Republic of the
SUPREME COURT
SECOND DIVISION
HANJIN HEAVY INDUSTRIES AND G.R. Nos. 169408 & 170144
CONSTRUCTION CO., LTD.,
Petitioner,
Present:
- versus - QUISUMBING, J., Chairperson,
CARPIO
MORALES,
TINGA,
DYNAMIC PLANNERS AND VELASCO,
JR., and
CONSTRUCTION CORP., BRION,
JJ.
Respondent.
Promulgated:
April 30,
2008
x-----------------------------------------------------------------------------------------x
D E C I S I
O N
VELASCO, JR., J.:
Central to the dispute between
petitioner Hanjin Heavy Industries and Construction Co., Ltd. (Hanjin), as contractor,
and respondent Dynamic Planners and Construction Corporation (Dynamic), as subcontractor,
is the Davao International Airport Project (Project). Hanjin seeks a reversal
of the decision rendered by the Construction Industry Arbitration Commission
(CIAC), as affirmed with modifications by the Court of Appeals (CA).
It is Hanjin’s basic posture that Dynamic was
in delay in the prosecution of, and eventually abandoned, the Project,
prompting Hanjin to complete the same. Hanjin thus claims that Dynamic should
not be entitled to the retention money and should instead be held liable for damages.
Dynamic denies having abandoned the
Project, then nearing completion, some time in December 2002, but admits
suspending work thereon on account of Hanjin’s act of withholding the release
of the down payment and the payment of its progress billing. Dynamic claims
being entitled to the release of its retention money, to partial payment in
foreign currency, and to payment for escalation costs.
The parties question certain items covered
by the award, the corresponding amount due for each item, and the computations adopted
first by the CIAC and then by the CA in arriving at a final award.
The Case
The
instant Petitions for Review on Certiorari, both filed under Rule 45, arose
from CIAC Case No. 07-2004 entitled Dynamic
Planners & Construction Corporation v. Hanjin Heavy Industries &
Construction Co., Ltd., a request for arbitration initiated by Dynamic before
the CIAC. On
On
Earlier,
in CA-G.R. SP No. 86633, the CA issued a Decision dated
The Facts
The facts, as found by the CIAC and
the CA, are as follows:
On
On
As drawn, the subcontract was a unit
price, as distinguished from a lump sum, agreement. As such, the quantities specified therein and
upon which the subcontract price was determined were provisional. Accordingly,
after re-measuring and after determining actual quantities required for the
works on the basis of changes in the specifications, the estimated quantities
were substantially reduced. The
reduction resulted in an adjustment of the subcontract price to PhP 714,868,129.[9]
As of January 2000, Dynamic already
mobilized its equipment and manpower, albeit it has yet to receive a Notice to
Proceed from Hanjin. This advance accommodating arrangement was made so that
the mobilization would coincide with the Notice to Proceed that the DOTC issued
to Hanjin. By March 2000, when it received a Notice to Proceed from Hanjin, Dynamic
had already spent a tidy sum for mobilization purposes.
In a clear breach of the subcontract agreement
which obligated Hanjin to give Dynamic an advance/down payment within 20 days
from contract execution,[10]
Hanjin paid Dynamic the stipulated down payment in 10 installments spread over
a six-month period. Payments for Dynamic’s progress billings likewise came late
and also effected in installments, when the subcontract called for progress
billing payment within seven working days from the payment by the client (DOTC)
to the contractor (Hanjin).[11]
It may be stated at this stage that shortly
after the subcontract signing, Dynamic secured a US dollar denominated loan
from GRB Capital, Inc. (GRB) of
Prior to the start of the construction
works, Dynamic engaged the services of Gregorio E. Origenes, a structural
engineer with 38-years experience behind him, to check on the designs of the
Project. After examining the plans and specifications for the Project, Origenes
found that “[t]he depth of the girder was undersigned [sic] considering the
length of the beam and considering further that no post tensioning cables were
provided; and [t]he framing system of the beams and girders was poorly
designed.”[12]
Dynamic called Hanjin’s attention to
such design deficiency. But upon the prodding of Hanjin which relied on a
contrary assessment of the Davao Airport Consultants (DAC), Dynamic nonetheless
proceeded with the construction as designed. The flawed design would later,
however, manifest themselves by cracks appearing in the beams to the second
floor slab in the
To address the adverted design
defect, Dynamic recommended post-tensioning. However, Hanjin balked at this recommendation.
Eventually, Hanjin and the DAC approved the use of carbon fiber as
post-tensioning material of the structures to be used by a new subcontractor,
the Composite Technology Corporation.[14]
On
As of April 2002, 89% of the Project had been finished. Hanjin would, however, inform
Dynamic that no progress billing payment would be forthcoming after April 2002.
As of that time, a total of 20 progress
billings were submitted to Hanjin in the total amount of PhP 582,103,359.35, 10% of which, or over PhP 58.2 million, was
retained by Hanjin.[17] By December 2002, when project works had
reached a 94% completion level, Hanjin took over the Project for the reason of alleged
abandonment.[18] Dynamic was thus impelled to demand payment
from Hanjin for work done on the Project, which then went unheeded.
Such was the state of things when
Dynamic submitted its claim against Hanjin for arbitration to the CIAC. In its
Answer, Hanjin made counterclaims, such as costs of takeover, contractual
negative balance, and damages.
At the CIAC, the parties entered into
a Terms of Reference whereby the issues they raised were embodied, viz:
1.
Is
Claimant [Dynamic] entitled to the release of its retention amounting to
P58,210,336.00 when DOTC released to the Respondent [Hanjin] the retained
amount of P89,492,594.56?
2.
Is
Claimant entitled to its claim for payment of escalation cost and/or price
adjustment amounting to P60,000,000.00?
3.
Is
Claimant entitled to its claim for payment of a foreign currency adjustment in
the amount of P160,688,069.00?
4.
Is
Claimant entitled to its claim for payment of its work accomplishments valued
at P27,790,675.00?
5.
Whether
or not Claimant is entitled to claim payment at 40% mark-up of the following
variation orders: (1) Variation Order amounting to P219,171,878.00 x 40% =
P87,668,722.00; (2) Variation Order amounting to P60,923,533.00 x 40% =
P24,369,413.20?
6.
Is
Claimant entitled to its claim for payment for the installation of three
systems of arrival carousel in the amount of P34,297,691.91?
7.
x x x x
8.
