Construction company Megawide Construction Corp. and developer Filinvest Land Inc. are close to signing an amicable settlement over an P800-million collection case.
Megawide chief finance officer Oliver Tan said a settlement could be finalized within the third quarter, with FLI agreeing to pay the construction company.
“I think we were able to come into a compromise agreement, so we should be disclosing the detail of that this third quarter,” Tan said.
Both parties are expected to sign the amicable settlement soon, he said.
Tan said while the structure of the amicable settlement was still being finalized, FLI, the property arm of the Gotianun family, was now willing to pay Megawide for the unpaid receivables from various projects it had undertaken for the property firm.
“They will pay something. The structure of the settlement will mend the relationship in such a way that we will not incur losses for the projects and they will walk away their good reputation still intact,” Tan said.
He said with the amicable settlement forthcoming, Megawide would no longer pursue any legal action against FLI. In 2017, Megawide said it was claiming roughly P800 million in unpaid receivables from various projects it had undertaken for FLI.
FLI said it was also demanding payment from Megawide for its failure to complete several projects.
The issue stemmed from the claim of FLI that Megawide failed to deliver the projects based on an agreed timetable.
Megawide, however, said the five high-rise projects it constructed for FLI were completed within the timetable, based on the approved extension and well within the new turnover schedule.
FLI said Megawide was liable for liquidated damages amounting to P793.5 million, plus another P72.24 million and other costs allegedly incurred by the property developer for rectification works, takeover works, importation and other expenses.
FLI said it had to take-over the projects to ensure completion, which resulted in substantial liquidated damages and other actual damages for costs of rectification, take-over works and lost income.
The rift between Megawide and Filinvest group started when Filinvest-Changi consortium lost to Bangalore’s GMR Infrastructure Limited-Megawide consortium in the auction for the P17.5-billion Mactan-Cebu International Airport contract.