Cebu City Mayor Tomas Osmeña smiles as he answers questions from reporters during the hearing of the Petition for Mandamus filed by Banco de Oro at the Regional Trial Court Branch 18. (CDN PHOTO/LITO TECSON)
The Regional Trial Court yesterday extended the Temporary Restraining Order (TRO) it granted to Banco de Oro (BDO) Unibank and ordered a Status Quo Ante to afford BDO and the Cebu City government a chance to come up with an agreement regarding the pending business permit applications of 26 BDO branches and the looming closure of its Magallanes branch.
RTC Branch 18 Presiding Judge Gilbert Moises “encouraged” both parties to discuss with one another the possibility of an amicable settlement during the hearing of BDO’s Petition for Mandamus yesterday afternoon.
In the meantime, the court also ordered a status quo ante on the bank’s operations until March 6. This means the city cannot take action against BDO.
The management of Banco de Oro (BDO) Unibank and the Cebu City government welcomed the decision which was arrived at during a closed-door chamber conference called by Moises with BDO and City Hall lawyers as well as Cebu City Mayor Tomas Osmeña at one point, during the hearing.
“The TRO has been extended for the full 20 days. We maintain status quo and let’s see. The judge required us to submit a memorandum, and we will comply. But in the meantime, we maintain status quo because we complied with everything. Well, let’s take it from there,” said lawyer Alvin Go, one of BDO’s two lawyers during the hearing.
Moises also asked both parties to submit their respective memoranda as to the pending Petition for a Writ of Preliminary Injunction within 10 days.
Another hearing was also set on February 27.
City Legal Officer Joseph Bernaldez said that while the order of a status quo might seem like an extension of the 72-hour TRO granted to BDO, “it’s not really a TRO.”
“We will look into their report on their assessment on the part of BDO. And on our side, we will also evaluate their assessment and probably also make our own assessment. We will compare it and look at which one is right and beneficial to the parties,” Bernaldez said.
He added that they have traded cell phone numbers with BDO’s lawyers and that they will soon be agreeing on a date in order to meet and discuss a possible settlement.
Osmeña has been threatening to close BDO’s Magallanes branch due to alleged tax fraud. He has been emphatic in making pronouncements that he would close the branch.
This too was recognized by the court as well as the mayor himself during their chamber conference.
“I have freedom of speech, but they just asked me to kalma kalma lang ba (just be calm)… Basta, no more comments. You will hear later on, sooner or later,” Osmeña said in an interview after their conference.
He also claimed that he was given ten days to decide whether or not to close the BDO Magallanes branch and to provide documents to support his decision.
BDO sought remedy from the court through its petition so that the mayor would act on BDO’s pending business permit applications for their 27 branches in city. Of BDO’s 28 branches in the city, only the branch in SM Seaside was given a business permit as it did not operate in 2016.
During yesterday’s hearing, Bernaldez asked the court to dismiss the petition, saying the mayor’s duty of issuing a permit is discretionary and not ministerial as ruled by Supreme Court in several cases.
But lawyer Salvador Peña, BDO’s other lawyer, explained that their Petition for Mandamus is not to compel the mayor to approve BDO’s permit applications but just to act on it and “without bias.”
He said BDO was constrained to seek judicial intervention because the mayor was treating BDO’s permit as a “special case,” with underlying “other motives.”
Go also argued that while BDO had submitted all required documents for their business permit application, the City Treasurer’s Office (CTO) required them to submit additional documents which, they said, should not even be included anymore.
Among the documents asked by the city, Go said, was a consolidated income tax return of BDO as well as their VAT (value added tax) payments. He pointed out that banks do not pay VAT since they only pay gross receipts tax to the national government.
“We are here to tell the truth. Everything has been laid down. We find no reason for the mayor’s office to not act on our application,” Go said.
It was at this point, around 30 minutes after the hearing started at 1:30 p.m., when the judge asked the lawyers to join him for a chamber conference.
They came out at around 45 minutes later.