COA stops developer from claiming P755M from Calamba

MANILA, Philippines – A bid by a private developer to enforce and eventually collect an arbitral award of over P700 million from the government of Calamba City was stopped cold because it was “not yet final and executory.”

This was the decision of the Commission on Audit which denied the petition by MTD Philippines Incorporated to finally claim its P755.006 million arbitral award from Calamba. 

MTD Philippines won the right to claim the amount, which stemmed from a favorable decision by the Construction Industry Arbitration Commission (CIAC) in the failed joint venture agreement (JVA) between the developer and the city government.

The COA Commission Proper, however, released a decision Wednesday, September 6, which said that although MTD got a favorable decision from CIAC, this was “not yet final and executory.” For one, this case has been elevated to the Supreme Court.

Back in December 2012, MTD and Calamba agreed to partner in developing a Calabarzon Regional Government Center which was envisioned to be the hub of regional offices of national line agencies.

What encouraged the two parties was Executive Order No. 246 issued by former President Gloria Arroyo, designating Calamba City as the regional government center for Calabarzon.

When problems led to disagreements between Calamba and MTD, their partially completed project was scrapped. Both agreed to submit to the CIAC which issued a Final Award and Order of Execution in favor of the developer. 

“This Commission dismisses the petition for being premature. MTD may be correct that its claim in the amount fixed in the CIAC Final Award and Order of Execution is liquidated, however, the same is not yet final and executory. Thus, this claim is not yet ripe for determination by this Commission,” the COA CP said.

COA chair Gamaliel A. Cordoba and Commissioners Roland Café Pondoc and Mario G. Lipana said that “while the commission exercises general jurisdiction over settlement of debts and claims from or owing to the government or its instrumentalities, that liability must first be settled and determined with finality.”

In this particular case, both the Calamba and MTD have filed their own separate petitions for review on certiorari before the Supreme Court.

COA said: “The city undisputedly filed its own petition for review on certiorari before the SC, which not only militates against the proposition that the claim is already liquidated or settled but also shows that the judgment is not yet final and executory,” it pointed out.

Earlier, the CIAC ruled in favor of the developer, holding that Calamba City failed to deliver on its responsibility in their JVA. The arbitral tribunal declared the JVA terminated and over the city to pay the developer P755,006,011.34 for the project cost of P712.27 million and liquidated damages at 6%. – Rappler.com