THE Mandaue City Council ratified the deed of assignment involving a prime government lot in Barangay Tipolo on Wednesday, Feb. 27, while closure orders on two hotel-occupants were being served.
Following the ratification, Mandaue Mayor Luigi Quisumbing readied on Thursday, Feb. 28, the filing of graft charges against the councilors who approved the deed of assignment between Katumanan Hardware Inc. (KHI) and Cenore Corp.
Quisumbing and the current City Hall lawyers deem the 2013 sublease contract between KHI and Cenore to be questionable and irregular.
To be named for violating Republic Act 2019, or the Graft and Corrupt Practices Act, are Councilors Nenita Ceniza-Layese, Carmelino Del Mar, Malcolm Sanchez, Cynthia Remedio, Marie Immaline Zafra, Ernie Manatad and Dalie Mae Cabatingan.
The seven councilors belong to the majority bloc and are allied with Rep. Jonas Cortes, who is vying with Quisumbing for the mayorship on May 13.
Meanwhile, it was business as usual on Thursday, Feb. 28, at Big Hotel, Big Hotel Suites, and Linear Coffee Shop (located within the Big Hotel premises) despite the closure orders posted on their doors by the Mandaue City Legal Office on Feb. 27.
No council approval
The closure orders cited as reason the three establishments’ failure to secure business permits. They have not been issued business permits since 2018 because, as the City Legal Office said, they do not have the legitimacy to build on government land that has been sublet to Cenore by KHI.
Last Wednesday, the City Council ratified the deed of assignment between KHI and Cenore, which runs Big Hotel and Big Hotel Suites, upon the written request of Cenore.
The ratification came six years after the deed of assignment was signed between KHI and Cenore in 2013.
Before Feb. 27, 2019, the City Council secretariat did not have a record of the deed of assignment, which the Commission on Audit (COA) noted. The lapse in procedural documentation was pointed out by Quisumbing’s chief of staff, lawyer Elaine Bathan.
Bathan said the deed of assignment may have been confirmed by then mayor Jonas Cortes in 2013, but it did not have the required approval of the City Council. The council also was unaware of the transaction.
In 2007, the Mandaue City Government under then mayor Cortes entered into a 15-year lease contract with KHI to develop 1.4 hectares of government land on Mantawi Drive in Barangay Tipolo at P12 per square meter or P170,000 for the 1.4 hectares per month.
In 2012, the lease was extended for 25 years. In 2013, KHI subleased the land to Cenore for commercial development.
“Favoring a third party”
The land where the hotels sit has a current appraisal value of P1,500 to P2,000/square meter and a market value of at least P10,000/square meter.
“Despite the audit findings of COA, despite the letter of the mayor to them informing them that he never asked for the ratification of the deed of assignment, and despite the City Legal Office and Atty. Omar Redula sending them legal opinion and questioning them not to proceed with the ratification because the deed of assignment and the contract of lease are no longer existing,” they went on with the ratification, Bathan said.
Bathan said the City Legal Office also supports Quisumbing’s position that it is only the mayor who can submit a letter for ratification and not a third party.
When the City Council ratified the deed of assignment, their act was “tantamount to favoring a third party, in lieu of the City,” Bathan said.
The City Legal Office had warned them that if they proceeded with the ratification, they were “construed” to have violated Republic Act 3019, Bathan said.
Councilor Manatad, speaking for the majority bloc, said the ratification was based on the opinion of the City Legal Office.
“The basis of our ratification... is the opinion of the city legal officer that ratification is a remedy to erase doubts on the interpretation of the lease contract provision. Hehe, kaalegre ani,” Manatad said.
He said it is not only the chief executive who can request for a council ratification but also Cenore, which owns the investments in question.
“Cenore, being a party to the document, has also the right to do so because it has big investments at stake here. Klaro ana,” Manatad said in a text message sent to reporters.
Jobs in jeopardy
“The Audit Observation Memo of COA is a mere observation subject to refutal or response and explanation from the City. It is not final. Even Parkmall has the same observations from COA, but why is it nga wala man lage nila lisora? Guess why?” Manatad said.
On the continued operation of the hotels despite the closure orders, Bathan said City Hall maintains its position that the closure orders are “in place.”
“We enjoin the establishments to follow the order or else we will be imposing sanctions,” she said.
A meeting between Bathan and Big Hotel lawyer Deolito Alvarez scheduled on Thursday, Feb. 28, did not push through because one party was not available.
The closure of the two hotels and the coffee shop would mean 150 people losing their jobs. (See story in Business, page 25.) The Mandaue City Government has prepared for the loss of employment owing to the closure.
Quisumbing has ordered the Public Employment Service Office to assist the hotel workers in finding jobs. (MPS from reports of FMD of SuperBalita Cebu)