Title
BF Corp. vs. Court of Appeals
Case
G.R. No. 120105
Decision Date
Mar 27, 1998
Construction dispute between BF Corp and SPI over EDSA Plaza Project; arbitration clause upheld, court proceedings suspended pending arbitration.
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Case Digest (G.R. No. 120105)

Facts:

Parties Involved

  • Petitioner: BF Corporation
  • Respondents: Court of Appeals, Shangri-La Properties, Inc. (SPI), Alfredo C. Ramos, Rufo B. Colayco, Antonio B. Olbes, Gerardo O. Lanuza, Jr., Maximo G. Licauco III, and Benjamin C. Ramos

Contractual Agreement

  • BF Corporation and Shangri-La Properties, Inc. (SPI) entered into an agreement for the construction of the EDSA Plaza Project, a shopping mall complex in Mandaluyong City.
  • The project was expanded, and a new agreement, "Agreement for the Execution of Builder’s Work for the EDSA Plaza Project," was signed on May 30, 1991, covering work from May 1, 1991, until completion.

Dispute and Claims

  • BF Corporation claimed that construction progressed as agreed until a fire on November 30, 1990, damaged Phase I of the project.
  • SPI accused BF Corporation of delays and abandoning the project, resulting in disagreements over liabilities.

Legal Proceedings

  • On July 14, 1993, BF Corporation filed a complaint for collection of outstanding payments in the Regional Trial Court (RTC) of Pasig.
  • SPI filed a motion to suspend proceedings, citing an arbitration clause in the contract.
  • BF Corporation opposed, arguing there was no formal contract with an arbitration clause.
  • The RTC denied the motion, stating that even if an arbitration clause existed, SPI was in default for not invoking arbitration within a reasonable time.
  • SPI filed a petition for certiorari with the Court of Appeals, which reversed the RTC’s decision and ordered a stay of proceedings pending arbitration.

Issue:

  1. Whether the contract between BF Corporation and SPI contained a valid arbitration clause.
  2. Whether SPI was in default for not invoking arbitration within a reasonable time.
  3. Whether the Court of Appeals erred in granting SPI’s petition for certiorari instead of requiring an ordinary appeal.

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

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