The Government Service Insurance System (GSIS) has entered into a settlement with the city government of Baguio in which the city has agreed to pay Php200.2 million to the GSIS for the purchase of the Baguio Convention Center.
The amount represents the full payment of the purchase price of the establishment including the 10,000-square meter parcel of land where it stands.
Under the Compromise Agreement signed by GSIS President and General Manager Robert G. Vergara and Baguio City Mayor Mauricio G. Domogan, the city handed over the check bearing the said amount simultaneously with the execution of a corresponding Deed of Absolute Sale of the said property in favor of Baguio City.
The agreement also settles all other claims and counterclaims of the parties arising from the ejectment suit including the claim of Baguio City for overpayment of premiums for the years 1996 to 1997.
It will be recalled that the GSIS entered into a Memorandum of Agreement with the city government of Baguio in 2003 and into a Supplemental Agreement in 2004 for the sale of the Baguio Convention Center and the lot where it was constructed. The total purchase price agreed upon at that time was Php250 million, payable on installments at 12 percent interest rate per annum.
Simultaneously, Baguio City entered into an agreement with the Bases Conversion and Development Authority (BCDA) where the latter, instead of paying its obligations to the city, agreed to remit directly the said payments to the GSIS at the time the obligation falls due.
In accordance with this agreement, BCDA remitted to the GSIS Php50 million on February 11 2004; another Php50 million on September 3, 2008; and Php60 million on May 27, 2011.
Despite these payments, however, the account remained in arrears. Hence, the GSIS filed an ejectment case before the Baguio City Municipal Trial Court.
To settle the ejectment case, the GSIS and the city government of Baguio entered into a Compromise Agreement.
“We’re glad that we can finally put this issue behind us and the local government can now rightfully claim ownership of one of the City’s landmarks,” said GSIS President and General Manager Robert G. Vergara.