SC sides with BF Corp. in dispute with SLPI

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    THE Supreme Court has directed Shangri-La Properties Inc. (SLPI) to pay BF Corp. (BFC) P52. 6 million for unpaid progress billings in connection with the construction of Phases 1 and 2 and the carkpark of the Edsa Plaza project in Mandaluyong City.

    The ruling, promulgated last Oct. 15 but released to the media only yesterday, stemmed from the civil case filed by BFC against SLPI and its board of directors before the Pasig City Regional Trial Court in 2007 for the collection of P228.6 million as part of payments for its work on the project.

    BFC also filed a request for arbitration before the Construction Industry Arbitration Commission but its petition was dismissed on the ground that the arbitration must be taken in accordance with Republic Act 876.

    The RTC revived the case and directed the parties to proceed with the arbitration case and directed Engineers Eliseo Evangelista and Alicia Tiongson and lawyer Mario Eugenio Lim to constitute the arbitration tribunal.

    The tribunal, in its July 31, 2007 ruling, directed SLPI to pay BFC the amount of P46.9 million but it was offset by P8.3 million awarded to SLPI for counterclaim, leading to a net worth award to BFC of 38.5 million plus legal interest at the rate of six percent per annum beginning from the date of the decision until it become final and executory.

    The SC said BFC deserved the award since it completed the original scope of works in phases 1 and 2, and the carpark of the said project.

    SLPI was awarded the counterclaim amount for the damages incurred in the delays to the project and for costs incurred to correct or repair some defective works done by BFC.

    Both parties appealed the decision to the Court of Appeals, which in 2008 directed SLPI to pay BFC P47.3 million plus the legal interest at six percent per annum from the date when the arbitral tribunal issued its decision in 2007.

    When both parties sought the partial reconsideration of the ruling, the CA on April 6, 2009 directed SLPI to pay BFC the amount of P32. 5 million plus the legal interest after it deleted a total of P14 million from the award for unpaid fixed and provisional attendances and retention money after SLPI paid the said amount with interest on October 2007.

    BFC elevated the case to the SC as it questioned the decision of the appellate court, saying it erred in so many aspects such as when it denied its claim for variation works that it said was done upon instruction of SLPI and when it denied its claim for fire damage and repair works as well as when it disregarded its agreement with SLPI.