UPSI Property Holdings, Construction Inc.
Inc.
vs.
Diesel
Facts: The respondent, Diesel Construction Inc., filed a comp complai laint nt agai agains nstt the the peti petiti tion oner er,, UPSI UPSI Prop Proper erty ty Holdings, Inc. for the collection of unpaid balance of cont contra ract ct pric pricee and and rete retent ntio ion n mone money y unde underr thei theirr constructive agreement, damages for unustified refusal to grant e!tension time, interest and attorney"s fees. The Construction Industry #rbitration Commission rendered an arbitral a$ard in favor of the respondent $ith an interest of %& per annum on the said amount computed from 'une (, )**+ and at the rate of +)& per annum from the date of finality of the decision herein until fully paid. The petitioner then appealed to the Court of #ppeals. The Court then rendered a decision granting the claim of the petitioner for liuidated damages. Unsatisfied $ith the udgment of the C#, both parties filed a separate petition for revie$ before the Supreme Court. The SC then rendered udgment modifying the decision of the Court of #ppeals $hich deleted the liuidated damages gran grante ted d by the the lo$e lo$err cour courts ts.. This This deci decisi sion on of the the Supr Suprem emee Cour Courtt beca became me fina finall and and e!ec e!ecut utor ory. y. The The resp respon onde dent nt then then move moved d for for the the e!ec e!ecut utio ion n of the the udgment $ith the CI#C Ho$ever, it subseuently move moved d for for the the amen amendm dmen entt of the the $rit $rit of e!ec e!ecut utio ion n see-ing to include in the e!ecution the payment of the legal interests and the reimbursement of the half of the aribitration costs. The CI#C, ho$ever, only granted the prayer see-ing see-ing to include include the payment payment of legal interest. interest. #s regards the reimbursement for the arbitration cost, the Commission denied it. ecause of this, the petitioner filed for a petition for revie$ revie$ before before the C# allegin alleging g that that there there has been a subs substa tant ntia iall vari varian ance ce bet$ bet$ee een n the the udg udgme ment nt of the the Supreme Court and the $rit of e!ecution issued by CI#C. The Court of #ppeals ruled in favor of the respondent and and dism dismis isse sed d the the peti petiti tion on for for revi revie$ e$ file filed d by the the petitioner. It ruled that, contrary to the contention of the petitioner, there is no substantial variance bet$een the decision and the $rit of e!ecution as it is already obvious that $hatever a$ard is granted by the Court, it already comes $ith the payment of legal interests. Hence, the current petition. The petitioner contends that the silence of the Supreme Court as regards the payment of legal interest means that the Court has already deleted the a$ard for such payment. /n the other hand, the respondent contends that since the ruling imposed by the CI#C is already imbued $ith finality, the a$ard for legal interest is already beyond uesti uestion. on. The legal legal intere interest st became became applic applicabl ablee as a matter of la$ upon finality. There $as no need for it be a$arded or declared in the udgment itself.
Issu Issue: e: 0hether or not there is a substantial variance bet$een the decision of the SC and the $rit of e!ecution issued by the CI#C. Ruli Ruling ng:: The The Supr Suprem emee Cour Courtt rule ruled d that that ther theree is no substanti substantial al variance variance bet$een the $rit and the decision. decision. 1or the Supreme Court to declare again that there is an a$ard for legal interest $ould be tantamount to an act of redundancy, since it has already been adeuately settled by the lo$er courts. The Court"s silence as to the the payment of the legal interests in the dispositive portion of the decision decision is not not tantam tantamoun ountt to its deletion deletion or reversal. The The Supr Suprem emee Cour Courtt also also pron pronou ounc nced ed,, for for futu future re guidelines, the rule embodied in SP23 Circular 4o. 566. It states that7 I. 0hen an obligation, regardless of its source, i.e., la$, contrac contracts, ts, uasi2 uasi2con contra tracts cts,, delict delictss or uasi2 uasi2del delict ictss is breached, the contravenor can be held liable for dama damage gess. The The pro provisi vision onss unde underr Tit Title 89II 9III on :Damages: of the Civil Code govern in determining the measure of recoverable damages. II. 0ith regard particularly to an a$ard of interest in the concept of actual and compensatory damages, the rate of interest, as $ell as the accrual thereof, is imposed, as follo$s7chan;oblesvirtual
, >, but but $hen $hen such such cert certai aint nty y cann cannot ot be so reasonably established at the time the demand is made, the interest shall begin to run only from the date the udgment of the court is made =at $hich time the uantification of damages may be deemed to have been reas reason onab ably ly asce ascert rtai aine ned> d>.. The The actu actual al base base for for the the computation of legal interest shall, in any case, be on the amount finally adudged. 0hen the udgment of the court a$arding a sum of money becomes final and e!ecutory, the rate of legal intere interest, st, $hether $hether the case case falls falls under under paragra paragraph ph + or
paragraph ), above, shall be %& per annum from such finality until its satisfaction, this interim period being deemed to be by then an euivalent to a forbearance of credit. #nd, in addition to the above, udgments that have become final and e!ecutory prior to 'uly +, )*+?, shall not be disturbed and shall continue to be implemented applying the rate of interest fi!ed therein.
1ollo$ing the foregoing ruling by the Court, the legal interest remains at %& and +)& per annum, as the case may be, since the udgment subect of the e!ecution became final on 3arch )(, )**@. Interests accruing after 'uly +, )*+?, ho$ever, shall be at the rate of %& per annum.
