Short answer. Yes, in part. Where work cannot be completed because of a defect in the material you furnished, without fault on the contractor's part, the Civil Code entitles the contractor to an equitable share of the compensation proportional to the work already done, plus reimbursement of proper expenses incurred.
What the law says
If the work cannot be completed on account of a defect in the material furnished by the employer, or because of orders from the employer, without any fault on the part of the contractor, the latter has a right to an equitable part of the compensation proportionally to the work done, and reimbursement for proper expenses made.
Civil Code, Article 1722 — Work Halted by Employer's Material or Orders. Read the full provision →
Your role as "employer" under this article
In a contract for a piece of work, the Civil Code calls the person who commissioned the job and furnished the materials the employer, and the person doing the work the contractor, regardless of whether either is an actual employer in the everyday sense. Article 1722 addresses exactly the situation you describe: the work cannot be completed because of a defect in the material furnished by the employer — that is, by you — where the contractor was not at fault.
What the contractor is entitled to
The article gives the contractor two things once the work stalls this way: an equitable part of the compensation proportionally to the work done, and reimbursement for proper expenses made. This is not the full contract price — it is a share of it, measured against how much of the job was actually finished before the defective material stopped things, plus whatever legitimate expenses the contractor already incurred toward the project.
Why the contractor's lack of fault matters
The article conditions this entitlement on the halt happening without any fault on the part of the contractor. Article 1722 is built around the idea that the contractor should not absorb the cost of a problem that originated with the materials you supplied, provided the contractor did not cause or contribute to the defect that stopped the work. If the contractor's own error was actually the cause, this specific provision would not be the one describing the situation.
What "equitable" and "proper expenses" leave open
Article 1722 does not fix a formula for calculating the equitable share or define exactly which expenses count as proper — it states the entitlement and leaves the amount to be worked out against the actual facts of the job. Records of what was completed, receipts for materials and labor the contractor already committed, and the state the project was in when it stopped are what that calculation would be built from.
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.
- In the Matter of Urgent Petition for the Release of Prisoners on Humanitarian Grounds, G.R. No. 252117, July 28, 2020 — read the decision on LawPhil →