Case Summary (G.R. No. 142641)
Applicable Law
The case is governed by provisions of the 1987 Philippine Constitution as well as relevant civil law regarding contracts and specific performance.
Background of the Case
The dispute arose from a complaint filed by petitioners Edron Construction Corporation and Edmer Y. Lim against the Provincial Government of Surigao del Sur, claiming specific performance and damages due to non-payment for construction services rendered under three contracts. The petitioners alleged that despite completing the work and receiving Certificates of Final Acceptance, they were owed a total of P8,870,729.67, which they demanded after several reminders.
Respondent's Defense
In their Answer with Counterclaim, the respondent admitted the existence of the contracts but contended there was no outstanding balance owed to the petitioners. The respondent raised several defenses, including claims of defective work, the petitioners being liable for underruns, and the absence of a sworn statement from the petitioners certifying that all obligations for labor and materials had been fulfilled.
Motion to Dismiss
More than a year after filing the Answer, the respondent filed a Motion to Dismiss on the ground that the petitioners had failed to state a cause of action, specifically pointing to the lack of a sworn statement required under the construction agreements. The RTC denied this motion, allowing the case to proceed.
Trial Findings
During the trial, both sides presented evidence regarding the completion and acceptance of the works. Petitioners argued that a Presidential Flagship Committee had evaluated their claims and indicated a lower amount should be paid, which the respondent still failed to honor. Conversely, the respondent's witnesses claimed discrepancies existed due to deviations from the specifications.
RTC Decision and Rationale
The RTC ruled in favor of the petitioners, determining they were entitled to receive P4,326,174.50 based on accepted evaluations, along with interest and legal fees. The court highlighted that the respondent's acceptance of the works signified its obligations to make payment, as it had not provided adequate evidence of any defects or failures.
Appeal to the Court of Appeals
In its ruling, the CA reversed the RTC's decision, asserting that the lack of a sworn statement was a critical condition precedent for any demand for final payment. The CA held that the absence of this document invalidated the petitioners' claim.
Supreme Court's Ruling
The Supreme Court found merit in the petitioners’ arguments, primarily noting that the CA had erroneously based it
...continue readingCase Syllabus (G.R. No. 142641)
Case Overview
- The case is a petition for review on certiorari by petitioners Edron Construction Corporation and Edmer Y. Lim against the Provincial Government of Surigao Del Sur, represented by Governor Vicente T. Pimentel, Jr.
- The ruling from the Court of Appeals (CA) dated November 26, 2014, and its Resolution dated September 8, 2015, reversed the earlier decision by the Regional Trial Court (RTC) which ruled in favor of the petitioners.
- The CA dismissed the complaint for lack of cause of action, which the petitioners contested in the Supreme Court.
Factual Background
- Petitioners entered into three construction agreements with the respondent for various projects: the Learning Resource Center of Tandag, the Tandag Bus/Jeepney Terminal, and the Tandag Public Market.
- Despite completion and acceptance of the projects, evidenced by Certificates of Final Acceptance, the respondent failed to pay the total amount of P8,870,729.67, prompting the petitioners to file a complaint seeking payment and damages.
- The respondent acknowledged the contracts but claimed no balance was due, citing issues such as alleged underruns, defective works, and failure of petitioners to submit a sworn statement as required by the contracts.
RTC Ruling
- The RTC ruled in favor of th