NORTHWESTERN UNIVERSITY

COLLEGE OF LAW

Laoag City

ALTERNATIVE DISPUTE RESOLUTION REVIEWER

DORONEO, MAE JANSEN D.

JD-2

JUDGE CHARLES JAVIER M. CALAPINI

Law Professor

SY 2019-2020
I.INTRODUCTION

The congestion of case dockets of Philippine courts, especially at the first

and second level, has grave consequences for the average time for disposition

case. In easing the burned of the courts with the accumulated cases, the

judiciary needs solutions to drastically reduce the number of pending cases at

any given time and to improve courts processes and expedite resolution of

disputes.

To actively promote the freedom of parties to make own arrangements to

resolve their disputes, the State encourage and actively promotes the use of

alternative dispute resolution (ADR).1

The Philippines favors alternative method of resolving disputes,

particularly in civil and commercial disputes. 2 Alternative dispute resolution

methods (i.e., arbitration, mediation, negotiation and conciliation) are

encouraged because “they provide solutions that are less time-consuming, less

tedious, less confrontational, and more productive of goodwill and lasting

relationship.”3

The prevailing doctrine then was that “a clause in a contract providing

that all matters in dispute shall be referred to arbitrators, and to them alone, is

contrary to public policy and cannot oust the courts of jurisdiction.” 4

The rule now is the unless the agreement is such as absolutely to close

of door of the courts against the parties, which agreement would be avoid, the

courts against the parties, which agreement arrangement and will only with

great reluctance interfere to anticipate or nullify the action of the arbitrator. 5

1
R.A No. 9285, Sec.2
2
Korea Technologies Co. v. Lerma, G.R No. 143581, January 7, 2008
3
LM Power Engineering Corporation v. Capitol Industrial Construction Groups, Inc., G.R No. 141833, March 26,2003
4
Wahl, Jr. v. Donaldson, Sims & Co, G.R.No. 1085, May 16,1903
5
Vega v. The San Carlos Milling Co., G.R. No. L-21549, October 22, 1924
Q: What is the nature of proceedings under ADR?

A:

 All proceedings under special proceedings

Q: What is the purpose of Alternative Dispute Resolution System in the

Philippines?

A:

 To achieve speedy and impartial justice.

 To declog courts dockets

 To prepare the Philippines for ASEAN integration and globalization.

Q: What is the source of Alternative Dispute Resolution?

A:

 1987 Philippine Constitution

 Statutes

 Executive order

 Decisions of the Supreme Courts

 International laws

Q: What are the General Principles Governing ADR

A:

 Principle of Party Autonomy

 Parties are free to make your own arrangements to resolve their

disputes.6

 Liberal Interpretation in favor of ADR

 In interpreting the ADR act, the court shall have due regard to the

policy of the laws in favor of arbitration.7

6
R.A No. 9285, Chapter 3, Section 18
7
R.A No. 9285, Chapter 4, Section 25
 In situations where n specific rule is provided under the Special

ADR Rules, the court shall resolve such matter summarily and be

guided by the spirit and intent of the Special ADR Rules and the

ADR Laws8

 Principle of Competence-Competence

 The Special ADR Rules recognize the principle of competence-

competence, which means that the arbitral tribunal may initially

rule on its own jurisdiction, including any objections with respect

to the existing or validity of the arbitration agreement or any

condition precedent to the filing of a request for arbitration.

 Principle of Separability

 The Special ADR Rules recognize the principle of separability of

the arbitraction clause, whish means that said clause shall be

treated as an agreement independent of the other terms of the

contract of which is forms parts. A decision that the contract is

null and void shall not entail ipso jure the invalidity of the

arbitration clause9

 The doctorine of separability states that an arbitration agreement

is independent of the main contract.

 Confidential Nature of ADR

 Information obtained through mediation is privileged and

confidential. Likewise, arbitration proceedings, including the

record, evidence and the arbitral award, are confidential and shall

not be published.10

Q: What is included in the phrase “confidential information?”

A: It shall include:

8
A.M No. 07-11-08-SC, Rule 1.13, Spirit and Intent of Special ADR Rules
9
A.M No. 07-11-08-SC, Rule 2.2, Policy on Arbitration
10
R.A No. 9285, Chapter 4, Section 23
 communication, oral or written, made in a dispute resolution

proceedings, including any memoranda,notes or work product of

the neutral party or non-party participant;

 an oral or written statement made or which occurs during

mediation or for purposes of considering, conducting,

participating, initiating, continuing of reconvening mediation or

retaining a mediator; and

 Pleadings, motions manifestations, witness statements, reports

filed or submitted in an arbitration or for expert evaluation.

Q: What are the cases not covered by ADR?

A:

The following cases are not covered by ADR?

 labor disputes covered by Presidential Decree No.442, otherwise known

as the Labor Code of thePhilippines, as amended and its Implementing

Rules and Regulations;

 the civil status of persons;

 the validity of a marriage;

 any ground for legal separation;

 the jurisdiction of courts;

 future legitime;

 criminal liability; and

 those which by law cannot be compromised.

 Adoption

DEFINITION OF TERMS

Q: What is arbitration?

A:
 Arbitration means a voluntary dispute resolution process in which one or

more arbitrators, appointed in accordance with the agreement of the

parties, or rules promulgated pursuant to ADR Act of 2004, resolve a

dispute by rendering

an award.

Q: What is Early Neutral Evaluation?

A:

 It means an ADR process wherein parties and their lawyers are brought

together in an early in a pre-trial phase to present summaries of their

cases and receive a nonbinding assessment by an experienced, neutral

person, with expertise in the subject in the substance of the dispute.

Q: What is Mediation?

A:

 It means a voluntary process in which a mediator, selectedby the

disputing parties, facilitates communication and negotiation, and assist

the parties in reaching a voluntary agreement regarding a dispute.

Q: What is Mini-Trial?

A:

 It means a structured dispute resolution method in which the merits of a

case are argued before a panel comprising senior decision makers with or

without the presence of a neutral third person after which the parties

seek a negotiated settlement.

Q: What is Concillation?

A:

 Concilitation is the adjustment and settlement of a dispute in a friendly,

unantoganistic manner; use in courts before trial with a view towards

avoiding trial and in a labor disputes before arbitration.

II MEDIATION

“Mediation” means a voluntary process in which a mediator, selected by

the disputing parties, facilitates communication and negotiation, and assist the

parties in reaching a voluntary agreement regarding a dispute.

Generally, mediation falls into 2 categories:

 Traditional or classic mediation – attorneys are not generally involved.

The mediator meets directly with the parties to facilitate negotiation.

The classic mediator is passive, expressing no judgment or opinion on

the merits of either position.

 Voluntary Settlement Conferences – attorneys are present and the

mediator takes a more active role, often expressing an opinion on the

merits but without authority to render a decision.

Q: What is Court-Annexed Mediation?

A:

 It means any mediation process conducted under the auspices of the

court, after such court has acquired

jurisdiction of the dispute.

Q: What are the purposes of a court-annexed mediation?

A:

 To unclog the docket of the court

 To shorten the proceedings

 To help in the evaluation of elements

 To bring the parties into a settlement

Illustration:

Q: There is a court proceeding between A and B with regardthe accounting

claim of A to B. Can the court direct the parties to go to ADR in order to

determine whether or not the particular amount being claimed by A is

correct?

