Case Digest (G.R. No. 212670) Core Legal Reasoning Model
Facts:
This case involves a construction dispute between petitioner DATEM Incorporated and respondents Alphaland Makati Place, Inc. and Alphaland Southgate Tower, Inc. concerning the construction of Towers 1, 2, and 3 of Alphaland Makati Place, a large condominium project located in Makati City. In May 2014, Alphaland and DATEM entered into a construction agreement with a total contract price of Php1,260,000,000. During the execution of the project, DATEM submitted progress billings and change orders, some of which remained unpaid, amounting to Php34,076,747.09. Additionally, retention money totaling Php121,930,996.35 was withheld by Alphaland despite DATEM's claim that they completed the project as of 30 September 2015 after deductions made by Alphaland, especially for unresolved design issues involving Tower 3. DATEM sent a letter terminating balance construction works on Tower 3 due to Alphaland's delays and subsequently demanded payment for unpaid claims, including extende
Case Digest (G.R. No. 212670) Expanded Legal Reasoning Model
Facts:
- Parties and Subject Matter
- Petitioner DATEM Incorporated (DATEM) and respondents Alphaland Makati Place, Inc. and Alphaland Southgate Tower, Inc. (collectively, Alphaland) were parties to a construction agreement covering the construction of Towers 1, 2, and 3 of Alphaland Makati Place, a mixed-use condominium project located in Makati City.
- The project included a 6-level podium with a 5-level basement and three towers to be constructed atop the podium, along with extensive landscaping and water features.
- The total contract price was Php1,260,000,000.00 for civil, structural, and architectural works.
- Claims, Payments, and Dispute
- DATEM submitted progress billings for Main Contract Works and Change Orders; Alphaland paid Php1,167,442,794.02 and Php230,201,525.49 respectively.
- An unpaid amount of Php34,076,747.09 remained, consisting of unpaid progress billings, change orders (some unreconciled), labor escalation claims, and additional work such as exterior walls and vertical fins.
- Completion was delayed due to causes allegedly not attributable to DATEM, who requested nine (9) time extensions; Alphaland granted six (6) extensions and evaluation on the remaining three was pending when the construction manager was terminated and no replacement appointed.
- On 06 September 2015, DATEM completed Towers 1 and 2, accepted by Alphaland, which secured occupancy certificates for these towers. However, unresolved design issues delayed Tower 3. Alphaland deducted Php72,396,659.29 for balance of Tower 3 works.
- DATEM claimed full project completion by 30 September 2015 and demanded payment of withheld retention money totaling Php121,930,996.35 for Original Works and Change Orders.
- Termination and Litigation
- On 27 January 2017, DATEM notified Alphaland of termination of remaining works on Tower 3 due to Alphaland’s inaction on design issues, demanding payment for unpaid billings, retention money, and extended preliminaries amounting to over Php309 million in various claims.
- Alphaland refused payment, prompting DATEM to file a complaint with the Construction Industry Arbitration Commission (CIAC) based on an arbitration clause in their construction agreement.
- Alphaland moved to dismiss before the CIAC, challenging jurisdiction due to alleged failure by DATEM to comply with a precondition (holding a meeting for amicable settlement) before arbitration. The CIAC denied the motion and a subsequent motion for reconsideration.
- Alphaland petitioned the Court of Appeals (CA) for certiorari to annul the CIAC’s ruling (CA-G.R. SP No. 152827).
- Pending CA resolution, the CIAC rendered a Final Award on 05 April 2018 in favor of DATEM, ordering Alphaland to pay Php235,901,940.49 for releases of retention money, progress billings, extended preliminaries, interest, attorney’s fees, and costs.
- Alphaland filed another CA petition (CA-G.R. SP No. 155448) assailing the Final Award; this was consolidated with the previous petition.
- On 25 October 2018, the CA annulled the CIAC’s Final Award, ruling the CIAC lacked jurisdiction due to DATEM’s non-compliance with the amicable settlement meeting as a condition precedent before arbitration and dismissed the case.
- DATEM filed a petition for review on certiorari before the Supreme Court.
Issues:
- Whether the Court of Appeals erred in ruling that the Construction Industry Arbitration Commission lacked jurisdiction over the arbitration case on account of non-compliance with a condition precedent under the arbitration clause of the construction agreement.
- Whether non-compliance with the pre-arbitration amicable settlement meeting ousts the CIAC of jurisdiction under Executive Order No. 1008.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)