SC ends decades-old Marbella Club dispute
SUPREME COURT OF THE PHILIPPINES / STOCK
The has junked a petition of the Presidential Commission on Good Government (PCGG) against a 1979 dream to replicate the success of a swanky resort town in Spain’s Costa del Sol in Cavite.
The idea was to build another Marbella Club, that was to be called Marbella Club Manila, for the rich and famous in Cavite at a time when the Philippines was in an economic boom.
Then Philippine Tourism Authority (PTA) Chair Bernardo Vergara, who would later become a Baguio City mayor and representative, put up Marbella Club Manila Inc. in 1978 specifically to build a resort similar to Spain’s Marbella Club which was then being deluged by Europe’s rich and famous.
Marbella Club Manila managed to get foreign financing and they also got a government guaranty for a foreign loan amounting to $20 million. But the foreign financing did not materialize and Marbella Club Manila decided to pursue the dream on its own.
Marbella Manila applied for a $20-million loan from the Philippine National Bank (PNB) which was still a government bank at that time. PNB approved the loan in September 1980, shortly before the economic crisis that developed in 1984.
Article continues after this advertisementBecause of the ensuing economic and political events, the dream of Marbella Club Manila ended, although the group managed to build apartment blocks in Manila. The dream, however, turned into a court room nightmare after the PCGG set its sights on Club Marbella shortly after the agency was created in 1986.
Article continues after this advertisementThe PCGG’s lawyers began the process although it took them years before filing a case with the Ombudsman.
On March 31, 2003, PCGG lawyer Virgilio Ponciano Ocaya, who was also a lawyer of the Metropolitan Waterworks and Sewerage System, asked the Ombudsman to charge PNB for granting an alleged “behest loan” that was disadvantageous to the government.
‘Acceptable banking practice’
After studying the case for years, however, the Ombudsman could not find cause to file a case and finally dismissed the PCGG charge in 2012, saying PNB acted within the “parameters of acceptable banking practices” as Marbella was a duly organized corporation with a P37.5 million subscribed capital.
The PCGG, however, raised the matter to the Supreme Court the same year and accused the Ombudsman of grave abuse of discretion amounting to lack or excess of jurisdiction.
Ten years later, on Jan. 17, 2023, the Supreme Court also dismissed the PCGG petition because it failed to present material evidence that the Ombudsman exercised bad faith in deciding in the case, which is an integral aspect of committing grave abuse of discretion.
“Because the Ombudsman acted pursuant to its mandate and did not commit grave abuse of discretion in issuing the assailed resolution and order,” the Supreme Court ruling read.
