Case Summary (G.R. No. 147925-26)
Applicable Law and Administrative Context
The Construction Industry Arbitration Commission (CIAC) and the applicable provisions of the 1987 Philippine Constitution govern the proceedings and the adjudication of disputes arising from the agreement. The case involves claims related to delays in contract performance and demands for additional costs incurred by Uy due to actions attributed to PEA.
Background of the Agreement and Performance Issues
On November 20, 1996, Uy entered into a Landscaping and Construction Agreement with PEA for a total price of P355,080,141.15, requiring completion within 450 days. The application of this timeline was hindered due to delays in the turnover of work areas by PEA, primarily because horizontal works by a different contractor, Makati Development Corporation (MDC), were ongoing. Consequently, Uy commenced work on January 7, 1997, and experienced further delays, leading to an extension of the contract period to 693 days.
Claims for Additional Costs
Due to the delays, Uy sought additional compensation amounting to P181,338,056.30, representing costs for idle equipment, labor, and additional topsoil procurement. The PEA Project Management Office (PEA-PMO) evaluated the claims and arrived at a lesser amount of P146,484,910, which led to disputes regarding obligations and liabilities.
CIAC Decision and Subsequent Appeals
The CIAC eventually ruled in favor of Uy, awarding him amounts for idle equipment and labor and for constructing a nursery shade net area. PEA contested the decision but failed to adhere to procedural rules, while Uy filed a motion for correction of computation that went unresolved, leading to further appeals to the Court of Appeals. The Court found PEA’s challenges lacked merit, maintaining that the CIAC's award was justified based on the presented evidence.
Grounds for Dismissal by the Court of Appeals
The Court of Appeals dismissed Uy’s petition on the grounds of being belatedly filed and upheld the CIAC's decision. Additionally, the court found insufficient justification to reverse the CIAC ruling based on contract provisions, available evidence, and relevant legal principles.
Injunctive Relief and Concurrent Claims
PEA’s plea for injunction against Uy’s new claims in CIAC Case No. 03-2001 was granted by the Court of Appeals, emphasizing the principle of litis pendentia given the overlap of issues between the cases. This was deemed necessary to prevent the inefficiencies associated with concurrent proceedings addressing the same contractual disputes.
Findings on Procedural Issues and Claim Validity
Examining procedural matters, the Supreme Court acknowledged that Uy’s appeal had been timely filed as the running of the appeal period was interrupted by his motion for correction. On substantive grounds, the Court rejected Uy’s claims for costs related to topsoil and water truck mobilization, citing the lack of required prior written approvals as stipulated in the contract. The Court concluded that Uy acted inappropriately by accruing additional costs without ensuri
...continue readingCase Syllabus (G.R. No. 147925-26)
Case Background
- Petitioner Elpidio S. Uy, operating as Edison Development & Construction (EDC), filed a petition for certiorari against the Public Estates Authority (PEA) and the Court of Appeals (CA) regarding a dispute over a landscaping contract.
- The CA's decisions dated September 25, 2000, and April 25, 2001, were contested, which arose from consolidated cases CA-G.R. SP Nos. 59308 and 59849.
- PEA was designated by the Bases Conversion Development Authority (BCDA) to manage the development of Heritage Park in Fort Bonifacio, Taguig City.
- EDC was contracted for landscaping work valued at P355,080,141.15, with a completion timeline of 450 days.
Contractual Delays and Claims
- EDC received the notice to proceed on December 3, 1996, but commenced work on January 7, 1997, due to PEA's delays in providing work areas.
- The original contract period was extended to 693 days because PEA continually failed to deliver work areas in a timely manner.
- EDC claimed additional costs totaling P181,338,056.30 due to these delays, citing expenses for standby equipment, idle manpower, and additional topsoil sourcing.
- PEA's Project Management Office evaluated EDC's claims and determined a lesser amount of P146,484,910, which was submitted for approval to the Heritage Park Executive Committee.
Termination of Contract
- On November 12, 1999, a Performance Audit Committee determined EDC's work was 20% behind schedule and recommended termination, which PEA executed on November 29, 1999.
- PEA paid EDC progress billings up to August 26, 1999, but did not recognize EDC