Is
Claimant entitled to its claim for payment for interest computed at the rate of
12% per annum in the amount of P51,288,786.36?
9.
Was respondent
guilty of bad faith and deceit in its dealings with the Claimant when (a) it
released the down payment in installments; x x x (c) it delayed payment of
progress billings; (d) it refused to release to the Claimant 35% of the foreign
currency portion of its contract with DOTC; x x x (f) it overpriced the
materials it purchased for the Claimant under the Supplementary Agreement
between the parties, and claimed reimbursement for materials for which it
failed to produce supporting receipts and also claimed reimbursement for
transporting materials from abroad using unreasonable and unacceptable method
of transporting materials?
10.
Were
there deductions from the work accomplishments of Claimant, which were
unauthorized and undue? Did the Claimant abandon the works? If it did, is the
Claimant liable to Respondent for additional expenses it incurred in completing
the work in the aggregate amount of P107,459,925.51?
11. Is Claimant liable for the claim x x x, for the cost of the supplies, materials and equipment, inclusive of taxes and customs duties, supplied by the Respondent x x x for the performance of the Subcontracted Works? If so, how much of this claim is Respondent entitled to x x x ?
12.
Was the
Claimant (i) mismanaged, (ii) lacking in capacity to perform the Subcontracted
Works, (iii) lacking in technical Know-how x x x (iv) lacking in expert engineers
and qualified manpower x x x (v) financially incapable of accomplishing the
Subcontracted Works x x x ?
13.
Did
Claimant discover the deficiency in the structural design of the buildings to
be constructed by it, namely: (i) the
14.
Is the
Claimant liable for the claims of Respondent, described generally as
“Contractual Negative Balance” x x x ?
15.
Is
Claimant liable to Respondent for delay x x x ?
16.
Is the
Claimant liable to the Respondent for x x x moral damages x x x and attorney’s
fees x x x ?
17.
Is
Claimant entitled to its claim for payment of attorney’s fees in the amount of
P25,554,857.55?[19]
The following is a summary of the
parties’ claims and counterclaims submitted before the CIAC:
[DYNAMIC’S CLAIMS:]
Retention Money P 58,210,336.00
Escalation Cost/Price Adjustment 60,000,000.00
Foreign Currency Adjustment 160,688,069.00
Work Accomplishments 27,790,675.00
Variation Orders 153,119,284.73
Interest for Late Payments 51,288,786.36
Attorney’s Fees 25,554,857.55
P 536,652,008.64
[HANJIN’S COUNTERCLAIMS:]
Contractual
Negative Balance P
121,273,314.00
Increase Manpower 81,486,997.00
Equipment 635,500.00
Electrical Consumption 419,939.16
Miscellaneous Materials 481,734.81
Liquidated Damages 12,600,000.00
Expenses for Preparation of Final
Drawing 11,705,354.12
Miscellaneous Expenses of
Claimant’s Subcontractors 130,500.00
Moral Damages
1,000,000.00
Exemplary Damages 1,000,000.00
Attorney’s Fees 2,000,000.00
P 232,733,339.51[20]
Thereafter,
the CIAC issued a Final Award awarding the following amounts for the items as
indicated:
The total credits to
Dynamic are:
Adjusted Subcontract Price P 1,028,932,282.36
Share in Profit in VOs 9,295,667.94
Materials Over-purchased 54,847,739.30
TOTAL P 1,093,075,739.30
The total deductions
are:
Payment, Progress
Net Cost to Complete 368,578,828.92
Repayment Un-recouped
Advance
Payment 16,398,419.74
TOTAL P 967,080,608.01
x x x x
BALANCE P 125,995,131.29[21]
Following the denial of Dynamic’s Motion to Correct Award
per the CIAC’s Order of September 24, 2004,[22] both
parties appealed to the CA.
The Rulings of the Court of Appeals
In CA-G.R. SP No. 86633, the CA rendered the first appealed
Decision dated January 28, 2005, veritably affirming the factual findings of the
CIAC, but nonetheless modified the latter’s ruling insofar only as the award of
attorney’s fees, rate of interest imposable, and liability for arbitration fees
were concerned. The fallo of the January 28, 2005 CA Decision reads:
WHEREFORE,
the assailed CIAC Final Award dated September 7, 2004 is MODIFIED and/or RECTIFIED
as follows: (a) to order the parties to equally share the costs of arbitration
conformably with Article 24 of their Subcontract Agreement; (b) to delete
the award of attorney’s fees in favor of respondent [Dynamic]; and, (c) to
reduce the rate of interest imposable after the finality of the award from 15%
to 12% per annum. The rest is AFFIRMED in toto.[23]
The CA would subsequently deny Hanjin’s motion for
reconsideration in its Resolution of October 14, 2005.
On
the other hand, the appellate court’s Decision dated July 6, 2005 in CA-G.R. SP
No. 86641 dispositively reads:
Foregoing
premises considered we vote to GRANT
the instant petition. The Final Award
dated
Original Subcontract
Price PhP 714,868,129.00
Foreign Currency
Adjustment 131,338,674.80
Price Escalation
48,171,585.32
Variation Orders 156,786,932.62
Adjusted Subcontract
Price PhP
1,051,165,321.74
x x x x
Share in Profit in VOs 61,400,096.07
Materials
Over-Purchased
54,847,789.94
Total PhP
1,167,413,207.75
Less: Total Deductions
Progress
net of
retention money 523,893,023.35
Net Cost to Complete 368,578,828.92
Repayment, Unrecouped
Advance Payment
16,398,419.74 908,870,252.01
Net Award PhP 258,542,935.74
================
The
net award in favor of petitioner Dynamic x x x shall be [PhP 258,542,935.74]
plus attorney’s fees of [PhP 500,000]. Respondent Hanjin x x x is hereby
ordered to pay petitioner corporation the amount of [PhP 259,042,935.74]; plus
interest at 12% per annum from the promulgation of the assailed Final Award on
September 7, 2004, until paid. The cost
of arbitration, however, should be equally borne by the parties in accordance
with Article 24 of the Subcontract Agreement.
