THE Court of Appeals (CA) has affirmed its ruling directing the Philippine Estates Authority (PEA) to transfer the ownership of a 19,274-square-meter property to Shoemart Inc. (SM) pursuant to a joint-venture agreement (JVA) they signed in 1994 for the development of the Central Business Park 1, Island A in Pasay City.

In a two-page resolution written by Associate Justice Michael Elbinias, the CA’s Thirteenth Division said the PEA failed to raise new arguments that would warrant the reversal of its decision on February 27.

“After a careful study of all the allegations in the defendant-appellant’s motion for reconsideration, and after re-evaluation of the records, no cogent and compelling reasons were found to justify the modification or reversal of our decision, which, by this opportunity, has also been reviewed to have had proper and reasonable bases,” the appellate court added.

Under the agreement entered into by the two parties, the PEA would be responsible for the relocation of squatters that might be found in the development site.

SM, on the other hand, would assist the PEA in the relocation and advance the needed funds for it.

The amount advanced would be paid by PEA with land at CBP-1 Island A, based on the current appraisal value at the time of the drawdown.

On June 29, 1995, the two parties entered into a Deed of Undertaking to implement the relocation of squatters in CBP-1 Island A.

Based on the agreement, SM agreed to release P85 million for the relocation of the squatters.

On November 10, 1999, PEA advised SM that at the time of the withdrawal of the money, the appraisal value of land at CBP-1 Island A was P4,410 per square meter, thus, the P85 million advanced by SM was equivalent to a land area of 19,274 square meters.

SM identified a particular area in CBP-1 Island A  in Block D, with an area of 19,274 square meters, as repayment for the P85 million it advanced.

In 2005 SM filed a “complaint for specific performance” against PEA due to the latter’s failure to convey the property, despite SM’s full payment of the advanced amount.

But PEA argued that “it is deemed prudent” to seek first the guidance of the Commission on Audit on whether or not it was in order to use the appraisal value of the land at the time of the drawdown in computing the area to be paid to SM at the present time, considering the length of time that elapsed before the parties could agree on the site to be conveyed.

In its February 27, 2013, decision, the appellate court dismissed the argument of PEA since the JVA and the deed of undertaking it executed with SM showed that the valuation of the land was to be based at the time of the drawdown.

“The Deed of Undertaking, Agreement and JVA, were the best evidence of the intention of the parties, because they contained all the terms agreed upon by defendant-appellant PEA and plaintiff-appellee [Henry] Sy,” the court said.

“Thus, if the parties wanted the valuation of the land to be that as of the time that plaintiff-appellee Sy made the choice, and not at the time of drawdown, then such contracts —Deed of Undertaking, Agreement and JVA—would have stated so,” it added.

The court noted that even PEA, through its then-General Manager Carlos P. Doble, confirmed the value of the land at the time of the drawdown to be at P4,410 per square meter, which was equivalent to 19,274 square meters.

“A reading of defendant-appellant’s motion for reconsideration shows that the arguments raised by defendant-appellant had already been considered and passed upon by us when we rendered the decision dated February 27, 2013, that is sought to be considered,” the court ruled.

Concurring with the ruling were Associate Justices Isaias Dicdican and Nina Antonio-Valenzuela.