Republic of the Philippines REGIONAL TRIAL COURT First Judicial Region Baguio City HON. CLIFTON U.

GANAY SC-Designated Judge

BAGUIO COUNTRY CORPORATION, Plaintiff, -versus-

CLUB

Civil Case No !"#$-R

MULTINATIONAL INVESTMENT BANCORPORATION, RAMON K. ILUSORIO, FELIX ADELFO LOPEZ and ROMEO RODRIGUEZ, Defendants %-----------------------------------------------------------%

MEMORANDUM
(For the Defendants)

&'() *++ D,- R-SP-C( (. ()- ).N.R*B+- C.,R(

./- N.& the defendants, by the undersigned counsel, unto the )onorable Court, 0ost respectfully sub0it their /-/.R*ND,/ in the above-entitled case, and for this purpose state1

I PREFATORY TATEMENT

(his is 2ust one of at least four 345 cases involving Penthouse 6 of the Baguio Country Club Corporation 7hich 7as leased to defendant Ra0on 8 'lusorio 3R8'5 by the plaintiff for a period of 9! years fro0 July :, 6$$4 *nd all the cases 7ere initiated 0ore than five 3!5 years fro0 the ti0e said unit 7as leased to hi0 and had been used by hi0, his friends and business associates 7ith the ;no7ledge and consent of the plaintiff Curiously, the cases 7ere filed only after the 'lusorio Fa0ily Feud started, specifically,

2 7hen the late Potenciano 'lusorio 7as <dadnapped= by his children Sylvia 8 'lusorio, -rlinda 'lusorio Bildner and /a%i0o 'lusorio fro0 his 7ife and 7hen the said estranged siblings beca0e 0e0bers of the Board of Directors in lieu of the late Potenciano 'lusorio, their father First, they li0ited the use of Penthouse 6 to R8' and i00ediate 0e0bers of his fa0ily li;e his father, 0other, brothers and sisters )is business associates, la7yers and friends 7ere no longer allo7ed to use the sa0e despite per0ission fro0 hi0 and 7hich 7as allo7ed for 0ore than five 3!5 years before the <fa0ily feud= But his parents and siblings have their o7n penthouse> *nd R8' is single? So 7ho 7ould or could use

Penthouse 6 aside fro0 R8' considering that since 6$$4, as pointed out by /alou @aliste during the ocular inspection, R8' 0ade use of the sa0e personally only t7ice or thrice> Second, they filed a case against R8' for allegedly introducing illegal i0prove0ents on Penthouse 6 7ithout the approval of the plaintiff 'ndeed, Penthouse 6 7as i0proved as early as 6$$4 or 6$$! by R8'As 0other thereby 0a;ing it the best a0ong all the penthouses---at no e%pense on the part of the Club despite the fact that they could lease it to other 0e0bers or guests 7hen not being used by R8' Not a single ob2ection 7as 0ade then though it 7as i0possible to introduce said i0prove0ents 7ithout being noticed by the 0anage0ent since the 0aterials and laborers have to pass through the gate as 7ell as the entrance of the 0ain building and li;e7ise passing through the front des; of the Club Fortunately, the <'llegal '0prove0ents Case= 7as dis0issed by the )onorable Presiding Judge even if it 7as only 7ithout pre2udice (hird, they filed this case clai0ing that there 7as conflict of interest in the a7ard of Penthouse 6 to R8' since he is the Chair0an of the Board of /ultinational 'nvest0ent Bancorporation 3/'B5, the Financial *dvisor of the plaintiff in 6$$#, 7hen it 7as do7n to its ;nees No roo0s to lease to its guests and 0e0bers since its buildings collapsed

due to the ;iller July 6B, 6$$" earthCua;e and the rest of its buildings gutted by fire on the sa0e yearD its real estate all 0ortgaged to the different ban;s and financial institutionsD and no substantial cash to start its business ane7 Defendant /'B 7as engaged as its Financial *dvisor of the plaintiff and through the efforts of the for0er,

3 0ore than PB"" / in cash 7ere raised for its disposal )ence, it has no7 ne7 buildings and 7orld class facilities but unfortunately, part of the said a0ount is no7 being used to fight /'B? Fourth, the plaintiff li;e7ise filed a P9/ plus collection suit against R8' to allegedly collect the a0ounts due for the use of Penthouse 6 by his friends and business associates since the plaintiff is no7 clai0ing that he should have been the only one, together 7ith the i00ediate 0e0bers of his fa0ily, 7ho could 0a;e use of the sa0e 7ithout charge Eet, they allo7ed his business associates and friends to use Penthouse 6 through his letters of authoriFation 7ithout any Cuestion 7hatsoever and 7ithout 0a;ing any billing for the use of Penthouse 6 for 0ore than five 3!5 years---7hich sho7s that no less than the plaintiff consented to said arrange0ent since R8' 7as single and his parents have also their o7n penthouse unit to use 't 7as only 7hen the 'lusorio Fa0ily feud bro;e out and his estranged siblings 7ere the ones sitting as 0e0bers of the Board of the plaintiff that the plaintiff suddenly de0anded pay0ent for the use of Penthouse 6 by others outside R8' and the i00ediate 0e0ber of his fa0ily but only after 0ore than five 3!5 years? .bviously, this is a clear and un0ista;able harass0ent suit brought against R8' by his estranged siblings using the plaintiff as a front (his, in a nutshell, is the su00ary of the case at bar

'' THE PLAINTIFF! ALLEGED CAU E OF ACTION

(he plaintiffAs causes of action as enu0erated in its Co0plaint are as follo7s, to 7it1 FIRST CAUSE OF ACTION (he plaintiff is suing the defendants for =actual da0ages by 7ay of actually unrealiFed receipts in the a0ount of at least FOUR MILLION PESOS (P4,000,000.005, e%cluding interest, consisting of the difference bet7een the prices

4 per sCuare 0eter of the units sold on Nove0ber B, 6$$# and the highest bid during the /arch 6G, 6$$4 bidding =

SECOND CAUSE OF ACTION T O !UNDRED T!OUSAND PESOS (P"00,000.005 by 7ay of 0oral da0ages

due to the <bes0irched reputation and good7ill of the Club= due to the <high-handed 0achination= co00itted by the defendants in bidding out the three 3#5 penthouse units on Nove0ber B, 6$$#

T!IRD CAUSE OF ACTION T O !UNDRED T!OUSAND PESOS (P"00,000.005 by 7ay of e%e0plary

da0ages due to the <high-handed and fraudulent 0achination in the conduct of the bidding of the three 3#5 penthouses on Nove0ber B, 6$$#

FOURT! CAUSE OF ACTION ONE !UNDRED T!OUSAND PESOS (P#00,000.00$ by 7ay of attorneyAs fees and e%penses of litigation

III DEFENDANT ! COUNTERCLAIM

(he defendants interposed the follo7ing Counterclai0s as a result of this baseless and 0alicious suit1 * FIRST COMPULSORY COUNTERCLAIM OF DEFENDANT MULTINATIONAL INVESTMENT BANCORPORATION

/'B suffered da0age to its business and credit standing in an a0ount reasonably esti0ated at ONE !UNDRED MILLION (P#00,000,00.00$ PESOS BE &*E .F /.R*+ D*/*@-S *S * R-S,+( .F ()- 'NS(*N( C*S- &'().,( *NE

5 F*C(,*+ *ND J,S('F'*B+- @R.,NDS 'N S,PP.R( ()-R-.F *ND C)*R*C(-R'H-D BE @R.SS *ND -I'D-N( B*D F*'() *ND /*+'CSECOND COMPULSORY COUNTERCLAIM OF DEFENDANT MULTINATIONAL INVESTMENT BANCORPORATION