SO
ORDERED.[24]
Upon motion for reconsideration filed by both parties, the CA
recomputed and came up with a higher net award as set forth in its Resolution
of August 31, 2005 in CA-G.R. SP No. 86641, disposing as follows:
Due to the complexity of the computations involved, We deem it wise to RESTATE Our Decision. The net award shall be recomputed as follows:
Original Subcontract
Price PhP 714,868,129.00
Foreign Currency
Adjustment 131,338,674.80
Price Escalation
53,744,697.39
Variation Orders (VOs) 141,535,238.92
___________________
Adjusted Subcontract
Price PhP 1,041,486,740.11
Share in Profit in VOs 9,295,667.94
Materials
Over-Purchased 54,847,789.94
___________________
Total PhP 1,105,630,197.99
Less,
Total Deductions
Progress
net of retention money 523,893,023.35
Unadjusted Net Cost to
Complete 470,183,498.41
Plus: Mech. Works
(EFQ) 7,776,735.77
Less: Amount to be
reimbursed
to [Dynamic] (3,338,736.57)
Disallowed
items (93,983,040.38)
Additional
disallowed (8,381,856.00)
Overcharging
of Materials
for
VOs (104,208,856.26)
Amended Cost to Complete 271,386,481.54
Repayment, Un-recouped
Advance Payment 16,398,419.74 811,677,924.63
_____________ _____________
Net Award PhP
293,952,273.36
==============
The net award in favor of petitioner [Dynamic]
shall be [PhP 293,952,273.36] plus attorney’s fees of [PhP 500,000]. Respondent [Hanjin] is hereby ordered to pay
petitioner x x x the amount of [PhP 293,952,273.36] plus interest at 12% per
annum from the promulgation of the assailed Final Award on September 7, 2004,
until paid. Hanjin is likewise ordered
to release to [Dynamic] the retention money in the amount of PhP 58,210,336.00,
plus interest at 12% per annum from the time the Request for Arbitration was
filed with the CIAC on February 20, 2004, until fully paid. The cost of arbitration, however, should be
equally borne by the parties in accordance with Article 24 of the Subcontract
Agreement.
SO ORDERED.[25]
From the CA Decision in CA-G.R. SP No. 86633, Hanjin
has come to this Court on a Petition for Review on Certiorari, the same docketed
as G.R. No. 170144. And from the more adverse CA Resolution in CA-G.R. SP No.
86641, Hanjin also filed a similar petition, docketed as G.R. No. 169408.
In a Resolution dated February 28, 2007,[26]
this Court consolidated the above cases.
The Issues
Hanjin raises identical issues in
both of its petitions, to wit:
I
WHETHER A REVIEW OF THE INSTANT CASE BY WAY
OF THE INSTANT PETITION FOR REVIEW IS WARRANTED
II
WHETHER THE [CA] ERRONEOUSLY READ INTO THE
SUBCONTRACT AGREEMENT EXTRANEOUS AND CONTRACTUALLY INEXISTENT TERMS AND CONDITIONS
TO LAMELY JUSTIFY ITS AWARD TO RESPONDENT DYNAMIC OF PAYMENT IN FOREIGN
CURRENCY
III
WHETHER THE [CA’S] AWARD OF PRICE ESCALATION
IN FAVOR OF RESPONDENT DYNAMIC IS WITH LEGAL BASIS
IV
WHETHER THE [CA’S] IMPOSITION OF CERTAIN
ITEMS, PERCENTAGES AND AMOUNTS IN RESPONDENT DYNAMIC’S CLAIM TO VARIATION
ORDERS IS WITH LEGAL BASIS
V
WHETHER THE [CA] WAS LEGALLY JUSTIFIED IN ITS
COMPUTATION WITH REGARD TO THE ITEMS ON COSTS TO COMPLETE IN FAVOR OF
PETITIONER HANJIN
VI
WHETHER THE [CA] COMMITTED REVERSIBLE ERROR
WHEN IT DISREGARDED THE EVIDENCE ESTABLISHED ON RECORD BY REWARDING RESPONDENT
DYNAMIC PAYMENT OF RETENTION MONEY DESPITE ITS ABANDONMENT OF THE SUBCONTRACTED
WORKS
VII
WHETHER PETITIONER HANJIN IS LEGALLY ENTITLED
TO REIMBURSEMENT OF THE COST OF ATTORNEY’S FEES, MORAL AND EXEMPLARY DAMAGES
VIII
WHETHER THERE WAS LEGAL BASIS FOR THE [CA’S] RULING
THAT RESPONDENT DYNAMIC IS ENTITLED TO INTEREST PAYMENT[27]
The Ruling of the Court
The Propriety of the Petitions for
Review
Dynamic
maintains that the issues Hanjin raised in its petitions are factual in nature and are, therefore, not
proper subject of review under Section 1 of Rule 45, prescribing that a petition
under the said rule, like the one at bench, “shall raise only questions of law
which must be distinctly set forth.”
Dynamic’s
contention is valid to point as, indeed, the matters raised by Hanjin are
factual, revolving as they do on the entitlement of Dynamic to the awards
granted and computed by the CIAC and the CA. Generally, this would be a
question of fact that this Court would not delve upon. Imperial
v. Jaucian suggests as much. There, the Court ruled that the computation of
outstanding obligation is a question of fact:
Arguing
that she had already fully paid the loan x x x, petitioner alleges that the two
lower courts misappreciated the facts when they ruled that she still had an
outstanding balance of P208,430.
This
issue involves a question of fact. Such question exists when a
doubt or difference arises as to the truth or the falsehood of alleged facts;
and when there is need for a calibration of the evidence, considering mainly
the credibility of witnesses and the existence and the relevancy of specific
surrounding circumstances, their relation to each other and to the whole, and
the probabilities of the situation.[28] (Emphasis
supplied.)
The rule, however,
precluding the Court from delving on the factual determinations of the CA,
admits of several exceptions. In Fuentes v. Court of Appeals, we held
that the findings of facts of the CA, which are generally deemed conclusive,
may admit review by the Court in any of the following instances, among others:
(1)
when the factual findings of the [CA] and the trial court are contradictory;
(2)
when the findings are grounded entirely on speculation, surmises, or
conjectures;
(3)
when the inference made by the [CA] from its findings of fact is manifestly
mistaken, absurd, or impossible;
(4)
when there is grave abuse of discretion in the appreciation of facts;
(5)
when the [CA], in making its findings, goes beyond the issues of the case, and
such findings are contrary to the admissions of both appellant and appellee;
(6)
when the judgment of the [CA] is premised on a misapprehension of facts;
(7)
when the [CA] fails to notice certain relevant facts which, if properly
considered, will justify a different conclusion;
(8) when the findings of fact are themselves conflicting;
(9)
when the findings of fact are conclusions without citation of the specific
evidence on which they are based; and
(10) when the findings of fact of the [CA] are premised on the absence of evidence but such findings are contradicted by the evidence on record.[29]
Significantly,
jurisprudence teaches that mathematical computations as well as the propriety
of the arbitral awards are factual determinations.[30]
And just as significant is that the factual findings of the CIAC and CA—in each
separate appealed decisions—practically dovetail with each other. The
perceptible essential difference, at least insofar as the CIAC’s Final Award
and the CA Decision in CA-G.R. SP No. 86641 are concerned, rests merely on mathematical computations or
adjustments of baseline amounts which the CIAC may have inadvertently utilized.
