G.R. No. 133909 - PHILIPPINE NATIONAL CONSTRUCTION CORPORATION, VS. MARS CONSTRUCTION ENTERPRISES, INC..D E C I S I O N - Supreme Court E-Library

Ruling

WHEREFORE, [there being] no error in the appealed decision, the same is AFFIRMED in toto ." The Facts In its assailed Decision, the Court of Appeals relates the facts of this case as follows: [3] "On July 2, 1982, [Mars Construction Enterprises, Inc., respondent herein] entered into a subcontract/Agreement with x x x Construction & Development Corporation of the Philippines (CDCP) [petitioner herein], later reorganized into the present Philippine National Construction Corporation (PNCC), for the supply of approximately seventy thousand (70,000) cubic meters of aggregates consisting of: 1. washed sand, 2. washed 3/4" gravel, 3. washed 1-1/2" gravel 4. sub-base. "On August 7, 1982, [respondent] and CDCP executed Amendment No. 1 increasing the amount of the third party liability coverage from P50,000.00 to P100,000.00. On November 5, 1982, [respondent] and CDCP executed Amendment No. 2 amending the scope of services, as follows: 1. Art. I is hereby amended to read: ARTICLE I SCOPE OF SERVICES 'The FIRST PARTY [respondent] shall supply approximately SEVENTY THOUSAND (70,000) cubic meters of concrete aggregates consisting of the following: 1. [W]ashed sand app. 17,500 cu. m. 2. Washed 3/4" gravel app. 17,500 cu. m. 3. Washed 1 1/2" gravel app. 35,000 cu. m. 4. Sub-base 2" minus crusher run xxx xxx xxx.' (Exhibit C-1, Folder of Exhibits) "Amendment No. 2 also altered Article IV (5.0) of the original Agreement which provided that (t)he first party guarantees to commence delivery within forty five (45) days after signing of the contract and continue delivery until the quantities enumerated x x x [shall] have been delivered to the jobsite stockpile to read as follows: ARTICLE V DELIVERY 'The FIRST PARTY [respondent] shall deliver a minimum of SIX THOUSAND (6,000) cubic meters of combined concrete aggregate per month until the entire requirements of the SECOND PARTY [petitioner] to complete the Philphos Project shall have been satisfied . (Italics supplied.) "Actual delivery of aggregates started only in March of 1983, or a delay of eight (8) months of the 45 days stipulated in the Agreement (Agreement, Article IV (5.0); TSN, September 6, 1985, pp. 9-10). There were also non-deliveries between the period June 1983 to January 1984 (TSN, supra ). Thus [petitioner] was constrained to obtain the necessary materials from other sources, incurring additional costs representing the difference between the agreed price of P140.00 per cubic meter under the Agreement and the pricing of the outside sources. The difference in cost was reimbursed by [respondent] in accordance with the default clause under the Agreement that the Second Party [petitioner] can procure from any other quarry operator x x x (and) should such procurement cost the Second Party more than the agreed price above, the excess [would] be for the account of the First Party x x x' (Article VII, no. 7). A total of P1.578 M was thusly paid by [respondent] (TSN, September 5, 1985, p. 12). "