*s a conseCuence of the filing of the instant case &'().,( *NE F*C(,*+ *ND J,S('F'*B+- @R.,NDS 'N S,PP.R( ()-R-.F *ND C)*R*C(-R'H-D BE @R.SS *ND -I'D-N( B*D F*'() *ND /*+'C-, /'B 7as constrained to engage the services of counsel in the a0ount of FIVE !UNDRED T!OUSAND (P%00,000.00$ PESOS BY AY OF ATTORNEY&S FEES B FIRST COMPULSORY COUNTERCLAIM DEFENDANT RAMON K. ILUSORIO OF

*s a conseCuence of the filing of the instant case &'().,( *NE F*C(,*+ *ND J,S('F'*B+- @R.,NDS 'N S,PP.R( ()-R-.F *ND C)*R*C(-R'H-D BE @R.SS *ND -I'D-N( B*D F*'() *ND /*+'C-, R*/.N 8 '+,S.R'. S,FF-R-D /.R*+ D*/*@-S C.NS'S('N@ 'N /-N(*+ *N@,'S),

S+--P+-SS N'@)(S, *NJ'-(E, ),/'+'*('.N, B-S/'RC)-D R-P,(*('.N, *ND ()- +'8-, &)'C), C.NS'D-R'N@ )'S PR.F-SS'.N*+ *ND S.C'*+ S(*ND'N@ 'S R-*S.N*B+E -S('/*(-D 'N ()- */.,N( .F ONE !UNDRED MILLION (P#00,000,000.00$ PESOS BY DAMAGES SECOND COMPULSORY COUNTERCLAIM OF RAMON K. ILUSORIO *s a conseCuence of the filing of the instant case &'().,( *NE F*C(,*+ *ND J,S('F'*B+- @R.,NDS 'N S,PP.R( ()-R-.F *ND C)*R*C(-R'H-D BE @R.SS *ND -I'D-N( B*D F*'() *ND /*+'C-, R*/.N 8 '+,S.R'. )*S B--N C.NS(R*'N-D (. -N@*@- ()- S-RI'C-S .F C.,NS-+ 'N ()AY OF MORAL

6 *@R--D */.,N( .F FIVE !UNDRED T!OUSAND (P%00,000.00$ PESOS BE &*E .F *((.RN-EAS F--S *ND (. 'NC,R -JP-NS-S .F +'('@*('.N *S PR.I-N D,R'N@ ()- (R'*+ C COMPULSORY COUNTERCLAIM OF DEFENDANTS ADELFO LOPEZ AND ROMEO RODRIGUEZ

*s a conseCuence of the filing of the instant case &'().,( *NE F*C(,*+ *ND J,S('F'*B+- @R.,NDS 'N S,PP.R( ()-R-.F *ND C)*R*C(-R'H-D BE @R.SS *ND -I'D-N( B*D F*'() *ND /*+'C-, D-F-ND*N(S *D-+F. +.P-H *ND R./-. R.DR'@,-H )*I- B--N C.NS(R*'N-D (. -N@*@()- S-RI'C-S .F C.,NS-+ 'N ()- */.,N( .F FIVE !UNDRED T!OUSAND (P%00,000.00$ PESOS BY -JP-NS-S .F +'('@*('.N AY OF ATTORNEY&S FEES *ND

'I
DI CU ION (Of the P"a#nt#ff!s $a%ses of a$t#on and defendants! defenses and $o%nter$"a#&s)

FIRST CAUSE OF ACTION (he plaintiff is suing the defendants for =actual da0ages by 7ay of actually unrealiFed receipts in the a0ount of at least F.,R /'++'.N P-S.S 3P4,""",""" ""5, e%cluding interest, consisting of the difference bet7een the prices per sCuare 0eter of the units sold on Nove0ber B, 6$$# and the highest bid during the /arch 6G, 6$$4 bidding =

SECOND CAUSE OF ACTION (&. ),NDR-D ().,S*ND P-S.S 3P9"",""" ""5 by 7ay of 0oral da0ages due to the <bes0irched reputation and good7ill of the Club= due to the <high-handed 0achination= co00itted by the defendants

7 in bidding out the three 3#5 penthouse units on Nove0ber B, 6$$# T!IRD CAUSE OF ACTION (&. ),NDR-D ().,S*ND P-S.S 3P9"",""" ""5 by 7ay of e%e0plary da0ages due to the <high-handed and fraudulent 0achination in the conduct of the bidding of the three 3#5 penthouses on Nove0ber B, 6$$# FOURT! CAUSE OF ACTION .N- ),NDR-D ().,S*ND P-S.S 3P6"",""" ""5 by 7ay of attorneyAs fees and e%penses of litigation (he above clai0s, being interrelated, are hereby discussed 2ointly in the follo7ing (he only 7itness presented by the plaintiff during the presentation of its evidence in chief 7as *N().NE D- +-.N, the @eneral /anager of Baguio Country Club Corporation since 9""6 Note that in 6$$# and 6$$4 7hen the Bidding of the Penthouses 7ere 0ade, he 7as allegedly the F K B Depart0ent )ead and 7as not yet a part of the top 0anage0ent group )e clai0s that the Club lost P4,"49,64$ 4" as a result of the sale of Penthouse 6, 9 and B on Nove0ber B, 6$$# on bids lo7er than the )'@)-S( B'D .F P#9,4!9 ""Lper sCuare 0eter during the /arch 6G, 6$$4 bidding )is co0putation is sho7n in -%hibit <+= of the Plaintiff, as follo7s1

R'()*+( ,- +.' B/dd/n0 ,n N,1'23'4 5, #667 Penthouse 6 9 B *rea 3sC 0eters5 6G9 "" 9#! "# 9"# $9 PriceLsC 0 and sale price P9B,#:# "" MP4, G"","" ""N P9!,!!G "" MPB,!":,""" ""N P9B,""" "" MP!,#"6,$9" ""N

)e clai0ed that had the said three 3#5 penthouses been sold at P#9,4!9 "" per sCuare 0eter on Nove0ber B, 6$$#, then the follo7ing a0ounts a0ounts received by BCC for the three 3#5 penthouses should have been the

Penthouse

*rea 3sC 0eters5

PriceLsC 0 and e%pected sale price

6 9 B

6G9 "" 9#! "# 9"# $9

P#9,4!9 "" MP!,$"B,9B4 ""N P#9,4!9 "" MP:,B9:,6$# !BN P#9,4!9 "" MPB,B6:,B66 G4N

Based on the above co0parison, he concluded that there 7as a loss on the part of BCC, as follo7s1

Penthouse -%pected Selling Price based on highest bid on /arch 6G, 6$$4 vs *ctual Selling Price on Nove0ber B, 6$$# 6 P!,$"B,9B4 ""- P4, G"","" "" 9 P:,B9:,6$# !BPB,!":,""" "" B P!,#"6,$9" ""P!,#"6,$9" "" *lleged (otal +oss of BCC

D/--'4'n8'

P#,#05,"54.00 P#,5"0,#67.%5 P#,7#%,56#.94 P4,04",#46.40

(here is no dispute, ho7ever, that said 7itness 0ade the follo7ing ad0issions during his cross-e%a0ination1 6 (hat based on the /inutes of the Board /eeting of the Board of Directors on *ugust 4, 6$$#, they set the 0ini0u0 price per sCuare 0eter of the penthouses to be sold on Nove0ber B, 6$$# at P9!,""" "" per sCuare 0eterD 9 (hat in the said Board /eeting, the said public auction sale 7ill be disse0inated to the 0e0bers starting *ugust 6!, 6$$# up to Nove0ber B, 6$$# .R * P-R'.D .F *+/.S( ()R-- 3#5 /.N()SD # (hat the bidding is open to all the 0e0bers and there 7as there 7as no prohibition 7hatsoever for defendant R*/.N 8 '+,S.R'. 3R8'5 to

participate in the bidding since he is also a 0e0berD 4 (hat the Nove0ber B, 6$$# bidding 7as attended by t7o 395 senior partners of JC Cunanan K Co0pany, the e%ternal auditors of BCC in 6$$#D