At
any rate, the challenge hurled by Hanjin against the merits of the CA’s findings,
particularly those embodied in its Decision in CA-G.R. SP No. 86641, must fail,
such findings being fully supported by, or deducible from, the evidence on
record.
Issue of Payment in Foreign Currency
Hanjin
argues that there is no provision in the subcontract agreement, as
supplemented, for the partial payment of the contract price in foreign
currency.
Hanjin
is wrong, a peso-dollar payment mix being effectively contemplated in the
subcontract. In construing a contract,
the provisions thereof should not be read in isolation, but in relation to each
other and in their entirety so as to render them effective, having in mind the
intention of the parties and the purpose to be achieved.[31] Thus, Article 1374 of the Civil Code provides
that “the various stipulations of a contract shall be interpreted together
attributing to the doubtful ones that sense which result from all of them taken
jointly.”
In
other words, the stipulations in a contract and other contract documents should
be interpreted together with the end in view of giving effect to all.[32]
The CA, as did the CIAC, found the Hanjin-Dynamic Subcontract Agreement as
including and incorporating the provisions of other agreements entered into by
and between the parties respecting the Project. They appropriately cited Art. 1
of the Subcontract Agreement, stating:
ARTICLE 1. SUBCONTRACT DOCUMENTS
1.1) The following documents shall be deemed to form and be read and be construed as an
integral part of the Subcontract Agreement in the same order of precedence
as below:
a)
Subcontract Agreement No. DAV-2-Sub-A-OO 1
b)
Special Conditions as the Annex 1
c)
General
Conditions of the Main Contract
d)
Technical
Specifications of the Main Contract
e)
Tender Drawings
f)
Priced Bill of Quantities as the Annex 2.
1.2) The Subcontractor is deemed to have
examined and fully understood the aforesaid Subcontract Agreement Documents.[33] (Emphasis supplied.)
It
is abundantly clear from the emphasized portions of the aforequoted provision that
the DOTC-Hanjin Main Contract forms as “an integral part of the Subcontract
Agreement.” It is settled that if the
terms of a contract leave no doubt as to the parties’ intention, the literal
meaning of its stipulations should control.[34] The categorical finding of the CA, affirmatory
of that of the CIAC, was that “the Subcontract is a back-to-back contract with
Hanjin’s contract with DOTC.” Under the Main
Contract, DOTC undertook to pay Hanjin 35% of the contract price in US
dollars. Be that as it may, and on the
postulate that the Main Contract is an integral part of the Subcontract
Agreement, it behooves Hanjin to extend to Dynamic the same benefits otherwise accruing
to Hanjin under the Main Contract. Apart
from dollar payment, other benefits contemplated include the payment of price
adjustment or escalation. An application of the “back-to-back” arrangement
between Hanjin and Dynamic to the contrary would be tantamount to a
construction against the terms of the Subcontract Agreement.
Before
the CIAC, Hanjin argued that Dynamic’s entitlement to a share in the foreign
currency portion of the contract price is conditioned on the completion of the
Project by April 2002.[35] The CIAC, however, correctly made short
shrift of this argument, tagging the condition to be an impossible one and
noting that Hanjin’s very act of releasing advance payments to Dynamic in trickles,
rather than in one full payment, as agreed upon, and delaying payments for
approved progress billings ensured that Dynamic would not meet the April 2002
deadline. The CA, it bears to stress, echoed
these CIAC findings, and stated the
observation that Hanjin’s actions not only delayed the Project, but also
rendered its completion on the date imposed by Hanjin impossible. Hanjin, therefore, cannot plausibly fault and
penalize Dynamic for not meeting the imposed deadline, the latter having in its
favor Art. 1186 of the Civil Code, which says that “[t]he condition shall be
deemed fulfilled when the obligor voluntarily prevents its fulfillment.”
Given
the above perspective, the condition imposed for Dynamic’s entitlement to a
share in Hanjin’s foreign currency receipts is, for the nonce, deemed fulfilled.
Accordingly, there is no legal obstacle to the award of a foreign currency
adjustment to Dynamic. Furthermore, Hanjin’s admission before
the CIAC that Dynamic is entitled to a foreign currency portion of the subcontract
price veritably placed Hanjin in estoppel from claiming otherwise. Under the doctrine of estoppel, an admission
or representation is rendered conclusive upon the person making it, and cannot
be denied or disproved as against the person relying thereon.[36]
Issue of Computation of Foreign Currency Adjustment
As
to the amount of foreign currency adjustment due Dynamic, the CIAC arrived at
the figure PhP 131,338,674.80. The CA agreed
with the CIAC’s computation and the ratiocination therefor. We reproduce with
approval what the CIAC wrote:
Dynamic’s
Subcontract Price of P714,868,129.00 is 76% of what Hanjin will derive from
DOTC for the Subcontract Works. 35% of
this amount represents the foreign currency portion of the Subcontract
Price. This amounts to
P250,203,845.00. At the exchange rate of
Hanjin which is P34.10: US$1, this amount of P250,203,845.00 is equivalent to
US$7,337,356.15. Converted again into
its value in pesos at the time when the Subcontract was performed which ranged
from P50.00 to P54.00 to US$1, or an average rate of P52.00: US$1, its peso
equivalent is P381,542,519.80. This is
the rate used by Hanjin in charging Dynamic for the peso value of the importation
of foreign materials. The difference between P381,542,519.80 and P250,203,845.00
is P131,338,674.80. We award to Dynamic as its share of the foreign currency
portion of the Subcontract Price the amount of P131,338,674.80 which shall be
added to the Subcontract Price.[37]
Issue of Applicable Exchange Rate
Hanjin
questions the PhP 52: USD 1 exchange rate adopted by the CA and by the CIAC
earlier, asserting that what is applicable is the PhP 34.10: USD 1 exchange
rate, the same being stipulated in the DOTC-Hanjin Main Contract.
