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HS Pow Construction Dev Corp Vs Shaughnessy Devt - Obli Con - Art 1167 & Art 1168

The case involves HSPCDC, a construction corporation, suing SDC for unpaid services related to construction projects. The Court of Appeals ruled that while HSPCDC must pay SDC for well drilling and water tanks due to non-compliance, HSPCDC is not liable for delays as the project modifications contributed to the delays. The Supreme Court partially upheld the CA's decision, affirming HSPCDC's liability for specific costs while rejecting the claim for damages due to delays.

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129 views1 page

HS Pow Construction Dev Corp Vs Shaughnessy Devt - Obli Con - Art 1167 & Art 1168

The case involves HSPCDC, a construction corporation, suing SDC for unpaid services related to construction projects. The Court of Appeals ruled that while HSPCDC must pay SDC for well drilling and water tanks due to non-compliance, HSPCDC is not liable for delays as the project modifications contributed to the delays. The Supreme Court partially upheld the CA's decision, affirming HSPCDC's liability for specific costs while rejecting the claim for damages due to delays.

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FCM DHSVUSOL
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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G.R. No. 229262 H. S. PCDC vs.

SDC July 07, 2021

FACTS:

HSPCDC is a corporation engaged in the business of constructing buildings, and supplying labor and
mats. HSPCDC filed a Complaint for Sum of MOney alleging that in September 2001, SDC engaged its
services for construction of several roads and water facilities in a subdivision in Tanay, Rizal.

SDC refused to pay HSPCDC (main contract plus duplex plus variation orders) and therefore HSPCDC filed
an action before the trial court to collect the total amounts plus interest, from the date of the extrajudicial
demand, as well as attorney’s fees, litigation expenses, and exemplary damages.

SDC alleged that HSPCDC incurred delay in performance of its obligation and abandoned work, as well as
refused to comply with undertaking of building several facilities of which was signed by all parties and
made an integral part of the contract. SDC counterclaimed with prayer for payment of expenses,
damages and cost for litigation

The RTC rendered a decision in favor of the HSPCDC. Both parties filed their respective appeals with the
CA. The CA granted the appeal ordering:
- SDC to pay HSPCDC remaining balance for contracts and duplex houses
- HSPCDC to pay SDC for well drilling, elevated water steel tanks, and for delays

CA noted that SDC was not liable to HSPCDC for the variation orders as there was neither a written
authority from SDC ordering or allowing the written changes in work, nor a written agreement of the
parties that there would be an additional cost due to the variations. On the basketball courts, absence of
agreements denote that HSPCDC is not liable. Both parties filed MR, which was denied, hence the present
petition

ISSUE: Whether the CA erred in directing petitioner to pay respondent the amounts for well drilling,
water tanks, and for delays

RULING:

The Court finds partial merit in the petition.

Anent the SDC’s claim of HSPCDC being liable for well-drilling and elevated water tank, the SC finds no
reason to disturb the decision of the lower courts. As correctly ruled by the RTC, HSPCDC's failure to
comply with its obligation to undertake the well-drilling and to put up the steel water tank renders it
liable under Article 1167 of the Civil Code which provides
that if a person obliged to do something fails to do it the same shall be executed at his cost.

Anent HSPCDC’s delay, the SC affirms the RTC findings in that the HSPCDC is not guilty of delay. Based
on the testimony of HSPCDC's witness and the admission of Ang, it is clear that the project went through
modifications even while the project was already ongoing. In cases where the respondent-developer
contributed to petitioner-contractor's delay, the CA's award of liquidated damages for delay in favor of
respondent-developer would have no basis

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