9 ! (hat on Nove0ber G, 6$$#, JC Cunanan K Co0pany 7rote BCC infor0ing it of the result of the Nove0ber B, 6$$# bidding and it even declared that the bidding 7as in accordance 7ith the reCuire0ents set by the Board 'n the said letter, Raul Baria 7as 0ade to appear by JC C,N*N*N K Co0pany as the representative of BCC 7hich the latter vigorously denies and even clai0ed that he is the driver andLor e0ployee of R8'D B : (hat the BCC never Cuestioned the said letter of JCC for : O yearsD (he BCC approved the *ssign0ent of Penthouse 6 to *delfo +opeF in /ay, 6$$4 or S'J 3B5 /.N()S *F(-R ()- N.I-/B-R B, 6$$# B'DD'N@ D G (hat BCC through the @eneral /anager approved the assign0ent of Penthouse 6 fro0 +opeF to R8' in July, 6$$4D $ (hat BCC allo7ed R8' to 0a;e use of said Penthouse 6, for hi0self, friends and relatives for 0ore than B years 7ithout any Cuestion as to the legality of the assign0ent to hi0 or the results of the Nove0ber B, 6$$# biddingD 6" (hat for the /arch 6G, 6$$4 bidding, only #" days to disse0inate the sa0e to the 0e0bers based fro0 the February, 6$$4 Board /eeting of BCC 7hile in the Nove0ber 6$$# bidding, at least $"- day notice 7ere given to the 0e0bersD 66 (hat no7here fro0 the records of BCC could 7e find any co0plaint fro0 0e0bers regarding the Nove0ber, 6$$# bidding, particularly on the issue that they 7ere not notifiedD 69 (hat no7here for0 the records of the Board could 7e find any ob2ection as regards the procedure that 7as follo7ed and the results of the Nove0ber, 6$$# biddingD 6# (hat based fro0 the letter of the @eneral /anager of BCC to /'B 3SIP Petronilo Carreon5, it is clear that the 0e0bers 7ere notified of the Nove0ber B, 6$$# bidding but so0e of the0 clai0ed that <price too high=, <Cost Cuite

10 steep=, <7ants 0ore infor0ation=, <7ants brochure=, <7ants a deferred pay0ent plan= because BCC 7ants cashD 64 (hat no7here fro0 the records of BCC could 7e find any notice to individual 0e0bers for the Nove0ber B, 6""# or the /arch 6G, 6$$4 bidding e%cept as to the clai0 of BCC that they posted one at BCC at the </e0berAs Corner=D 6! (hat despite the alleged notice to the #!9B 0e0bers 6 0e0bers for the /arch 6G, 6$$4 bidding, only three 3#5 0e0bers appeared Potenciano 'lusorio 3P'5, -rnesto SancheF and /argie Provido P' 7as there to bid for t7o 395 units 9 successfully Please note further that .N+E S-I-N 3:5 P-N().,S,N'(S &-R- *C(,*++E B'DD-D .,(, N.( (-N 36"5 *S ()-

P+*'N('FF &.,+D &*N( (. /*8- '( *PP-*R 'N ()C./P+*'N( S,C) 'S B-+'-D BE -J)'B'(S <96-/= *ND <99-/= &)'C) &-R- N-I-R R-B,((-D BE ()- P+*'N('FF D-SP'(.PP.R(,N'('-S (. D. S. (here 7ere no bidders for Penthouse <*=, Penthouse ! and Penthouse : as 7ell as the 64 th Penthouse since there are 64 all in all, including those sub2ect of the bidding on Nove0ber B, 6$$# *s such, only 6" penthouse units 7ere actually sub2ected to public bidding 3 three 3#5 during the Nove0ber B, 6$$# bidding and seven 3:5 during the /arch 6G, 6$$4 bidding5 Please ta;e note further that during the /arch 6G, 6$$4 bidding, the elevator had been installed and 0ost of the facilities 7ere already operational Eet, there 7ere no bidders 7hatsoever for four 345 penthouses despite notices allegedly sent to all the 0e0bers 't need not be over-

e0phasiFed that out of the B: 0e0bers 7ho allegedly 7ere interested in the penthouses as per letter of @/ Donald Nye #, only Jose Concepcion, Jr participated in the /arch 6G, 6$$# bidding Clearly, there 7as lac; of interest fro0 the 0e0bers and stoc;holders due to the prohibitive cost of the units, as 7ell as the difficult access to Baguio City fro0 /etro /anila then as a result of the lahar in (arlac and Pa0panga as 7ell as the July, 6$$" earthCua;e
6 9

Please see -%hibit <9!-/= Not one 365 as alleged in the co0plaint Please ta;e note that the Report of /'B to BCC 3-%hibit <96-/= as 7ell as that of JoaCuin Cunanan K Co 3-%hibit <99-/= in connection 7ith the /arch 6G, 6$$4 bidding sho7s that P' 7on the bidding for Penthouse F and @ # Please see *nne% of -%hibit <C=

11 7hich severely da0aged the roads going to Baguio City, especially 8ennon Road (he line of argu0ent of the plaintiff that it lost an e%pected profit of at least P4,""",""" "" because the price for the units during the Nove0ber B, 6$$B bidding failed to reach P#9,4!9 "" per sCuare 0eter 7hich 7as the highest bid during the /arch 6G, 6$$4 bidding is grossly speculative and has no logic 7hatsoever (he plaintiff 7ants that each of the fourteen 3645 penthouses should be leased at P#9,4!9 "" per sCuare 0eter .ther7ise, there is a loss 't is very absurd, to say the least, especially if 7e are tal;ing of a bidding 7here each unit is different fro0 the other in ter0s of location and area 'f 7e follo7 the sa0e line of argu0ent, the losses incurred by the plaintiff during the /arch 6G, 6$$4 bidding, despite co0plete notices 7ere allegedly sent to all the 0e0bers, 7ould even be 0ore than that of the Nove0ber B, 6$$# bidding 'f 7e consider the highest bid on /arch 6G, 6$$4 in the a0ount of P#9, 4!9 "" per sCuare 0eter as the only supposedly acceptable bid in the Nove0ber B, 6$$# bidding, then BCC suffered a bigger loss during the /arch 6G, 6$$4 bidding as sho7n belo71

MARC! #9, #664 BIDDING Penthouse *rea 3sC 0 5 # 4 D @ ! : * F 9#! "# :9 4! 6:B 9B 99: $9 :4 4" :9 4! 6!6 6!9 :# 6:B 9B Bid PriceLsC 0 P#",4!4 "" P9B,994 "" P9$,""9 "" P9G,B"" "" P9G,:!" "" P9$,9"B "" P9$,9"B "" P9$,9": "" P#6,""" "" Difference fro0 +oss of BCC P#9,4!9 ""LsC0 based on the highest bid P6,$$G "" P4B$,!G$ $4 PB,99G "" P4!6,96G B" P#,4!" "" PB"G,"$: "" P#,G!9 "" PG::,$4: G9 P#,:"9 "" P9:!,49G G" P#,94B "" P9#!,6:9 :" P#,94B "" P4$",64B "" P#,94! "" P4$!,B"G G! P6,4!9 "" P9!!,$9$ !9

