Short answer. No. The law gives that at-will withdrawal right to the owner alone, letting the owner call off the work even after it has started, provided the contractor is indemnified for expenses, work done, usefulness gained, and damages. A contractor has no matching right to walk away from the project at will.
What the law says
The owner may withdraw at will from the construction of the work, although it may have been commenced, indemnifying the contractor for all the latter's expenses, work, and the usefulness which the owner may obtain therefrom, and damages.
Civil Code, Article 1725 — Owner's Right to Withdraw. Read the full provision →
The owner's at-will right to withdraw
The law gives the owner of a construction project the right to withdraw at will from the construction of the work, even if that work has already been commenced. This is a one-sided privilege written specifically for the owner: it does not depend on the contractor breaching the agreement or the project running into trouble. The owner can simply decide to stop the project. What the owner cannot do is walk away without cost — withdrawal is conditioned on indemnifying the contractor for all the latter's expenses, work, and the usefulness which the owner may obtain therefrom, and damages.
Why this is the owner's privilege, not the contractor's
This article is written and framed around the owner specifically, because the owner is the one who commissioned the work and stands to lose the most from being locked into a project they no longer want or can afford, whether because circumstances changed, funding fell through, or the owner simply reconsidered. Because the law recognizes the owner may need to exit even after work has begun, it builds in the indemnity requirement precisely to protect the contractor from bearing that decision's cost. Nothing in the text extends this same at-will privilege to the contractor's side of the relationship. A contractor who simply wants to stop working on a project without cause has no equivalent statutory right to invoke.
What indemnity the contractor is entitled to
When the owner exercises this right, the contractor does not simply lose out on the unfinished project. The indemnity due covers four distinct elements: the contractor's expenses already incurred, the value of the work already performed, the usefulness the owner obtains from that work even if the project stops short of completion, and damages beyond those first three items. This framework exists because the owner's right to walk away is deliberately broad — it does not require any fault on the contractor's part — so the compensation owed in exchange has to be correspondingly complete to make the contractor whole for a project the owner alone chose to end.
Cases citing this provision
These Supreme Court decisions cite the provision above. We list them so you can read them yourself; the summaries of what each decided are not ours to give.
- National Power Corp. vs. Court of Appeals, et al, G.R. No. 107631, February 26, 1996 — read the decision on LawPhil →