Hanjin’s
assertion may be accorded some cogency but for the fact that, as the CA and the
CIAC found, Hanjin charged Dynamic for all the costs related to the importation
of raw materials to be used in the Project at the average exchange rate of PhP
52.00: USD 1. And as the CA aptly observed, the “Subcontract called for the
importation of a substantial amount of equipment and materials for the project.” We need not belabor the iniquitousness of the
lopsided formula foisted by Hanjin and the undue enrichment resulting
therefrom.
Issue of Computation of Total Escalation
Hanjin
assails the CA for failing to use the 52 formulas and price indexes from the National
Statistics Office and the National Statistical Coordination Board in computing
the escalation cost or price adjustment.
Alternatively, it argues that if Dynamic is indeed entitled to any price
escalation, then the applicable figure is 35% of price index only. Notably, Hanjin admitted before the CIAC that
Dynamic is entitled to price escalation of PhP 25,938,545.94 for the local
portion,[38] which
amount the CIAC awarded to Dynamic. In view of such admission, Hanjin’s
arguments contesting the award for price escalation are puerile.
As
against, however, the CIAC’s computation of escalation cost which the CIAC
predicated on works accomplished as of April 2002 and covered by the 20 progress
billings, the Court is inclined to sustain the CA’s computation of the price
escalation as summarized in its Resolution of August 31, 2005 in CA-G.R. SP No.
86641, for the CA rightfully took into account Dynamic’s accomplishment after
April 2000 but before Hanjin took over the Project, thus:
x x x. In Our assailed Decision [of July 6, 2005], We granted [Dynamic] additional escalation as to the “local portion” i.e., on 65% of [Dynamic] billings based on the formula: [Dynamic] Billing multiplied by 65% of the said billing, multiplied by the percentage of the escalation. However, We computed escalation of the total amount of PhP 545,162,305.61 because the CIAC computed escalation up to this extent only. It appears that a total of twenty (20) progress billings have been submitted by [Dynamic] to Hanjin because it was advised that no payments were forthcoming for subsequent progress billings.
x x x x
This being the case, We have no recourse but to limit the award of escalation only up to the period covered by Progress Billing No. 20 or up to April 2002 as the value of all subsequent accomplishments remained undetermined. It appears however, that the total amount billed up to the time was PhP 582,103,359.35. We have computed escalation only up to the PhP 545,162,035.61 or short as to PhP 36,941,052.74. Applying the formula mentioned above, an additional [PhP 5,573,112.07] is due [Dynamic] as escalation computed: PhP 36,941,053.74 x 65% x 0.2321, over and above PhP 22,233,039.38, so that a total of [PhP 27,806,151.45] is due [Dynamic] as additional escalation over and above that computed by the CIAC.[39]
As
it were, the records do not show that Hanjin presented any of the supposed 52
formulas and price indexes, the utilization of which would have resulted, so it
claims, in a more exact price escalation figure. Hanjin did not adduce any evidence to provide
legal support to its assertion that the price escalation portion to which Dynamic
is entitled to is 35% of the price index only.
The Court agrees with the CA that, in computing price escalation, the
allowable escalation is to be pegged on the local portion, that is, on 65% of
the Dynamic billing multiplied by 100% price index, because Dynamic is entitled
to both price adjustment and price escalation under the Subcontract Agreement.
As
may be noted, the CA initially followed the baseline amount used by the CIAC in
computing the amount of price escalation at PhP 545,162,305.61. However, after another look at the case, the
CA found the CIAC to have erred in starting at the figure of PhP 582,103,359.35
as the baseline amount which, as earlier indicated, represented the total
billing as of April 2002. Accordingly,
the CA granted a total award of PhP 27,806,151.45 by adding the amount of PhP
5,573,112.07 to its previous award of PhP 22,233,039.38 to Dynamic based on the
corrected computation. At bottom then, the
CA merely corrected its own computation error, a process which it can
undoubtedly do as long as jurisdiction over the matter has not been lost, as
here.[40]
Issue of Computation of Variation Order
Hanjin
also challenges the CA’s computation of Dynamic’s share in the profit in the
Variation Orders (VOs). The CA, in its July 6, 2005 Decision in CA-G.R. SP No.
86641, found the amount of Dynamic’s share in the VOs to be PhP 61,400,096.07, up from the PhP 9,295,667.94
awarded by the CIAC. On reconsideration,
the CA returned to the original CIAC figure.
Instead, in its August 31, 2005 Resolution, the appellate court deducted
the whole amount of PhP 104,208,856.26 from Hanjin’s Net Cost to Complete Claim. This amount represented the cost of materials
with the overcharge component passed by Hanjin to Dynamic. The CA arrived at the figure of PhP
104,208,856.26 after a painstaking, itemized comparison of the items and
amounts common in the Tables of Variance submitted by the parties in the two
tables.
We
see no reason to disturb the CA’s findings which appear to be supported by the evidence
on record. The computation of awards is,
to stress, purely factual which the Court, not being a trier of facts, need not
evaluate and analyze all over again.
On
another point, Hanjin argues that the original contract price on the items
subject to VOs should be added to the DOTC-approved amount for the same items.
And from this sum total should be deducted the amount representing what the CA
considered as overcharging Hanjin passed onto Dynamic. According to Hanjin, the amount it was
charging Dynamic represents the actual cost of work done on the items subject
to VOs. Hanjin’s posture would necessarily diminish the amount allegedly
overcharged by Hanjin to Dynamic.
The
Court is not convinced. At the outset, we find Hanjin’s presentation of a partial list[41] in its Memorandum of the items each
party is charging the other quite disturbing.
As the petitioner in this case, Hanjin is charged with the burden of
establishing the grave error allegedly committed by the CA in its computation
of the overcharged amount. Its failure
to provide a complete and clear computation of what it considers as the correct
one militates against the supposed merit of its argument.
Hanjin’s
own annexes to its Petition indicate the deleted
items from the original
subcontract price of PhP 924,670,819, as follows:
Original Subcontract Price PhP 924,670,819.00
Deleted after re-measurement PhP 118,338,206.31
Deleted due change of
specifications subject to VOs 91,464,481.64
209,802,687.95
PhP 714,868,129.05[42]
==============
Also
pertinent is a list of VOs[43]
approved by the DOTC with an aggregate amount of PhP 37,326,381.54,[44]
corresponding to the same items previously deleted, as shown above, amounting
to PhP 91,464,481.64.