TOTAL LOSS

P4,#%6,#76.#0

(he defendants pray to the )onorable Court to 0inutely observe that the bid for Penthouse 4 during the /arch 6G, 6$$4 bidding in the a0ount of P9B,""" "" per sCuare

12 0eter by *rch Jose /anosa, the Contractor of BCC then, is even 0uch 0uch lo7er than the bid for Penthouse 6 by R8' 7hich 7as P9B,#:# "" per sCuare 0eter Clearly, therefore, the bidding on Nove0ber B, 6$$# 7as done in accordance 7ith the rules and procedure approved by the Board 'f ever the average price per sCuare 0eter during the Nove0ber B, 6$$# bidding 7as slightly lo7er than that of /arch 6G, 6$$4, it 7as e%plained by the defendants that during the first bidding, unfavorable 7eather condition 7as prevailing, not to 0ention the fact that at that ti0e, the penthouse units 7ere unattractive since it 7as bare )o7ever, during the /arch 6G, 6$$4 bidding, the elevator is already operational and 0ost of the facilities 7ere already in place 4 T!E CLAIM OF T!E PLAINTIFF T!AT T!ERE AS NO NOTICE TO T!E MEMBERS FOR T!E NOVEMBER 5, #667 BIDDING IS FALSE No less than the President, Corporate Secretary and (reasurer of the plaintiff 0ade the instruction to defendant /ultinational 'nvest0ent Bancorporation to conduct the first bidding 3for the : penthouses on the &est &ing5 on Nove0ber B, 6$$# ! 't also provides that all 0e0bers in good standing shall be Cualified to participate in the bidding 7here the 0ini0u0 bid price per sCuare 0eter shall be P9!,""" "" *side fro0 that, no less than -%hibit <C= of the plaintiff 7ill prove that the B: 0e0bers 7ere all a7are of the Nove0ber B, 6$$# bidding as 7ell as the 0ini0u0 bid price of P9!,""" "" per sCuare 0eter because in their co00ents, it 7as sho7n that they clai0ed that the <cost is Cuite steep=, <price is too high=, <prefers deferred pay0ent plan=, and others +i;e7ise, the +etter of Senator Sotero ) +aurel B to the plaintiff sho7s that he 7as indeed notified of the Nove0ber B, 6$$# (he letter of the plaintiffAs @eneral

/anager dated *ugust 6#, 6$$#: to /s Nancy -nriCueF, un0ista;ably sho7s that /r +acson, a 0e0ber of BCC, 7as a7are of the bidding of the penthouses on Nove0ber B, 6$$#
4 !

Please see pages B-: of -%hibit <F= Please see -%hibit <B-/= B Please see -%hibit <64-/= : Please see -%hibit <9"-/=

13 But the 0ore telling argu0ent is the fact that not a single stoc;holder or 0e0ber of the Baguio Country Club Corporation ever raised the issue that he or she 7as never notified of the t7o 395 biddings and as such, Cuestions the results thereof Please ta;e note that as a corporation 7hich raised a very large a0ount of 0oney and invested it for its infrastructure after its original buildings 7ere da0aged by earthCua;e and fire, said long ter0 lease of the penthouses should have been reported to the stoc;holders and 0e0bers during its *nnual Stoc;holders /eeting, either in the year 6$$# or 6$$4 Eet, there 7as nothing in the records of the corporation could 7e find any ob2ection nor co00ent of the said 0e0bers about their not being notified of the biddings (his fact 7as grudgingly ad0itted by plaintiffAs @eneral /anager

T!E PLAINTIFF IS ESTOPPED FROM :UESTIONING T!E LEASE OF PENT!OUSE # TO RAMON K. ILUSORIO AS ELL AS T!E AMOUNT OF BID IN T!E AMOUNT OF P"5,757 PER S:UARE METER.

't 7as never denied by the plaintiff that defendant /'B 0erely reco00ends to the plaintiffAs Board of Directors and -%ecutive Co00ittee courses of actions to be done in connection 7ith the rehabilitation of the Baguio Country Club Corporation (he sa0e is true in connection 7ith the rules and regulations in connection 7ith the bidding of Penthouses 6 up to 64D a7arding of said penthousesD e%ecution of Deeds of *ssign0ent of said penthouses, and the li;e *ll the reco00endations of /'B 7ere e%tensively discussed by the Board of Directors of the plaintiff and 7as a7are and in full control of all stages in the process in connection 7ith the long ter0 lease of the penthouses 'n fact, the Board of Directors of the plaintiff 7as fully a7are of the entire process and too; plenty of ti0e to 0a;e the a7ard itself as 7ell as the e%ecution of the corresponding Deeds of *ssign0ent to the 7inning bidders, including that of defendant R*/.N 8 '+,S.R'. through his representative, F-+'J *D-+F. +.P-H Please consider the follo7ing1

14 6 *s early as Nove0ber G, 6$$#, J.*P,'N C,N*N*N K C./P*NE G, the -%ternal *uditor of the plaintiff infor0ed the plaintiffAs Board of Directors through its Board /e0ber, Corporate Secretary and (reasurer, in the person of -rnesto SancheF, the results of the bidding on Nove0ber B, 6$$# and even infor0ed the plaintiff of the people present during said bidding and that the <bids 7ere in co0pliance 7ith the reCuire0ents set out in the instructions to bidders = (he Board never Cuestioned said Report of its -%ternal *uditor No Board Resolution or /inutes of any Board /eeting of the plaintiff 7as ever presented to prove that the said report 7as re2ectedD 9 't 7as only in /ay, 6$$4 or 0ore than si% 3B5 0onths fro0 the ti0e the Nove0ber B, 6$$# bidding too; place that the Deed of *ssign0ent of Penthouse 6 7as e%ecuted by the plaintiff in favor of R8'As representative, Feli% *delfo +opeF$ 7hich sho7s that the plaintiffAs Board had e%tensively discussed the sa0e before giving its sta0p of approvalD # 'n July, 6$$4, the plaintiff approved the Deed of *ssign0ent of Penthouse 6 fro0 Feli% *delfo +opeF to Ra0on 8 'lusorio6"D 4 (hat on *ugust #", 6$$4, the plaintiffAs Board through its @eneral /anager even 7rote Ra0on 8 'lusorio apologiFing for the inconvenience brought about by the lea;ing roof of Penthouse 6 and even infor0ed the latter that <the Board of Directors in its /eeting on *ugust 9$, 6$$4, decided to 0ove up the co00ence0ent of the ter0 of your assign0ent contract to such ti0e as the aforesaid proble0 has been satisfactorily resolvedQ after giving our

contractor B" days 7ithin 7hich to fully repair the lea;s on the roof = 66 'n short, the 9!-year lease of Penthouse 6 by defendant R8' 7as to co00ence only on .ctober #", 6$$4 at the earliest as per approval of the Board of DirectorsD ! (hat during the .ctober 9$, 6$$# Board /eeting, Ro0eo RodrigueF of /'B reported to the Board that *++ ()- /-/B-RS *ND S(.C8).+D-RS
G $

Please see -%hibit <-= of the plaintiff and -%hibit <4= of defendant Ra0on 8 'lusorio Please see -%hibit <!= of Ra0on 8 'lusorio and -%hibit <'= of the plaintiff 6" Please see -%hibit <J= of the plaintiff and -%hibit <B= of defendant Ra0on 8 'lusorio 66 Please see -%hibit <G-/= for /'B and -%hibit <9"= for Ra0on 8 'lusorio

