CA affirms London court’s ruling, orders PIATCO to pay NAIA 3 builders

MANILA, Philippines—The Court of Appeals affirmed the decision of the London court ordering the Philippine International Air Terminals Company Inc. (Piatco) to pay US$172-Million of its contractual obligations to Takenaka Corporation and Asahikosan Corp. of Japan, the principal builder and main supplier of the Ninoy Aquino International Airport Terminal 3.

In a 32-page decision, the appeals court’s 3rd division through Associate Justice Rebecca De Guia-Saldavor affirmed the ruling of Makati Regional Trial Court Judge Zenaida T. Galapate-Laguilles that the two firms are entitled to collect from Piatco based on the two judgments of the Queen’s Bench Division in London, England.

The Makati Court ruled 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, England in 2005.

Piatco was also ordered to pay Takenaka and Asahikosan the amount of P2-M as attorney’s fees and the amount of P77.8-M as litigation expenses.

“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 on-shore construction contract and off-shore procurement contract with appellees (Takenaka and Asahikosan), as well as their enforcement,” the appeals court said.

“True, Piatco’s perceived ‘very low’ valuation that could be finally adjudged in that case, e.g. US175,787,245.10, 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. 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 appeals court added.

But the appeals court said that 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 appeals court said.

Concurring in the decision are Associate Justices Normandie Pizarro and Rodil Zalameda.