April 7, 2022

Engineer 3, MESD/ASD

SUBJECT : DEDUCTIVE CLAIMS FOR LABOR COST OF UNINSTALLED

CABLES
(Supply & Installation of (3) Three Brand New Units Oil Type
And One new unit dry type transformer)

Dear Engr. Aldwin Evidiente

Good day!

This is in response to your deductive claim of 25% for the total cost of the
item for labor cost of cables amounting to PESOS AND THIRTEEN
CENTAVOS (.13).

Please be informed that it is not acceptable in our end for this deductive cost
in our contract. Below are our justifications;

1. It was CCP’s decision and direction not to install the cable wires in
anticipation that there will be electrical system upgrade in the future.
It was not mentioned in the TOR that any uninstalled items initiated
by the client are subject for deductive claims. Also it was not verbally
agreed by the parties that the same shall be a deductive cost in the
contract price.

2. As per assessment of during the bidding, the location @ the “loading

bay” is the best route for lifting the 500kVA transformer. This is the
most convenient and economical compared to other location. However,
this preferred route by was not materialized and disapproved by CCP
due to safety concerns.

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 3. The final route proposed by CCP is through the escalator of main
entrance and the team agreed since no other option is available,
besides the delay of completion is continuously getting longer which is
not okay in the part of nd CCP. Due to urgency and limited time to
work at the area given by escalator contractor, the activities
immediately started. The actual execution required various manpower,
material, tools and equipment for the transformer to be lifted. Actual
expense incurred by to complete the works is around PESOS
(Php,000.00) while the original estimated budget is PESOS Php
180,000 as for the original location. incurred additional PESOS
(Php,000.00). Supposed to be, this is subject for additional claim and
amendment to order. However, Kempal did not charge to CCP
additional cost just to expedite the completion of the project.

Please note that the additional amount of the cost incurred for the
hauling of 500kVA transformer alone is much higher to your
computed deductive claims for the labor cost of uninstalled cables.

4. There were termination works that have been done even without
installation of the new wires. l provided various termination
accessories like terminal lugs, connectors, trapo box, cable tray, etc.
just to adopt, wire managed and used the existing cables.

Based from the justifications mentioned above, it is just fair that no

deductive claim for labor cost of uninstalled cable should be imposed.

We hope that we can settle this matter amicably.

Thank you very much.

Sincerely yours,

CEO/Managing Director

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