15 &-R- D,+E N.('F'-D .F ()- B'DD'N@ SC)-D,+-D .N N.I-/B-R B, 6$$# B,( I-RE F-& *((-ND-D ()- PR--B'DD'N@ C.NF-R-NC- )-+D *( ()- C*S'N. -SP*N.+ 3Please see -%hibit <6$-/= for /'B and -%hibit <9#= for R8', pages :-G5 *s e%pected, no one 0ade a clai0 that he did not receive a copy of the said notice since the 0e0bers 7ere really notified (he Directors and officers present 7ho are also stoc;holders and 0e0bers 7ould have denied having received such notices if no notices 7ere actually sent 't is very convenient no7, ho7ever, for the plaintiff to deny that there 7ere notices sent and that the proof of said notices 0ight have been given to BCC by /'B during the said Board /eeting .ther7ise, it 7ould be very obvious that this case is 0erely a harass0ent suitD B (hat fro0 then on, or for 0ore than five 3!5 years, Ra0on 8 'lusorio, his la7yers, friends and business associates 7ere allo7ed to use Penthouse 6 7ithout any restrictions 7hatsoever Said guests, friends and associates of R8' 7ere allo7ed unrestricted use of Penthouse 6 as long as they carry 7ith the0 letters of authoriFation fro0 hi0 for the use of Penthouse 6 *s a conseCuence of said e%press approval, no billings 7ere issued as against the use of Penthouse 6 of said friends and business associates for 0ore than seven 3:5 years? : (hat no Board Resolution or 0inutes of the Board /eetings of the plaintiff 7as ever presented Cuestioning the acCuisition of R8' or Feli% *delfo +opeF of Penthouse 6 by reason of conflict of interest G (hat as early as the *ugust 4, 6$$# /eeting of the Board of Directors of the plaintiff 7ith R-P J.8-R *RR.E., *((E P.(-NC'*N. '+,S.R'., *N(.N'. .H*-(*, -NR'P,- I*++-S, C*R.+EN B,(+-R and -RN-S(. S*NC)-H in attendance, together 7ith the other officers of the Club, Ra0on RodrigueF, a partner at /'B and a close associate of R8' already infor0ed the Board of the interest of R8' to participate in the bidding of the penthouses N. .BJ-C('.N &*S /*D- .N R-C.RD N. B.*RD R-S.+,('.N .F -'()-R ()- B.*RD .F D'R-C(.RS .R

16 ()- -J-C,('I- C.//'((-- &*S -I-R PR-S-N(-D (. S).& ()*( R8' &*S B*RR-D 'NS(-*D, P' /-R-+E S*'D )- *ND R*/.N 8 '+,S.R'. &'++ &.R8 .N ()-'R R-SP-C('I- S'D-S .F ()- F-NC- &*S ()*( /-*N( (. C.NI-E ()*( )- *ND R*/.N *R- N.( S,PP.S-D (. J.'N ()- B'DD'N@> N., B-C*,SP' -I-N &-N( .N (. S,CC-SSF,++E B'D F.R (&. 395 P-N().,S- ,N'(S, P-N().,S-S <F= *ND <@= 69 'n short, 7hat P' 0eant 7as that he and Ra0on could bid provided it 0ust be 7ithin the para0eters set out by the Co00ittee and that their bid price shall not be lo7er than the 0ini0u0 bid price set by the Board of Directors * contrary interpretation 7ould be absurd considering that P' bidded for t7o 395 units and 7as allo7ed to use the sa0e (he 0e0bers of the Board of the plaintiff then 7ere 0en of unCuestionable and i0peccable integrity and they never Cuestioned the propriety of R8' 2oining the bidding and the subseCuent assign0ent of Penthouse 6 to hi0 'n fact, the 0e0bers of the Board 7ere even very apologetic to R8' 7hen the roof of Penthouse 6 7as lea;ing that is 7hy the effectivity of the 9!-year lease as to hi0 7as set bac; to .ctober #", 6$$4, at the earliest 7hen the contractors 7ere e%pected to have re0edied the situation
6#

(his is so

because he is a 0e0ber of the plaintiff in good standing and that all 0e0bers are allo7ed to participate in the bidding 'n fact, the plaintiff 7as then 2ust after the 0oney that it could raise for its survival since its business 7as on its ;nees 't could not choose fro0 7ho0 such funds 7ill co0e fro0 Beggars couldnAt be choosy, as they say (he Board of Directors of the plaintiff approved the bid in connection 7ith Penthouse 6D approved the e%ecution of the Deed of *ssign0ent to Feli% *delfo +opeFD and approved the e%ecution of the Deed of *ssign0ent fro0 *delfo +opeF to Ra0on 8 'lusorio (he plaintiff is no7 estopped fro0 Cuestioning the actions ta;en by its Board in the ordinary course of business since the corporate po7ers of a corporation shall be e%ercised, all business conducted by, and all the property of such corporation, be

69 6#

Please see -%hibits <96-/= and <99-/= of defendant /'B Please see -%hibit <G-/= of defendant /'B

17 controlled and held by the Board of Directors 64 .ne of the functions of the Board of Directors is to fi% policies on e%pansion of the business, capital changes and the li;e 6! (he issue regarding the a7ard of Penthouse 6 7as 0ade in 6$$4 and 7as Cuestioned only on Septe0ber 6", 9""6 or after a period of 0ore than seven 3:5 years -ven assu0ing for the sa;e of argu0ent that the 0e0bers of the Board then, 7hich included Senator Jo;er *rroyo and the President of Baguio Country Club then, *((E P.(-NC'*N. '+,S.R'., e%ceeded their po7ers in approving the a7ard or

assign0ent of Penthouse 6 to Ra0on 8 'lusorio, the sa0e cannot be Cuestioned no7 because the plaintiff should have PR./P(+E disaffir0ed the contract or act not to allo7 the other party or third persons to act in the belief that the Board 7as authoriFed or that the contract has been ratified 'f it acCuiesces, 7ith the ;no7ledge of the facts, or it fails to disaffir0 pro0ptly, a ratification 7ill be i0plied, or else it 7ill be estopped to deny ratification 6B * private corporation by accepting and retaining the fruits or benefits of an unauthoriFed contract or other transaction 0ade or entered into by one its officers is considered to have ratified it and 7ill be estopped to deny its validity and binding effect 6: 't 7ould be unbelievable for the plaintiff to clai0 that the 0e0bers of the Board of Baguio Country Club Corporation in 6$$4 are not a7are that 365 Ra0on 8 'lusorio is the Chair0an of /'B, its Financial *dvisor and 395 Feli% *delfo +opeF is a close associate and Partner of R8' at /ultinational *s such, it is no7 estopped fro0 Cuestioning the a7ard and assign0ent of Penthouse 6 to defendant Ra0on 8 'lusorio at this ti0e or 0ore than seven 3:5 years fro0 the ti0e 7hen an obviously valid corporate act 7as perfor0ed by its Board of Directors .r 7ould the plaintiff no7 7ants to reverse the BoardAs action in 6$$4 after 0ore than seven 3:5 years> Could that be done after 0a;ing use of the fruits of said transaction> T!E PRESENT COMPLAINT IS BARRED BY PRESCRIPTION AND LAC!ES
64 6!

