AITERIUATTVE DISPUTT

RF$n[rl'TlolllACT
',.
'lt.
'lil,F ?O(04- "
t,.l

AND CONCILIATION
{ARBITRATIoN, MEDIATION
UNDER REPUBLIC ACT NO' 92851

2005 Edition

REYNALDO B.ARALAR

$T$
 Copyright,2005

Preface

ISBN-971-23-4299-9 court dockets is the primortlill

The need to declog clogged
No' 9285' The law dot's
purpose for the Act
No portion of this book may be copied or reproduced ofd "Arbitration Law"' Republic
""ut"iEnioifrepubhlAct
printed' not iepeal the comparatit"iy law
it b.ro/r, pamphlets, outlines or notes' whether No. 876 of June 1g,9;;"
;;proved on 2' 2004'
April the new
mimeogriphed, typewritten, copied in different elec-
the old'
for distribution or ,"if-,"t seeks to improve on
tronic i"ui."r, or in any other form' Resolution Act of 2004 has
sale, without the written permission of
the author' ex- The Alternative Dispute lt
GtoUut and E-Commerce age'
."pi bri"f quotations in books, articles' reviews' or legal provisions consistent nlith the law
Given the exposure it deserves'
pliadings and in judicial or other official proceedings iras international flavor' "ht at the first instance'
disputes reaching'
with proPer citation. wiil certainly result in L's"'
t" Th;;;;o'"lr tn" tu* *ould then be achieved'
Any copy of this book without the corresponding
'";ilJ"*tt'
In the prepatation of this
volume'Attv' Antonio M' Santos'
other
on
.,r-r-b", ani-not bearing the signature of the author or Si"gttudo Periication and the
Ms. Evelyn I. Cuaust"ro'"Vr.
source extended the much needed
this page either proceeds from an illegitimate personnel of the u.p. Law Library,
no authority to dispose th"'n and the pioneering spirit of
;;;;t"tsion of one who has
ffi;;il:il;r;ilJ.io
of the same. the Publisher'

ALL RIGHTS RESERVED Manila, julY 1,2005'

BY THE AUTHOR

N? 0395

Printed bY

REX pRiNriNq COMPANY, iNC.

rypoqnnphy & cntnrivr Iirhoqnnphy 111

84 P. Florenlino St , Ouezon CitY

Tel. Nos.J1&t-01d 712 41'08

t'*
 TABLE OF CONTENTS

REPUBLIC ACT NO.9285

AN ACT TO INSTITUTIONALIZE THE USE OF AN

ALTERNATIVE DISPUTE RESOLUTION SYSTEM IN THE
PHILIPPINES AND TO ESTABLISH THE OFFICE FOR
ALTERNATIVE DISPUTE RESOLUTION, AND FOR OTHER
PURPOSES

CHAPTER 1- GENERAT PROVISION

Section 7. Title
1

Section 2. Declaration of PolicY

1'

The Alternative Dispute ResolutionAct of 2004 2

Party autonomy in dispute resolution explained """"' 2

How the State shall achieve alternative dispute

resolution 2

The case of Magellan Capital Management

Corporation vs. Zosa (355 SCRA 157)

B
Section 3. Det'inition of Terms
Alternaiive Dispute Resolution System defined """"" t2
1a
Arbitration defined and explained """""""" IJ
13
ADR provider defined
Commercial arbitration defined 14
14
Arbitrator defined

Section 4. Electronic Signatures in Global and

E-Commerce Act ..... -......'. 14

Effect of Signatures in Global and E-Commerce Act "" l4

l4
Electronic Signature defined

Itr
Secti on 5. Liability of ADR Proaidersl P ractitionc rs
l,r
Liability of ADR providers/ practitioncrs
 26
Section 38(1), Chapter 9, Book I, Revised Section 15. Place of Mediation 26
Administrative Code Place of mediation
15
to Submit Dtspute
Section 6. Exception to the Applicatiln of this Act 15 Section 1'6. Effect of Agreement Rules 26
n Meliation under Institutional
Non-applicability of Republic Act No. 9285 16 26
"Model Law" on mediation 27
Effect of submission to mediation
by institution """""
CHAPTER 2 - MEDIATION
Agreenrcnts "' 27
Section 7. Scope 17 Section 77 ' Enforcement of Mediated Settlement
agreement 28
Scope of Chapter 2, Republic Act No. 9285 ................... 77 Deposit of mediated settlement 28
Enior."rn"t't if mediator is sole arbitrator
Mediation defined 77 28
Mediation-Arbitration defined 77 Award defined""" 29
Convention state defined
Inc' vs' Chatham
Section B. Application and lnterpretation 17 The case of Metro Construction' 29
Considerations in applying and construing Properties, Inc' (365 SCRA 697) """"' "'
mediation provisions 18
Integrity defined 1B CHAPTER 3 - OTHER ADR FORMS

