Malilong: You can’t issue a permit to violate law

The other side

FILINVEST must be ruing the day they succumbed to the pressure applied by former Cebu City Mayor Tomas Osmeña and agreed to return the 19.2 hectare property in the SRP that it purchased in 2015 from the City Government.

After almost four years, the property must have risen in value (P130 thousand per square meter) from the P38 thousand per square meter that the giant developer paid the City for the prime lots. A bigger portion, consisting of 26.3 hectares, was gobbled up by the consortium of Ayala Land and SM Prime Holdings in the same public bidding that Filinvest joined.

Osmeña had vigorously opposed both sales even before they could be consummated, claiming that they violated a city ordinance and were grossly disadvantageous to the City. Rama, however, outmaneuvered his predecessor, moving swiftly, including flying to Manila in a lightning trip, to complete the deal and returning with P8 billion plus as downpayment.

When he returned to City Hall after beating Rama in 2016, Osmeña vowed to do everything to recover the properties. “Everything,” it turned out, included applying immense pressure on the buyers, especially on SM, which was ordered to remove a structure in its Seaside mall and threatened with closure, along with BDO, for alleged tax violations.

While the consortium of SM and Ayala stood their ground, Filinvest soon folded, announcing in 2017 that it was rescinding the sale because the City had failed to comply with its obligations in the contract.

Mayor Edgardo Labella said he will honor the rescission and is now discussing with former City Councilor Joey Daluz, who is his SRP manager, when and how to return Filinvest’s downpayment. I am surprised that the money has not yet been returned two years after the announced rescission, but I do not think that will pose any problem, unless the rescission itself has not yet been formalized.

Has a deed of rescission been formally executed? I ask because if I remember correctly there is a law that says that any contract for the creation, modification or termination of real rights over an immovable property must be in the form of a public document. A press conference or a joint statement will not suffice.

Osmeña was a thorough planner so I trust that such a document already exists. But even if there is none, I do not think Filinvest will even contemplate damaging its brand by withdrawing from a commitment that it has publicly announced. Especially not now when questions are being raised about the company’s compliance with building rules in the SRP.

Osmeña asked similar questions to SM in 2016. In reply, SM said they had the building plans reviewed by City Hall and the Department of Public Works and Highways and that both agencies have approved them.

Filinvest is also now claiming that it has the necessary building permit and certificate of occupancy signed by City Hall as it defended the eight columns at Il Corso that are said to have violated the setback required by law.

The question, as in the case of SM, should not be whether they have a permit or not but whether or not there is an encroachment. If there is none, then fine. On the other hand, you cannot issue a license to violate the law; any official who does that will be legally accountable. So will any later official who will condone the violation. That should be fair warning to everyone.


SunStar website welcomes friendly debate, but comments posted on this site do not necessarily reflect the views of the SunStar management and its affiliates. SunStar reserves the right to delete, reproduce or modify comments posted here without notice. Posts that are inappropriate will automatically be deleted.

Forum rules:

Do not use obscenity. Some words have been banned. Stick to the topic. Do not veer away from the discussion. Be coherent. Do not shout or use CAPITAL LETTERS!