In the Philippine legal landscape, the construction of government infrastructure is governed by stringent rules to ensure public safety and the efficient use of taxpayers' money. The framework for structural liability and warranty periods is primarily established by Republic Act No. 9184, otherwise known as the Government Procurement Reform Act (GPRA), and its 2016 Revised Implementing Rules and Regulations (IRR).
Under these laws, the responsibility of a contractor does not end upon the physical completion of a bridge, road, or building. Instead, a multi-layered system of liability and warranties ensures that the government is protected against defects and structural failures.
I. The Defects Liability Period (DLP)
The first stage of post-construction responsibility is the Defects Liability Period. This period lasts for one (1) year from the date of project completion up to the point of "Final Acceptance" by the Procuring Entity.
- Contractor’s Responsibility: During this year, the contractor is legally obligated to undertake repair works, at their own expense, on any damage to the infrastructure arising from the use of materials of inferior quality or faulty workmanship.
- Retention Money: To guarantee these repairs, the government withholds "retention money" (usually 10% of the total contract price) or requires a bank guarantee. This is only released after the one-year period, provided all defects have been rectified.
II. The Warranty Period and Structural Integrity
Once the project receives a Certificate of Final Acceptance, the specific Warranty Periods begin. These periods are categorized based on the expected lifespan and nature of the infrastructure:
1. Permanent Structures (Fifteen Years)
For projects intended to last decades, the warranty period is fifteen (15) years from final acceptance. These include:
- Buildings (Administrative, healthcare, educational).
- Concrete/steel bridges and flyovers.
- Major dams and irrigation canals.
- Port authorities and similar steel/concrete structures.
2. Semi-Permanent Structures (Five Years)
For projects with a shorter lifecycle or those utilizing less durable materials, the warranty is five (5) years. These include:
- Asphalt roads and river control works.
- Drainage systems and wooden bridges.
- Buildings made of mixed materials (e.g., semi-concrete).
3. Other Structures (Two Years)
For temporary or minor works (e.g., bailey bridges, temporary shanties), the warranty period is typically two (2) years.
III. Liability for Structural Defects and Failures
Section 62.2.3.2 of the IRR of RA 9184 defines the specific conditions under which a contractor (and other parties) can be held liable for Structural Defects (faults in the execution) or Structural Failures (total or partial collapse).
Liability is triggered if the failure is caused by:
- Defective Plans: If the design itself was flawed (liability may extend to the consultant/designer).
- Deficiency in Workmanship: Failure to follow the approved plans and specifications.
- Use of Substandard Materials: Using materials lower than the quality required by the contract.
- Negligence: Failure to exercise due diligence during construction.
Note on Force Majeure: A contractor is generally not held liable for structural failure caused by "Acts of God" (extraordinary earthquakes, typhoons) unless the failure was exacerbated by the contractor's use of substandard materials or poor workmanship that did not meet the building code requirements for such events.
IV. Solidary Liability
In the Philippines, structural liability is often solidary. This means the government can pursue multiple parties simultaneously:
- The Contractor: For construction and execution.
- The Project Consultants: If the failure is due to design errors.
- The Government Project Engineer: If the failure is due to gross negligence in supervision.
V. Warranty Security
To ensure that funds are available for repairs during the 5 to 15-year warranty period, contractors are required to post a Warranty Security. This can take the following forms:
- Cash or Letter of Credit: Usually 5% of the contract price.
- Bank Guarantee: Usually 10% of the contract price.
- Surety Bond: Usually 30% of the contract price, callable on demand and issued by the GSIS or an authorized insurance company.
The security is reduced annually on a graduated scale as the warranty period nears its end, provided no structural defects have surfaced.
VI. Penalties and Administrative Sanctions
Failure to comply with warranty obligations or the occurrence of structural collapse due to fault results in severe penalties:
- Blacklisting: The contractor may be barred from participating in any government bidding for a specific period (usually 1 to 2 years for the first offense).
- Criminal Liability: Under Article 1723 of the Civil Code of the Philippines, the engineer or architect who drew up the plans is liable for 15 years if the building collapses due to defects in the plans or the ground. The contractor is likewise liable if the collapse is due to defects in construction or materials.
- Civil Damages: The government may sue for the full cost of reconstruction and consequential damages.