Supplier appeals nixing of P690-M ballot folder deal

The firm that bagged the botched P690-million contract to supply the ballot secrecy folders filed on Friday a motion for reconsideration with the Commission on Elections (Comelec), saying that the sudden scrapping of the deal was unlawful. In its petition, the OTC Paper Supply firm insisted that the Comelec should either maintain the contract or pay the company for its expenses in the manufacture of the ballot secrecy folders because the deal was terminated unlawfully.

Worth P690 million, the contract covers supply and delivery of 1,815,000 pieces of 25-inch long ballot secrecy folders priced at P380 each. OTC said the poll body scrapped the deal "without the observance of the process, both procedural and substantive, required by the law." "The short end of it is it's an appeal for the rule of law to prevail, as simple as that," OTC legal counsel Benedicto Valerio told reporters in an interview. He said that a "valid contract" had already existed between the Comelec and the OTC when the poll body did not act within 10 days after awarding the deal, adding that the company received the notice of award on March 16. Section 37 of Republic Act or the Government Procurement Reform Act says the Comelec had 10 days to formally enter into contract with OTC. But if no action is taken within the 10-day period, Section 38 states that the contract "shall be deemed approved." The same provision also provides that a contract entered into by a procuring entity may be terminated only upon grounds "recognized by and only after compliance with the process required under the said law." But Valerio said the Comelec failed to show the grounds for terminating the contract. "Siguro naman eh nag-attach na rin yung liability ng Comelec na pwede lang nilang kanselahin ang kontrata matapos dumaan sa tamang proseso at sa grounds na sinasabi ng batas (The Comelec should be held liable for canceling a contract without going through the proper process and grounds as stated in the law)," he said. He likewise said that OTC has already invested a "significant amount" of capital in order to deliver the goods and will suffer "serious financial losses" if the termination of the contract is not reversed. "Marami na kaming ginawang preparasyon, yung preparasyon na ito (We have already done a lot of preparations which) would involve a substantial investment on our part so that we can comply with the deadline requirements," he said. OTC manager Henry Young said they have already paid a P34-million performance bond, which is 5 percent of the worth of the whole contract. He added that they have already spent P500 million for the materials that were supposed to be used for the folders. No stopping OTC petition In a separate interview, Comelec’s Law Department head Ferdinand Rafanan said that they cannot stop OTC from filing the petition. "Karapatan naman nilang mag-file ng motion for reconsideration kung di sila konteto sa hindi pagkakatuloy ng kontrata nila with Comelec (It's their right to file an motion for reconsideration if they were not satisfied with how the contract with Comelec was terminated)," he said. He noted, however, that he cannot comment much on the matter because the awarding of the deal to OTC is still under investigation. Earlier, the poll body scrapped the contract because it was supposedly "extravagant beyond the ordinary needs of the Commission." It also said that the number of folders to be purchased exceeded the total number that may actually be used during the elections. Comelec chairman Jose Melo also admitted that the Comelec en banc and the Bids and Awards Committee (BAC) committed a "lapse" in judgment when it awarded the contract. The poll body then decided to create a three-man panel to look into the recommendation of the BAC to award the contract to OTC. — LBG/RSJ, GMANews.TV