Please see Section 9# of the Corporation Code of the Philippines Ballantine, page 69", cited in C.//-RC'*+ +*&S .F ()- P)'+'PP'N-S, Iolu0e #, *@B*E*N', *guedo F , 6$$B -dition, page 99# 6B 9 Fletcher, G64-G6!, citing nu0erous cases 6: ) - )-*C8.C8 C. IS N+,, July #6, 6$!4, !" @ 3No $5 49##

18

(here is no dispute that the Bidding involving Penthouse 6 too; place on Nove0ber B, 6$$# 7hile the Deed of *ssign0ent in favor of Feli% *delfo +opeF 7as e%ecuted on /ay 9, 6$$4 .n the other hand, the Deed of *ssign0ent in favor of defendant Ra0on 8 'lusorio 7as e%ecuted on July :, 6$$4 (he present case 7as filed before the Regional (rial Court of Baguio City only in Septe0ber of 9""6 or al0ost eight 3G5 years fro0 the ti0e the bidding of Penthouse 6 too; place or 0ore than seven 3:5 years fro0 the ti0e the Deeds of *ssign0ent 7ere e%ecuted By the ti0e the instant case 7as instituted, the plaintiff had allo7ed defendant Ra0on 8 'lusorio , his friends, and business associates the use of Penthouse 6 for not less than four 345 years starting fro0 6$$4 Clearly therefore, this case is already barred by prescription Prescription is rightly regarded as a statute of repose 7hose ob2ect is to suppress fraudulent and stale clai0s fro0 springing up at great distances of ti0e and surprising the parties or their representatives 7hen the facts have beco0e obscure fro0 the lapse of ti0e or the defective 0e0ory or death or re0oval of 7itnesses 3!# C J S $"# cited in S/na,n 1(. S,4,0,n#9$. Prescription is rightly regarded as a statute of repose 7hose ob2ect is to suppress fraudulent and stale clai0s fro0 springing up at great distances of ti0e and surprising the parties or their representatives 7hen the facts have beco0e obscure fro0 the lapse of ti0e or the defective 0e0ory or death or re0oval of 7itnesses (53 C.J.S. 903 cited in Sinaon vs. Sorogon19). -ven assu0ing 7ithout ad0itting that prescription has not set in to bar the clai0s of the plaintiffs, clearly, laches has set in M,4',1'4, +.' *a; <4,+'8+( +.,(' ;., a4' 1/0/*an+ ,- +.'/4 4/0.+(. UNDUE DELAY IN T!E ENFORCEMENT OF A RIG!T IS STRONGLY INDICATIVE OF A LACK OF MERIT IN T!E CLAIM SINCE IT IS !UMAN NATURE FOR PERSONS TO ASSERT T!EIR RIG!TS MOST VIGOROUSLY !EN T!REATENED OR INVADED (Salao vs. Salao, 70 SCRA 65, cited in G !"A#$S %S. &'$

6G 6$

6#B SCR* 4": 6#B SCR* 4":

19 (!&$R)$*(A&$ A++$##A&$ C ,R&, -0. SCRA 106) 'n :UINSAY VS. IAC, #64 SCRA "59, the Supre0e Court held that1 Considerable delay in asserting oneRs right before a court of 2ustice is strongly persuasive of the lac; of 0erit of oneRs clai0 +i;e7ise, the case of ARRADAZA VS. CA, #=0 SCRA #" is applicable (hus1 S)8. n'0*/0'n8' ,4 -a/*)4' ;a44an+( +.' a(()2<+/,n +.a+ +.' <a4+/'( 8*a/2/n0 +, 3' 'n+/+*'d +, a(('4+ /+, '/+.'4 .ad a3and,n'd /+, ,4 .ad d'8/d'd +.a+ +.'> ;'4' n,+ 'n+/+*'d +, a(('4+ /+ and +.)(, a8?)/'(8'd /n /+ (Pan0ad/* 1. CFI ,C,+a3a+,, ##5 SCRA 7%7 (#69"$. .r as held in Vda. d' A*3'4+, 1(. C,)4+ ,- A<<'a*(, #=7 SCRA 475@ (his Court has consistently declared that laches is the failure or neglect, for an unreasonable and une%plained length of ti0e, to do that 7hich by e%ercising due diligence, could or should have been done earlier T.' n'0*/0'n8' ,4 ,2/((/,n +, a(('4+ a 4/0.+ ;/+./n a 4'a(,na3*' +/2', ;a44an+( a <4'()2<+/,n +.a+ +.' <a4+> 'n+/+*'d +, a(('4+ /+ '/+.'4 .a( a3and,n'd /+ ,4 d'8*/n'd +, a(('4+ /+. (hus, it is 7ell established that S(he la7 serves those 7ho are vigilant and diligent and not those 7ho sleep 7hen the la7 reCuires the0 to act (C/i and Joven vs. 'enson, 51 +0il. 606, 6101 2acolod3 )/rcia )illing Co. vs. %illal/4, Se5t. -9, 1951, 90 +0il. 15.). 6&0e la7 does not enco/rage lac0es, indi88erence, negligence or ignorance. n t0e contrar9, 8or a 5art9 to deserve t0e considerations o8 t0e co/rts, 0e : : : ;/st s0o7 t0at 0e is not g/ilt9 o8 an9 o8 t0e a8oresaid 8ailings. .r as held in B'40ad, 1(. C,)4+ ,- A<<'a*(, #=7 46=@ (he doctrine of laches or of Sstale de0andsS is based upon grounds of public policy 7hich reCuires, for the peace of society, the discourage0ent of stale clai0s and, unli;e the statute of li0itations, is not a 0ere Cuestion of ti0e but is principally a Cuestion of the ineCuity or unfairness of per0itting a right or clai0 to be enforced or asserted 'n the case of Ca4, 1(. C,)4+ ,- A<<'a*(, #90 SCRA 406, the Supre0e Court held1

20 S'n the recent case of Ba0+a( 1(. C,)4+ ,A<<'a*(, '+ a*, G.R. N,. %0=77", A)0)(+ #0, #696 , 7e held that considerable delay in asserting oneRs right before a court of 2ustice is strongly persuasive of the lac; of 0erit of his clai0, since it is hu0an nature for a person to enforce his right 7hen the sa0e is threatened or invaded (hus, he is estopped by laches fro0 Cuestioning the o7nership of the Cuestioned land S 'n G)'44'4, 1(. C,)4+ ,- A<<'a*(, #"5 SCRA ##9, the Supre0e Court further held that1 't is 7ell-settled that the negligence or o0ission to assert a right 7ithin a reasonable ti0e 7arrants not only a presu0ption that the party entitled to assert it either had abandoned it or declined to assert it, (!'/4( ,- P'd4, G)2/n</n 1(. C,)4+ ,A<<'a*(, #"0 SCRA 59=$ 3)+ a*(, 8a(+( d,)3+ ,n +.' 1a*/d/+> ,- +.' 8*a/2 ,- ,;n'4(./< ()asadanga vs. Arga;ora, 109 SCRA 53). S/c0 neglect to assert a rig0t ta<en in con=/nction 7it0 t0e la5se o8 ti;e, ;ore or less great, and ot0er circ/;stances ca/sing 5re=/dice to t0e ot0er 5art9 o5erates as a >ar in a co/rt o8 e?/it9.6

MULTINATIONAL INVESTMENT BANCORPORATION NEVER ABUSED ITS RIG!TS AS FINANCIAL ADVISOR OF T!E PLAINTIFF ESPECIALLY IN CONNECTION IT! T!E BIDDING CONDUCTED ON NOVEMBER 5, #667.

