DOES THE RELEASE OF FINAL PAYMENT RELIEVE THE CONTRACTOR OF LIABILITY FOR ANY DEFECT IN THE WORK?
After release of final payment and acceptance by the Owner of the Work, the Contractor is still liable for any defect in the Work, if:
1. The defect is hidden;
2. The Owner’s acceptance of the Work was made with reservations to specific portion of the Work;
3. Inferior work or work which does not comply with the Drawings and Specifications and is apparent upon inspection by the Owner within one year from final payment; and
4. Hidden defect discovered within the warranty period or within one year from posting of the Guarantee Bond.
The Contractor is likewise liable for damages and structural defects, within FIFTEEN (15) YEARS from completion of the structure, on account of defects in the construction or the use of materials of inferior quality or due to any violation of the terms of the Contract as provided in Article 1723 of the Civil Code of the Philippines.
