Case Summary (G.R. No. 163915)
Background of the Case
ASIAKONSTRUCT awarded two contracts to COMFAC for the provision of construction services, specifically a raised flooring system and an air-conditioning and ventilation system, with total combined costs amounting to approximately P5,698,635. COMFAC completed the projects and issued Certificates of Completion, which ASIAKONSTRUCT acknowledged. However, after a series of demands for the unpaid balance of P1,969,863.50 went unheeded, COMFAC initiated a collection lawsuit against ASIAKONSTRUCT in the Regional Trial Court of Makati City, claiming not only the unpaid amount but also attorney's fees and exemplary damages.
Trial Court Proceedings
The trial court ruled in favor of COMFAC after ASIAKONSTRUCT failed to present its evidence due to its counsel's absence at the hearings. The trial court awarded the claimed amount to COMFAC along with interest, penalties, and attorney's fees. ASIAKONSTRUCT subsequently appealed the decision, asserting several errors related to the authentication of evidence, completion of project claims, and the justifications for fees awarded.
Court of Appeals Decision
The Court of Appeals upheld the trial court’s decision with some modifications, affirming the admissibility of evidence, including the invoices provided by COMFAC, as well as the validity of the Certificates of Completion. The appellate court reduced the interest rate from 14% to 6% and adjusted the calculation of the amount owed to account for a 1% withholding tax, which ASIAKONSTRUCT was required to deduct.
Legal Issues on Appeal
ASIAKONSTRUCT raised several legal questions on appeal, primarily concerning the proper authentication of invoices, whether COMFAC proved the project completion, entitlement to attorney’s fees, and the appropriate basis for calculating legal interest. The court found that the failure to challenge evidence at the trial effectively rendered it admissible, thereby binding ASIAKONSTRUCT to the court’s findings.
Authentication of Evidence
ASIAKONSTRUCT's arguments regarding improper authentication of the invoices were dismissed because its counsel failed to object during the trial stage. The principle of timely objection applies, meaning the admissibility of evidence stands if no challenge is raised at the appropriate time. The appellate court affirmed the trial court’s findings as these were consistent and supported by testimonies confirming the project's completion.
Award of Attorney's Fees
In respect to attorney's fees, the court acknowledged ASIAKONSTRUCT's stance that such fees should not be granted without substantial proof of bad faith or improper conduct by the party resisting payment. Since COMFAC could not sufficiently demonstrate ASIAKONSTRUCT’s bad faith, the court decided to delete the award of attorney’s fees in favor of COMFAC.
Computation of Legal Interest
ASIAKON
...continue readingCase Syllabus (G.R. No. 163915)
Case Background
- The case revolves around a petition for review filed by Asian Construction and Development Corporation (ASIAKONSTRUCT) against COMFAC Corporation.
- The petition assails the Decision dated March 12, 2003, and the Resolution dated June 2, 2004, of the Court of Appeals in CA-G.R. CV No. 69123.
- The dispute originated from a contract awarded by ASIAKONSTRUCT to COMFAC for the installation of a raised flooring system and an air conditioning and ventilation system at two different sites, with contract amounts totaling P5,698,635.
Factual Antecedents
- On November 28, 1996, COMFAC completed the project and issued Certificates of Completion, confirmed by Rene T. Soriao, Group Manager of ASIAKONSTRUCT.
- In May 1998, COMFAC sent demand letters to ASIAKONSTRUCT for an unpaid balance of P1,969,863.50, which ASIAKONSTRUCT failed to settle.
- Consequently, COMFAC filed a complaint for collection in the Regional Trial Court of Makati City, seeking not only the unpaid amount but also attorney's fees amounting to 20% of the claim, P2,000 per appearance, and exemplary damages of P500,000.
Trial Court Proceedings
- ASIAKONSTRUCT raised several defenses, claiming that the Certificates of Completion were unauthorized, the projects were incomplete, the claims were bloated, and that no proper demand for payment was made.
- The trial court, in an order dated November 23, 1999, deemed ASIAKONSTRUCT to have waived its right to present evidence due to the absence of its counsel.
- A judgment was rendered in favor of COMFAC, ordering ASIAKONSTRUCT to pay the claimed amount along with interest and attorney's fees.
Court of Appeals Decision
- ASIAKONSTRUCT appealed the trial court's decision on various grounds, including improper authentication of invoice