(he allegation of the plaintiff that /'B too; advantage of the plaintiff in its dealing 7ith the latter is 7ithout basis and contrary to the evidence on record 't 7as a rec;less assertion fro0 one 7hich 7as the recipient of the good7ill and unselfish assistance of defendant /'B )ad /'B 7anted to ta;e advantage of the plaintiff, it could have collected interests of its loans to the plaintiff using the rates of PNB 7here 0ost of the funds of BCC then 7ere co0ing fro0 (here 7ould have been no Cuestion as to the propriety of /'B collecting the sa0e interest rate as that of PNB since it 7as the Financial *dvisor of the plaintiff No less than an additional (-N /'++'.N 3P6",""",""" ""5 P-S.S could have been collected by /'B for such act alone Please consider the follo7ing1

21 6 -%hibit <#-/= and -%hibit <D= of the plaintiff 3page $5 of defendant /'B or the *ugust 4, 6$$# /inutes of the Board of Directors /eeting of the plaintiff sho7s that /'B lent P!"/ in clean loan to the plaintiff for it to pay its ongoing construction because PNB refused to issue the second dra7do7n of its loanD 9 -%hibit <6$-/= 3page $5 of defendant /'B or the /inutes of the Board /eeting of plaintiffAs Board on .ctober 9$, 6$$#, sho7s that /'B again e%tended a loan in the a0ount of P4!/ to the plaintiff a+ a *,;'4 /n+'4'(+ 4a+' +.an +.a+ ,- PNBA # EB./3/+ C#5D of /'B 3Page !5 or -%hibit <R= of the plaintiff 7hich the /inutes of the Board /eeting of the board of Directors of the plaintiff on January 96, 6$$4 sho7s that /'B e%tended another loan to the plaintiff in the a0ount of P!"/ at 6B !T interest 7hile the P#"/ loan of the Club fro0 PNB bears an interest of 9" !T or a difference of 4T Stated other7ise, had /'B i0posed an interest rate si0ilar to that of PNB for the said loan, an additional inco0e of P9,""",""" "" could have been obtained fro0 said transaction But /'B did not 4 EB./3/+ C"7EMD 3pages :-$5 or the /inutes of the Board /eeting of the Board of the plaintiff on /arch 9#, 6$$4 sho7s that /'B again e%tended a loan in the a0ount of P::/ at a lo7er rate of interest than that of PNB that is 7hy the plaintiff did not continue to avail of its P9""/ loan fro0 said ban; because of its higher interest than /'B

(he foregoing sho7s that /'B could have earned no less than an additional P6"/ in a yearAs ti0e by 2ust i0posing on its 7ill over the plaintiff being the Financial *dvisor by collecting an interest rate eCual to that of the Philippine National Ban; But it did not because it is a7are of the serious financial condition of its client 't 7as therefore highly ungrateful for the plaintiff to no7 clai0 that /'B abused its rights in dealing 7ith the for0er

22 Please note that in the bidding of Penthouses, /'B 7as 2ust tas;ed 7ith the acCuisition or raising the a0ount of P!:/ for the plaintiff During the sa0e period 9", ho7ever, defendant /'B 7as able to raise P!B for its other clients96, as follo7s1 a b c d e f PB#G,""",""" "" for J@ Su00it of the John @o;ong7ei @roupD PB"",""",""" "" for S/CD PG::,""",""" "" for Filinvest +andD P!"",""",""" "" for Coca Cola Bottling Co0panyD P!9!,""",""" "" for Iictorias /illing CorporationD and P6 4BB for Benpres Corporation

Eet, the plaintiff clai0s to have been deprived of at least P4/ due to the unprofessional conduct of defendant /'B---a clai0 7hich is belied by the evidence of the defendants 7hich even e0anated fro0 the plaintiff li;e the /inutes of the /eetings of the Board of Directors of the Club MULTINATIONAL INVESTMENT BANCORPORATION IS ENTITLED TO MORAL DAMAGES AND ATTORNEY&S FEES FROM T!E PLAINTIFF AS A RESULT OF T!IS OBVIOUSLY BASELESS AND !ARASSMENT SUIT.

(he plaintiff sued defendant /'B for having allegedly violated the <conflict-ofinterest rule= and that it acted in bad faith in its dealings 7ith the Baguio Country Club Corporation *s pointed out by defendants Ra0on 8 'lusorio and Ro0eo RodrigueF, the plaintiff 7as the first and only client 7hich sued /'B for allegedly violating the <conflict-of-interest= rule out of its nu0erous clients, 0ost of 7hich belong to the (op 6"" Corporations of the Philippines Billions of Pesos 7ere raised by /'B for said clients 7ith no co0plaints 7hatsoever * sa0ple of the corporations-clients of /'B 7hich it help raised 0uch needed capital are the follo7ing1

9" 96

June-Nove0ber, 6$$# Please see -%hibit 69-/

23 T!E MULTINATIONAL GROUPS INVESTMENT BANKING PROFECTS"" Co0pany 'nvolved /etro Drug, 'nc S7ift Foods, 'nc Filinvest +and /usic Se0icon, 'nc ,rban Corporation Realty Developers, 'nc P+D( 'onics Circuits, 'nc Bulletin Publishing Co0pany C K P )o0es -Cuitable Ban;ing Corporation Cebu )oldings Central Ban; of the Philippines J@ Su00it PS Ban; San /iguel Corporation *las;a /il; Corporation Iictorias /illing Corporation Coca Cola Bottling Co0pany Davao ,nion Ce0ent Corporation )i Ce0ent Corporation Science Par; of the Phils , 'nc Bacnotan Consolidated 'ndustries, 'nc -0pire -ast +andholdings, 'nc Deutsche Ban; K RCBC )o0e @uaranty Corporation P+D( Selecta Dairy Products, 'nc ,ni7ide )oldings, 'nc
99

*ctivity ,nderta;en by /'B Public offering of co00on shares Public offering of shares Public offering of shares Public offering of co00on shares Public offering of co00on shares Public offering of Co00on stoc;s Public offering of co00on shares Public offering of co00on shares Public offering of co00on shares Public offering of co00on shares Public offering of co00on stoc;s '0ple0entation of Debt Reduction Progra0 Public offering of shares Co00on share offering +ong (er0 Co00ercial issue Public offering of co00on shares Public offering of co00on stoc;s +ong (er0 co00ercial issue +ong (er0 Co00ercial Paper issue +ong (er0 Co00ercial Paper issue Public offering of co00on shares 'nvest0ent Ban;er for long ter0 loan Public offering of co00on shares *dvisor K /anager, #rd (ranche Bond .ffering Public .ffering of Cu0ulative, nonconvertible stoc;s Co00on share public offering Public offering of co00on shares

*0ounts 'nvolved P#,$"",""",""" "" P9,$"",""",""" "" P6,$"",""",""" "" P6,$"",""",""" "" P6,G#B,""",""" "" P#,G"",""",""" "" P9,B"",""",""" "" P9,!$$,""",""" "" P!,!"",""",""" "" P9,!"",""",""" "" P6,!"",""",""" "" P6,4B",""",""" "" P4,#"",""",""" "" P#,#"",""",""" "" P6,#"",""",""" "" P9,9:!,""",""" "" P9,9#",""",""" "" P:,9"",""",""" "" P4,9"",""",""" "" P4,9"",""",""" "" P6,9"",""",""" """ P6,9"",""",""" "" P6,9"",""",""" "" P9,69G,:G9,6"" """ P9,6"",""",""" "" P6,6"",""",""" "" P6,6"",""",""" "" P:"4,4B",94" ""