ADR Forms 36
Section 9. Confidentiality of Information to O-ther
1B Section 18. Referral of Dispute 36
Confidentiality defined and explained ............... 19 Other forms of ADR defined
Privileged communication defined 20
CHAPTER 4_ INTERNATIONAL COMMERCIAL
Section 10.Waia er of Confi den tiali ty ........... 20 ARBITRATION
Waiver defined and waiver of confidentialitv
explained ..........:................ 27 Section 19. Adoption 0f the
Model Law o.n, .
37
In ter iational Commer cial
Arbitr ation
commercial
Section 77. Exceptions to Priailege ................. 27 "Model Law" on international J/
Instances when there is no privilege against mediation..
disclosure z-J 37
Mo d el law "': "; " "" " " " "
Section 20. Interpr etation of
Section 72. Prohibited Mediator Reports ZJ fiod"l Act" defined and distinguished from 38
I']rohibited mediation reports 23 "Model Law" """"" 38
How to interpret "Model Law" """""
Section 13. Mediator's Disclosure and Conflict of Interest ........ 24 3B
Mediator's disclosure and conflict of interest .A
LA Section
- - - -- 21. Commercial Arbitration """""""" 39
Co*-ercial arbitration defined """""""" "
Section 74. Participation in Mediation 25 in International
Section 22. Legal Representation
Designation of lawyer or non-lawyer to assist in 39
Arbitration
mediation.. 25 arbitration 39
Representation in international
Rescind and rescission defined and explained ............. 25
vll
VI
 Arb-itratr.on 58
Section 23. Confiden tiali ty of Arb itr tttion Proceedin gs . 39 Section 33. Appticability to Domestic
ApplicuUitity of Model Law and Republic Act
Rule on confidentiality of arbitration 58
proceedings .................. No' 9285 to domestic arbitration
40

CHAPTER 6 _ ARBITRATION OF
Section 24. Referral to Arbitrotion ................. 40
CONSTRUCTION DISPUTES
Court referral to arbitration proceedings ..................... 41
No referral of arbitration allowed A1
al Disputes:
Section 34. Arbitration of Construction 59
Goaerning Lau """"'-""
Section 25.Interpretation of the Act ............. 41 Governing law on construction arbitration 59
Interpretation of Republic Act No. 9285.... 41 disPutes....'
The case of Philrock, Inc. vs. Construction Industry 59
Effect of decisions of voluntary arbitrators
Arbitration Commission (359 SCRA 633) ............ 42 59
Section 35.CooerageoftheLaw :"""""""""""
Section 26. Meaning of "Appointing Autlnrity"
.................... 5l Matters included in exclusive original iurisdiction 60
Appointing authority defined and explained ............. 5t of CIAC
Arbitrator 60
Attthority to
36. Act ns Mediator or '
Section 27.lMat Functions may be Performed by Section 67
Appointing Authority 51
AuthoritY defined
Function defined 52 Arbitrator 61
Section 37. Appointment of Foreign
61
International PartY defined
Section 28. Grant of Interim Measure of Protection 52 62
Who shall appoint foreign mediator""
Court may grant interim measure.... 54
n. Arb.it r at ion
62
lnterim defined 54 Section 38. AppI i c abili t y t o Co ns t r u c t i o
62
When arbitral tribunal deemed constituted 54 Applicability to construction arbttratlon """"""""""'
Construction Industry Arbitration Commission 62
Section 29. Further Authority for Arbitrator to (CIAC) iurisdiction
Crant lnterim Measure of Protection ............... 54
Section 39. Court to Dismiss Case Inaoluing
a
Interim measures of protection by arbitrator .............. 55 63
Construction DisPute " " "'
arbitration
Section 30. Place of Arbitration ................. 55 General rule is dismissal of construction 63
Rules on place of arbitration ................. 55 dispute
OF
Section 31. Language of the Arbitrstiotr 56 CHAPTER 7 - JUDICIAL REVIEW
Language or languages of arbitration ............. 56 ARBITRAL AVIARDS