Hanjin
presently asks the Court to add the
original subcontract price of the items subject to VOs, that is, PhP
91,464,481.64, to the DOTC- approved amount for the corresponding VOs in the
amount of PhP 37,326,381.54, the sum of which to be deducted from the amount of
PhP 141,535,238.92[45]
which Hanjin is charging Dynamic to arrive at the amount of the overcharge.
Hanjin
knows fully well that the amount of PhP 91,464,481.64 covers items deleted from
the contract price by reason of the VOs.
Such deleted items lowered the original aggregate subcontract price from
PhP 924,670,819 to PhP 714,868,129. The
amount of PhP 91,464,481.64, representing items already deleted by reason of VOs,
has been superseded by the succeeding changes in specifications which the DOTC
approved in the amount of PhP 37,326,381.54.
Hence, only the amount approved
by the DOTC for the items actually installed should be the subject of
computation. The amounts representing items already
deleted should necessarily be excluded from the computation.
From
the foregoing consideration, it is unreasonable for Hanjin to charge Dynamic
the amount of PhP 141,535,238.92 for the items subject to VOs when DOTC actually
approved only PhP 37,326,381.54 for the same items. And lest it be overlooked, Dynamic was
credited only the amount approved by DOTC at PhP 37,326,381.54 of the subject VOs. To charge Dynamic more than the approved
amount for the VOs would result in an overcharging on the part of Hanjin.
Issue on Computation of Hanjin’s Net Cost to Complete
As
regards the issue of disallowed deductions from Hanjin’s Net Cost to Complete,
the CA, in its underlying decision in CA-G.R. SP No. 86641, included the amount
of PhP 8,558,652.78 and PhP 1,257,417.30, being not properly receipted, as
additional disallowed deductions to the CIAC’s figure of PhP 84,166,970.47[46]
or a total disallowable deduction of PhP 93,983,040.38.[47] We agree and thus affirm the CA’s holding
that when expenses or offered deductions are not properly documented, such deductions should not be allowed,
such deductions being in the nature of actual damages. To be recoverable, actual damages must be
pleaded and adequately proven in court. An
award thereof cannot be predicated on flimsy, remote, speculative, and
insubstantial proof.[48] Again, we see no reason to deviate from the CA’s
findings on the matter of how much Hanjin expended to complete the Project.
To
be sure, the Court cannot close its eyes to the consistent findings of the appellate
court, affirmatory of that of the CIAC, that Hanjin padded expenses chargeable against
Dynamic. Consider the following apt observations of the CIAC on the computation
of deductions Hanjin charged Dynamic under “Net Cost to Complete”:
The Dynamic Summary is divided into two parts: The first part covered all purchases, payments to subcontractors and all expenses deducted from Dynamic’s progress billings nos. 1 to 20. We reviewed the Dynamic Summary to ascertain the expenses that are questioned. We assume that those not questioned are admitted to be proper expenses and are deductible from the [adjusted subcontract price]. We agree with Dynamic that we should disallow certain items for the following reasons:
1. The expense is outside the scope of work of Dynamic;
2. The expense relates to an item that is subject to a prior deduction; in other words, in the cases of double deduction.
3. The expense is undocumented.
We came across a substantial number
of imported items where there was a material variance between the value of an
imported item as reflected in a Customs declaration and the value reflected in
private documents. The value reflected
in the Bureau of Customs declaration is less, in some cases, substantially less
than that reflected in other documents.
We chose to rely on the value in the Bureau of Customs declaration. First, because it is a public document. Second, because if the case is one in which
Hanjin undervalued the imported goods, which is a criminal act, we will not
allow it to profit from its own wrong.[49]
Issue of Dynamic’s Abandonment of Work
Hanjin claims as being entitled to
other costs which it incurred when Dynamic later abandoned the subcontracted
works in December 2002. Both the issues
of “other costs” and “abandonment” are factual matters settled in the
proceedings below. The CIAC findings
argue against the notion of abandonment on the part of Dynamic. Wrote the CIAC:
Even if it were true, as argued by Hanjin, that there were other aspects of the work that could have been aggressively pursued by Dynamic, it could have given the guarantee requested by Dynamic that it will be paid even if DOTC does not in turn pay Hanjin for the same work. Moreover, the admission by Hanjin that after the April 2002 progress billings, it did not pay Dynamic for work it had accomplished, in our view, provides sufficient legal justification for not continuing with the work. Article 1169 [of the] Civil Code, invoked by Dynamic provides:
ART.
1169. In reciprocal obligations, neither party incurs in delay if the other
does not comply or is not ready to comply in a proper manner with what is
incumbent upon him. From the moment one
of the parties fulfills the obligation, delay by the other begins.
Under the Subcontract, Dynamic
agreed to perform the Subcontract Works in consideration for which Hanjin
agreed to pay Dynamic the stipulated Subcontract Price in accordance with the
terms and conditions of the Subcontract.
The payment for performing the Subcontract Works consisted of an advance
payment exclusively to cover the costs of mobilization and monthly progress
payments within seven (7) days after DOTC pays Hanjin. [Hanjin has not argued] that DOTC was remiss
in the payment of Hanjin’s progress billings.
Clearly, therefore, there was failure on the part of Hanjin to comply
with its obligation to pay Dynamic. Thus, we hold that x x x Dynamic did not
abandon the Works. As will be shown
later, Dynamic was squeezed out of the Subcontract and was rendered by Hanjin
incapable of performing its obligations therein. Under Article 1186 of the Civil Code, “The condition shall be deemed fulfilled
when the obligor voluntarily prevents its fulfillment.”[50] (Emphasis
supplied.)
In
its Resolution dated August 31, 2005, the CA sustained the CIAC’s finding on
non-abandonment, as follows:
[T]he
CIAC found that [Dynamic] did not abandon the subcontract works, but that it
was squeezed out of the Subcontract and was rendered by Hanjin incapable of
performing the obligations therein. It
found certain circumstances to justify the suspension of work by [Dynamic], to
wit: that [Dynamic] was forced to de-mobilize because it was not being paid for
work undertaken; that the issue of retrofitting had not been resolved; and that
the manner of retrofitting still had to be decided upon. Despite the same, [Dynamic] continued with
the work not affecting the retrofitting work, but Hanjin terminated the
Subcontract. The CIAC thus held that
Hanjin, the obligor, in voluntarily preventing the fulfillment by [Dynamic],
the obligee, of its obligation, the condition was deemed fulfilled.[51]
It cannot be overemphasized that conclusions arrived at on
factual issues by the CIAC, when affirmed by the CA, are accorded great respect
and even finality, if supported by substantial evidence.[52] In the instant case, both the CIAC and the CA
found more than ample evidence to support Dynamic’s disclaimer of having
abandoned the Project.