Please see -%hibit <69-/= of /'B

24 Fil--state +and, 'nc Filinvest Corporation * Soriano Corporation ,nion Ban; of the Philippines Bacnotan Consolidated 'ndustries, 'nc Solid @roup, 'nc D'@'(-+ )i-Ce0ent Corporation *yala +and, 'nc *lsons Ce0ent Corporation ,niversal Robina Corporation /anila -lectric Co0pany *yala +and, 'nc &illia0 +ines, 'nc S/ Pri0e )oldings, 'nc Philippine National Ban; D/C' )oldings, 'nc *boitiF -Cuity Ientures, 'nc Banco de .ro First Philippine )oldings, 'nc Prudential Ban; Prudential Ban; P'+(-+ PNB Philippine National Ban; Security Ban; Benpres Corporation +a (ondena, 'nc San /iguel Corporation S/ Pri0e )oldings Public offering of co00on shares Public offering of co00on shares +ong (er0 Co00ercial Paper issue Co00on share public offering +ong (er0 Co00ercial Paper issue Public offering of co00on shares Public offering of co00on shares Public offering of co00on shares Convertible +ong (er0 Co00ercial issue Public offering of co00on shares Public offering of co00on shares Class * and B co00on stoc; offering Class * and B Co00on stoc;s offering Public offering of shares Do0estic offering of co00on shares Second Public .ffering of co00on shares Public offering of co00on shares Co00on share public offering Public offering of co00on shares +ong (er0 Co00ercial Paper 'ssue Pri0ary preferred stoc;s public offering Preferred shares issuance Public offering of co00on shares Public offering of co00on shares, #rd (ranche Public offering of co00on shares of stoc;s Public offering of co00on shares Co00on share public offering Co00on shares public offering +ong (er0 Co00ercial Paper 'ssue Series <D6= and <D9= +ong (er0 Co00ercial P$"9,""",""" "" P$"",""",""" "" PG::,""",""" "" PG"",""",""" "" PG"",""",""" "" P:!",""",""" "" P:#",""",""" "" P:,""",""",""" "" PBB:,""",""" "" PBB",""",""" "" PB#G,""",""" "" PB"9,""",""" "" PB"",""",""" "" P!#6,""",""","" P!9!,""",""" "" P!"",""",""" "" P!"",""",""" "" P!"",""",""" "" P!"",""",""" "" P!",""",""" "" P!,""",""",""" "" P!,""",""",""" "" P4"",""",""" "" P4"",""",""" "" P#!",""",""" "" P#!",""",""" "" P#"",""",""" "" P#,""",""",""" "" P9,""",""",""" "" P9,""",""",""" ""

25 'ssue Co00on share public offering Public offering of co00on shares Public offering of co00on shares Series <@= and <)= 'ssuance of +ong (er0 Co00ercial Paper 'ssuance of shares +ong (er0 Co00ercial Paper Series <-6= and <-9= Public offering of preferred shares Public offering Public offering of co00on shares Certificates issue +ong (er0 Co00ercial Paper 'ssue Series <-= and <F= Public offering of co00on shares

Southeast *sia Ce0ent )oldings, 'nc Fortune Ce0ent Corporation Iitarich Corporation P+D( 8uo; Philippines Properties, 'nc San /iguel Corporation *boitiF and Co Central *Fucarera Don Pedro -ver @otesco Resources, 'nc Pabahay sa Riles *sset Participation Certificates San /iguel Corporation (rust 'nternational Paper Corporation

P9,""",""",""" "" P6!",""",""" "" P6!",""",""" "" P6,""",""","""" "" P6,""",""",""" """ P6,""",""",""" """ P6,""",""",""" "" P6,""",""",""" "" P6,""",""",""" "" P6,""",""",""" "" P6,""",""",""" "" P6,""",""",""" ""

't 7as therefore unacceptable for a Corporation 7hich operates and deals 7ith its clients under the <D'C(,/ N.S(R,/ P*C(,/= rule to be charged as cheating on a client 7hich is the plaintiff in this case (his is so because the unrebutted evidence on record, particularly the /inutes of the Board /eetings of the plaintiff, sho7 ho7 /'B e%tended loans to the plaintiff at an interest rate very 0uch lo7er that those of big ban;ing institutions li;e PNB if only to help the plaintiff regain its footing (he price for such help, after raising the a0ount of over PB""/, is the unfair accusation of cheating by the plaintiff (he success of defendant /'B as a corporation need not be over-e0phasiFed 'n its #9-year e%istence , it 7as not profitable or it failed to 0a;e 0ore 0oney than the previous year only once and that happened in 2ust a single year1 6$G4Uthe tu0ultuous year after the assassination of the late Senator Benigno *Cuino 9# 't is a record unparalled in the history of Philippine Business *nd to thin; that /'B is one of very fe7 co0panies 7hich does advertise its business in the ne7spapers

9#

Please see Page :", (he story of /ultinational 'nvest0ent Bancorporation, -%hibit <66-/=

26 Considering the said baseless accusation of the plaintiff 7hich severely da0aged and tarnished its reputation, defendant /'B should be co0pensated in the a0ount of not less than P6""/ by 7ay of 0oral da0ages and P!"",""" "" by 7ay of attorneyAs fees for forcing it to litigate RAMON K. ILUSORIO, ROMEO RODRIGUEZ AND ADELFO LOPEZ ARE LIKE ISE ENTITLED TO AN A ARD OF MORAL DAMAGES.

(he social and business standing of defendant Ra0on 8 'lusorio is undeniable )is record in business is unassailable )e 7as a recipient of at least thirty nine 3#$5 Professional *7ards, citations and Recognitions not only fro0 the Philippines but other countries, including the <(-N .,(S(*ND'N@ E.,N@ /-N 3(.E/5 .F ()P)'+'PP'N-S *&*RD 'N 6$:# )e had li;e7ise held no less than forty three 34#5 e%ecutive positions in different corporations as Chair0an of the Board, President, Director, /anaging Director, Consultant, (reasurer, Founder, etc 94 (he sa0e is true 7ith defendants Feli% *delfo +opeF and Ro0eo RodrigueF (hey have been instru0ental in the pheno0enal success of /ultinational 'nvest0ent Bancorporation and its subsidiaries (heir honor, integrity and reputation 7ere li;e7ise unduly tarnished by this case )ence, they should be co0pensated in such a0ount as indicated in their Counterclai0s PRAYER &)-R-F.R-, in vie7 of all the foregoing, it is 0ost respectfully prayed of the )onorable Court to D'S/'SS the instant co0plaint for lac; of 0erit and to a7ard the da0ages and attorneyAs fees prayed for in the defendantsA *ns7er 7ith Counterclai0s in the interest of 2ustice Baguio City *ugust #6, 9""4

94

Please see -%hibit <6G=

27 GACAYAN PAREDE AGMATA ' A OCIATE LA( OFFICE

66-B ,rbano St , Baguio City

by1

LAURO D. GACAYAN
Roll No #4##G, June #, 6$GB 'BP . R No B"64$B, February #, 9""4 Baguio City P(R No 669#4G:, February #, 9""4 Baguio City

E)PLANATION
3Re1 Section 66, Rule 6# of the 6$$: Rules of Civil Procedure5

T.' ,4/0/na* 8,<> ,- +./( <*'ad/n0 ;a(1

M N Filed directly 7ith this )onorable CourtL.fficeD M % N Filed 7ith this )onorable CourtL.ffice by Registered /ail 7ith Return Card because1
M N (he distance bet7een this )onorable CourtL.ffice and the .ffice of the undersigned counsel 0a;es personal filing i0practicableD M %N +ac; of office staffLpersonnel to effect personal serviceD M N (i0e constraintsD M N ,nfavorable 7eather conditions prevents personal serviceD M N Pleading is not urgent in nature

C,<>G8,</'( ,- +./( <*'ad/n0 ;a(G;'4'1

M N Personally served on counsel of the adverse partyD M % N Sent to counsel of the adverse party by Registered /ail 7ith Return Card due to the follo7ing reason1
M M M M M N (he distance bet7een the offices of counsels 0a;es personal filing i0practicableD %N +ac; of office staffLpersonnel to effect personal serviceD N (i0e constraintsD N ,nfavorable 7eather conditions prevents personal serviceD N Pleading is not urgent in nature

LAURO D. GACAYAN Copy furnished1 ATTY. ABELARDO ESTRADA 9nd Floor /anahan Building Session Road, Baguio City