F. F. MAÑACOP CONSTRUCTION CO., INC.,
                                                             Petitioner,

COURT   OF  APPEALS  and  THE  MANILA
INTERNATIONAL AIRPORT AUTHORITY,
                                                Respondents.
 
 

Sometime in September, 1995, petitioner started with the construction of a perimeter fence along the MIA road from Asia Overseas, Inc. up to Airscope Development Corporation for and in consideration of the quoted price of P307,440.00. Because of the urgency of building the said fence which was to prevent would be squatters from entering the area, petitioner proceeded with the fence construction even if the Notice to Proceed was not yet signed by the general manager[1] of private respondent[2] but already initialed by its Assistant Project Manager.[3] After the February, 1986 revolution, however, the new general manager[4] of private respondent stopped the construction of the said fence. By that time, 95% was finished which was worth P282,068.00 as computed by petitioner. Petitioner made repeated demands for the payment of what it has completed but private respondent ignored said demands. After two years of making demands for payment which, as aforesaid, were simply ignored by private respondent, petitioner decided to bring the matter to court and thus incurred attorney's fees in the process.

In court, the issues were limited to whether or not petitioner had done works for the private respondent and whether or not the same was authorized.In order to prove that petitioner rendered services to private respondent, petitioner presented Engr. Angelito Gonzales who testified that indeed fence was constructed for private respondent in accordance with plans therefor [Exh. "C"] and pictures had been taken of the fence [Exhs. "N" to "N-3"] and the certification of the supplier as to the materials used by petitioner in constructing the fence and the price thereof.

Private respondent presented no evidence whatever (sic) despite the chances[5] given to it by the trial court, one of which evidence would have consisted of a testimony from the COA[6] on what should be the expenses involved in the construction of said fence.

After the repeated failure of private respondent to present its evidence, the trial court rendered a decision wherein it is found that for the services rendered by the petitioner it should be paid P238,501.48 based upon a quantum meruit since there is an absence of a written contract between the parties. Said amount is the latest evaluation of the work done which evaluation was made by private respondent itself. Likewise, the trial court ordered private respondent to pay petitioner attorney's fees since there is reason to believe that private respondent acted in bad faith in refusing to comply with the repeated demands of petitioner for payment for two long years.

On appeal to the respondent court, the private respondent assigned the error that the trial court should have referred the computation of what should be paid to petitioner to the COA pursuant to what was done in the case of Eslao v. Commission on Audit, 195 SCRA 730. The petitioner refuted this assigned error by pointing out that it is not one of the issues raised before the trial court.

In its decision dated September 8, 1995, the Court of Appeals agreed that petitioner rendered services to private respondent for which it should be paid but set aside the entire decision of the trial court directing the latter to refer the computation of what should be paid to petitioner to the COA as done in the case of Eslao v. Commission on Audit.

A motion for reconsideration of the aforesaid decision proved futile.[7]

Well-recognized jurisprudence precludes raising an issue only for the first time on appeal,[9] as it would be offensive to the basic rules of fair play and justice to allow private respondent to raise a question not ventilated before the court a guo.[10] There is no dispute that the issue of whether the matter should be referred to the COA was not raised in the lower court. Thus, technically, respondent court should not have taken cognizance of the same. However, considering that the issue of reference is a matter closely related to the determination of the question on how much is exactly due to petitioner, the court may consider the former issue for a just and complete resolution of the case.[11] Besides, the present case involves the disposition of public funds and calls for the performance of a constitutional duty of the COA which should not be defeated by mere technicalities of procedure.

Proceeding to the merits, it is not disputed that petitioner is entitled to payment for the construction it made, which arose from a quasi-contractual relation created between the former and private respondent. But should petitioner be paid based on quantum meruit?

The issue was answered in the affirmative in the case of Eslao. We find no reason to depart from such ruling due to the following reasons: First, the instant quasi-contract is neither fraudulent nor mala in se. Second, the project was already covered by a specific appropriation.[12] Third, as in private contracts, the facts show that an implied obligation to pay would be imposed upon the government. Fourth, the property or benefit is not ultra vires, i.e. they can be the proper subject of an express contract and are within the contractual powers of the public body. Fifth, the case falls within the exemption from the mandatory procedure of public bidding which is dispensed with on the ground of public necessity,[13] or when time is of the essence,[14] and considering that the subject project was contiguous to an on going project [15] performed by petitioner and there is no proof of any unsatisfactory performance or negative slippage.[16] Sixth, the contractor substantially complied [95% complete] in good faith with its obligation and no intentional departure from the specifications were alleged. Seventh, petitioner's claim is clearly supported by equity. Private respondent is reaping benefits from the scallop fence and wire placed by petitioner. Eighth, there is no proof of any collusion among the parties involved. Finally, the payment is limited to the actual cost chargeable against funds authorized and certified for the purpose. All these circumstances, taken together, negate fraud and collusion.[17]

Citing the cases of Eslao and Royal Trust, the Solicitor General, on behalf of private respondent, argues that the matter should be referred to the COA. Such argument is without merit. Quantum meruit allows recovery of the reasonable value regardless of any agreement as to value. It entitles the party to "as much as he, reasonably deserves,"[18] as distinguished from quantum valebant or to "as much as what is reasonably worth."

Unliquidated claims present a justiciable question ripe for judicial determination which is beyond the powers of the COA to adjudicate.[19] Recovery based on quantum meruit is in the nature of such claim because its settlement requires the application of judgment and discretion and cannot be adjusted by simple arithmetical processes. In the cases of Eslao and Royal Trust, the Court found it necessary to refer to the COA the task of determining the total compensation due to the claimants considering that the matter on the exact amount was not at issue[20] and the determination thereof involves a review of the factual findings and evidence in support thereof. On the other hand, the lower court in this case, had already made a factual finding on the amount reasonably due to petitioner and scrutinized the evidence to sustain the claim. Besides, there is nothing in the cited cases which would imply that only the COA can determine the specific amount due to a contractor guided by the equitable principle of quantum meruit. As our courts are both courts of law and equity, they are not powerless to determine a factual matter in accordance with both standards.

With respect to the award of attorney's fees, the same is premised on the uncontroverted factual finding of the lower court, as affirmed by respondent appellate court, that private respondent acted in bad faith in refusing payment to petitioner. Such factual findings are not only accorded great weight, but finality as well, since they are supported by substantial evidence.[21] No reason appears in this case that would justify departure from the above doctrine.

WHEREFORE, the decision of the Court of Appeals is SET ASIDE and the decision of the Regional Trial Court dated May 4, 1992 is REINSTATED.

SO ORDERED.

Narvasa, C.J., Davide, Jr., Melo and Panganiban, JJ., concur.

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Endnotes