G.R. NO. 157480 - PRYCE CORPORATION (FORMERLY PRYCE PROPERTIES CORPORATION), VS. PHILIPPINE AMUSEMENT AND GAMING CORPORATION.

Ruling

WHEREFORE, in view of the foregoing, judgment is hereby rendered as follows: (1) In Civil Case No. 93-68266, the appealed decision[,] is AFFIRMED with MODIFICATION[,] ordering [Respondent] Philippine Amusement and Gaming Corporation to pay [Petitioner] Pryce Properties Corporation the total amount of P687,289.50 as actual damages representing the accrued rentals for the quarter September to November 1993 with interest and penalty at the rate of two percent (2%) per month from date of filing of the complaint until the amount shall have been fully paid, and the sum of P50,000.00 as attorney's fees; (2) In Civil Case No. 93-68337, the appealed decision is REVERSED and SET ASIDE and a new judgment is rendered ordering [Petitioner] Pryce Properties Corporation to reimburse [Respondent] Philippine Amusement and Gaming Corporation the amount of P687,289.50 representing the advanced rental deposits, which amount may be compensated by [Petitioner] Pryce Properties Corporation with its award in Civil Case No. 93-68266 in the equal amount of P687,289.50." [4] The Facts According to the CA, the facts are as follows: "Sometime in the first half of 1992, representatives from Pryce Properties Corporation (PPC for brevity) made representations with the Philippine Amusement and Gaming Corporation (PAGCOR) on the possibility of setting up a casino in Pryce Plaza Hotel in Cagayan de Oro City. [A] series of negotiations followed. PAGCOR representatives went to Cagayan de Oro City to determine the pulse of the people whether the presence of a casino would be welcomed by the residents. Some local government officials showed keen interest in the casino operation and expressed the view that possible problems were surmountable. Their negotiations culminated with PPC's counter-letter proposal dated October 14, 1992. "On November 11, 1992, the parties executed a Contract of Lease x x x involving the ballroom of the Hotel for a period of three (3) years starting December 1, 1992 and until November 30, 1995. On November 13, 1992, they executed an addendum to the contract x x x which included a lease of an additional 1000 square meters of the hotel grounds as living quarters and playground of the casino personnel. PAGCOR advertised the start of their casino operations on December 18, 1992. "Way back in 1990, the Sangguniang Panlungsod of Cagayan de Oro City passed Resolution No. 2295 x x x dated November 19, 1990 declaring as a matter of policy to prohibit and/or not to allow the establishment of a gambling casino in Cagayan de Oro City. Resolution No. 2673 x x x dated October 19, 1992 (or a month before the contract of lease was executed) was subsequently passed reiterating with vigor and vehemence the policy of the City under Resolution No. 2295, series of 1990, banning casinos in Cagayan de Oro City. On December 7, 1992, the Sangguniang Panlungsod of Cagayan de Oro City enacted Ordinance No. 3353 x x x prohibiting the issuance of business permits and canceling existing bus