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Sandiganbayan orders Northstar Transport to leave Baseco property

  • August 24, 2026

By ABOGADO.COM.PH Staff

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The Sandiganbayan has directed Northstar Transport Facilities Inc. (NTFI) and Northstar Shipping and Marine Services Inc. (NSMSI) to leave the 1.79-hectare property in Manila that it had leased from the Bataan Shipyard and Engineering Co. Inc. (Baseco), due to unpaid rent and failure to meet contractual obligations.

The anti-graft court’s Second Division handed down the ruling based on a complaint filed by Baseco, represented by the Presidential Commission on Good Government (PCGG).

It was brought before the Sandiganbayan because the leased premises have been identified as among the ill-gotten wealth of the Marcoses.

In its August 17, 2026 decision penned by Presiding Justice Geraldine Faith Econg, the Sandiganbayan also ordered NTFI and NSMSI to pay Baseco P10.83 million representing the principal of unpaid monthly amortization subject to six percent yearly interest.

It likewise ordered the payment of P6.89 million representing the principal amount of back rentals also covered by six percent yearly interest.

It also said 5 percent of the monetary award should be remitted to the Office of the Solicitor General.

In granting the petition, the court noted that NTFI and NSMSI had been delayed in paying rent and in fulfilling terms of their lease contract with Baseco.

“As the records reveal, the defendants committed material violations of the lease contracts. This confirms the plaintiff’s cause of action against them. Despite repeated demands to pay, the defendants defaulted or incurred delay in the payment of their monthly amortizations and monthly rental,” it said.

It said there was no doubt that the shipping firms had committed a material breach of contract that warrants the termination of the contract.

“Beyond doubt, the defendants had breached their obligation under the Compromise Agreement and the Fourth Lease Contract, which reiterated the terms thereof. On the basis of such breach, the plaintiff can legally terminate the contract and demand the ejectment of the defendants,” it said.

It directed NTFI and NSMSI to leave the Baseco property.

“The defendants and all other persons claiming rights under them are ordered to immediately vacate and peacefully surrender the possession of the subject leased premises located at the Engineer Island, Port Area, Manila,” it said.

Baseco leased the property to NTFI on September 15, 2006 under a 10-year contract ending on December 31, 2016.

The rent of P350,000 per month was supposed to increase to P385,000 per month with an add-on rate of 10 percent of the total monthly income of the tenant.

In October 2006, they signed a second lease contract modifying the terms by deleting the add-on rates and reducing the escalation rate from 10 percent to just five percent every two years.

NTFI was also permitted to sublease a portion of the property even without prior consent from Baseco.

In January 2010, NTFI sought to extend the lease term for another 10 years.

But Baseco said NTFI started defaulting on its rent payments, prompting it to send a demand letter in May 2012 asking for payment of P36.63 million covering partial arrears and accrued penalty interest. It told NTFI to leave the property.

The parties negotiated for an amicable settlement in 2018, with NTFI offering to pay P42.63 million with P10 million to be paid outright and the balance divided into 94 equal monthly amortizations.

They executed a fourth lease contract in 2021, but in August 2022, Baseco again sent a demand letter to NTFI asking for strict compliance with contractual obligations regarding payment of rental deposits, monthly add-on rates and penalty charges. I

It also required delivery of a tenement-style structure under the CSR Program provision of the lease contract and a customs-bonded warehouse, container freight station, and feed meal storage facilities under the Work Program provision.

It reminded the defendants of their additional investment for the Development Plan equivalent to the supposed P450 million loan under the Guarantee Investment Plan provision of the fourth lease contract.

The NTFI initially sought dismissal of the complaint, arguing that the Sandiganbayan lacked jurisdiction, but this was denied.

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