METRO RAIL TRANSIT DEVELOPMENT CORP V.

GAMMON PHILIPPINES, INC

G.R. No. 200401, January 17, 2018

LEONEN, J.:

FACTS:
MRTDC was awarded a government contract by way of a Build Lease and Transfer Agreement
to undertake the MRT 3 North Triangle Development Project. Among the major components of
the Project was the construction of a four level podium structure.

MRTDC, through its Project Manager, Parsons Inter Pro Joint Venture, give notice to the
Gammon, of the award to it of the contract for the construction of the podium superstructure.
Shortly thereafter, MRTDC sent a letter to Gammon, notifying the latter of the suspension of all
the undertakings because of the currency crisis at that time.

According to Gammon, however, it proceeded to de-water and clean up the Project site. On the
other hand, MRTDC claims that before any construction activity could proceed, it formally
served Gammon a notice confirming the "temporary suspension of all requirements under the
terms of the contract until such time as clarification of scope has been received from the owner.
The only exception to this suspension is the re-design of the projects floor slabs and the site de-
watering and clean up. As a result of its analysis of the impact of the currency crisis, MRTDC
decided to downsize the podium structure to two levels. Gammon then submitted a proposal
reducing the contract price. This proposal was accepted by MRTDC.

Gammon qualifiedly accepted the offer but manifested its willingness to consider revisions to the
terms and conditions of the NOA/NTP. MRTDC notified Gammon that it was awarding the
contract to Filsystems since Gammon did not accept the terms and conditions of the NOA/NTP.
Consequently, Gammon sought reimbursement of the direct and indirect costs it incurred in
relation to the Project.

MRTDC signified its willingness to reimburse Gammon but rejected the latter’s computation and
instead offered a fixed cap of five percent of Gammon’s total claims.

Dissatisfied with this figure, Gammon filed its claim with the CIAC invoking the arbitration
clause of the General Conditions of Contract which provides that the arbitration of all disputes,
claims or questions under the contract shall be in accordance with CIAC rules.

ISSUE: Whether the CIAC decision over the case cannot be disturb by the court.

HELD:

As a rule, findings of fact of administrative agencies and quasi-judicial bodies, which have
acquired expertise because their jurisdiction is confined to specific matters, are generally
accorded not only respect, but also finality, especially when affirmed by the Court of Appeals. In
particular, factual findings of construction arbitrators are final and conclusive and not reviewable
by this Court on appeal. This rule, however admits of certain exceptions.
In David v. Construction Industry and Arbitration Commission, we ruled that, as exceptions,
factual findings of construction arbitrators may be reviewed by this Court when the petitioner
proves affirmatively that: (1) the award was procured by corruption, fraud or other undue means;
(2) there was evident partiality or corruption of the arbitrators or of any of them; (3) the
arbitrators were guilty of misconduct in refusing to hear evidence pertinent and material to the
controversy; (4) one or more of the arbitrators were disqualified to act as such under Section nine
of Republic Act No. 876 and willfully refrained from disclosing such disqualifications or of any
other misbehavior by which the rights of any party have been materially prejudiced; or (5) the
arbitrators exceeded their powers, or so imperfectly executed them, that a mutual, final and
definite award upon the subject matter submitted to them was not made.
Other recognized exceptions are as follows: (1) when there is a very clear showing of grave
abuse of discretion resulting in lack or loss of jurisdiction as when a party was deprived of a fair
opportunity to present its position before the Arbitral Tribunal or when an award is obtained
through fraud or the corruption of arbitrators, (2) when the findings of the Court of Appeals are
contrary to those of the CIAC, and (3) when a party is deprived of administrative due process.

However, petitioner failed to prove that any of these exceptions are present in the case at bar.
Thus, this Court will no longer disturb CIAC's factual findings, which were affirmed by the
Court of Appeals.