THE Iloilo provincial government does not have to pay a P13-million claim filed against it by pri-vate contractor DCMS Trading and Construction for supposed unpaid billings, the Commission on Audit said in a ruling released last week.
The COA en banc held that the alleged obligation resulted from a change order or modifications for reasons attributable to the contractor and not from errors in the original contract.
“Evaluation of the ATL (audit team leader) disclosed that the change orders claimed by DCMS are not those which have not been anticipated in the contract documents but are due to errors, omissions, inconsistencies, or inadequacies of DCMS,” the commission said.
The ruling was signed by COA Chairperson Gamaliel Cordoba and Commissioners Mario Lipana and Douglas Michael Mallillin.
Based on COA’s records, DCMS won the contract for the design and construction of a multi-level parking building on Bonifacio Drive, Iloilo City worth P185.19 million on March 26, 2018. A no-tice to proceed was issued on April 5, 2018.
DCMS then entered into a sub-contract agreement with another construction firm on Aug. 28, 2018 “to execute, complete the work, and remedy any defects in conformity with the specifica-tions of the project.”
While the original completion date was set on June 3, 2019, the contractor obtained a 45-day extension which moved the deadline to July 18, 2019. However, as of January 15, 2021, the pro-ject was only at 96.78 percent completion which prompted the provincial government to impose P20.74 million in total liquidated damages.
In its petition, DCMS said it performed various change orders to the original plan, costing an additional P10.607 million including pile driving (P8.64 million), masonry and painting works (P1.13 million), and feeder line (P838,513.17).
It said the changes to the original plan were undertaken in compliance with “verbal instruc-tions” of the provincial engineer and/or project inspector, hence should be compensated in ac-cordance with the principle of quantum meruit which allows payment commensurate to ser-vices accomplished.
In rejecting the contractor’s claim, the COA noted that the alleged change from 92 piles of 400x400mm to an additional 126 450x450mm had no basis since the original foundation plan called for 190 450x450mm pre-stressed concrete piles.
“The claims of DCMS were only based on alleged verbal instructions. Thus, following the very basic rule that bare and unsubstantiated allegations do not constitute substantial evidence and have no probative value, the money claim of DCMS should be denied,” the COA said.