The
Court concurs with the parallel findings of the CIAC and the CA on the issue of
abandonment. Indeed, Hanjin, by its
unjustifiable and unfair actions, veritably forced Dynamic out of the Project
at a time when the subcontract works were already 94% complete. In net effect, Hanjin accepted the benefits arising
from the subcontract agreement without as much as asking Dynamic to finish its part
of the bargain. Under Art. 1235 of the
Civil Code, the obligation is deemed fully complied with when an obligee
accepts the performance thereof knowing its incompleteness or irregularity, and
without expressing any protest or objection.
An obligee is deemed to have waived strict compliance by an obligor with
an obligation when the following elements are present: (1) an intentional
acceptance of the defective or incomplete performance; (2) with actual
knowledge of the incompleteness or defect; and (3) under circumstances that
would indicate an intention to consider the performance as complete and
renounce any claim arising from the defect.[53]
These
elements obtain in the instant case. At
the time it “booted out” Dynamic from the Project, Hanjin knew that the
subcontract works were not yet complete.
In fact, there were unresolved matters involving structural design
deficiencies and the methods to be used in the retrofitting of the cracked
slabs and beams in the
Issue of Dynamic’s Entitlement to Retention Money
Hanjin,
as stated at the outset, refused to release Dynamic’s retention money on the
ground of abandonment and non-completion of the Project. Arts. 6.2, 7, and 8.3 of the Subcontract
Agreement, relating to the matter on retention money, respectively read, as
follows:
6.2) Monthly progress billing calculated on the basis of actual works measured and sixty percent (60%) of the material costs of the delivered goods according to the Bill of quantities, x x x shall be paid with deductions of advance payment stipulated in Article 6.1 and ten percent (10%) of billing amount as the retention money stipulated in Article 7.1 for the period covered. Monthly progress billing[s] shall be paid by the Contractor and to the Subcontractor within seven (7) working days after the Client pays the Contractor.
x x x x
ARTICLE 7. RETENTION
7.1) The retention money, ten percent (10%) of every progress billing with cumulative amount not exceeding ten percent (10%) of the Subcontract Price shall be deducted therefrom in order to secure the remedy of defects.
7.2) Fifty percent (50%) of the retention money shall be released to the Subcontractor immediately after the Contractor issues the “Taking Over Certificate” to the Subcontractor and against presentation of Warranty Bond x x x valid for the duration of the Defects Liability Period specified in Article 8.
The other fifty percent (50%) retention shall be released pro rata, if no defects have been found, after the Client releases retention money to the Contractor, after the Subcontractor issues a Clearance Certificate to the Contractor attesting that the Contractor is free from all liens and encumbrances in relation to the Subcontract Works and after the Subcontractor submits an acceptable Warranty Bond to the Contractor which is valid until the defects liability period of the Main Contract plus 2 months.
x x x x
8.3) Defects Liability Period shall be three hundred sixty-five (365) days from the date of issuance of the Taking Over Certificate. Within this period, the Subcontractor shall repair and make good all defects in the Subcontract Works at his own cost x x x. The Subcontractor shall assume full and sole responsibility for the removal, repair and replacement of any defective or non- conforming works.[54] x x x
The
retention money, as described above, is intended to ensure defect and deficiency-free
work as evidenced by the contractor’s issuance of a Take Over Certificate. Hanjin, as contractor, never issued this key
document to Dynamic. Instead, it
discharged Dynamic from the 94%-done Project rendering the issuance of such
certificate a virtual impossibility. On
June 1, 2003, the DOTC issued a Take Over Certificate to Hanjin and released the
latter’s retention money under the Main Contract. But even earlier, the DOTC
released Hanjin’s retention money covering the period February 2000 to December
2001, a development which would have obligated Hanjin to release the
corresponding Dynamic’s retention money for the same period. But instead of
paying, Hanjin held onto Dynamic’s retention money. Worse still, Hanjin
willfully and in apparent bad faith took over the unfinished work of Dynamic.
To us, and to CIAC and the CA earlier, Hanjin in effect waived any and all of
its rights to hold Dynamic liable for any defects, deficiencies, or unfinished
work. Consequently, there is no legal basis for Hanjin to further withhold
payment of Dynamic’s retention money.
Issue of Entitlement to Moral and Exemplary Damages
Hanjin’s
ascription of bad faith and gross negligence on the part of Dynamic, as basis
for its claim of attorney’s fees against the latter, has nothing to commend
itself for concurrence. In fact, both
the CIAC and CA are one in saying that it was Hanjin which acted in bad faith in
its contractual relation with Dynamic.
The CIAC, in awarding attorney’s fees to Dynamic, categorically stated:
On the basis of the evidence before us, we do not find any basis to hold Dynamic liable to Hanjin for x x x damages and attorney’s fees. On the other hand, on the basis of our finding that Hanjin acted in bad faith and had persistently acted in a manner that we interpret as attempts to squeeze out Dynamic from the Subcontract, and for attempting to pass on to Dynamic a part of the cost of retrofitting when, it is clear from the evidence, it was free from fault, and all the difficulties encountered by Dynamic in trying to enforce its rights under the Subcontract, we should find Hanjin liable to pay Dynamic exemplary damages but we cannot award exemplary damages as they are not part of the claim of Dynamic. x x x We, however, award attorney’s fees of P500,000.00.[55]
Issue of Entitlement to Attorney’s Fees
The
Subcontract Agreement, as supplemented, is silent as to payment of attorney’s
fees. The applicable law, Art. 2208 of
the Civil Code, must thus govern any award thereof. It reads:
ART.
2208. In the absence of stipulation,
attorney’s fees and expenses of litigation, other than judicial costs, cannot
be recovered except:
x x x x
2) When the defendant’s acts or omission has
compelled the plaintiff to litigate with third persons or to incur expenses to
protect its interest;
x x x x
5) Where the defendant acted in gross and
evident bad faith in refusing to satisfy the plaintiffs plainly valid, just and
demandable claim;
x x x x
11) In any case where the court deems it just and
equitable that attorney’s fees and expenses of litigation should be recovered.