CHAPTER 5 - DOMESTIC ARBITRATION

A. DOMESTIC AWARDS
64
Section 32. Law Gouerning Domestic Arbitratiorr Section 40' Confrmation of Award """ """""""
58 governs
Section 22, Republic Act No' 876
Domestic Arbitration defined 6rl 64
"* domestic awards""""
.::

ix
vlll
{-
::
4
::::
 77
Final and executory judgment explained 65 Section 47. Venne and iurisdiction " "" " " ""'
Confirmation defined 65 Venue and jurisdiction for recognition etc' of an
77
Function of ordering execution of judgment .........'..... 66 arbitral award
"""""' 78
The case of Del Monte Corporation-USA vs. Venue and jurisdiction distinguished
Court of Appeals (351 SCRA 373) ............. 66
78
Section 48. Notice of Proceeding to Parties
7B
Section 41. Vacation award 77 Notice defined and explained """"""""
79
Section 25, Republic Act No. 876 on grounds for Notice of Proceedings to Parties
vacating domestic awards 77
Methods of vacating an award 77 CHAPTER 8 - MISCELLANEOUS
PROVISIONS
B. FOREIGN ARBITRAL AWARDS BO
Section 49. Office for Alternatiae Dispute Resolution
Section 42. Application of the New York Conuention 72 Office oi Alternative Dispute Resolution
BO
New York Convention defined 72 establisheo
Application of the New York Convention 73 Objectives of the Office for Alternative Dispute
80
Vacate defined and explained ............... 73 Resolution.

Section 43. Recognition and Enforcement of Foreign Section 50. Powers and Functions of the Office
Dispute Resolution 81
Arbitral Awards not Coaered bY the t'or Alternatiae
B1
New York Conaention 73 Power defined
Recognition defined 74 Functions of the Office of Alternative Dispute
81
Enforcement defined .................... 74 Resolution exPlained
82
Recognition and enforcement of non-New Formulation of standards for ADR training
82
York Convention awards 74 Certification defined ""
Comity and "judicial comity" defined and 82
explained 74 Section 51. APProPriations
82
Reciprocity defined and explained ............... 75 ApProPriation defined
Appropriation for Republic Act No' 9285 """""""""" 83

Section 44. Foreign Arbitral Award not Foreign

(IRR)""""" 83
ludgrnent 75 Section 52.lmplementing Rules and Regulations
Effect of a foreign arbitral award..........'...... 75 Rules and regulations defined and explained """"""' B4
84
Functus oficio defined """""""""
Section Arbitral Award...'.....
45. Rejection of a Foreign 76
"" 84
How foreign arbitral award rejected 76 Section 53. Applicability of the Katarungang Pnmbarangay
Katarungang Pambarangay provisions not
84
Section 46. Appeal from Court Decisions on rePealed
Arbitral Autards 76
85
Appeal defined 77 Section 54. RePealing clause
85
Appeal from decisions on arbitral awards......' 77 Repealing clause defined
xi
Scction 55. Separability clause 85
Separability clause defined 85
Separability clause in Republic Act No. 9285 .............. 85

Section 56. Effectiuity 86

REPUBLIC ACT NO. 9285

APPENDICES
OF AN
Appendix t' A" - Republic Act No. 9285 (An Act to AN ACT TO INSTITUTIONALIZE THE USE
Institutionalize the Use of an SYSTEM IN
ALTERNATIVE DISPUTE RESOLUTION
Alternative Dispute Resolution
rNE PTTIUPPINES AND TO ESTABLISH THE OFFICE
System in the Philippines and to AND FOR
Establish the Office for Alterr-rative
TON1UTERNATIVE DISPUTE RESOLUTION,
-
OTHER PURPOSES
Dispute Resolution, and For
Other Purposes) 87
CHAPTER 1
Appendix "B" - Executive Order No. 1008
(Creating an Arbitration GENERAL PROVISION
Machinery in the Construction
SECTION l.Title'- This Act shall be known
Industry of the Philippines) ...... .. ......... 10s as

