SECOND DIVISION
G.R. No. 179537 -- Philippine
Economic Zone Authority, Petitioner, versus Edison
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Promulgated:
October 23, 2009
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CONCURRING OPINION
ABAD, J.:
Petitioner Philippine Economic Zone
Authority (PEZA)[1] and respondent Edison (
On October 22, 2004 Edison filed a
complaint for specific performance against PEZA before the
Edison also claimed that PEZA granted
tariff rate relief to a power supplier in Cebu but would not consider extending
such relief to Edison, entitling the latter to terminate their agreement and recover
a pre-termination fee of over P708 million. Because PEZA refused Edison’s demand for an
end to their agreement and for PEZA to pay pre-termination fee arising from its
violation of the agreement,
In its answer to the complaint,[3] while PEZA admitted that Edison has claims
against it for alleged refusal to grant tariff rate adjustments that it had
given other power suppliers and that PEZA had refused to pay the pre-termination
fee Edison asked, PEZA claimed that the supposed disputes were not proper for
arbitration since the pre-termination fee in the agreement was “gravely
onerous, unconscionable, greatly disadvantageous to the government, against
public policy, and therefore, invalid and unenforceable.”
PEZA further claimed a) that Edison’s
termination of the agreement was whimsical and baseless, in itself a breach of
the agreement; b) that during the negotiations for the requested power rate
increase, Edison declined to submit relevant data that PEZA needed to act on
the request; c) that, in utter bad faith, Edison cut off power supply to PEZA
on August 13, 2004; d) that Edison’s motive was to maneuver PEZA into paying
its demand for unconscionable and illegal pre-termination fee rather than to get
its tariff rate adjusted; and e) that this ill motive was evidenced by the fact
that Edison had been negotiating to sell its power engines to NPC even before
it asked PEZA for tariff rate adjustment.
Edison filed a reply and a motion to
render judgment on the pleadings, contending that since PEZA did not challenge
the fact that there are disputes between the parties, Edison is entitled to a
resolution of such disputes by a three-member arbitration committee to be
constituted by the RTC. Acting on this
motion and on the belief that PEZA’s answer did not tender a genuine issue, on
April 5, 2005 the RTC issued an order constituting an Arbitration Committee
with Chief Justice Andres Narvasa as chairman and retired Supreme Court
Justices Hugo Gutierrez and Jose Y. Feria, as members with power to arbitrate
the disputes between Edison and PEZA.
The RTC denied PEZA’s motion for reconsideration of the order.
On appeal to the Court of Appeals, the
latter court affirmed the RTC’s order under a decision dated April 10, 2007,
prompting PEZA to come to this Court on petition for review by certiorari.
I fully agree with the ponencia of Justice Conchita Carpio
Morales in holding that PEZA’s answer to the complaint acknowledged the existence
of the remedy of arbitration concerning any dispute that might arise between
them involving their agreement, in this case, PEZA’s alleged refusal to grant
I would like to add, however, that in
voting to grant the petition, it is clear to me that the Court does not resolve
today the issue that PEZA raises: whether or not the pre-termination clause of
its agreement with Edison is “gravely onerous, unconscionable, greatly
disadvantageous to the government, against public policy, and therefore,
invalid and unenforceable.” In fact, if the
Arbitration Committee should uphold its defense that it had not arbitrarily
denied
ROBERTO
A. ABAD
Associate Justice