An
award of attorney’s fees being the exception,[56] some
compelling legal reason must obtain to bring the case within the exception and
justify such award. In the case at bench, there is a categorical finding by the
CIAC and CA that Hanjin’s refusal to satisfy Dynamic’s just claims amounted to
gross and evident bad faith. This to us presents the justifying ingredient for
the award of attorney’s fees. Accordingly, we affirm the award of attorney’s
fees in CA-G.R. SP No. 86641 to Dynamic in the amount of PhP 500,000.
Issue of Computation of Interest
The Court of Appeals Erred in Its Award
of Interest Payment
In
its appealed Resolution of August 31, 2005, the CA decreed that:
[Hanjin] x x x is hereby ordered to pay [Dynamic]
the amount of [PhP 293,952,273.36]; plus interest at 12% per annum from the
promulgation of the assailed Final Award on September 7, 2004, until paid.
Hanjin is likewise ordered to release to [Dynamic] the retention money in the
amount of PhP 58,210,336.00, plus interest at 12% per annum from the time the
Request for Arbitration was filed with the CIAC on February 20, 2004, until fully
paid.[57]
x x x
In
the landmark case of Eastern Shipping
Lines v. Court of Appeals, the Court summarized the rules on interest
award, as follows:
II. With regard
particularly to an award of interest in the concept of actual and compensatory
damages, the rate of interest, as well as the accrual thereof, is imposed, as
follows:
1. When the
obligation is breached, and it consists in the payment of a sum of money, i.e.,
a loan or forbearance of money, the interest due should be that which may have
been stipulated in writing. Furthermore, the interest due
shall itself earn legal interest from the time it is judicially demanded.
In the absence of stipulation,
the rate of interest shall be 12% per annum to be computed from default,
i.e., from judicial or extrajudicial demand under and subject to
the provisions of Article 1169 of the Civil Code.
2. When an
obligation, not constituting a loan or forbearance of money, is breached, an
interest on the amount of damages awarded may be imposed at the discretion
of the court at the rate of 6% per annum. No
interest, however, shall be adjudged on unliquidated claims or damages except
when or until the demand can be established with reasonable certainty. Accordingly,
where the demand is established with reasonable certainty, the interest shall
begin to run from the time the claim is made judicially or extrajudicially
(Art. 1169, Civil Code) but when such certainty cannot be so reasonably
established at the time the demand is made, the interest shall begin to run
only from the date the judgment of the court is made (at which time the
quantification of damages may be deemed to have been reasonably ascertained).
The actual base for the computation of legal interest shall, in any case, be on
the amount finally adjudged.
3. When the judgment of the court awarding a sum of money becomes final and executory, the rate of legal interest, whether the case falls under paragraph 1 or paragraph 2, above, shall be 12% per annum from such finality until its satisfaction, this interim period being deemed to be by then an equivalent to a forbearance of credit.[58]
The
contract under consideration does not partake of a loan or forbearance of money;
it is a construction contract. Thus, the matter of interest award proceeding
from the dispute would fall under the second paragraph of the above-quoted decision.
The
reckoning point in the determination of the period of application of the six
percent interest is from the time extrajudicial demand is made. In the instant
case, the Terms of Reference submitted before the CIAC shows that, in a letter
dated
WHEREFORE, the CA Decision dated July
6, 2005, as modified by the
Resolution dated August 31, 2005, both rendered in CA-G.R. SP No. 86641, are
hereby AFFIRMED with the MODIFICATION that the interest to be
imposed on the sum total of the net award (PhP 293,952,273.36) and retention money (PhP 58,210,336) awarded to Dynamic shall be six percent
(6%) interest per annum, reckoned from November 20, 2003 until the total award
becomes final and executory. A yearly interest of twelve percent (12%) on the
total amount adjudged by the CIAC, as modified in the CA Resolution and further
modified by this Decision, as due to Dynamic, shall be assessed against Hanjin,
computed from the finality of the CIAC Final Award, as thus modified, until the
final satisfaction thereof.
Insofar
as they are inconsistent with this Decision, the CA Decision dated January 28,
2005 and Resolution dated October 14, 2005 in CA-G.R. SP No. 86633 are MODIFIED accordingly.
The petitions of Hanjin are PARTIALLY GRANTED in a sense as above
discussed.
Costs against Hanjin.
SO ORDERED.
PRESBITERO J. VELASCO, JR.
Associate
Justice
WE
CONCUR:
Associate Justice
Chairperson
Associate Justice Associate Justice
ARTURO D.
BRION
Associate Justice
I attest that the conclusions in the above
Decision had been reached in consultation before the case was assigned to the
writer of the opinion of the Court’s Division.
Pursuant to Section 13,
Article VIII of the Constitution, and the Division Chairperson’s Attestation, I
certify that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Court’s Division.
REYNATO S. PUNO
Chief Justice
[1] Rollo (G.R. No. 169408), pp. 217-264.
[2]
[3]
[4] Rollo (G.R. No. 170144), pp. 95-120. Penned by Associate Justice Rebecca De
Guia-Salvador and concurred in by Associate Justices Portia Aliño-Hormachuelos
(Chairperson) and
[5]
[6] Rollo (G.R. No. 169408), pp. 131, 229.
[7]
[8]
[9]
[10]
[11]
[12]
[13]
[14]
[15]
[16]
[19]
[21] Supra note 1, at 262.
[22] Rollo (G.R. No. 169408), pp. 273-274.
[27] Rollo (G.R. No. 169408), pp. 1446-1447.
[28] G.R. No. 149004, April 14, 2004, 427 SCRA 517, 523-524.
[29] G.R. No. 109849, February 26, 1997, 268 SCRA 703, 709.
[30] Megaworld Globus Asia, Inc. v. DSM Construction and Development Corporation, G.R. No. 153310, March 2, 2004, 424 SCRA 179.
[34] Civil Code, Art. 1370; See Baylon v. Court of Appeals, G.R. No.
109941, August 17, 1999, 312 SCRA 502.
[48] Spouses Renato S. Ong and Francia N. Ong v.
Court of Appeals, Inland Trailways, Inc. and Pantranco Service Enterprises,
Inc., G.R. No. 117103, January 21, 1999, 301 SCRA 387.
[52] Philrock, Inc. v. Construction Industry
Arbitration Commission, G.R. Nos. 132848-49, June 25, 2001, 359 SCRA 632.
[57] Supra note 3, at 166.
[58]
G.R. No. 97412,