Olongapo SubicBay BatangGapo Newscenter

Monday, November 10, 2008

Feud over Zambales co-op reaches high court

The Supreme Court has been asked to intervene in the ownership dispute over Zambales II Electric Cooperative Inc.

Zameco board directors led by Jose Dominguez also urged the high court to prevent the unlawful and forcible takeover of the co-operative by a small mob led by several municipal mayors with the help of the National Electrification Administration.

In an 11-page petition, Dominguez urged the justices to restrain NEA, the “interim board of directors” and the mob-installed officer-in-charge engineer Alvin Farrales from exercising management control of the cooperative to prevent loses and damage to the prejudice of the interest of its 55,000 member-customer-owners.

Amid the tense situation prevailing over Zameco II, the petitioner sought the immediate issuance of temporary restraining order or status quo ante order to enjoin the respondents from implementing NEA’s “unnumbered” Office Order issued on Oct. 31, 2008, which among others designated engineer Paulino T. Lopez as project supervisor.

The Office Order provides that as project supervisor, Lopez shall oversee the operations and management of Zameco II, sign checks, withdrawal slips and other banking transactions, and ensure the orderly conduct of elections in all districts.

Zameco’s woes began when it asserted its tax exemptions from the local and national governments to reduce the rates their customers pay for electricity by registering itself with the Cooperative Development Authority.

It was granted a certificate of registration by the CDA pursuant to Republic Act 6938, otherwise known as the Cooperative Code of the Philippines and RA 6939, which creates the CDA.

“This tax exemption could help the cooperative avoid any power rate increase resulting from its payment of such taxes, an expense that will merely be passed on by the cooperative to its member-customer-owners based on the present cash-flow methodology that is being applied by the Energy Regulatory Commission in setting the tariff for all electric cooperatives,” the petitioners said.

This act of the Zameco’s board to have it registered with the CDA in order to effect not only the transfer of real ownership of the cooperative to its member-customer-owners, but also to avail of the exemption from taxes imposed by the national government and LGUs, did not sit well with the local officials within its service areas. As a consequence, the town mayors instigated the forcible takeover of the cooperative and installed an interim board.

Zameco II’s board of directors also reiterated its appeal for the SC to review and reverse the ruling of the Court of Appeals, which upheld the NEA’s resolution dated Nov. 24, 2004, which authorized a change in the cooperative’s board after it insisted on finding the petitioners administratively guilty on the basis of an audit report lodged by a consumer group identified with the local officials concerned.

Dominguez’s camp argued that the NEA’s resolutions “are void not only because they were issued in grave abuse of discretion amounting to lack of jurisdiction. NEA had lost its power since the Epira (Energy and Power Industry Reform Act). By Rey E. Requejo - Manila Standard today

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