QuestionsQuestions (PRESIDENTIAL DECREE NO. 1870)
To authorize the Government to take over by administration or to award to another qualified contractor the whole or portion of delayed infrastructure projects, thereby expediting completion within contract schedules and protecting public interest.
It addresses pernicious acts of contractors who, after securing government contracts through representations, later cause delays, refuse to continue, or otherwise fail to comply—prejudicing the Government’s finances and the public interest.
Whenever a contractor is behind schedule and incurs 15% or more negative slippage based on its approved PERT/CPM.
It means the contractor’s progress is behind the planned schedule to the extent that measurable schedule deviation reaches at least 15% negative slippage using the project’s approved PERT/CPM.
At the discretion of the Minister concerned (as worded in the decree). In modern application, this would be the head/competent authority of the implementing agency under current government structure.
The Minister concerned/Head of Implementing Agency must notify and direct the contractor to immediately undertake the specific work activity.
The contractor has 15 days from receipt of notice to start the work activity and show satisfactory performance; if it fails, the Government may take over the whole or portion and may complete it by administration or award it to another qualified contractor via negotiated contract.
If the contractor fails/refuses/neglects to supply required tools, materials, equipment, facilities, and labor/workmen; or sublets/assigns the contract or any part without prior written consent; or wilfully violates any terms/conditions/covenants/agreements or technical requirements.
The Government shall have the option to take over the project in whole or in part and complete it by administration or award it to another qualified contractor through negotiated contract at the current valuation price.
The cost of the work done shall be deducted from the contract price.
The contractor shall pay the difference.
It covers not only schedule delays (including measurable slippage) but also refusal/neglect to supply required resources, unauthorized subletting/assignment, and willful violation of contract/technical requirements.
A negotiated contract at the current valuation price.
It emphasizes that essential attributes of sovereign power are read into contracts and frames the remedy as a valid and reasonable exercise of police power to protect the public interest.
It references Section 11 of Presidential Decree No. 1594, and states that Section II of PD 1594 should be read into government infrastructure contracts as a valid and reasonable exercise of police power.
Immediately, as expressly stated in the decree.