the "Alternative Dispute Resolution Act of

2004'"
Appendix "C" - Republic Act No. 876 (AnAct to
Authorize the Making of SEC. 2. Declaration of Poticy' - It is hereby
Arbitration and Submission the State to actively promote
declared the policy of
Agreements, to Provide for the in the resolution of disputes or the
put,y
Appointment of Arbitrators and ""t."omy
?r"uio* of the parties to make their own arrange-
the Procedure for Arbitration Towards this end' the
in Civil Controversies, and -"ttt to resolveiheir disputes' the use
State shall encourage and actively promote
im-
of Alt"rr,utive Dispute Resolution (ADR) as an
For Other Purposes) 110
justice
Appendix "D" oortant means to achieve speedy and impartial
- Republic Act No. 8792 (An Act
;;;l;.i"g court docketJ' Rs such' the state shall
Providing for the Recognition efficient tool
and Use of Electronic Commercial pr""ia" t"Eans for the use of ADR as an
'und ut alternative procedure for the resolution of
and Non-Commercial Transactions.
appropriate cases. iikewise, the State shall
enlist
Penalties for Unlawful Use thereof,
u.tirr"^p.irrate sector participation in t\1
settlement
and For Other Purposes) 1.21 ;
Apn' rnit Act shall be without
lL
oi airp"t.t through
Appendix "E" - Rules on Electronic Evidence r65
.
pt";"if." to the adoption by tl: Supreme Court of
u"y A.nn system, such as mediation' conciliation'
of
Appendix "F" - Uncitral Model Law on International arbitration, or any combination thereof as a means
Commercial Arbitration .......................... 773 : speedy and efficient means of resolving
p ".ii""i"g
xii !:
*.*i
5
 Acr or- 2004
AuenruartvE Dtspure REsorurtoiv
..":::: T 1:: [:,,"1:;' " "
rules
cases pending before all courts in the Philippines the Philippines which shall be governed by such
as the Supreme Court may apProve from
time to time'
which shall be governed by such rules as the Supreme
Court may approve from time to time.
The case of Magellan CaPital Management
Corporation vs'
The Afternative Dispute Resolution Act of 2OO4- Zosa (355 SCRA t 571'
The Altcrnative Dispute Resolution Act o[ 2004 (ADR) is In this case, the Supreme Court held that "under Act
No'
licpublic Act No. 9285. It was approved on April2, 20O4, Itepublic g76, otherwrse known ai the Arbitration Law it is the Regional
nci No. 9285 is entitled "An Act to Institutionalize the Use of an to
irlut Cot,tt which exercises jurisdiction on questions-relating
Alternative Dispute Resolution System in the Philippines and to arbitration." Moreover, "arbitration proceedings
are designed-to
Iistablish the office for Alternative Dispute Resolution and For in pursuit of mutually
f"""fift" pfrying field among the parties and any
Other Putposes."' acceptable"rolutio., to their conflicting claims'
advantage to a
u*rig"*""t or scheme that would give undue
Party autonomy in dispute resolution explained. to the very purpose of
oa.tvln the negotiating table is anathema
portions
irUiirutio" un; shouid be resisted." of the decision
Autonomy means the state of independence. It is a declared
policy of the Stut" "to actively promote party autonomy in the follows.
iesolution of disputes for the freedom of the parties to make their We rule against the Petitioners'
own arrangements to resolve their disputes. Towards this end,
It is error for the petitioners to claim that the case should
the State shall encourage and promote the use of Alternative
Dispute Resolution (ADR) as an important means to achieve
fall under the jurisdiction of the Securities and Exchange
does not in
Commission (SiC, for brevity)' The controversy
speeay and impartial justice and declog court dockets'"2
;;;;"; ;volve the election/appointment of officers of
in their assignment
o"iirlor-tu, MCHC, as claimed by petitioners
How the State shatf achieve alternative dispute resofution' heavily
|i"tt.tt. n"spondent Zosa' su-"ttd"d complaint focuses
The State shall use the alternative dispute resolution as an 's "Arbitration
iir" ifi"gotity of the Employrnen.t Agreemenf
important means and efficient tool "to achieve speedy and "^
Clause" i.titiatiy invoked by him in seeking
his termination
impartial justice and alternative procedure for the resolution of of th! employment contract' And under
benefits under Section 8
appropriate cases" by: known as the "Arbitration
n"f"Ufi. Act No. 876, otherwise jurisdiction
(1) g-die$g-tlg4clive prlvate ge9to--r participation in the Lai," it is the regional trial court which exercises to the
We thus advert
settlement of disputes through ADR. ou.. q.r"rtior',, ,Jluti"g to arbitration'
