Pagcor lease ‘valid, legal,’ PAL insists

Philippine Airlines (PAL) on Thursday said it had a valid lease contract with the Philippine Amusement and Gaming Corp. (Pagcor) over the 10-hectare government property where the air carrier planned to build a P20-billion annex to Ninoy Aquino International Airport Centennial Terminal 2.

The airline also said that Pagcor’s authority to lease the property, located at the old Nayong Pilipino compound, was “very clear” in the contract.

“The existing contract between PAL and Pagcor is legal, valid and binding based on the terms negotiated and finalized by both parties three years ago,” PAL said in a statement issued by Ma. Cielo Villaluna, its external communications head and spokesperson.

Pagcor earlier said that it had studied the lease contract and determined that it was not the “absolute and registered” owner of the property. It also said the contract with PAL was “grossly disadvantageous” to the government.

The casino regulator said it would seek a legal opinion from the Office of the Solicitor General on the lease contract.

PAL president Jaime Bautista earlier said the proposed annex would be built on a 16-hectare area adjacent to Naia 2. The construction will cover parts of the now-defunct Philippine Village Hotel, Nayong Pilipino and the Pagcor property.

The airline said Pagcor’s claim that it was not the property’s absolute owner was “totally inconsistent with its covenants under the contract.”

“At any rate, this statement of Pagcor is immaterial and irrelevant,” PAL said. “Assuming for the sake of argument Pagcor is not the absolute and registered owner of the property, it can still enter into a valid contract owing to the fact that it has control and/or possession over the area and has the legal personality to do so.”