A:

 In such case, the court may refer the parties. Since the court will have to

determine the actual amount which the parties owe to each other, the

court can direct the parties to go to mediation to an annex court. The

judge in such case will be the judge of an annex court who is not the

same judge whom the case was first filed. The 2 courts in such case

belongs to the same category or equal level.

Q: What is Court-Referred Mediation?

A:

 It means mediation ordered by a court to be conducted in accordance

with the Agreement of the Parties when as action is prematurely

commenced in violation of such agreement.

Application and Interpretation in Mediation

The rules on mediation are to be construed with the following considerations in

mind:

 The need to promote candor of parties and mediators through

confidentiality of the mediation process;

 The policy of fostering prompt, economical, and amicable

resolution of disputes in accordance with the principle of integrity

of determination by the parties, and

 The policy that the decision-making authority in the mediation

process rests with the parties.11

Procedure on Mediation

a. Selection of Mediator

 Freedom to select mediator

The parties have the freedom to select mediator. The parties may request

the OADR to provide them with a list or roster or the resumes of its certified

mediators. The OADR may be requested to inform the mediator of his/her

selection.

Replacement of Mediator

If the mediator selected is unable to act as such for any reason, the

parties may, upon being informed of such fact, select another mediator.

b. Participation of Lawyers

Q: May a party ask the assistance of a lawyer in mediation proceedings?

A:

11
R.A No. 9285, Chapter 2, Section 8
 Yes. A party may designate a lawyer or any other person to provide

assistance in the mediation.

Who should be Mediators?

1. The mediator shall be a neutral third person.

2. He has no personal bias regarding the disputants or the subject matter

of the case in dispute.

3. An individual is not neutral if he or she has a financial interest in the

subject matter of the dispute or a financial relationship with any party to

the dispute subject of the resolution proceedings.

4. If before or during the dispute resolution proceedings, a neutral person

has acquired an actual or apparent conflict of interest the mediator shall

inform all the disputants, and shall disqualify him or herself unless all

the disputants consent in writing to continue.

HOW DOES ONE BECOME A MEDIATOR

Basic Qualifications of Prospective Mediators

1. Bachelor’s degree

2. At least 30 years of age

3. Good moral character

4. Willingness to learn new skills and render public service

5. Proficiency in oral and written communication in English and Pilipino

c. Place of Mediation

Q: Where should the Mediation be held?

A: The parties are free to agree on the place of mediation. Failing such

agreement, the place of mediation shall be any place convenient and

appropriate to all parties.

d. Ethical Conduct of a Mediator

Competence

 It is not required that a mediator shall have special qualifications by

background or profession unless the special qualifications of a mediator

shall:

a. Continually upgrade his/her professional competence in mediation

skills;

b. Ensure that his/her qualifications, training and experience are known to

and accepted by the parties; and

c. Serve only when his/her qualifications, training and experience enable

him/her to meet the reasonable expectations of the parties and shall not

hold himself/herself out or give the impression that he/she does not

have.

Impartially

 A mediator shall maintain impartiality.

a. Before accepting a mediation, an individual who is requested to serve as

a mediator shall:

i. Make an inquiry that is reasonable under the circumstances to

determine whether there are known facts that a reasonable

individual would consider likely to affect the impartiality of the

mediator, including a financial or personal interest in the outcome

of the mediation and any existing or past relationship with a party

of foreseeable participant in the mediation; and

ii. Disclose to the mediation parties any such fact known or learned

as soon as practicable before accepting a mediation.

b. If a mediator learns any fact described in paragraph (a) of this Article

after accepting a mediation, the mediator shall disclose it as soon as

practicable to the mediation parties.

Confidentiality

 A mediator shall keep in utmost confidence all confidential information

obtained in the course of the mediation process. A mediator shall discuss

issues of confidentiality and the extent of confidentiality provided in any

private sessions or caucuses that the mediator holds with a party.

Information obtained through mediation proceedings shall besubject to the

following principles and guidelines: (a) Information obtained through mediation

shall beprivileged and confidential. (b) A party, a mediator, or a nonparty

participant mayrefuse to disclose and may prevent any other person from

disclosing a mediation communication.

Q: May the modes of discovery under the rules of court be availed of to

obtain information disclosed in mediation proceedings?

A:

 (c) Confidential Information shall not be subject to discovery and shall

be inadmissible if any adversarial proceeding, whether judicial or

quasijudicial, However, evidence or information that is otherwise

admissible or subject to discovery does not become inadmissible or

protected from discovery solely by reason of its use in a mediation.

Q: Who are the parties covered by the confidentiality rule?

A:
 (d) In such an adversarial proceeding, the following persons involved or

previously involved in a mediation may not be compelled to disclose

confidential information obtained during mediation:

(1) the parties to the dispute;

(2) the mediator or mediators;

(3) the counsel for the parties;

(4) the nonparty participants;

(5) any persons hired or engaged in connection with the mediation as

secretary, stenographer, clerk or assistant; and

(6) any other person who obtains or possesses confidential information

by reason of his/her profession.

Q: There is an on-going mediation proceedings, as a consequence of that

proceedings, a party filed a case in court which involve the same issue,

same parties that is the subject of mediation. Then the parties

subpoenaed the mediator as a witness to testify about the mediation

proceedings, can the mediator testify?

A:

 No

Q: Can the mediator voluntarily testify?

A:

 No, because such situation will violate the rules on confidentiality

Q: Can this privilege arising from the confidentiality of information in

mediation proceedings be waived?

A:

 Yes. A privilege arising from the confidentiality of information may be

waived in a record, or orally during a proceeding by the mediator and the

mediation parties. A privilege arising from the confidentiality of

information may likewise be waived by a nonparty participant if the

information is provided by such nonparty participant.

Q: What is the consequence of disclosure of such confidential information

by the parties covered by the rule?

A:

 A person who discloses confidential information shall beprecluded from

asserting the privilege to bar disclosure of the rest of the information

necessary to a complete understanding of the previously disclosed

information. If a person suffers loss or damages in a judicial proceeding

against the person who made the disclosure. A person who discloses or

makes a representation about a mediation is precluded from asserting

the privilege to the extent that the communication prejudices another

person in the proceeding and it is necessary for the person prejudiced to

respond to the representation of disclosure.

Q: The rule is that if a party has been prejudiced in that situation, the

recourse will be an objection as to the

presentation of evidence that is privileged. Suppose the court did not

sustain the objection, and allow the mediator to continue his testimony,

what will be the aggrieved party’s recourse?

A:

 The court may allow the party the right to respond and repudiate

whatever testimony that was given by the mediator (right to rebut or

counter-testimony). He may also file an action for damages.

Waiver of Confidentiality

In Section 10, a privilege arising from the confidentiality of information

may be waived in a record or orally during a proceeding by the mediator and

the mediation parties.

A privilege arising from the confidentiality of information may likewise be

waived by a non-party participant if the information is provided by such non-

party participant.

In the case of Eisendrath vs. Superior Court of LA County, May 2002, 12

illustrates the application of the confidentiality rule. The plaintiff and private

respondent, Kathly Rogers were married and had two children. They filed a

petition for dissolution of marriage after 6 years of marriage. Mediation was

commenced two years later to settle issues of support and custody of children.

Before commencing mediation, they executed a mediation agreement that

expressly states that the mediation was governed by Evidence Code. In

addition, the mediation agreement provides: “We agree reform or avoid liability

on a contract. Even in this proceeding, the mediator may not be compelled to

provide evidence or to testify in such proceeding.

