WITHOUT complete documentary proof of an obligation, the Commission on Audit (COA) said the Department of Public Works and Highways–National Capital Region (DPWH-NCR) cannot be compelled to pay the P6.75 million claim of a construction company.
In its 13-page decision, the COA en banc sustained the findings of the COA National Government Sector-Cluster 7 director that claimant Ferdstar Builders Contractor failed to comply with the documentary requirements to prove that it is entitled to collect payment on the unpaid work accomplished on the Tullahan River Bridge and Approaches project in 2007.
In 2006, Ferdstar won the P11.64 million contract for the “Reconstruction of the Tullahan Bridge- Completion of Approaches from DPWH-NCR.
Under the contract, Item No. 311-1a-Portland Cement Concrete Pavement (0.30m thick) was supposed to be done but the DPWH-NCR issued Change Order No.1, which removed the Portland cement surface to be replaced by Bituminous Concrete Surface (asphalt) Course.
Ferdstar said it completed the project on October 31, 2007 but the new approaches sustained water damage due to pipe leaks near the bridge. It added that immediate repair was necessary because the damage has been causing massive traffic in the area.
The DPWH-NCR prepared a supplemental program of work (POW), which was later designated as change order No. 2, amounting to P6.27 million.
The work entailed replacing the damaged asphalt paving with Portland cement concrete pavement and extending the bridge approach at the Malabon City side from 50 meters to 92 meters. The work was instructed to implement all supplemental works.
The Regional Technical Inspectorate and Acceptance Team issued its Final Inspection Report dated November 18, 2009 stating that “the Reconstruction of Tullahan Bridge, Completion of Approaches Project is 100 percent complete.”
The DPWH Legal Services issued the opinion that Ferdstar should be paid for the extra work even without a second contract to cover the latter scope of work.
However, the COA National Government Sector-Cluster 7 noted that there was not enough basis to determine the validity of change order No. 2, noting that if the damage to the completed bridge approaches happened right after acceptance, it would still be covered by the warranty period. If that were the case, the cost of the extra work should be shouldered by the contractor alone.
“While Ferdstar alleged that the damages occurred due to pipe leaks near the bridge, which would imply that the damages were extrinsic and not due to the quality of the materials used, such allegation is self-serving as it was not supported by any documentary proof,” the COA-NGS Cluster 7 added.
On the other hand, if the damage happened after the warranty period, auditors pointed out that the issuance of change order No. 2 is invalid because the work should have required a new contract and not simply been awarded to the original contractor.
The COA en banc affirmed the COA-NGS Cluster 7 and flagged irregularities in the funding procedure.
“When DPWH-NCR issued the Supplemental POW, there was no appropriation sufficient to cover the additional works. The availability of the funds was certified by the accountant of DPWH-NCR only on December 30, 2010, when the project was already finished on October 21, 2009,” it noted.
“Even based on quantum merit, the claim could not be paid with the absence of complete documentation to ascertain the value or extent of the work accomplished,” it added.
