G.R. No.

181969
October 2, 2009
ROMAGO, INC. vs SIEMENS BUILDING TECHNOLOGIES, INC.
Romago Inc. was awarded the Sub-contract for the Building Services-Electrical Package for the Insular Life
Corporate Center. Under the consortium agreement and Equipment Supply Sub-Contract Agreement
(ESSA), Siemens Building Technologies Inc. undertook to deliver the needed electrical equipment for the
project for Romago. SBTI made deliveries but ROMAGO failed to pay in full. The former made demands,
but they were not paid. Romago refused to pay its obligation which amounted to P16,937,612.68, unless
SBTI compensates ROMAGO for the total expenses it allegedly incurred in taking over SBTIs contractual
obligations when the earlier demands to pay were unheeded.

SBTI filed a Request for Arbitration with the Philippine Dispute Resolution Center, Inc. (PDRCI)
which was agreed to by Romago. After due proceedings, the arbitrator awarded to SBTI its claim
of the amount above mentioned plus legal interest, attorneys fees and costs.
SBTI filed a petition for Confirmation of the Arbitrators Decision, and instead of filing a Motion to
Vacate the Award, Romago filed an Answer. The RTC granted the petition, confirmed the award
and issued a Writ of Execution. This had become final and executory. Despite receipt of the Order
on July 3, 2006, Romago did not interpose an appeal. It was only later on August 22, 2006 when
Atty. Barrios withdrew his appearance and the law office of Mutia Venadas entered appearance
that Romago sought for a petition for relief from judgment. Claiming that Atty. Barrios was sick
for three weeks and only later were they aware of the orders of the court.
SBTI opposed, and the RTC denied it. MR was denied. And upon petition for certiorari to the
CA,Romago raised the issue that the PDRCI had no jurisdiction over the dispute since the
contract with SBTI was a construction contract and was within the jurisdiction of the CIAC.
However, the CA also denied this.
Issue: was the contract between the parties a construction contract that would place it in the
jurisdiction of the CIAC?
Ruling:
No. It was a supply contract, thus, not within the jurisdiction of the CIAC.
SBTIs scope of work under the ESSA was:
1.01 x x x to furnish all equipment in accordance with the equipment and delivery schedule x x x
1.02 [to] supply and deliver the equipment in accordance with the Bill of Quantities and Cost
Schedule (Attachment Nos. 1 &2) and equipment delivery schedule (Attachment -3) to the
jobsite/designated areas including unloading of equipment from the delivery truck.xxxx

By no stretch of the imagination can the ESSA be characterized as a construction contract.

Crystal clear from the provisions of the ESSA is that SBTIs role was merely to supply the needed
equipment for the Insular Life Corporate Center project. The ESSA is, therefore, a mere
supply contract that does not fall within the original and exclusive jurisdiction of
CIAC.
We also note that the Consortium Agreement between ROMAGO and SBTI contained an
arbitration clause, wherein the parties agreed to submit any dispute between them for
arbitration under the Philippine Chamber of Commerce and Industry (PCCI),36 such as the PDRCI.
Furthermore, the issue of jurisdiction was rendered moot by ROMAGO's active
participation in the proceedings before the PDRCI and the RTC. In fact, during the
proceedings for the confirmation of the Arbitrators award, ROMAGOs opposition zeroed in on the
alleged bias and partiality of the Arbitrator in rendering the decision. Even in its petition for relief
from judgment filed with the RTC, the PDRCIs alleged lack of jurisdiction was never raised as an
issue. It was only in its petition for certiorari with the CA, and after a writ of execution had been
issued, that ROMAGO raised the issue of lack of jurisdiction.
ROMAGO attempted to avoid this final and executory judgment by filing a petition for relief from
judgment with the RTC. However, under the rules, the equitable remedy is allowed only under
exceptional circumstances of fraud, accident , mistake or excusable negligence, which is not
applicable in this case. Romago ascribes its failure to appeal due to the negligence of its counsel,
Atty. Barrios, who had suffered from hypertension; but the court is not convinced since the

affidavit it submit to prove such allegations was filled with blanks of the name of the physician
and hospital who attended the lawyer. As such, It is settled that clients are bound by the
mistakes, negligence and omission of their counsel. While, exceptionally, the client may
be excused from the failure of counsel,49 the circumstances obtaining in the present case do not
persuade this Court to take exception.