THE Department of Public Lands on Thursday terminated its land lease contract with Rota Resort LLC, which owns Rota Resort & Country Club, and demanded that it pay $639,897.37 in lease fees with interest.
In her termination notice, acting DPL Secretary Teresita A. Santos also informed Rota Resort LLC owner Hee Kyun Cho that the department will enter the premises and take possession of all buildings, fixtures and improvements and evict the lessee without liability of trespass.
The Rota Resort, which operates a hotel and an 18-hole golf course, is in violation of several provisions of the land lease contract, Santos said.
These violations include failing to make timely quarterly payments; failing to build, construct and fully equip and furnish a minimum of 200 hotel rooms; and failing to maintain the buildings and surrounding premises in a neat, sanitary and attractive condition.
Santos told Cho that based on DPL records, Rota Resort owes DPL $639,897.37 in lease and interest for the period of July 1, 2020 to Feb. 28, 2023.
She noted that Rota Resort invoked a “force majeure” clause in the land lease contract due to the economic impact of the Covid-19 pandemic.
But she said the clause only applies to the commencement or completion of the original construction, repairs or reconstruction, and does not excuse performance entirely.
In addition, Santos said, the land lease contract requires Rota Resort to notify DPL in writing, 30 days after the occurrence of any such events.
She said Rota Resort did not notify DPL of its intent to seek relief until Rota Resort’s attorney sent DPL a letter claiming force majeure.
“While DPL understands the hardships that the pandemic has caused not only within the CNMI but worldwide as a whole, DPL is bound by its fiduciary duty to collect payments on public land leases on behalf of the persons of NMI descent,” Santos said.
She added that DPL is also aware that Rota Resort subleased a portion of the hotel resort premises to Docomo Pacific.
She said Rota Resort did not obtain DPL’s consent to enter into a sublease contract with Docomo, so she is also ordering Rota Resort to require Docomo to remove its equipment from the premises.
Last month, Senate Vice President Donald M. Manglona said Rota Resort had not been operating since last year and all its assets, including furniture, had been “liquidated” without the knowledge of the CNMI government.
He said it was only in early February when DPL found out that the hotel was “empty.”
