Prosecutors Push to Establish Corporate Links in Alleged Ghost Flood Control Project Case
In a significant development in the ongoing legal proceedings, prosecutors on Friday, February 27, 2026, sought to establish corporate connections among three firms allegedly associated with contractor Sarah Discaya. The pretrial hearing took place before the Regional Trial Court (RTC) Branch 27 in Lapu-Lapu City, focusing on an alleged non-existent flood control revetment project valued at P96.5 million in Culaman, Jose Abad Santos, Davao Occidental.
Charges and Defendants
The case involves serious allegations of malversation of public funds and violations of Republic Act 3019, known as the Anti-Graft and Corrupt Practices Act. Discaya, along with nine co-accused who are officials from the Department of Public Works and Highways (DPWH), faces these charges. The pretrial hearing, which lasted three hours, is a crucial step to organize the case, clarify issues, and streamline the upcoming trial process.
Prosecution's Corporate Link Claims
During the hearing, prosecutors presented evidence based on filings with the Securities and Exchange Commission (SEC). They proposed that St. Gerard Construction, Alpha and Omega General Contractor & Development Corp., and St. Timothy Construction share significant corporate overlaps. According to the prosecution, these firms have the same Pasig City address, common email addresses, identical contact numbers, and the same contact persons as listed in their general information sheets and annual financial statements.
Prosecutors further alleged that Sarah Discaya and her husband, Pacifico "Curlee" Discaya II, were major stockholders in all three corporations at the time of their incorporation. The defense did not dispute the couple's stockholder status but requested the prosecution to specify the relevant years for clarity.
Defense's Counterarguments
The defense team strongly denied any interrelation among the three firms and their connection to Discaya. In separate admissions, they acknowledged that St. Timothy was the lowest bidder for the revetment project, while Alpha and Omega ranked second. However, they emphasized that the core issue of the case is whether the Culaman revetment project actually exists, not just corporate links.
Defense lawyer Paul Tristan Sato, representing seven DPWH district officials, stated that the defense intends to seek an ocular inspection "in due time" to verify the project's existence. A previous motion for such an inspection had been denied as premature. Joseph Randi Torregosa, legal counsel for accused Rodrigo Larete, officer-in-charge of the DPWH Davao Occidental District Engineering Office, added that his client was not aware of any cement strength tests and questioned their relevance.
Technical Disputes and Evidence Challenges
Beyond corporate links, prosecutors proposed technical stipulations, including one stating that cement requires 28 days to fully harden. Sato noted that this proposal came from the prosecution and that he needed to confirm it with his clients as directed by the court.
Defense lawyers also opposed a prosecution proposal to use Google Earth or satellite imagery to verify the project's existence, citing concerns over inconsistent coordinates. Sato pointed out that at least three sets of coordinates appear in various sources, such as the Sumbong ng Pangulo website, the DPWH website, and official DPWH documents. He referenced a Senate inquiry where DPWH officials admitted that some recorded coordinates were incorrect, leading to projects being flagged as ghost projects.
The court ruled that only marked exhibits may be considered at this stage of pretrial, limiting the scope of evidence.
Outcome of the Hearing
Sato revealed that prosecutors presented over 70 proposed stipulations, many of which the defense denied due to lack of access to supporting documents or insufficient time for review. He confirmed that the 90-day preventive suspension imposed on the public official-accused is mandated under RA 3019.
Torregosa indicated that hearings on petitions for bail will be scheduled after the pretrial is completed. The defense requested 10 days from receipt of documents to finalize its pretrial order after consulting clients, a request granted by the court.
RTC Branch 27 Judge Nelson Leyco set the resumption of the pretrial hearing for March 10 at 1:30 p.m., marking the next step in this high-profile corruption case.