12
Eisendrath vs. Superior Court of LA County, May 2002
He may however disclose that mediation occurred, or it has terminated

or a settlement was reached.

It will be noted that bad faith conduct of one of the parties participating

in a mediation proceeding is not an exception to the application of the

confidentiality rule.

Q: What is the exception to the application of Confidentiality?

A:

 There is no privilege against disclosure under Section 9 if mediation

communication is:

a. in an agreement evidenced by a record authenticated by all parties to

the agreement;

b. available to the public or that is made during a session of a mediation

which is open, or is required by law to be open, to the public;

c. a threat or statement of a plan to inflict bodily injury or commit a

crime of violence;

d. internationally used to plan a crime, attempt to commit, or commit a

crime, or conceal an ongoing crime or criminal activity;

e. sought or offered to prove or disprove abuse, neglect, abandonment, or

exploitation in a proceeding in which a public agency is protecting the

interest of an individual protected by law;

 XPN to the XPN: exception does not apply where a child protection

matter is referred to

mediation by a court or a public agency participates in the child

protection mediation;
f. sought or offered to prove or disprove a claim or complaint of

professional misconduct or malpractice filed against mediator in a

proceeding; or

g. sought or offered to prove or disprove a claim of complaint of

professional misconduct of malpractice filed against a party, nonparty

participant, or representative of a party based on conduct occurring

during a mediation.

 There is no privilege if a court or administrative agency, finds, after a

hearing in camera, that the party seeking discovery of the proponent of

the evidence has shown that the evidence is not otherwise available, that

there is a need for the evidence that substantially outweighs the interest

in protecting confidentiality, and the mediation communication is sought

or offered in:

a. a court proceeding involving a crime or

felony; or

b. a proceeding to prove a claim or defense that under the law is

sufficient to reform or avoid a liability on a contract arising out of the

mediation.

(c) A mediator may not be compelled to provide evidence of a mediation

communication or testify in such proceeding.

(d) If a mediation communication is not privileged under an exception in

subsection (a) or (b), only the portion of the communication necessary for

the application of the exception for nondisclosure may be admitted. The

admission of particular evidence for the limited purpose of an exception

does not render that evidence, or any other mediation communication,

admissible for any other purpose.

Consent and Self-Determination

a. A mediator shall make reasonable efforts to ensure that each party

understands the nature and character of the mediation proceeding

including private caucuses, the issues, the available options, the

alternatives to non-settlement, and that each party is free and able to

make whatever choices he/she desires regarding participation in

mediation generally and regarding specific settlement options.

If a mediator believes that a party, who is not represented by counsel, is

unable to understand, or fully participate, the mediation proceedings for

any reason, a mediator may either:

i. limit the scope of the mediation proceedings in a manner

consistent with the party's ability to participate, and/or

recommend that the party obtain appropriate assistance in

order to continue with the process; or

ii. terminate the mediation proceedings.

b. A mediator shall recognize and put in mind that the primary

responsibility of resolving a dispute and the shaping of a voluntary and

uncoerced settlement rests with the parties.

Conflict of Interest

Q: What is the obligation of the Mediator before accepting a

mediation?

A:
 Before accepting a mediation, an individual who is requested to serve as

a mediator shall:

1) make an inquiry that is reasonable under the circumstances to determinate

whether there are any known facts that a reasonable individual would consider

likely to affect the impartiality of the mediator, including a financial or personal

interest in the outcome of the mediation and any existing or past relationship

with a party or foreseeable participant in the mediation; and

2) disclosure to the mediation parties any such fact known or learned as soon

as is practical before accepting a mediation.

Q: What is the obligation of the Mediator before accepting a mediation?

A:

 Before accepting a mediation, an individual who is requested to serve as

a mediator shall:

 make an inquiry that is reasonable under the circumstances to

determinate whether there are any known facts that a reasonable

individual would consider likely to affect the impartiality of the mediator,

including a financial or personal interest in the outcome of the mediation

and any existing or past relationship with a party or foreseeable

participant in the mediation; and

 disclosure to the mediation parties any such fact known or learned as

soon as is practical before accepting a mediation.

Q: Can the mediator be asked to disclose his/her qualifications?

A:
 Yes. At the request of a mediation party, an individual who is requested

to serve as mediator shall disclose his/her qualifications to mediate a

dispute.

Q: Suppose that the proposed mediator did not disclose any of the

matters that he is supposed to disclose, and as a consequence of that, he

was appointed as a mediator, immediately the parties knew such failure to

disclose in the middle of the mediation proceedings, what can the party

do?

A:

 The party can remove the mediator and substitute another one. Failure

of the party to remove the mediator means there is a waiver.

Q: Can the parties ask the mediator to establish his qualification?

A:

 At the request of a mediation party, an individual who is requested to

serve as mediator shall disclose his/her qualifications to mediate a

dispute.

Q: Who should determine the qualifications of the mediator?

A:

 The parties on their agreement.

Enforcement of Mediated Settlement Agreement

Q: How is a mediated settlement agreement prepared?

A:

 A settlement agreement following successful mediation shall be prepared

by the parties with the assistance of their respective counsel, if any, and

by the mediator.

Q: Who are required to sign the agreement?

A:

 The parties and their respective counsels, if any, shall sign the

settlement agreement. The mediator shall certify that he/she explained

the contents of the settlement agreement to the parties in a language

known to them.

III.ARBITRATION

(IV. International Commercial Arbitration vis-à-vis Domestic Law)

“Arbitration” is defined in Section 3(d) of the ADR Act as a voluntary

dispute resolution process in which one or more arbitrators, appointed in

accordance with the agreement of the parties or the rules promulgated

pursuant to this Act resolve a dispute by rendering an award.

Q: What are the elements of arbitration?

A:

 The elements or arbitration are:

a. The parties have mutually agreed to submit their dispute to selected

persons whose determination is to be accepted as a substitute for the

judgment of a court;

b. There is an actual dispute or matter in controversy; and

c. The dispute or matter in controversy is capable of being referred to

arbitration.

Q: How may the consent of the parties to arbitrate their dispute be

expressed?

A:

 The parties may SUBMIT to arbitration any controversy existing between

them at the time of the submission and which may be the subject of an

action. Also, the parties to any contract may in such CONTRACT agree to

settle by arbitration a controversy thereafter arising between them

Q: Distinguish an arbitrator from a mediator.

A:

 An arbitrator acts as an out of court judge and settles disputes extra-

judicially. A mediator does not render an award but only arranges the

facts to be negotiated so parties can come to a compromise agreement.

Q: What is the objective of Arbitration

A:

 The basic objective of arbitration is to provide speedy and inexpensive

method of settling disputes by allowing parties to avoid the formalities,

delay, expense and aggravation which commonly accompany ordinary

litigation, especially litigation which goes through the entire hierarchy of

courts.

 ADR enables the parties to resolve their disputes amicably in a manner

that is simple, speedy, less confrontational, and more productive of

goodwill and lasting relationships.

In the case of Korea Technologies vs. Lerma G.R. No. 143581, January 7,

2008,13While the RTC does not have jurisdiction over disputes governed by

arbitration mutually agreed upon by the parties, still the foreign arbitral

award is subject to judicial review by the RTC which can set aside, reject, or

vacate it. An arbitration clause, stipulating that the arbitral award is final

and binding, does not oust our courts of jurisdiction as the international

arbitral award is still judicially reviewable under certain conditions provided

for by the United Nations Commission on International Trade Law

(UNCITRAL) Model Law on International Commercial Arbitration (ICA) as

applied and incorporated in RA 9285.

