Benitez family files legal action vs Tanco

MANILA, Philippines - The Benitez family, which is in a bind to keep the Philippine Women’s University, has elevated its case to the Manila Regional Trial Court in the hope of reaching a common ground to ensure fair and equitable treatment for all parties including the students of the nearly-century old educational institution.

PWU media center director Lyka Benitez-Brown said they filed a legal action against the camp of businessman Eusebio Tanco who declared the Benitezes in default on their obligations under a cooperation deal inked in 2011 and threatened to take over the university should they fail to pay the accumulated amount of P928 million.

Benitez-Brown said the Tanco group’s refusal to discuss matters in an amicable manner has left the family no choice but to take the necessary legal action to protect its rights.

“Our stand remains, we’re going to pay our debt but we need to settle the issues on a fair, amicable and equitable basis. Let’s sit down and discuss what will be a reasonable return for your money,” she said.

Benitez-Brown said while the family is thankful for the help extended by Tanco that allowed PWU to avert creditor foreclosure, it is contesting the “excessive” amount payable to STI.

“We don’t have as much money as Mr. Tanco’s but we will honor our obligations. He only invested P450 million and now he wants four times the amount of the initial loan he extended.  He even demanded that we paid up in just seven days. That is so unreasonable and exorbitant,”” she said.

“He wants PWU’s real estate so he can proceed with his joint venture deal with Ayala Land involving the development of the property into a condo mall project,” Benitez-Brown said.

She said the family strongly objected to the planned commercialization of the property because it runs contrary to the founders’ vision for a progressive, non-sectarian school.

“It became clear that the Benitez family and the Tanco group are not on the same wavelength as far as running the PWU is concerned. These differences have led the Benitez family to reassess the relationship with the Tanco group and call for the nullification of the partnership,” Benitez-Brown said.

“We are a non-stock, not-for-profit foundation. We want to ensure that the school and its philosophy will be preserved,” she added.

She said the family discussed last Christmas what assets they had as well as all other options to take to raise funds in order to settle its debt to STI.

“Let the courts judge. We have a commitment to the students. He would have disrupted the lives of the PWU community/ students by taking over the school in a hostile manner,” she said.

Last Monday, STI deferred its takeover of PWU and reverted day-to-day management control of the school to the Benitez family to protect the students from being dragged into the dispute.

STI said it was putting the welfare of the students ahead of the enforcement of its rights as an unpaid creditor.

STI served notices of default on PWU and its sister company, Unlad Resources, on Dec. 9 and gave them seven days to pay the accumulated amount of P928 million, or relinquish control of the university.

Under the original agreement, STI should have been paid through the conversion of all its loans into 40-percent equity in Unlad, which, in turn, was to absorb all the real estate assets of PWU in a share-for-property swap.

The Benitez group was likewise supposed to raise the capitalization of Unlad to P1.5 billion to be allowed to issue the shares as payment to STI.

STI invoked the Benitez group’s failure to pay STI for loans through a debt-to-equity conversion and appointed representatives to the PWU board.