HIGHLIGHTS :

❖ Verification by the owner

❖ Final acceptance and payment
❖ Contract price adjustments
❖ Liquidated damages
❖ Warranty for the defect
❖ Release of performance bond
Verification by the owner

▪ The owner is entitled, at its/his discretion

to conduct such audit as he may deem
necessary for his own investigation in
connection with the following:
Verification by the owner

1. Extra work done on cost-plus percentage basis as

provided for in Clause Variations, of the General
Conditions.
2. Revisions of Bid/Tender prices by reason of
increase in the cost of material and minimum
daily wage rate in accordance with Verification by
the Owner.
Verification by the onwer

3. Costs incurred in the event of take over or

termination of the Contract.
4. Such other matters related thereto

The Contractor is obliged to keep accurate up to

date ac- counting books and records concerning
the above items.
FINAL ACCEPTANCE AND PAYMENT

When the Contractor has satisfactorily completed

the Works and the same has been accepted by the
Owner, a final estimate showing the value of the
Works in accordance with the approved "as built
plans" shall be prepared as soon as the necessary
measurements and computation have been made.
FINAL ACCEPTANCE AND PAYMENT

The final estimate shall be submitted to the

Contractor for his approval and signature. The
signing of the final estimate by the Contractor shall
constitute full acceptance of the total amount
shown as entire payment for the amount due him
under the Contract If the Contractor does not agree
to this estimate, he shall, within a period of thirty (30)
calendar days,
FINAL ACCEPTANCE AND PAYMENT

file with the Owner a written statement setting forth

his claim for adjustment.
Failure on the part of the Contractor to file such
statement within calendar days from the date of his
non-acceptance of the final estimate, shall
constitute evidence of his agreement to the
quantities set forth therein and he shall have no
further claim against the Owner.
FINAL ACCEPTANCE AND PAYMENT

The amount of his final estimate, including sums

that have been retained under the provisions of the
Contract, will be paid to the Contractor as soon as
practical after the final acceptance.
PAYMENT OF OBLIGATION

1. The Contractor shall punctually pay all workmen

employed him on the Contract Works at such
times and at such rates as are provided by
existing laws.
2. He shall also promptly pay all materials and
equipment used by him for the Works.
PAYMENT OF OBLIGATION

3. He shall likewise pay all his taxes obligations and

remit as required by law all amounts that he may
have withheld from the salaries or wages of his
employees or workmen.
4. The Contractor shall have on hand every payday,
in addition to the usual requirement of cash
outlay for the Contract Works, a labor fund
sufficient enough to cover up each fifteen day
payroll for the workers.
PAYMENT OF OBLIGATION

5. Payments to the laborers and employees shall be

made on or a day immediately after every pay
period.
6. Payment of wages and salaries to laborers and
employees assigned in the project shall be
witnessed by the duly authorized representative
of the Owner who shall certify to such payment.
PAYMENT OF OBLIGATION

7. Failure of the Contractor to pay his laborers and

employees within the period herein stated, the
Owner shall forthwith make such payment out of
the funds of the project in which case the sum
paid out plus a surcharge of one (1%) percent
shall be deducted from any amount due or to
become due the Contractor without prejudice to
the right of the Owner to terminate the Contract.
PAYMENT OF OBLIGATION

8. Before any payment is made to the Contractor in

excess of twenty percent (20%) of the Contract
Price, the Contractor shall submit a written sworn
affidavit stating that he had paid all obligations
due for labor, materials rent of equipment and
taxes in connection with the Contract
PAYMENT OF OBLIGATION

9. Before final payment is effected, another written

sworn statement shall be required from the
Contractor to the effect that the completed
Permanent Works is being delivered to the Owner
free from any lien or other encumbrances or
claim of whatever kind of description.
PAYMENT OF OBLIGATION

10. If prior to any partial or final payment, the Contractor

cannot, or for any reason fails to file his sworn
statement or if the sworn statement submitted by the
Contractor are contradicted by sworn statements of
claimants against him for unpaid accounts or wages,
salaries, rents, materials and taxes incurred in
connection with the Contract, the Owner may
withhold the amount equivalent to the total of all
such claims from any and all payments due the said
Contractor.
PAYMENT OF OBLIGATION

11. Direct payment to creditors of the Contractor for

materials, rents, or taxes, shall be made by the
Owner only upon due execution by the
Contractor of a Special Power of Attorney or Deed
of Assignment in favor of such creditors.

12. In case the Contractor denies under oath the

claims of the claimants,
PAYMENT OF OBLIGATION

the Owner shall advise the claimants to file their

respective claims in court and secure a restraining
order directing the Owner to withhold the amount
equivalent to their claims from whatever payment
due the Contractor. It is understood however, that,
should the claimants fail to secure the restraining
order within forty five (45) calendar days upon
advice, the amount withheld shall be released to the
Contractor
CONTRACT PRICE ADJUSTMENT

The Contract Price shall be based on price

levels as of the date of opening of the Bid
Adjustments of the Contract Price shall be
made in accordance with the approved
guidelines for the computation and payment
of price escalation for infrastructure contracts
as contained in P.D. 1594 and its Implementing
Rules and Regulations as amended.
(Applicable to government projects)
LIQUIDATED DAMAGES

In case the Contractor refuses or fails to

satisfactorily complete the Contract Works within the
time specified herein, plus any time extension duly
granted and is thereby in default under the Contract,
the Contractor shall be liable to the Owner in the form of
liquidated damages and not by way of penalty, an
amount equal to one tenth of one percent (0.10%) of
the total Contract Price for each calendar day of delay,
until such time as the Owner may reasonably secure the
completion of the works.
LIQUIDATED DAMAGES

To be entitled to such liquidated damages, the

Owner does not have to prove that it has incurred
actual damages and may deduct the amount from
any monies due or which may become due the
Contractor under the Contract and or collect such
liquidated damages from the Performance Bond of
the Contractor or Contractor's Sureties whichever is
convenient to the Owner.
LIQUIDATED DAMAGES

1. Provide progress report for the month and estimated

progress for the succeeding month.
2. Completion schedule (target and actual) based on
the approved construction programs
3. Tabulation of employees showing the supervisory
staff and the members of the several classes of
employed by the Contractor during the month.
4. List of equipment utilized for the performance of the
Contract Works during the month.
WARRANTY FOR THE DEFECT

There is hereby provided a Warranty Period of

One year from the date of final completion of the
Contract Works as certified by the Owner in
accordance with this section.
Within the above prescribed period, the
Contractor shall be liable for any failure or defect
noted or appearing in the Works which is traceable
to poor workmanship, use of poor quality
materials/equipment and non compliance with the
Plans and Specifications.
WARRANTY FOR THE DEFECT

The Contractor shall at his own expense make

good such defect as directed by the Owner. If the
Contractor fails or refuses to do so, the Owner shall
carry out the corrective work and the expenses
consequent therefrom or incidental thereto shall be
deducted by the Owner from any monies due or which
may become due to the Contractor.
Defects and failures due to ordinary wear and
causes other than the fault or the Contractor shall not
be taken against the Contractor, and the Contractor
shall not be held liable therefor.
RELEASE OF PERFORMANCE BOND

The Contractor's Performance Bond will be

released by the Owner after the issuance of the
Certificate of Completion of the projects, provided
that, there are no claims for labor and materials filed
against the Contractor, and provided further, that
the Contractor has posted the required warranty
bond in the amount of ten percent (10%) of the
Contract Price