SOLICITOR General Jose C. Calida on Thursday said the joint-venture agreement (JVA) between the Bureau of Corrections (BuCor) and the Tagum Agricultural Development Corp. (Tadeco) over a 5,212.46-hectare land within the Davao Penal Colony (Dapecol) is void.
Calida issued the findings after House Speaker Pantaleon D. Alvarez sought the Office of the Solicitor General’s review of the deal, which, the latter said, is grossly disadvantageous to the government.
“The JVA entered into by the BuCor and Tadeco is void as it goes against the Constitution and the Public Land Act,” Calida said.
He said the 5,212.46-hectare land within the Dapecol subject of the JVA is land of public domain. This means the land belongs to the State.
In 1969 the BuCor and Tadeco entered into a JVA, where BuCor undertook to allocate areas within the Dapecol for Tadeco to develop into a banana plantation.
Another JVA was entered into by the parties in 1979, whereby they agreed to extend the joint venture for 25 years. In 2003 the JVA was renewed for another 25-year period, or until 2029.
Calida said the Constitution only allows private corporations to hold lands of the public domain through lease for a total period not exceeding 50 years.
“Assuming the JVA is a lease, the initial agreement was entered into in 1969, extended for 25 years in 1979 and extended for another 25-year period in 2003. Tadeco’s use and occupation of the Dapecol lands should cease by 2019. The JVA cannot be allowed to last until 2029.”
He said under the Constitution, private corporations may only lease lands of the public domain not exceeding 1,000 hectares.
However, Calida noted the JVA covers 5,212.46 hectares, way more than what is allowed in the Constitution.
The Solicitor General also said the JVA violates Commonwealth Act 141, or the Public Land Act, which provides that “agricultural public lands, such as the Dapecol, may be disposed of only through homestead, sale, lease, or confirmation of imperfect title”.
“It should be noted that BuCor and Tadeco entered into a joint-venture agreement. Clearly, a joint-venture agreement is not one of the modes by which agricultural public lands may be disposed of,” Calida said.
Under the JVA, the BuCor is entitled to receive a “guaranteed annual production share” and a “share in the profits of Tadeco”. In turn, the BuCor guaranteed Tadeco“free and uninterrupted use” of Dapecol’s land.
“These stipulations clearly show that what Tadeco and the BuCor entered into was not a lease, but a joint venture for the purpose of operating a banana plantation within Dapecol,” Calida said. “This is a clear violation of the Public Land Act.”
“Assuming arguendo that the agreement falls under the definition of a lease under the Civil Code, the JVA would still be void because it failed to comply with the competitive bidding requirement under the Public Land Act,” Calida said. “The right to lease the Dapecol land must be made through a public auction, where bidders are required to submit sealed bids.”
Alvarez earlier said Tadeco was paying only a guaranteed P5,000 per hectare for the 5,212.46-hectare penal lands, which amounts to P26.541 million per year, or P663.525 million from 2003
to 2028.
Alvarez said plantations with the same development scale would fetch as much as P200,000 per hectare. This means Tadeco should be paying P1.061 billion per year, or P26.525 billion for the entire 25-year contract.
The Speaker said it was clear based on the estimates the government would lose a total of P25.464 billion.
Justice Secretary Vitaliano N. Aguirre II earlier said he would release the justice department’s legal opinion on whether the contract is null and void for being grossly disadvantageous to the government.
Aguirre had formed a legal team, headed by Chief State Counsel Ricardo Paras III, to look into the regularity of the BuCor’s 25-year JVA with Tadeco.
The Department of Justice chief ordered the review of the contract upon request of Alvarez, who sought to cancel the allegedly disadvantageous contract.
3 comments
Don’t listen to this guy, he obviously doesn’t know anything. He probably dont even know that the probe has not yet started. All he wants to do is condition people’s minds. Palibas wala silang makikitang mali sa contract ng TADECO and Bucor.
So Calida is the sole court now? And snce when are decisions based on opinion and even before the actual investigation. Only proves one thing.
Calida really overreaches the scope of his office. The court will decide not Him!