Camp John Hay Development Corporation v. Charter Chemical

Summary

Camp John Hay Development Corporation contracted Charter Chemical and Coating Corporation for painting works at Camp John Hay Manor for P15.5 million, with partial payment through two studio units at Camp John Hay Suites. Charter Chemical completed the work in 2003, but the promised units were never delivered due to construction delays. Originally estimated for completion by 2006, the project was repeatedly delayed until 2012. Charter Chemical demanded payment and filed for arbitration in 2008. The Supreme Court upheld the Construction Industry Arbitration Commission's jurisdiction and affirmed rescission of the contract under Civil Code Article 1191, ordering payment of P5.9 million plus interest and attorney's fees. The Court ruled that rescission was the proper remedy rather than fixing a performance period, given the unjustified years-long delay without just cause.