Tire company mulls lawsuit vs DND move to cancel deal

From the Business Mirror (Sep 13): Tire company mulls lawsuit vs DND move to cancel deal

THE winning bidder in a multimillion-peso tire-delivery contract with the Department of National Defense (DND) said it mulls a lawsuit as the DND moves to cancel the deal.

Tire company Caloocan Standard Inc. (CSI), represented by Alexander Kho, wrote the defense department, saying that it would be forced to seek redress in court, unless officials would honor the contract, which was perfected through a bidding process.

The BusinessMirror obtained a copy of Kho’s letter addressed to the chairman of the DND Bids and Awards Committee (BAC). “Any member of your committee might be held answerable for civil damages, much more the CGPA [commanding general, Philippine Army], since all proponents for this particular procurement had already labored, spent much time and resources, paid bidding documents, hired professionals and lawyers if only to win the bidding,” Kho said in his letter.

“And here is the Army belatedly telling everybody that it does not need the goods being procured on the guise that it has an excess stock, notwithstanding its prior determination in the year 2013 of its need thereof that paved the way for its inclusion in the 2014 General Appropriations Act,” he added.

CSI won on December 13 last year the bidding for the delivery of 7,043 pieces of lug-type and directional tires. However, in a May 12 letter, Angelito Castillo, head of the DND BAC Secretariat, told CSI it would no longer pursue its contract with the firm.

“Much to the regret of the DND Bids and Awards Committee, we wish to inform you that the Department of National Defense will no longer pursue the aforestated procurement as the end-user of these commodities,” Castillo said in his letter, a copy of which the BusinessMirror also obtained.

“The Philippine Army has requested for its cancellation, as well as the realignment of fund supposedly allocated for the project,” Castillo added.

Castillo said in the letter that “upon the request of the Commanding General, Philippine Army, the Secretary of National Defense is constrained to cancel the project the same being no longer necessary.” Kho however responded, wherein he also asked for a reconsideration of the project’s cancellation, saying the reasons given by the DND were not only “unconstitutional but unduly exposes the CGPA to criminal, administrative and civil prosecution.”

http://www.businessmirror.com.ph/tire-company-mulls-lawsuit-vs-dnd-move-to-cancel-deal/