7.20 Section 10 of the General Conditions of the Contract stipulates that payment shall
only be made upon certification by the HOPE that the goods have been delivered
in full compliance with the terms and conditions set forth in the contract. The
Contract Agreement executed between the City of Guihulngan and the Supplier
is legally binding on both parties and clearly outlines the obligations and
responsibilities therein. Notably, the contract does not contain any clause
permitting partial deliveries or corresponding partial payments.
7.21 Any deviation from the agreed terms—such as accepting and paying for partial
deliveries—constitutes a breach of contract and may expose the agency to
significant risk. Such non-compliance may not only compromise the integrity of
the procurement process but could also set a detrimental precedent for future
contractual engagements. It may encourage suppliers to disregard contractual
obligations, potentially leading to inefficiencies, delays, or disputes, thereby
placing the agency at a disadvantage both legally and operationally.
Specifications of the medicines delivered deviated from the contract of agreement
8. Drugs and medicines were accepted by the City even though the items delivered
did not conform to the specifications stipulated in the contract agreement, as listed
in the Request for Quotation (RFQ) submitted by the winning bidder, in violation
to Section 1.2 of Annex D of the Revised IRR of RA No. 9184, thereby
compromising the integrity of the procurement process.
8.1 As previously discussed in AOM No. 2025-09(2024), the City Government paid
for the delivery of drugs and medicines even if the supplier did not fully comply
with terms of the contract.
8.2 Section 1.2, Annex D of the 2016 Revised IRR of RA No. 9184 provides that,
“An amendment to order may be issued only in emergency cases or during
fortuitous events requiring necessary adjustments within the general scope of the
contract in any one or more of the following is required in order to fully meet the
requirements of the project:
a) drawings, design or specifications, if the goods to be furnished are to be
specifically manufactured for the Government in accordance therewith;
b) method of shipment or packing; or
c) place of delivery.”
8.3 Post-audit of the disbursement voucher paid to the Supplier amounting to
₱5,964,085.88 under Check No. 592418 dated October 8, 2024, and its supporting
documents disclosed that the technical specifications, such as the brand names for
37 out of 102 items or 36 per cent were changed during its contract
implementation by the supplier.
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