National Power Corporation v. Hon. Court of Appeals

Summary

This case involves a contractual dispute between National Power Corporation and PECORP, Inc. over fee claims under a cost-plus construction contract for Mariveles Dam No. 1. The main issue was whether two specific claims could be arbitrated: fees for drilling and grouting work that NPC contracted separately with another company, and fees for minimum guaranteed equipment rental. NPC argued these claims were not arbitrable, invoking Civil Code Article 1725 and claiming PECORP withdrew one claim. The Supreme Court affirmed lower courts' decisions requiring arbitration of all claims, holding that the contract's arbitration clause covers any disputes arising from the contract without qualification. The Court rejected NPC's Article 1725 defense, finding no actual withdrawal from construction but merely a transfer of work. The case establishes the broad scope of contractual arbitration clauses and limits on unilateral contract modifications.