Case Digest (G.R. No. 195552)
Facts:
ACS Development & Property Managers, Inc. v. Montaire Realty and Development Corporation, G.R. No. 195552, April 18, 2016, Supreme Court Third Division, Reyes, J., writing for the Court.ADPROM (petitioner/contractor) and MARDC (respondent/owner) entered into a Construction Agreement dated April 25, 1996 for the construction of 17 Villa Fresca townhome units for P39,500,000.00; the parties later amended the contract to reduce the project to 11 units and the contract price to P25,500,000.00. Under the agreement, Angel Lazaro & Associates (ALA) served as construction manager, and payments to ADPROM were to be made on the basis of monthly progress billings “as approved by ALA,” with a 10% retention.
ADPROM commenced work on May 2, 1996. MARDC paid Progress Billings Nos. 1–8 (total P23,169,183.43). In Progress Billing No. 9 (February 1997) ADPROM claimed P1,495,345.24 but ALA approved only P94,460.28 after disputing certain items; ADPROM refused reductions and, by letter of March 14, 1997, insisted on MARDC’s acceptance of its accomplishments and threatened to stop work. When Progress Billing No. 9 remained unpaid, ADPROM stopped work beginning March 18, 1997; MARDC served a notice of default on March 20, 1997. Despite ADPROM’s subsequent consolidated billings and meetings, ALA continued to withhold full approval and recommended reduced payments.
On June 5, 1997 MARDC terminated the Construction Agreement and claimed overpayments of P11,188,539.69 based on ALA’s finding that only 54.67% (and an independent TCGI Engineers’ finding of 46.98%) of the work had been accomplished. ADPROM filed a claim before the Construction Industry Arbitration Commission (CIAC Case No. 32‑97) for unpaid billings; MARDC counterclaimed.
On August 17, 1998 the CIAC awarded ADPROM P4,384,987.03 (including unpaid billings P1,468,348.60, refund of 10% retention P2,806,814.00, and interest on billings computed at 6% per annum) and charged MARDC nothing on its overpayment/liquidated damages claims. MARDC filed a petition for review with the Court of Appeals. On March 28, 2000 the Court of Appeals (Asuncion, J., penned) modified the CIAC award by deleting the interest on unpaid billings and holding ADPROM liable for liquidated damages of P39,500.00 per calendar day from March 20, 1997 until September 1, 1997 (when MARDC engaged another contractor). Motions for reco...(Subscriber-Only)
Issues:
- Was ADPROM’s petition in the Supreme Court properly brought under Rule 65, or was Rule 45 the proper remedy?
- Did the Court of Appeals err in deleting the CIAC’s award of interest on unpaid billings?
- Did the Court of Appeals err in holding ADPROM liable for liquidated damages for its work stoppage?
- What interest rate should apply to the monetary awards f...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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