THE Commission on Audit has granted the claim of Malaysian-based Asiavest Equity SDN BHD against the Philippine National Construction Corp. (PNCC) for payment of a judgment award by the Pasig Regional Trial Court (RTC) in 1994 totaling P174.53 million and lawyer’s fees amounting to P300,000.
Based on the claimant’s petition, it formed a partnership with the Construction Development Corporation of the Philippines (CDCP, later PNCC) to bid for infrastructure contracts in the state of Pahang, Malaysia.
PNCC, backed by various bonds and guarantees from Asiavest, landed four contracts which were not delivered, prompting the Pahang to go after Asiavest’s performance bonds.
A compromise agreement enabled Asiavest to settle with the Pahang state in the reduced amount of (Malaysian ringgit) RM3.915 million.
On April 12, 1994, Asiavest filed a complaint for recovery of sum of money against the PNCC before the Pasig RTC.
PNCC asked the court for time to answer the complaint and was granted three extensions with the last one expiring on July 3, 1994, which resulted in it being declared in default.
On Nov. 29, 1994, the Pasig RTC ruled in favor of Asiavest, ordering PNCC to pay RM3.915 million plus legal interest computed from the date of demand, and P300,000 as attorney’s fees.
PNCC elevated the case to the Court of Appeals and the Supreme Court which both upheld the ruling in favor of Asiavest.
After the SC decision became final on June 2, 2016, Asiavest filed its petition before the COA to compel PNCC to pay up.
“Based on the final and executory decision of the SC in PNCC vs. Asiavest Merchant Bankers, this Commission grants the foregoing money claim. Legal interest from the date of judicial demand shall be imposed,” the COA En Banc declared.
While the judgment award in Philippine peso equivalent amounts to P174.53 million, the actual payment is likely to cost the PNCC well over a billion because COA also granted imposition of interest at 12 percent per year from April 12, 1994 to June 30, 2013 and 6 percent annual interest from July 1, 2013 until full payment.
“This Commission cannot determine the exact amount of the claim considering that PNCC has not yet paid its obligation. However, the parties are enjoined to abide strictly on the manner of computing the claims as prescribed above,” COA said.
