Makati RTC junks LBC case against ATR Kim Eng

The Makati Regional Trial Court (RTC) dismissed the case filed by LBC Development Corp. and businessman Carlos Araneta against ATR Kim Eng Capital (ATRKE Capital) and its chairman Ramon Arnaiz. LBC and Araneta wanted to annul the Joint Venture Agreement, Undertaking Agreement and shareholders agreement they entered into with ATRKE and Arnaiz in 1999 to take over the pre-need firm The Professional Group (TPG). Araneta claimed that despite his long friendship with Arnaiz, he was enticed and "baited" into the deal, further alleging that the defendants fraudulently concealed the risks, implications and consequences of the TPG acquisition. Makati RTC Branch 66 Judge Rommel Baybay upheld the validity of the above-mentioned agreements and found them above board and not fraudulent. In his ruling, the judge said the questioned contracts may not have been favorable to Araneta but they were written in clear English, a language that he used in his pleadings and therefore understands. As head of LBC Development and several other companies, Araneta is a seasoned businessman and presumed by law to know the consequences of his actions. While friendship was evident in the generation of the contracts, the parties were propelled by commerce and currency, not by personal relationship, the judge opined. Courts have no power to relieve parties from obligations voluntarily assumed just because they turn out later to be unwise investments, and for that reason it will not exercise judicial power to annul the said contracts, the judge stressed. The decision also pointed out that the existence of the contracts per se are not being questioned, and that both parties complied with their respective obligations and it was only in March 2005 when their validity were questioned.

Imprudent bank

A reader complained about a bank’s failure to deliver the title to his property even after fully paying his loan. According to the reader, he secured a loan in 1998 to retrieve a loan from another bank using the Torrens Title to his property worth P30 million. The bank would send a bill every quarter for interests, and whenever the reader paid the interest, he also paid part of the principal amount. This was paid in full in September last year. The bank manager then gave the assurance that the title would be given back in two weeks. It has been more than two months since but despite repeated inquiries, the title has yet to be delivered. The lame excuse is that the manager is still following up the release. This imprudent bank is causing the owner a lot of anguish because the title is needed for a bigger loan to expand the man’s small business.

Forum shopping?

Branch 61 of the Makati Regional Trial Court recently gave due course to the rehabilitation petition of the College Assurance Philippines, Inc. (CAP). Like most of the major players in the education pre-need industry, CAP’s financial position was affected when the Securities and Exchange Commission (SEC) arbitrarily adopted the AGILE-recommended Actuarial Reserve Liability (ARL) as the new computation scheme that treated educational pre-need plans as insurance rather than investments. The Makati RTC order also cited SEC representatives’ admission that the ARL "are not actual and present liabilities" of CAP. The ruling further boosts pre-need insiders’ suspicion that the SEC may be in cahoots with a US insurance company and certain government officials to takeover the P200-billion pre-need industry. Meanwhile, the National Bureau of Investigation (NBI) officer-in-charge and assistant director Nestor M. Mantaring had recommended to the Makati Prosecution Office the filing of charges against high-ranking officers of CAP. The NBI evaluation cites that CAP is an insolvent entity which "incurred very high actuarial reserve liability expenses". Apparently, Director Mantaring had not been given a copy of the Makati RTC Branch 61 Order. This new charge follows the trail of 19 CAP plan holders (or some .00002 percent of the total 720,000 CAP plan holders) whose class suit was thrown out by the Makati RTC. Observers are wondering if there’s a forum-shopping trend here.

Spybiz mail: Acci manager issues disclaimer

Alabang Country Club Inc. (ACCI) general manager Lawrence Jalbuena felt alluded to in a Spybiz item titled "A big bang in Alabang" (Jan. 24, 2006) and wrote that an email purportedly coming from him was being circulated among members of the ACCI. Jalbuena stressed that he has "not said or written anything to anyone, by email or otherwise, on supposed corruption in the Board and Management of ACCI. I have not because there is no such corruption. I am resigning effective Jan. 31, 2006 because I feel that four challenging, rewarding but stressful years of managing and taking care of the day-to-day operations of ACCI are more than enough. I intend to take it easy for a while and to attend to some other professional pursuits. I am leaving, secure in the thought that everything is well in ACCI and as it should be, despite some comments/criticisms from a few – disgruntled, misguided or otherwise – which, I understand, are to be expected in membership clubs like ours."

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