The City Government is hopefully awaiting the Court’s injunction in stopping the Dumaguete City Water District DCWD from going private.
The City is a co-owner of DCWD being a government-owned and controlled corporation DOCC.
Convinced that the proposed Joint Venture Agreement between MetroPac Water Investment Corporation and Dumaguete City Water District is “highly anomalous and very irregular,” the city government sued DCWD to prevent the parties from consummating and implementing the project.
Lawyer-Mayor Felipe Antonio Remollo, representing the City of Dumaguete through Sanggunian Panlungsod Resolution No. 126, sued DCWD so that “all proceedings already concluded by the defendants as well as any agreements as well as any agreements already reached by them or other private sector participants be set aside and or declared without force and effect.”
In an early partial victory on the part of the City Government, the prayer for a Temporary Restraining Order from the court was effectively granted after Atty. Myles Nicholas Bejar counsel for DCWD and Atty. Cyrus C. Riconalla, a member of the DCWD Board of Directors, manifested that they will observe the status quo until such time that Branch 38 Presiding Judge Cenon Voltaire B. Repollo be able to rule on whether to issue a preliminary injunction based on the merits of the case with a hearing set on September 12, 2018.
If allowed to proceed, a Joint Venture Company will be set up with MetroPac owning 80% while DCWD is left with just 20% share, a clear minority.
However, under the proposed joint venture, the new company will takeover the operation, maintenance and expansion of wastewater treatment plant including the facilities when it is clear that both the city government and DCWD are coowners of the Septage Waste Water Treatment System and the facilities were built on land owned by the city government.
In fact, the city government is responsible for managing the operation and maintenance of the septage treatment plant. Hence, it is alleged that DCWD violated the property rights of the city government when it surreptitiously offered to include in the project, without consent of the latter, the operation, maintenance and expansion of the system.
Furthermore, DCWD also created committees to accept unsolicited proposals, evaluation and awarding of the submitted proposals that can easily be rigged and vulnerable to collusions since the Technical Working Group and Joint Venture Selection Committee are composed of members of the Board of Directors or top officials of DCWD.
Specifically, the Technical Working Group is composed of 7 members: Esperato Dicen, the General Manager of DCWD and the Presiding Officer of the TWG, Rodrigo C. Lagahit Sr., Chairman of the BOD of DCWD, Atty. Rosemarie A. Rusell, a Division Manager, Atty. Cyrus C. Riconalla, a member of BOD of DCWD, Sofronio T. Pinero, Department Manager, Engr. Roderick N. Diaz and Cleonico Y. Fontelo, a BOD member of DCWD. On the other hand, the Joint Venture Selection Committee is chaired by Carlo B. Fontelo, son of Cleonico Y. Fontelo, who is a member of the TWG and BOD of DCWD.
It must also noted that DCWD earlier offered the city government to buy-out one half equity in the system at P 15 million but the offer is still pending due to the nonsubmission of documents by DCWD to justify the offered price.
These series of actions on the part of the DCWD that allow MetroPac to takeover the control of the operation, maintenance and expansion of the wastewater treatment system without the consent of the City government “clearly indicate bad faith and intended to take advantage of the city government.”
Finally, the joint venture company will undertake exploration, development and utilization of water supply in Dumaguete City, which is clearly reserved to Filipino citizens or to corporations at least 60% of whose capital is owned by such citizens as provided in the 1987 Constitution.
But MetroPac is disqualified to legally undertake a nationalized activity such as the project in joint venture with DCWD since the company failed to meet the mandatory citizenship requirement.
Hence, the actions of DCWD and MetroPac caused “irreparable damage and prejudice” to the city government particularly in safeguarding the equity of the plaintiff in the Septage Waste Water Treatment System and thus the issuance of preliminary injunction is necessary to prevent the performance of an illegal action.