Although attorney’s fees are not allowed in the absence of stipulation, the court can award the same when the defendant’s act or omission has compelled the plaintiff to incur expenses to protect his interest or where the defendant acted in gross and evident bad faith in refusing to satisfy the plaintiff’s plainly valid, just, and demandable claim.

Still, the award of attorney’s fees to the winning party lies within the discretion of the court, taking into account the circumstances of each case.  This means that such an award should have factual, legal, and equitable basis, not founded on pure speculation and conjecture.  Further, the court should state the reason for the award of attorney’s fees in the body of the decision.  Its unheralded appearance in the dispositive portion is, as a rule, not allowed.

Here, however, although the RTC did not specifically discuss in the body of its decision its basis for awarding attorney’s fees, its findings of fact clearly support such an award.  For instance, the RTC found, based on the record, that Bongar persistently and clearly violated the terms of its contract with Alcatel.  It failed to finish the works by October 29, 1991, the stipulated date.  It sought on December 1, 1991, more than a month after it was in violation, to finish its job by May 31, 1992, an extra seven months for just a three-month project.  Worse, when Alcatel had to take over the job to save its own undertaking to PLDT, Bongar refused to return to Alcatel the uninstalled materials that it provided for the works.[3]  Alcatel was forced to litigate to protect its interest.

Alcatel v. Bongar, G.R. No. 182946, October 5, 2011 (Third Division)