Experts say Duterte cannot cancel water agreements

Legal and political experts agree that President Rodrigo Duterte has basis for rescinding concession agreements with water concessionaires, but he cannot arbitrarily do so.
Fr Ranhilio Aquino, dean of San Beda University’s Graduate School of Law, yesterday said cancellation of the contracts must undergo a process in courts.
“If he wants to go that way, then he must go to the courts in order to have the contracts declared null or to modify them because courts have the power to amend contracts when their terms are unconscionable,” Aquino added.
The Department of Justice (DoJ) has already declared the agreements to be questionable and onerous, according to the San Beda law dean.
Neri Colmenares, chairman of both the National Union of People’s Lawyers and party-list group Bayan Muna, echoed Aquino, saying the president had basis to cancel the deals, but the scrapping must undergo court processes.
“The president was right in saying that the concession agreements were onerous and disadvantageous to the Filipino people,” Colmenares added.
He said Bayan Muna had been exposing lopsided provisions in favour of the concessionaires and against the people and the consumers such as guaranteed profit and passing on of expenses and income tax to customers.
The lawmaker added that Duterte had basis for questioning the deals that can be voided because of agreements that violate public policy, the Constitution or the law.
“While his basis is correct, in my opinion, but he has to go to court and have the court declare the agreements void. I don’t think he can unilaterally just say that, ‘They are revoked because they were too arbitrary,’” Colmenares pointed out.
The lawyers said Duterte can give an order to the Justice secretary or to the solicitor general to file a case before any court.
Any interested citizen may also file a case, they added.
Aquino said the president had already ordered the DoJ to investigate who were the people responsible for the contracts and to prosecute them if there was any fault on their part.
Administrative and criminal charges may be filed against individual public officials who have been found guilty of corruption.
For the concessionaires, a civil case may be filed to annul or set the contracts aside.
“But the government officials who agreed to those contracts at the time can be proceeded against criminally and administratively,” Aquino said.
Colmenares said the government-run Metropolitan Manila Waterworks and Sewerage System should initiate filing of the case.
He added that consumers can also go to court despite the concession agreement citing them as third party who have no business in the agreement.
Political analyst Ramon Casiple, said going to court is the regular means to rescind the deals. He, however, raised the possibility that the president may also invoke emergency powers to cancel the concession agreements with the approval of Congress.
Casiple said it is a possibility if he deems there is a need to declare a state of emergency as the agreements are affecting the people adversely.
“State of national emergency is a general term, it does not only apply to disasters. If the president sees any situation that cannot just be resolved by normal means of governance, then he can invoke his powers. But it would come under automatic review of Congress,” he added.
“If the DoJ has the determination that the agreements were onerous, it should file charges and they may be granted, its prayer. The prayer is that somebody should go to jail and the president doesn’t even need to step in,” Casiple said.
“But the president can invoke emergency powers because he can. He can declare an emergency, and he has 60 days before Congress reviews his declaration, and he can order, in that time, that somebody be sent to jail,” he added.
Colmenares, however, said the regular means were enough to seek cancellation of the deals and he opposes emergency powers if there was no need and no substantial basis for them.
Meanwhile, the experts also said that although the Permanent Court of Arbitration (PCA) in Singapore ruled for the Philippine government to reimburse Manila Water Co Inc P7.39bn, it still has to be first enforced through local courts.
According to them, the government can then contest the judgment on the basis that the agreements were onerous.
“I’m sure that Maynilad and the other concessionaire will seek to enforce the judgment of the Singapore arbitral tribunal here but to do that they must go to court, they will file an action to enforce the judgement, ‘that is our chance to contest the judgment of the arbitral tribunal,” Aquino said.
“That judgment should be enforced here and we enforce it here, that’s the time we ask our courts and say ‘Please set aside this judgment because it runs contrary to public policy,’” he added.