Former Guam-based couple Rolan and Sandy Bansil had anticipated that they would have to contend with some time-consuming red tape and other financially draining procedures when they decided to open a business in the country.

What they failed to anticipate was the welter of nerve-wracking intra-corporate imbroglio and court cases confronting them after less than a year of operations. The predicament that they fell into was enough to dissuade any well-intentioned investor from setting up business here, especially at a time when the country is beginning to feel the impact of the global financial turmoil.

With three other partners, the couple formed the Philippine Pacific Rim Corp. to engage in small-town lottery in Albay. STL is being supervised nationwide by the Philippine Charity Sweepstakes Office as the legal alternative to outlawed jueteng.

The Bansils chipped in P1.75 million of the P5-million paid-up capital and P20-million authorized capital of the company. The couple also posted the P10-million cash bond required by the PCSO, which granted the gaming outfit a franchise in January 2007 to conduct an actual test-run for the STL operation in the province.

The couple expected that it would take sometime for the PPRC to turn in profits. The company was, in fact, running a deficit by August of that year. It also had unpaid government remittances to the PCSO. But two of their partners were running out of patience. Unmindful of the Bansils? explanation that it would be highly unreasonable to expect an infant enterprise like this to become profitable after only seven months, the impatient partners demanded that they be given full management control of the firm?s day-to-day operations. Expectedly, the Bansils turned down the demand.

As if to test their mettle, the couple was left to settle by themselves a P2-million claim by bettors who hit the jackpot prize in one of the draws. This happened after the two partners, together with the company?s chief accountant, abandoned the operations. Rolan and Sandy later learned that without informing them, their two partners had sold, transferred and assigned all the stocks of the corporation ?both paid and unpaid, with a total value of P20 million?to the group of a certain David Emralino for just P5 million.

Left with no option but to pay the claims of winning bettors, they continued to manage the company with Rolan ironing out the kinks and doing liaison work with such state agencies as the Bureau of Internal Revenue and local government units. But that was not the end of their woes. They were later informed that their two partners also executed a Deed of Assignment of all the company?s 200,000 shares of stock, with a Declaration of Trust and Power of Attorney in favor of a certain Joel Descallar. Reportedly, there was no money involved this time around, with the transaction being consummated in exchange for a so-called ?valuable consideration??whatever that phrase means.

Thereafter, a lawyer of the Descallar group sent the Bansils a demand letter calling on the latter to turn over the company?s book of accounts and to allow the group to conduct a full audit of the PPRC?s finances. The latter carried a threat to subject the couple to ?appropriate criminal charges? if they refuse to comply with the group?s demands.

On Oct. 31, 2007, the Bansils received a letter from the PCSO notifying them of the election of a new set of members of the board of directors supposedly voted upon during an alleged special stockholders meeting. The said meeting was purportedly held in the principal office of the company. A week later, the Descaller group filed a case against the Bansils and the PCSO before Branch 93 of the Quezon City Regional Trial Court and asked for an injunction and temporary restraining order. Presiding Judge Ramon Hernando immediately dismissed the suit for improper venue, since the principal office of the company was not in Quezon City.

On March 3, 2007, the Descallar group filed another case against PCSO for mandamus and issuance of an injunction and TRO, this time before the sala of Judge Samuel Gaerlan of RTC Branch 92. The suit asked that the PCSO be enjoined to deal only with the Descallar group. Since they were not included as respondents, the Bansils filed a motion for intervention but this was denied by Judge Gaerlan on April 28, 2008.

The Bansils claim that unknown to them and despite Judge Hernando?s dismissal of the earlier case, Judge Gaerlan issued the injunction against the PCSO. Purportedly, the judge also ignored the PCSO?s April 21 motion for a 10-day extension to submit its comment and memorandum on the petition for injunction.

On May 12, 2008, the Bansils still filed a motion asking the court to reconsider its April 28 order denying their plea for intervention in the injunction case against the PCSO. On Oct. 10 last year, the court finally granted the motion for intervention

Meanwhile, the Bansils won the case they filed against the Descallar group before the Special Commercial Court in Branch 5 of the RTC in Legazpi City. In a decision handed down on Sept. 3, 2008, the court recognized the Bansils as the rightful owners of the company. It ordered the Descallar group ?to cease and desist from acting as the officers, directors and stockholders? of the PPRC, and ?from running, operating and managing? the firm?s small town lottery project in Albay.

Following their win at the Legazpi RTC, the couple then filed a motion with the RTC Branch 92 for the lifting of the injunction. During a hearing on Nov. 14, however, the court reportedly indicated that it may not recognize and give due course to the ruling of the special commercial court. This prompted the Bansils, through their lawyer, to file a motion for inhibition against Judge Gaerlan. Apart from the seeming unwillingness of the judge ?to give judicial credence to an order of a co-equal court,? the motion also cited Gaerlan?s supposed bias and partiality in favor of the other party. This included granting the other party?s petition to conduct oral deposition upon the Bansils.

The motion pointed out that such a deposition is prohibited under the Rules of Civil Procedures which state that ?a party shall not be deemed to make a person his own witness for any purpose by taking his deposition.? It also mentioned five different instances when the Descallar group and its counsel either did not appear and were given extensions, failed to file their comments, or were allowed to postpone hearings. Such instances occurred on March 17, April 4, Oct. 24, Nov. 14 and 18 last year.

Even if the Bansils win the case before the sala of Judge Gaerlan, it is doubtful if their troubles will be over. They will still have to contend with the sale of the company to David Emralino. And what about their two partners?are they going to file cases against the duo?

The lesson to be learned here is: Beware of smart operators, not just in jueteng or small town lottery.