Procedure in Arbitration

 Appointment of Arbitrators

Q: How should the appointment of arbitrators be made?

A:
13
Korea Technologies vs. Lerma G.R. No. 143581, January 7, 2008
 1.in accordance with the method of naming or appointing the

arbitrators/s described in the

contract for arbitration or in the submission contract;

 2. but if no method be provided therein the Court of First Instance shall

designate an arbitrator or arbitrators.

 Sole Arbitrators

 In the event that the contract between the parties provides for the

appointment of a single arbitrator, the demand shall be set forth a

specific time within which the parties shall agree upon such arbitrator.

 Three Arbitrators

 If the contract between the parties provides for the appointment of three

arbitrators, one to be selected by each party, the demand shall:

1. name the arbitrator appointed by the party making the demand and;

2. shall require that the party upon whom the demand is made shall within

fifteen days after receipt thereof advise in writing the party making such

demand of the name of the person appointed by the second party;

3. such notice shall require that the two arbitrators so appointed must

agree upon the third arbitrator within ten days from the date of such notice.

Q: Can the arbitrators appointed decline? How should the vacancy be

filled?

A:
 Arbitrators appointed under this section shall either accept or decline

their appointments within seven days of the receipt of their

appointments. In case of declination or the failure of an arbitrator or

arbitrators to duly accept their appointments the parties or the court, as

the case may be, shall proceed to appoint a substitute or substitutes for

the arbitrator or arbitrators who decline or failed to accept his or their

appointments

Q: What are the Grounds for Challenge of the appointment of an

Arbitrator?

A:

 if circumstances exist that give rise to justifiable doubts as to his/her

impartiality or independence; or

 if he/she does not possess qualifications agreed to by the parties.

A party may challenge an arbitrator only for reasons of which he/she

becomes aware after the appointment has been made. (Rule 3 Article

4.12, IRR of ADR Act)

Q: What is the Procedure in challenging an arbitrator?

A:

 The parties are free to agree on a procedure for challenging an arbitrator,

subject to the provisions under this article. Absent such agreement,

within fifteen (15) days after becoming aware of the constitution of the

arbitral tribunal or after becoming aware of any Grounds for Challenge,

send a written statement of the reasons for the challenge to the arbitral
tribunal. Unless the challenged arbitrator withdraws from his/her office

or the other party agrees to the challenge, the arbitral tribunal shall

decide on the challenge. (Rule 3 Article 4.13, IRR of ADR Act)

Q: What if the challenge procedure was not successful?

A:

 The challenging party may request the appointing authority, within thirty

(30) days after having received notice of the decision rejecting the

challenge, to decide on the challenge, which decision shall be

immediately executory and not subject to motion for reconsideration

or appeal. While such a request is pending, the arbitral tribunal,

including the challenged arbitrator, may continue the arbitral

proceedings and make an award. (Rule 3 Article 4.13, IRR of ADR Act)

Q: Where should the challenge be made? Should it be with the arbitral

tribunal or with the RTC?

A:

 The challenge shall be made before them. If they do not yield to the

challenge, the challenging party may renew the challenge before the

Court of First Instance of the province or city in which the challenged

arbitrator, or, any of them, if there be more than one, resides.

Q: What is the effect of the challenging incident to the arbitral

proceedings?

A:
 While the challenging incident is discussed before thecourt, the hearing

or arbitration shall be suspended, and it shall be continued

immediately after the court has delivered an order on the challenging

incident.

Commercial Arbitration Domestic Arbitration

 International  The arbitration of

commercial construction

arbitration shall disputes shall be

be governed by governed by

the Model Law on Executive Order

As to Governing law International No. 1008,

Commercial otherwise known

Arbitration (the as the

"Model Law") Constitution

adopted by the Industry

United Nations Arbitration Law.

Commission on

International

Trade Law on

June 21, 1985.

 Equal Treatment  Equal Treatment

of Parties. The of Parties. The

parties shall be parties shall be

As to Due Process treated with treated with

equality and each equality and each

shall be given a shall be given a

full opportunity of full opportunity of

presenting presenting

his/her case. his/her case.

(Article 4.18, IRR (Article 5.17, IRR

of ADR Act ) of ADR Act )

In the case of Equitable PCI Banking Corp, v. World Interactive Network

System, 544 SCRA 308, 14

the right to cross-examine a witness although a

fundamental right of a party, may be waived. Petitioners themselves admit

having had the opportunity to cross- examine RCBC’s Witnesses during the

hearings before the tribunal, but declined to do so by reserving such right at a

later time. Having had the opportunity to cross-examine RCBC’s witnesses,

petitioner were not denied their right to due process.

In international commercial arbitration

conducted in the Philippines, a party may be

represented by any person of his0her choice:

Provided, that such representatives, unless

As to Legal Representation admitted to the practice of law in the Phillipines,

shall not be authorized to appear as counsel in

any Philippine court or any other quasi-judicial

body whether or not such appearance is in

relation to the arbitration in which he/she

appears ( Sec. 22, ADR Act of 2004, Art 4.40,

14
Equitable PCI Banking Corp, v. World Interactive Network System, 544 SCRA 308
IRR of ADR Act)

Q: Give the rule with regard to the representation of a partyin

international (as well as in mediation and domestic) arbitration? May an

alien represent a party in international arbitration conducted in the

Philippines?

A:

 Yes. In international arbitration conducted in the Philippines, a party

may be presented by any person of his choice. Provided, that such

representative, unless admitted to the practice of law in the Philippines,

shall not be authorized to appear as counsel in any Philippine court, or

any other quasi-judicial body whether or not such appearance is in

relation to the arbitration in which he appears.

 The Parties are  The parties are

As to Place free to agree on free to agree on

the place of the place of

arbitration. If no arbitration.

agreement is Failing such

made, the place agreement, the

shall be in Metro place of

Manila unless the arbitration shall

Arbitral Tribunal be in Metro

shall decide on a Manila unless the

different place of arbitral tribunal,

arbitration, having regard to

subject to the the circumstances

circumstances of the case,

and convenience including the

of the parties. The convenience of the

Arbitral Tribunal parties, shall

may, unless decide on a

otherwise agreed different place of

by the parties, arbitration. The

meet at any place arbitral tribunal

it considers may, unless

appropriate for otherwise agreed

consultation by the parties,

among its meet at any place

members for it considers

hearing witnesses, appropriate for

experts or the consultation

parties, or for among its

inspection of members, for

goods, other hearing witnesses,

property or experts or the

documents (Art. parties, or for

4.20,IRR f ADR
o inspection of

Act goods, other

property or

documents. (Art.

5.19, IRR of ADR

Act)

 The parties are  The parties are

free to agree on free to agree on

the language or the language or

As to Language languages to be languages to be

used. Failure to used in the

agree on such arbitral

language, they proceedings.

shall use English. Failing such

Such language agreement, the

will apply to all language to be

written used shall be

statements, English or

hearing and any Filipino. The

award, decisions language/s

and other agreed, unless

communication of otherwise

the Arbitral specified therein,

Tribunal. The shall be used in

arbitral tribunal all hearings and

may order that all written

any documentary statements,

evidence shall be orders or other

accompanied by a communication by

translation into the parties and

the language or the arbitral

languages agreed tribunal. The

upon by the arbitral tribunal

parties or may order that

determined by the any documentary

Arbitral Tribunal, evidence shall be

as the case may accompanied by a

be. (Art. 4.22, IRR translation into

of ADR Act) the language or

languages agreed

upon by the

parties in

accordance with

paragraph above

paragraph. (Art.

