A listed Taiwanese company that leased an Airbus helicopter in 2016 to a local company, led by businessman Christopher Pastrana that allegedly defaulted, vowed to pursue legal challenges all the way to the Supreme Court.
The Chailease Group, with a market capitalization of $11 billion and assets of over $21 billion, said it has “overwhelming documentary evidence” to prove CAPP Industries Inc. of Pastrana was not the owner of the subject helicopter, but was instead a lessee.
Pastrana, who also heads JAM Liner, Philtranco Service Enterprises and FastCat operator Archipelago Philippines Ferries Corp., secured an early victory against Chailease when the Pasay City Prosecutor’s Office issued a resolution late last year saying CAPP was the owner of the helicopter.
The prosecutor also filed a case of qualified theft against the officials of Chailease based in Manila.
Chailease said in a statement the prosecutor based its finding partly on an unsigned bill of sales. It said the helicopter was subject to a lease agreement signed at the Alabang office of Pastrana in the presence of his lawyers. It also said that Singapore or New York should be the venue in resolving any dispute between the parties.
Chailease said it declared Pastrana in default on Oct. 21, 202, terminated the contract, took back the unit and got a re-export permit from the Civil Aviation Authority of the Philippines, which listed Chailease as the owner.
Chailease said aside from fighting in the local court, it was planning to bring the case to arbitration in New York as required in the agreement.
Jose Bernas, legal counsel of Chailease, said the findings by the prosecutor’s office were “without basis” as “we have all the documents that would show Chailease as the owner, that it was a financial lease, that we notified Mr. Pastrana of his several failures to pay rent on time, and informed him that we had to cover for his failure to pay the insurance premiums since the unit must be insured at all times, among other default events”.
Bernas said Pastrana had the option to buy the unit at the end of the contract or at any time a payment is due by paying a residual value of $1.2 million which was provided for in the lease contract.
“As in a car loan where you are the buyer and owner only after full payment, just as an example to follow his thinking, if you fail to pay the periodic dues, the unit will be taken away,” Bernas said.
Bernas said a financial lease is no different from leasing a car or heavy equipment, with the lessor buying the equipment and leasing it to the lessee who is freed from shelling out a substantial amount upfront. The lessee has to pay an initial amount as equity, which in this case was $700,000.
He said Chailease bought the helicopter for $3.7 million and extended to CAPP a lease facility of $3 million. Pastrana offered as guarantor his other corporations such as JAM Liner, Philtranco Service Enterprises and Archipelago Philippines Ferries Corp.
Bernas said Pastrana, in August 2016, or two months before the lease agreement was signed, emailed Chailease asking for a copy of the draft lease agreement, adding that the “contents…is (sic) very important to us to understand our obligation and the terms and conditions required…”