Pay construction firm, DoH ordered

The Court of Appeals (CA) has ordered the Department of Health (DoH) to pay the construction firm which built 270 barangay health stations for use by COVID-19 patients.

In a 51-page decision penned by Associate Justice Ruben Reynaldo Roxas, the CA’s Former Fifth Division partially granted the petition filed by the DoH questioning the 19 September 2019 final award and the 21 October 2019 corrected final award of the Construction Industry Arbitration Commission (CIAC).

The CIAC granted the claim of

JBros Construction Corporation for the payment of around P1.04 billion for the works it accomplished under its previous deal with the health department.

It declared as valid the decision of JBros to terminate its contract with the government due to the latter’s failure to comply with the agreement.

The project was implemented under then Health Secretary Janette Garin targeting to establish 5,700 rural health units to ensure barangays have access to primary health care. Elementary schools were to be identified as sites for the health stations.

But the construction firm was awarded the P3.5 billion contract for the construction of over 3,000 barangay health stations across the country in 2016.

In partially granting DoH’s petition, the CA reversed and set aside the CIAC’s decisions, insofar as it ruled that JBros validly terminated the contract and that it is entitled to money claims amounting to more than P1 billion.

The appellate court said the DoH still has to pay JBros for the 270 fully constructed BHS “in the interest of substantial justice and equity.”

“At this juncture, it should be noted that there are 270 BHS units with certificates of completion as can be gleaned from the consolidated report made by the parties. Indisputably, these completed units can be used for the benefit of the government and the public,” the CA said.

“Accordingly, the Commission on Audit is directed to determine, on a quantum merit basis, the compensation due to private respondent. This amount shall be deducted from the mobilization fees and any remaining amount shall be returned by private respondent to petitioner,” it added.

Record showed JBros had already received P668.48 million as mobilization fees for the project.

The constuction firm In 2018, wrote the DoH informing it of the termination of contract and a billing of about P2.9 billion.

Health Secretary Francisco Duque III said the bill was for 429 barangay health sites which the construction company claimed it had completed.

But a DoH task force tasked to investigate anomalies involving the contract, found out that only about 270 barangay health stations were completed while only eight had complete documents.

Arbitration was sought by both parties to seek legal redress.