5.21, IRR of ADR

Act)

 The arbitration  The arbitration

proceedings, proceedings,

As to Confidentiality including the including the

records, records, evidence

evidence and the and the arbitral

arbitral award, award, shall be

shall be considered

considered confidential and

confidential and shall not be

shall not be published.

published.

 XPN:

 XPN: (1) with the consent of

(1) with the consent of the parties, or

the parties, or

(2) for the limited

(2) for the limited purpose of disclosing to

purpose of disclosing to the

the court of relevant

court of relevant documents in cases

documents in cases where resort to the

where resort to the court is allowed herein.

court is allowed herein. (Art. 5.42, IRR of ADR

(Art. 4.41, IRR of ADR Act)

Act)

Q: Can the court in which the action or the appeal is pending issue a

protective order or prohibit disclosure or

information?

A:

 Yes. The court in which the action or the appeal is pending may issue a

protective order to prevent or prohibit disclosure of documents or

information containing secret processes, developments, research and

other information where it is shown that the applicant shall be materially

prejudiced by an authorized disclosure thereof.

Form and content of Arbitral Award

Q: What should be the form and contents of an arbitral award?

A:

 The arbitral award shall be made in writing and shall be signed by the

arbitrator or arbitrators. In arbitral proceedings with more than one

arbitrator, the signatures of the majority of all members of the arbitral

tribunal shall suffice, provided that the reason for any omitted signature

is stated. The award shall state the reasons upon which it is based,
unless the parties have agreed that no reasons are to be given. The

award shall state its date and the place or arbitration. After the award is

made, a copy signed by the arbitrators shall be delivered to each party.

Q: How may an arbitral award be confirmed?

A:

 At any time within one month after the award is made, any party to the

controversy which was arbitrated may apply to the court having

jurisdiction, as provided in section twentyeight, for an order confirming

the award. The court must grant such order unless the award is vacated,

modified or corrected, as prescribed herein. Notice of such motion must

be served upon the adverse party or his attorney. A domestic arbitral

award shall be enforced in the same manner as final and executory

decisions of the RTC.

Q: What are the remedies of the aggrieved party against an

arbitral award?

A:

 Under Article 2044 of the New Civil Code, the validity of any stipulation

on the finality of the arbitrators’ award or decision is recognized.

However, where the conditions described in Articles 2038, 2039, and

2040 applicable to both compromises and arbitrations are obtaining, the

arbitrators’ award may be annulled or rescinded. Consequently, the

decision of the Arbitration Committee is subject to judicial review. The

proper recourse of the petitioner from the denial of its motion for

reconsideration by the Arbitration Committee is to file either:

a. a motion to vacate the arbitral award with the RTC;

b. a petition for review with the Court of Appeals under Rule 43 of the Rules of

Court; or

c. a petition for certiorari under Rule 65 of the Rules of Court.

The RTC will only have jurisdiction over an arbitral award in cases of motions

to vacate the same. Otherwise, as

elucidated herein, the Court of Appeals retains jurisdiction in petitions for

review or in petitions for certiorari (Insular Savings Bank vs. Far East Bank and

Trust Company, 492 SCRA 145, 22 June 2006)15

Interim Measures

Q: What is an Interim Measures?

A:

 An interim measure is any temporary measure, whether in the form of an

award or in another form, by which, at any time prior to the issuance of

the award by which the dispute is finally decided. (Art. 17, par. 2 of

UNCITRAL Model Law on International Commercial Arbitration)

Examples of interim measures:

1. Preliminary injunction directed to a party

2. Appointment of receivers

15
Insular Savings Bank vs. Far East Bank and Trust Company, 492 SCRA 145, 22 June 2006
3. Detention, preservation or inspection of property subject matter of the

dispute

Q: What are the rules on Interim or Provisional Reliefs?

A:

1. Any party may request for the interim or provisional relief

2. Such relief may be granted to:

2.a To prevent irreparable loss or injury

2.b To provide security for the performance of an obligation

2.c To produce or preserve evidence

2.d To compel any other acts or omission

3. The order granting a provisional relief may be conditioned upon a

provision of security or any act or omission specified in order.

4. Interim or provisional reliefs may be requested from the arbitral tribunal,

describing in detail the precise relief, its grounds and evidence supporting

the relief prayed for.

5. The order granting or denying the interim relief shall be binding upon the

parties.

6. Either of the parties may apply with the court for assistance in

implementing an interim measure ordered by an arbitral tribunal.

7. A party who does not comply with the interim order shall be liable for

damages, including all expenses and reasonable attorney’s fee in obtaining

the order’s judicial enforcement.

Q: What is the effect if a party does not comply with the order for interim

or provisional relief?
A:

 A party who does not comply with the order shall be liable for all

damages resulting from noncompliance, including all expenses, and

reasonable attorney's fees, paid in obtaining the order's judicial

enforcement.

Q: What are the interim measures of protection available to the parties in

an arbitration proceeding?

A:

 Such interim measures may include but shall not be limited to:

a. preliminary injuction directed against a party;

b. appointment of receivers or detention;

c. preservation, inspection of property that is the subject of the dispute in

arbitration.

Q: What is the Doctrine of Separability of Arbitration Clause?

A:

 The arbitration agreement is to be treated as a separate agreement and

the arbitration agreement does not automatically terminate when the

contract of which it is part comes to an end. Indeed, the doctrine denotes

that the invalidity of the main contract, also referred to as the “container”

contract, does not affect the validity of the arbitration agreement.

(Gonzales vs. Climax Mining Ltd. G.R. No. 161957, January 22, 2007, 512

SCRA 151)16

16
Gonzales vs. Climax Mining Ltd. G.R. No. 161957, January 22, 2007, 512 SCRA 151
Judicial Review and Court Intervention

Q: What is the Extent of Court Intervention?

A:

 No court shall intervene except where so provided in the ADR Act. Resort

to Philippine courts for matters within the scope of the ADR Act shall be

governed by the Special ADR Rules. (Rule 1 Article 4.5., IRR of ADR Act)

In the case of ABS-CBN Broadcastibg Corp., v. World Interactive Network

Sytem, 544 SCRA 30817, it mandates that it is the Court of First Instance,

now the RTC which has jurisdiction over questions relating to arbitration

such as a petition to vacate an arbitral award.

Recognition and Enforcement of Arbitral Award

Q: What is the nature of the action for recognition and enforcement of a

foreign award? Where should it be filed?

A:

 Proceedings for recognition and enforcement of an arbitration agreement

or for vacation, setting aside,

correction or modification of an arbitral award, and any application with a

court for arbitration assistance and

supervision shall be deemed as special proceedings and shall be filled with

the regional trial court (i) where arbitration proceedings are conducted; (ii)

where the asset to be attached or levied upon, or the act to be enjoined is

located; (iii) where any of the parties to the dispute resides or has his place

17
ABS-CBN Broadcastibg Corp., v. World Interactive Network Sytem, 544 SCRA 308
of business; or (iv) in the National Judicial Capital Region, at the option of

the applicant (Section 47 of R.A. 9285).

