G.R. Nos. 243477-78 - ASEC DEVELOPMENT CONSTRUCTION CORPORATION, VS. TOYOTA ALABANG, INC..D E C I S I O N - Supreme Court E-Library

Ruling

Accordingly, ASEC Development submitted its Financial Bid Evaluation of P60,000,000.00 for the tempered glass and red flash. [8] Toyota later informed ASEC Development that it would be removing glass and aluminum works from the project contract and would be awarding this to another contractor. ASEC Development agreed to this modification, provided that only P25,451,311.98the amount in its Bill of Quantities for glass and aluminum workswould be deducted from the contract. However, Toyota informed ASEC Development that it would be deducting P58,868,716.00 from the contract price, representing the P60,000,000.00 ASEC Development had initially quoted for tempered glass minus P1,131,284.00 for the cost of red flash. [9] ASEC Development countered that only P32,504,329.98P25,451,311.98 for the total cost of glass and aluminum works plus P7,053,018.00 for the cost for sun baffle and glass canopyand not P58,868,716.00 should be deducted from the contract price. [10] Toyota disagreed. This prompted ASEC Development to file a request for arbitration before the Construction Industry Arbitration Commission, [11] which was docketed as CIAC Case Number 07-2014. In its Answer, Toyota emphasized that from the beginning of the bidding process, it had already expressed intention to secure an energy and environmental design certification for its Alabang showroom, hence the specification for Low-E glass windows for an energy-efficient building. [12] The Tenns of Reference in CIAC Case Number 07-2014 stated the following issues: Does the CIAC have jurisdiction over the case considering the non­fulfillment of the preconditions to arbitration? Are the following part of the architectural scope of work of the Claimant? 2.1 Low-E glass? 2.2 Red flash? 2.3 Penthouse doors and windows in the hatched areas? Does the Respondent have the right to deduct from the Claimant the amount of Php 52,000,0000.00 [sic] which Respondent awarded to Wall Vision instead of Php 32,504,329.98 as contended by the Claimant? Which of the parties are entitled to attorney's fees[?] Who should bear the cost of arbitration? [13] After conducting hearings and receiving evidence from both ASEC Development and Toyota, the arbitral tribunal rendered a Final Award on June 30, 2014 (First Arbitral Award) granting ASEC Development's claims. [14] It held that only P32,504,329.98 should have been deducted from the scope of works. Said the arbitral tribunal: This Bid Bulletin has a more probative value at third priority level over the Final Bid Proposal at 7 th priority level. The reason for this is that the Bid Bulletin and its Bill of Quantities constitute the framework under which all bidders must calculate their bid. Claimant submitted its bid for the glass component at P32,540,329.98, consisting of P25,451,311.98 for the tempered glass and P7,053,018.00 representing the value of the sun baffle and canopy. .... It is accordingly the holding of this Tribunal that the correct amount that may be deducted