Capitol pays P89.6M worth of infra projects

CEBU, Philippines - The Cebu provincial government has paid only P89.6 million of the P607 million worth of projects completed during the previous administration.

 Provincial Treasurer Emmanuel Guial said Capitol paid the amount to Duros Development Corporation late last year after the Court of Appeals on March 21, 2016 affirmed the decision of an arbitral tribunal dated November 21, 2014, which directed Capitol to pay the amount claimed by the contractor.

 Duros filed a case before the Construction Industry Arbitration Commission (CIAC) of the Department of Trade and Industry, a quasi-judicial body which has jurisdiction over disputed contracts, after the province under the administration of Governor Hilario Davide III, refused to pay its obligation arising from contracts entered into without authority from the Provincial Board.

 Capitol filed a petition for review before the CA after receiving the adverse decision of CIAC but the appellate court ruled on the principle of "quantum meruit," which entitles a party to recover an amount or actual value to be paid for works and services rendered.

 CA ordered Capitol to pay P95.5 million for the 25 infrastructure projects the contractor rendered to the provincial government from 2006 to 2012.

 Guial explained that under the compromise agreement between Capitol and Duros, the latter reduced to P89 million the P95 million claim, which included the P91 million principal claim and at least P4 million legal interest and other charges.

 Guial said the payment for Duros was sourced from the 20-percent development fund last year.

 Apart from Duros, there are 30 other contractors claiming payment from the Capitol.

 Guial said the province has still P517.8 million remaining payables to at least 30 project contractors who undertook projects of then governor and now third district Rep. Gwendolyn Garcia.

 "But minus all the legal interests and other deductions, our payables would only total to around P470 million," he said.

 Lawyer Orvi Ortega, provincial legal officer, made it clear earlier that the CA's ruling does not apply to other contractors, saying they have to seek a court order first for their claim.

 Guial said CIAC also ordered Capitol to pay for its obligation to Pragmatic amounting to P19 million.

 Guial said the province would prioritize the payment of Pragmatic, WTG Construction and Development Corp (P48 million), and OR Sarmiento Construction Inc (P25 million) if it will accumulate huge savings this year.

 The payment for Pragmatic would be sourced from the P202-million Special Education Fund (SEF) account for Pragmatic, while the payment for WTG and OR Sarmiento would be taken from the P641 million development fund.

 Pragmatic has implemented over 50 school building projects both in north and south areas; WTG built the 100-bed capacity Balamban Provincial Hospital; and OR Sarmiento constructed road networks. 

 However, Guial said Governor Hilario Davide III has the say to whether or not prioritize the payment of these contractors.

 Davide has been reiterating his position not to pay for contracts entered into by the previous administration that were not authorized by the Provincial Board, violating Section 22 of the Local Government Code of 1991 provides that "no contract may be entered into by the local chief executive in behalf of the local government unit without prior authorization by the sanggunian concerned." (FREEMAN)