Q: When may a foreign award be refused recognition and

enforcement in our jurisdiction?

A:

 At the request of the party against whom it is invoked, if that party

furnishes to the competent

court where recognition or enforcement is sought proof that:

a. a party to the arbitration agreement referred to in article 7 was under

some incapacity; or the said agreement is not valid under the law to which

the parties have subjected it or, failing any indication thereon, under the

law of the country where the award was made; or

b. the party against whom the award is invoked was not given proper notice

of the appointment of an arbitrator or of the arbitral proceedings or was

otherwise unable to present his case; or

c. the award deals with a dispute not contemplated by or not falling within

the terms of the submission toarbitration, or it contains decisions on

matters beyond the scope of the submission to arbitration,

provided that, if the decisions on matters submitted to arbitration can be

separated from those not so

submitted, that part of the award which contains decisions on matters

submitted to arbitration may be recognized and enforced; or

d. the composition of the arbitral tribunal or the arbitral procedure was not

in accordance with the agreement of the parties or, failing such agreement
was not in accordance with the law of the country where the arbitration

took place; or the award has not yet become binding on the parties or has

been set aside or suspended by a court of the country in which, or under

the law of which, that award was made; or

 If the court finds that:

a. the subject-matter of the dispute is not capable of settlement by

arbitration under the law of this State; or

b. the recognition or enforcement of the award would be contrary to the

public policy of this State (Article

36 of UNCITRAL Law).

Q:Can a foreign arbitral award be confirmed by a court of a foreign

country?

A:

 A foreign arbitral award when confirmed by a court of a foreign country,

shall be recognized and enforced as a foreign arbitral award and not a

judgment of a foreign court.

V. CONSTRUCTION INDUSTRY ARBITRATION LAW

The arbitration of construction disputes shall be governed by Executive

Order No. 1008, otherwise known as Construction Industry Arbitration Law.

This law covers construction disputes which fall within the original and

exclusive jurisdiction of the Construction Industry Arbitration Commission

(CIAC) shall include those between or among parties to, or who are otherwise

bound by, an arbitration agreement, directly or by reference whether such

parties are project owner, contractor, subcontractor, quantity surveyor,

bondsman or issuer of an insurance policy in a construction project.

The Commission shall continue to exercise original and exclusive

jurisdiction over construction disputes although the arbitration is commercial

pursuant to Section 21 of the R.A. 9825 or Alternative Dispute Resolution.

(Rule 2, IRR of CIAC)

Salient Features of the Construction Industry Arbitration Law

1. Construction arbitration cases are decided by a single arbitrator or an

arbitral tribunal nominated by the parties from the roster of CIAC-

accredited arbitrators.

2. The prevailing rules of evidence in the courts of law need not be

controlling as the arbitrators will use all reasonable means to ascertain

the facts in each case speedily and objectively in the interest of

substantive due process.

Arbitral awards are final and binding upon the parties and are not

subject to judicial confirmation. They are enforced by writ of execution issued

by the arbitrator/s as soon as the awards become executory.

JURISDICTION OF THE CIAC

Q: State the jurisdiction of the CIAC.

A:
 Jurisdiction. The CIAC shall have original and exclusive jurisdiction over

disputes arising from, or connected with, contracts entered into by

parties involved in construction in the Philippines:

 whether the dispute arises before or

 after the completion of the contract, or

 after the abandonment or breach thereof.

** These disputes may involve government or private contracts.

In the case of Licomcen v. Foundation Specialist 647 SCRA 8318, The CIAC

was created through E.O No. 1008, in recognition of the need to establish an

arbitral machinery that would expeditiously settle construction industry

disputes. The prompt resolution of problems arising from or connected with the

construction industry was considered of necessary and vital for the fulfillment

of national development goals, as the construction industry provides

employment to a large segment of the national labor force and is leading

contributor to the gross national product.

Q: What is the requisite for the CIAC to acquire jurisdiction?

A:

 For the Board to acquire jurisdiction, the parties to a dispute must agree

to submit the same to voluntary arbitration.

Q: What matters may be covered by the jurisdiction of the CIAC?

A:

18
Licomcen v. Foundation Specialist 647 SCRA 83
 The jurisdiction of the CIAC may include but is not limited to:

 violation of specifications for materials and workmanship;

 violation of the terms of agreement;

 interpretation and/or application of contractual time and delays;

 maintenance and defects;

 payment, default of employer or contractor and changes in contract cost.

Exception: Disputes arising from employer-employee relationships which shall

continue to be covered by the Labor Code of the Philippines.

Jurisdictional challenge

A motion to dismiss based on lack of jurisdiction shall be resolved by the

appointed arbitral tribunal.

The Arbitral Tribunal shall have full authority to resolve all issues raised

in the Motion to Dismiss for lack of jurisdiction on the grounds that the

dispute is not a construction dispute, or that the Respondent was represented

by one without capacity to enter into a binding arbitration agreement, or that

said agreement or submission is not valid for some other reasons, or does not

cover the particular dispute sought to be arbitrated or other issues of

interpretation or non-fulfillment of pre-conditions to arbitration that are raised

therein.

Non-waiver of jurisdictional challenge

A party does not waive its right to challenge the jurisdiction of CIAC by

any of the following acts:

a. participating in the nomination process including challenging the

qualifications of a nominee;

b. praying for extension of time to file appropriate pleading/motion to

dismiss;

c. opposing an application for interim relief;

d. filing of a motion to dismiss/suspend

Q: What is the basis of Construction Arbitration?

A:

 Construction arbitration is based on the consent of the disputing parties,

unless made compulsory by law.

Consent can be manifested in three ways: 

1. Contracting parties provide for an arbitration clause in the construction

contract;

2. If there is no arbitration clause in the contract, disputing parties may

sign a joint statement of issues of the dispute(s) and/or a voluntary

agreement to undertake construction arbitration.

3. Any written agreement or submission to arbitration in the form of

exchange of letters (by post or telefax), telexes, telegrams, emails, or any

other mode of communication, even if unsigned by the parties, as long as

the intent is clear that the parties agree to submit to arbitration.

R.A. 9184 (the Government Procurement Reform Act) provides that

disputes that are within the competence of the CIAC shall be referred thereto. 
Q: How many arbitrators are required to settle a dispute?

A:

 A sole arbitrator or three arbitrators may settle a dispute (Sec. 14).

Q: What is the effect if the parties agree that the dispute shall be settled

by a sole arbitrator?

A:

 Where the parties agree that the dispute shall be settled by a sole

arbitrator, they may, by agreement, nominate him from the list of

arbitrators accredited by the CIAC for appointment and confirmation

(Sec. 14).

Q: What is the effect if the parties fails to select an arbitrator?

A:

 The CIAC taking into consideration the complexities and intricacies of

the dispute has the option to appoint a single arbitrator or an Arbitral

Tribunal.

Q: What is the procedure in choosing or appointing the arbitrators?

A:

1. Sole Arbitrator

- where the parties have agreed that the dispute(s) shall be settled by a

sole arbitrator, each shall nominate at least six (6) from the list of
CIAC-accredited arbitrators. The CIAC shall appoint the common

nominee of the parties. If there is no common nominee, the parties

shall be asked to agree on a common nominee within fortyeight (48)

hours otherwise, the CIAC shall appoint either a Sole Arbitrator who

is not a nominee of any of the parties or, if it deems it necessary, the

members of the Arbitral Tribunal.

