“We issued a notice of default to DCM,” CUC Executive Director Antonio S. Muna said, but added that they still “recognize” DCM’s contract.
DCM said CUC has not cancelled the contract.
DCM human resources manager Nena Titer said their repair crewmembers still report to work daily at Power Plant 1 to conduct repairs.
Muna said CUC found sufficient ground to consider DCM in default.
According to CUC’s contract with the company, one of the grounds for default is when the contractor “fails to complete the scope of work within the time schedule.”
Muna said CUC transmitted the notice to DCM on June 13, adding that they expect the contractor to “offer an amended timeline for the rehabilitation of the engines.”
It is time “to revisit the repair timeline,” he said.
Asked if the notice of default carries a penalty against DCM, Muna said the contract doesn’t allow it.
Gregorio T. Cruz Jr. of the Taotao Tano group earlier urged CUC to invoke the penalty clause in its contract with DCM.
Muna hopes CUC will receive “an acceptable rehabilitation timeline” from DCM within this week.
If the contractor fails to comply with the default notice, CUC will consult with its legal counsel, Muna said.
The contract provides for a 15-day grace period to allow the contractor to “remedy” the problem after the receipt of the default notice from CUC.
Muna believes legal action might take place.
“This is not a clear-cut situation,” he added.
