CA upholds lower court on Piatco

MANILA, Philippines - Philippine International Air Terminals Co. (Piatco) must pay Japanese firms Takenaka Corp. and Asahikosan Corp. for building the Ninoy Aquino International Airport Terminal 3 (NAIA-3), the Court of Appeals (CA) has ruled.

In a decision released yesterday, the CA third division dismissed Piatco’s petition questioning the decision of Makati Regional Trial Court Branch 143 Judge Zenaida Galapate-Laguilles allowing the two Japanese firms to collect their claims from Piatco based on two judgments of the Queen’s Bench Division in London.

“The present case of enforcement of the orders of the London court had to do only with the contractual obligations of appellant Piatco under its onshore construction contract and offshore procurement contract with appellees (Takenaka and Asahikosan), as well as their enforcement,” read the CA ruling.

Associate Justice Rebecca de Guia-Saldavor penned the decision. Associate Justices Normandie Pizarro and Rodil Zalameda concurred.

The CA agreed with the RTC that Takenaka and Asahikosan are entitled to collect the amounts of $81.27 million, P116.8 million and £65,000 (or roughly $83 million) from Piatco pursuant to the two judgments they obtained against Piatco from the High Court of Justice, Queen’s Bench Division, Technology and Construction Court in London in 2005.

Piatco was also ordered to pay Takenaka and Asahikosan the amount of P2 million as attorney’s fees and the amount of P77.8 million as litigation expenses. “True, Piatco’s perceived ‘very low’ valuation that could be finally adjudged in that case, e.g. $175,787,245.10, might severely affect Piatco’s solvency or ability to pay its creditors, including appellees, but such matter is for future insolvency proceedings to tackle, and not in the present case,” read the CA ruling. “Moreover, the value or build quality of the completed facilities are matters of defenses that should have been raised before the London proceedings, not in this case.” 

The CA said while the structural soundness of the airport should not be tackled in this case, Piatco can still raise such issue in other remedies or actions.

“The present action is only one for the enforcement of the London orders, not their modification or review,” the CA said.