2. Arbitral Tribunal

- where the parties have agreed that the dispute(s) shall be settled by

an arbitral tribunal, each party nominates at least six (6) arbitrators

from the list of arbitrators accredited by the CIAC. The CIAC then

appoints one arbitrator from the claimant's nominees and another

from the respondent's list. The third arbitrator shall be agreed upon

by the two arbitrators first appointed.  The three shall decide from

among themselves who shall be the chairman. Common nominees

shall be appointed. 

Q: Who can be accredited as Arbitrators?

A:

 People from the government and the private sectors who meet the

technical requirements set by the CIAC shall be accredited and

appointed by the CIAC as arbitrators. 

Minimum Requirements for Accreditation as CIAC Arbitrator:

(per CIAC Res. No. 06-2015 dated 28 September 2015)

1. At least 40 years of age at the time of application;

2. Holder of a Bachelor’s degree in Engineering, Architecture, Law,

Accountancy or any other course relevant to any field of construction

or construction activity;

3. Licensed to practice his/her profession in the Philippines and,

preferably, endorsed and/or nominated by his/her professional

organization through a duly approved Board Resolution;

4. At least ten (10) years in the practice of his/her profession and ten

(10) years of work experience in construction management-related

activities or in handling of construction disputes and/or contract

negotiations;

5. In full enjoyment of his/her civil rights and must not have been

convicted of a crime involving moral turpitude or of any crime for

which the penalty imposed upon him/her is over six (6) months of

imprisonment; and 

6. Subject to all screening requirements and accreditation course for

arbitrators to be conducted by the CIAC.

Q: Are the arbitrators permanently employed by the CIAC?

A:

 They shall not be permanently employed with the CIAC. Instead, they

shall render services only when called to arbitrate. For each dispute they

settle, they shall be given fees (Sec. 14).

Q: May an arbitrator act as mediator and a mediator act as arbitrator?

A:
 Yes. By written agreement of the parties to a dispute, an arbitrator may

act as mediator and a mediator may act as arbitrator. The parties may

also agree in writing that, following a successful mediation, the mediator

shall issue the settlement agreement in the form of an arbitral award.

EXPENSES

Q: Who shall shoulder the expenses for the services of an expert?

A:

 Whenever the parties request for the services of an expert, they shall

equally shoulder the expert's fees and expenses, half of which shall be

deposited with the Secretariat before the expert renders service. When

only one party makes the request, it shall deposit the whole amount

required (Sec. 15).

Q: What are included in the arbitration expenses?

A:

 Arbitration expenses shall include:

 filing fee;

 administrative charges,

 arbitrator's fees;

 fee and expenses of the expert, and others which may be imposed by the

CIAC (Sec. 16).

Q: How are the administrative charges and the arbitrator’s fees shall be

computed?
A:

 The administrative charges and the arbitrator's fees shall be computed

on the basis of percentage of the sum in dispute to be fixed in

accordance with the Table of Administrative Charges and Arbitrator's

Fees (Sec. 16).

Q: What should be the amount of the deposit?

A:

 The CIAC shall be authorized to fix the amount to be deposited which

must be equivalent to the expected arbitration expenses.

Q: To whom shall the deposit be paid?

A:

 The deposit shall be paid to the Secretariat.

Q: When should the deposit be made?

A:

 Before arbitration proceedings shall commence.

Q: Who shall make the payment?

A:

 Payment shall either be:

 shared equally by the parties or

 paid by any of them.

EFFECT OF FAILURE TO PAY

Q: What if one party fails to contribute his share in the deposit?

A:

 If one party fails to contribute his share in the deposit, the other party

must pay in full.

Q: What if both parties fail to tender the required deposit?

A:

 If both parties fail to tender the required deposit, the case shall be

considered dismissed but the parties shall still be liable to pay one half

(1/2) of the agreed administrative charge.

Q: When should the CIAC make a report?

A:

 The Commission shall within three (3) months after the end of the fiscal

year, submit its annual report to the CIAP. It shall, likewise, submit such

periodic reports as it may be required from time to time.

APPOINTMENT OF FOREIGN ARBITRATION

Q: Under what instances can a foreign arbitrator or co-arbitrator be

appointed?

A:
 The Construction Industry Arbitration Commission (CIAC) shall

promulgate rules to allow for the appointment of a foreign arbitrator or

co-arbitrator or chairman of a tribunal a person who has not been

previously accredited by CIAC:

Provided, that:

 the dispute is a construction dispute in which one party is an

international party

 the person to be appointed agreed to abide by the arbitration rules and

policies of CIAC;

 he/she is either co-arbitrator upon the nomination of the international

party; or he/she is the common choice of the two CIAC-accredited

arbitrators first

 appointed one of whom was nominated by the international party; and

 the foreign arbitrator shall be of different nationality from the

international party.

ARBITRAL AWARD

Q: How soon should the award be rendered by the arbitrator/s?

A:

 The award shall be rendered promptly by the arbitrator/arbitral tribunal

as agreed upon by the parties, but in no case beyond thirty (30) days

from the time the case is submitted for resolution or six (6) months from

the date of signing of the TOR (or in cases where a TOR is absent, not

more than 6 months from date of the last preliminary conference).

Extensions of time shall be approved by the CIAC.Finality of the awards

(Sec. 19)

Q: What is the nature of an arbitral award made by the CIAC?

A:

 GR: The arbitral award shall be binding upon the parties. It shall be final

and inappealable

XPN: Except on questions of law which shall be appealable to the Supreme

Court.

Q: When is appeal on the award possible?

A:

 A petition for review from a final award may be taken by any of the

parties within fifteen (15) days from receipt thereof in accordance with

the provisions of Rule 43 of the Rules of Court.

Q: How shall the award be issued?

A:

 The award shall be in writing and signed by the arbitrator(s). If decided

by an arbitral tribunal, the decision of the majority shall

prevail. Generally, the award shall contain the issues involved, a brief

statement and discussion of the facts, and the authority relied upon to

resolve the issues.  

EXECUTION AND ENFORCEMENT OF AWARDS

Q: Who executes and enforces the award?

A:

 The award shall become executory upon the lapse of fifteen (15) days

from receipt thereof by the parties even if it has been elevated on appeal.

The arbitral tribunal or the sole arbitrator, with the concurrence of the

CIAC shall, automatically, or upon motion of any of the parties, issue a

writ of execution ordering any sheriff or proper officer to carry out said

award. 

Q: May the parties agree that the settlement be in the form of an arbitral

award?

A:

 The parties may also agree in writing that, following a successful

mediation, the mediator shall issue the settlement agreement in the form

of an arbitral award (Sec. 36)

VI.JUDICIAL REVIEW OF ARBITRAL AWARDS

Court intervention is allowed under RA No. 9285 in the following

instances: (1) when a party in the arbitration proceedings requests for an

interim measure of protection; (2) judicial review of arbitral awards by the

Regional Trial Court (RTC); and (3) appeal from the RTC decisions on arbitral

awards to the Court of Appeals.19

Part I of this report focuses and deals with the intervention of the court

through Judicial Review of Arbitral Awards and relevant rules for appeal.

