Iloilo court allows further expropriation of PECO’s assets

The Iloilo Regional Trial Court Branch 24 has ruled in favor of Enrique Razon's MORE Electric and Power Corp. (MORE) to expropriate further Panay Electric Co.’s (PECO) power distribution assets.

In a 22-page decision issued on September 24, 2020, RTC Judge Nestle Go granted MORE Power’s motion to include the so-called Category C assets in the writ of possession (WOP) earlier issued by RTC Judge Emerald Requina-Contreras in February 2020.

The WOP was an offshoot of the expropriation case that MORE Power filed against PECO on March 11, 2019, almost a month after the former secured its congressional franchise to distribute power in Iloilo City via Republic Act 11212.

Contreras’ WOP divided the PECO properties into three categories:

• Category A includes all properties that PECO did not contest as “distribution assets”
• Category B includes the properties the court initially found as part of the “distribution assets” listed under the “distribution plant” in the Energy Regulatory Commission record and may be necessary for the operation of MORE Power
• Category C lists the properties excluded in the coverage of the writ.

The WOP covers the properties under categories A and B, which include the La Paz, City Proper, Jaro, Molo, and Mandurriao substations; and the Meter Lab, Power Plant Building, and Switchboard House located in General Luna Street.

The Category C assets include:

• PECO’s business building office, elevator and parking lot on General Luna Street, City Proper;
• A 769-square meter lot at General Hughes, City Proper;
• A 2,401-square meter lot used as pole stockyard at Diversion Road, San Rafael, Mandurriao;
• Two guest/staff houses and semi concrete canteen at General Luna Street, City Proper

In his decision, Go found PECO’s assertion that only assets that are connected to the distribution system must be covered by the WOP and turned over to MORE Power as “without merit.”

The judge said the Category C properties are “necessary for the maintenance and operation of the distribution systems,” thus “the issuance of a writ of possession over the same is in order.”

Go also found as devoid of merit PECO’s contention that “a full-blown trial should be conducted before an order of expropriation be issued.”

“There is no need for a full-blown trial before the court can issue an order of expropriation. The propriety of the complaint and the compliance with the deposit required by law are the determining factors before an order of expropriation can be issued,” according to the judge.

“Since the Honorable Court had already issued a writ of possession with respect to the properties enumerated as Category A and B Assets, an order of expropriation is proper. However, with respect to Category C Assets, plaintiff MORE is still not in possession of the same, thus an Order of Expropriation pertaining to all these properties is held in abeyance,” she said.

Allana Mae Babayen-on, legal officer of MORE Power, said the Category C assets are vital to MORE Power’s operations especially that they plan to put up more substations in the city.

MORE Power can also use the business building to cater to consumers.

Babayen-on said they will wait for the sheriff to turn over the Category C assets to MORE Power, just like what happened when they took over the substations early this year.

PECO is Iloilo City's power distributor of 95 years, but its franchise has already lapsed.

MORE secured a franchise to be Iloilo City’s power distribution utility in 2019.

PECO went to court last year to question provisions in the MORE franchise that would supposedly allow the Razon company to take over its assets, including its poles, wires, cables, transformers, infrastructure and equipment.

PECO scored the first win in the legal saga last year after the Mandaluyong RTC invalidated the expropriation provisions in MORE's franchise

PECO accused MORE of the alleged "forcible, deceptive and intimidating" takeover of its stations and facilities earlier this year.

But the Supreme Court ruled in favor of MORE. Voting 8-6, the court en banc declared constitutional Section 10 and 17 of MORE's franchise, reversing the judgment of the Mandaluyong Regional Trial Court (RTC) Branch 209 that had invalidated these provisions in 2019.

Also last March, the Energy Regulatory Commission revoked PECO's certificate of public convenience and necessity “after determining that MORE has established or acquired its own distribution system and verified MORE’s complete transition to full operations.” -MDM, GMA News