Court allows Razon firm to take over Peco assets

ILOILO CITY—A dispute over the distribution of electricity in Iloilo City is headed for a legal showdown after the Iloilo Regional Trial Court (RTC) granted the application of a company owned by businessman Enrique Razon to take possession of distribution assets of Panay Electric Co. (Peco).

The ruling of Judge Marie Yvette Go of the Iloilo RTC Branch 37, however, ran counter to an earlier order of the Mandaluyong RTC barring Razon’s More Power from expropriating Peco’s distribution assets.

In a 13-page order dated Aug. 14, Go granted More Power’s application for the issuance of a writ of possession.

“Let a Writ of Possession be issued in favor of More Electric Power Corp. The deputy sheriff of this court or other proper officer is hereby ordered to forthwith place (More Power) in possession of the property involved and submit a report thereof to the court …,” the court order read.

In granting the application for the writ, Go cited Republic Act No. 11212, which granted More Power a 25-year franchise to establish, operate and maintain a power distribution system in Iloilo City.

Go said in her order that the court’s duty for the issuance of a writ of possession was ministerial when More Power complied with two requirements: the submission of an expropriation complaint sufficient in form and substance and upon depositing the amount equivalent to the assessed value of properties subject for expropriation.

More had deposited P481.84 million, an amount equivalent to the minimum assessed value of the distribution assets.

In its July 1 decision, the Mandaluyong RTC barred More Power from expropriating Peco’s distribution assets.

The court also ruled that Section 10 (right of eminent domain) and Section 17 (transition of operations) of RA 11212 were void and unconstitutional for infringing on Peco’s “rights to due process and equal protection of the law.”

“Peco has no obligation to sell and (More Power) has no right to expropriate Peco’s assets,” according to the Mandaluyong RTC decision. “The only tangible effect of the exercise of eminent domain by virtue of the assailed provisions would be to replace Peco with More as the owner of the existing electric power distribution system of Iloilo City. In other words, a corporate takeover. To achieve this end, the State should not intervene. This should be a private matter between Peco and More.”

Go in her order said that the provisions declared unconstitutional by the Mandaluyong RTC were still “in force and effect, pending a final executory decision on that score.”