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Court: Capitol to pay only P257 million

By Ador Vincent Mayol, Doris C. Bongcac
Cebu Daily News
First Posted 10:25:00 10/09/2009

Filed Under: Heavy construction

The Regional Trial Court granted the request of the Cebu Provincial government to reconsider its decision that ordered the Capitol to pay for the additional works done on the Cebu International Convention Center (CICC).

Judge Ester Veloso of RTC branch 6 told the Capitol to pay WT Construction Inc. (WTCI) P257,413,911.73 instead of the original amount the court asked the Capitol to pay the contractor.

Veloso, in her decision last May, ordered the Capitol to pay WTCI P263,263,261.41 for additional works done on CICC, including site development, structural, architectural, electrical and plumbing.

But in her recent decision, Veloso granted the request of the Capitol to allow them to pay P257,413,911.73 based on the appraisal done by the provincial Technical Working Group.

But Veloso, however, sustained her ruling that the Capitol should pay a legal interest of 12 percent per annum to be computed from Jan. 22, 2008 when WTCI filed the civil case until such a time that the amount was paid in full.

The court also ordered Capitol to pay P50,000 in attorney's fee.

Capitol Consultant Rory Jon Sepulveda said that while they welcomed the decision of the court, they might contest before the Court of Appeals (CA) tje order requiring them to pay legal interest and the attorney's fee.

Gov. Gwen Garcia mentioned the RTC decision when she met with Provincial Board Members for a meeting late on Tuesday afternoon.

PB Member Jose Ma. Gastardo said that the governor told PB members of the need to pass a supplemental appropriation so that they could settle the unpaid balance which the RTC has asked them to pay.

However, Garcia wanted to appeal the interest payment.

Garcia pegged the total cost of her centerpiece project at P573.3 million during her presentation before officials of the Kapisanan ng mga Brodkaster sa Pilipinas in Cebu and critic broadcaster Leo Lastimosa last February.

She did not include the cost on the additional works done on CICC in the computation because it was subject to litigation at that time.

But Garcia admitted that additional works were done on the facility because its construction was fast-tracked in time for the 12th Association of Southeast Asian Nations (ASEAN) Summit in 2007.

The CICC at the Mandaue Reclamation Area was one of the key venues for the summit.

Its construction was completed in a record time of eight months.

Allegations that it was overpriced was still subject to investigation by the Office of the Ombudsman in the Visayas based on the complaint filed by contractor Crisologo Saavedra who claimed that the project was undertaken using illegal shortcuts in the bidding process.

The WTCI won the bidding for the construction of the CICC's substructure or foundation in February 2006. After the phase 1 was completed, the contractor was awarded phase II for the superstructure.

But in January 2008, the WTCI filed a civil case to collect payment of P261 million for the additional works on CICC that included P175,951,478.69 for the site development, structural and architectural works and P85,266,407.97.

The province opted not to pay because these were still subjected to technical evaluation and cost analysis of their technical personnel.

It also said the WTCI did not have a contract with the province which would make any payment questionable and illegal.

But the WTCI said the province had made continued assurance that it would pay the contractor once the additional works were completed.

The court, however, ruled that the contractor was entitled to P263 million or P2 million more than what WTCI originally asked after the province admitted in its evaluation report that such was the true value of the additional works.

But when the Capitol reviewed last May the actual cost of the additional works on the CICC, they learned that the amount was only P257.4 million, prompting Veloso to grant the Capitol's request for reconsideration.



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