A. DOMESTIC AWARDS

The confirmation of a domestic arbitral award shall be governed by

Section 23 of R.A. 876.

xx At any time within one month after the award is made, any party to

the controversy which was arbitrated may apply to the court having

jurisdiction, as provided in section twenty-eight, for an order confirming

the award; and thereupon the court must grant such order unless the

award is vacated, modified or corrected, as prescribed herein. xx

A domestic arbitral award when confirmed shall be enforced in the same

manner as final and executory decisions of the Regional Trial Court.

The confirmation of a domestic award shall be made by the Regional Trial

Court in accordance with the Rules of Procedure to be promulgated by the

Supreme Court.

19
DFA vs. BCA CORPORATION INTERNATIONAL & AD HOC ARBITRAL TRIBUNAL, G.R. No. 225051,
July 19, 2017
Q: What is the exception to the requirement on confirmation of award?

A:

 CIAC arbitral award need not be confirmed by the regional trial court

to be executory as provided under E.O. No. 1008.

xx Sec. 19. Finality of Awards. The arbitral award shall be binding

upon the parties. It shall be final and not appealable except on

questions of law which shall be appealable to the Supreme Court.

xx

Q:Is a party precluded from questioning the arbitral award?

A:

 No.A party to a domestic arbitration may question the arbitral award

with the appropriate regional trial court in accordance with the rules of

procedure to be promulgated by the Supreme Court only on those

grounds enumerated in Section 24 of Republic Act No. 876.

Q: What are the grounds for vacating an award?

A:

 In any one of the following cases, the court must make an order vacating

the award upon the petition of any party to the controversy when such

party proves affirmatively that in the arbitration proceedings:

(a) The award was procured by corruption, fraud, or other undue means;

(b) That there was evident partiality or corruption in the arbitrators or

any of them; or

(c) That the arbitrators were guilty of misconduct in refusing to postpone

the hearing upon sufficient cause shown, or in refusing to hear evidence

pertinent and material to the controversy; that one or more of the

arbitrators was disqualified to act as such under section nine hereof, and
wilfully refrained from disclosing such disqualifications or of any other

misbehavior by which the rights of any party have been materially

prejudiced; or

(d) That the arbitrators exceeded their powers, or so imperfectly executed

them, that a mutual, final and definite award upon the subject matter

submitted to them was not made. Xx

B. FOREIGN ARBITRAL AWARDS

A foreign arbitral award when confirmed by a court of a foreign country,

shall be recognized and enforced as a foreign arbitral award and not a

judgment of a foreign court. A foreign arbitral award, when confirmed by the

regional trial court, shall be enforced as a foreign arbitral award and not as a

judgment of a foreign court.

A foreign arbitral award, when confirmed by the regional trial court, shall be

enforced in the same manner as final and executory decisions of courts of law

of the Philippines.

CONVENTION ON THE RECOGNITION AND ENFORCEMENT OF FOREIGN

ARBITRAL AWARDS

(NEW YORK CONVENTION OF 1958)

RECOGNITION AND ENFORCEMENT OF ARBITRATION

AGREEMENTS

 Arbitration is a consensual process. It can only take place if the parties

have agreed to submit their dispute to arbitration. The agreement to refer

disputes to arbitration is called the “arbitration agreement”.

RECOGNITION AND ENFORCEMENT OF ARBITRAL AWARDS

 The recognition of arbitral awards is the process that makes arbitral

awards part of a national legal system. For example, a party will request the

recognition of an arbitral award in order to raise a defense of res judicata

and thus bar the re-litigation in court of issues that have already been

resolved in a foreign arbitration, or a party will seek set-off in court

proceedings on the basis of a foreign arbitral award. Because recognition

often acts as a defensive mechanism, it is frequently described as a shield.

By contrast, enforcement of arbitral awards is the process where

successful parties in arbitration will seek to obtain what the arbitrators

have awarded them. It is true that most awards are complied with

voluntarily. However, when the losing party does not comply, the prevailing

party may request court assistance to force compliance. The New York

Convention allows parties to request such assistance.

Q: What should apply in case an ambiguity would exist in one of the

authentic language versions of the Convention?

A:

 courts could normally apply the rules of interpretation provided in the

Vienna Convention on the Law of Treaties of 1969 which provides:

“A treaty shall be interpreted in good faith in accordance with the

ordinary meaning to be given to the terms of the treaty in their context

and in the light of its object and purpose” and “recourse may be had to
supplementary means of interpretation, including the preparatory work

of the treaty and the circumstances of its conclusion, in order to confirm

the meaning resulting from the application of article 31”

SPECIAL RULES OF COURT ON ALTERNATIVE DISPUTE RESOLUTION

APPEALS TO THE COURT OF APPEAL

Appeal from Court Decisions on Arbitral Awards. – A decision of the

regional trial court:

a. confirming,

b. vacating,

c. setting aside,

d. modifying or correcting an arbitral award may be appealed to the Court of

Appeals in accordance with

the rules of procedure to be promulgated by the Supreme Court.

Q: What is required from the party who appeals from the judgment of the

court confirming an arbitral award?

A:

 The losing party who appeals from the judgment of the confirming an

arbitral award shall required by the

appealant court to post counterbond executed in favor of the prevailing

party equal to the amount of the award in accordance with the rules to be

promulgated by the Supreme Court (Sec. 46).

 VenueWhere to appeal. - An appeal under this Rule shall be taken to the

Court of Appeals.

 When to appeal. - filed within fifteen (15) days from notice of the

decision of the Regional Trial Court or the denial of the petitioner’s motion

for reconsideration.

 How appeal taken. - by filing a verified petition for review in seven

(7) legible copies with the Court of Appeals, with proof of service of a copy

thereof on the adverse party and on the Regional Trial Court. ..the petitioner

shall pay docketing fees and other lawful fees of P3,500.00 and deposit the

sum of P500.00 for costs.

Refference:

 R.A No. 9285

 IRR OF R.A No. 9285

 A.M No. 07-11-08-SC (SPECIAL RULES OF COURT ON ALTERNATIVE

DISPUTE RESOLUTION)

 Executive Order No. 1008 (Construction Industry Arbitration Law)

 R.A No. 876 ( Domestic Arbitration)

 UNCITRAL Model Law on International Commercial Arbitration (Model

Law)

 https://www.scribd.com/document/237518087/ADR-Reviewer

 New York Convention

CASES:

 Korea Technologies Co. v. Lerma, G.R No. 143581, January 7, 2008

 LM Power Engineering Corporation v. Capitol Industrial Construction

Groups, Inc., G.R No. 141833, March 26,2003

 Wahl, Jr. v. Donaldson, Sims & Co, G.R.No. 1085, May 16,1903

 Vega v. The San Carlos Milling Co., G.R. No. L-21549, October 22, 1924

 Eisendrath vs. Superior Court of LA County, May 2002

 Korea Technologies vs. Lerma G.R. No. 143581, January 7, 2008

 Equitable PCI Banking Corp, v. World Interactive Network System, 544

SCRA 308

 Insular Savings Bank vs. Far East Bank and Trust Company, 492 SCRA

145, 22 June 2006

 Gonzales vs. Climax Mining Ltd. G.R. No. 161957, January 22, 2007, 512

SCRA 151

 ABS-CBN Broadcastibg Corp., v. World Interactive Network Sytem, 544

SCRA 308
 Licomcen v. Foundation Specialist 647 SCRA 83

 DFA vs. BCA CORPORATION INTERNATIONAL & AD HOC ARBITRAL

TRIBUNAL, G.R. No. 225051, July 19, 2017