THE Mandaue City Government is moving to settle a long-standing P9.3 million debt over unpaid waste disposal fees, with officials warning that delaying action could cost the city even more.
Councilor Carlo Fortuna said the City Council has approved a resolution authorizing Mayor Thadeo Jovito “Jonkie” Ouano to negotiate and sign a compromise agreement with Asian Energy Systems Corporation, the company that previously handled the city’s solid waste.
“In summary, the committee report recommended that Mandaue City enter into a compromise agreement with Asian Energy Systems Corporation,” Fortuna said, emphasizing that the facility is currently the only one accepting the city’s waste in Metro Cebu.
The dispute stems from unpaid billing amounting to about P9 million covering the years 2011 to 2018, which has since grown to P9.3 million.
Asian Energy has already filed a collection case against the city before a court in Parañaque City, and the case is now awaiting a decision.
Rather than risk a court ruling that could increase the City’s financial obligations, officials are pushing for an early settlement.
“We had a meeting with different city departments, and the recommendation is that it is better to settle through a compromise agreement instead of waiting for a decision that might include additional damages,” Fortuna said.
He added that the City Environment and Natural Resources Office confirmed that Mandaue had indeed disposed of waste at the facility, even without a formal agreement at the time.
Payment was reportedly delayed due to incomplete documentary requirements.
“Even without a memorandum of agreement, it is clear that we were served. Their claim is justifiable,” Fortuna said.
The councilor also pointed to the legal principle of Unjust Enrichment, stressing that the city cannot benefit from services without paying for them.
“It is clear that we received the service, so we should pay for it,” he said.
Under the approved resolution, city lawyers will meet with the company’s legal team to finalize the terms and conditions of the compromise agreement.
Once agreed upon, the settlement will be subject to council approval and processed through the Commission on Audit.
Fortuna warned that prolonging the case could lead to higher costs if it reaches higher courts.
“If we lose and the case goes up to the Court of Appeals or even the Supreme Court, it will take a long time and the city may end up paying more,” he said.
He added that a court-approved compromise agreement would allow the city to settle its obligation more efficiently while avoiding further legal risks. (ABC)