iotlo*irlg discussions irade by the-Court of Appeals' tqTt:g
(2) Without prejudice to the adoption by the Supreme S'P' No'
Court of any ADR system such as lrediatiory thru )ustlce Minerva P' Gonzaga-Reyes' in C'A'-G'R'
43059, uiz.:
An-cili?q!-o& qbilt$gl or any combination thereof as
a means of resolving iirses pending before all courts in "As regards the fourth assigned error' asserting that
for the first time in
iurisdiction iles with the sEC, which is raised
Amended Complaint
ih;;;it;n, suffice it to state that the
rSee title and Section the Arbitration Clause
,lbid.
I Republic Act No. 9285
sq,rarely put in issue the question whether
 Dtspurr ResoLurtotl Ao or' 2004
ArEnru,qnvE
.,":::: T a-" )"?.,?13"u*,
" "
file petition
is valid and effective between the parties. Although the August 11', 1gg7 and withdrawal of intention to
DECLARE
trrntroversy which spawned the action concerns the validity of for review on certiorari, the Court Resolved to
and DIRECT the Clerk of Court
tlre termination of the service of a corporate officet, the issue on THIS CASE TERMINATED
that the judgment sought to be
the validity and effectivity of the arbitration clause is determinable a lNnOnVf the parties
reviewed has become final and executory/ no aPpeal
by the regtrlar courts, and do not fall within the exclusive and
therefore having beer-r timely perfected''
original jurisdiction of the SEC."
"The determination and validity of the agreement is not a 1997 become final and
and that the same' has, on September
17
matter intrinsically connected with the regulation and internal ' '
of
;;;;;t ancl is hereby recorded in the Book of Entries
affairs of corporations (See Pereyra us. IAC,181 SCRA 244; Snles
us. SEC,169 SCRA 121.);itis rather an ordinary case to be decided Judgments."
anew
in accordance with the general laws, and do not require any Petitioners, therefore, are barred from challenging
in utt{,oth"I,f,o,:1lll
particular expertise or training to interpret and apply (Viray us. through another remedial measure and
regional trial court to resolve the valtdtty ot tne
cA,197 SCRA 308)."3 authoiity of the
clause,"lest they be truly guilty of forum-shoPpilg
Furthermore, the decision of the Court of Appeals in CA- "Jii.",i." a contumacious practice
which the courts consistentiy consider as
G.R. S.P. No. 43059 affirming the trial court's assumption of of justice'
that derails the orderly administration
jurisdiction over the case has become the "law of the case" which by this
now binds the petitioners. The "law of the case" doctrine has been Equally unavailing for the petitioners is the review
findings made by
defined as "a term applied to an established rule that when an Court, lriu inu instant i"titiott, of th" factual
panel of arbitrators
appellate court passes on a question and remands the cause to if'," i.i"f court that the composition of the
work iniustice.to respondent Zosa'.We
the lower court for further proceedings, the question there settled ;;"1d, in all probability, in a
that the jurisdiction of this Court
becomes the law of the case upon subsequent appeal." To note, h*u ,"p"utedly stressed
Rules
the CA's decision in CA-G.R. SP No. 43059 has already attained petition for review on certiorariunder Rule 45 of the Revised
of law' not of fact'
finality as evidenced by a Resolution of this Court ordering entry ile;;;;i;limited to reviewing only errors
devoid of support
of judgment of said case, to wit: .rrrt"r, the factual findings complained of are
judgment is based on
by the evidence o.t ."toih, or the assailed
''Entry of Judgement misapprehension of facts'a
and a scrutiny of
Even if procedural rules are disregarded'
This is to certify that on September B, 1'997 a decision / the merits oi the case is undertaken' this
Court finds the trial
the panel of
resolution rendered in the above-entitled case was filed in this court's observations on why the composition of
to merit our
u.Uit.utorc should be voided, incisively correct
so as
Office, the dispositive part of which reads as follows:
approvals. Thus,
'G.R. No. L2961,5 (Magellan Capital Management the view
"From the memoranda of both sides' the Court is of
Corporation, et al. vs. Court of Appeals, Rolando Zosa, el MCHC represent the
that the defendants [petitioner] MCMC and
al.). Considering the petitioner's manifestation dated same inte.est. Therels no quarrel that both defendants are entirely
-
rLoevjllo C. Agustin vs. Court of Appeals and Filjnvest Finance Corporation,2ll
the Re|igious of the Virgin Mary vs' CA, 29 l SCRA 385 ll 998)
scRA4sT lt997l. 'Cong,"g"il.n of
5
 ALrEnr,rqrrve DrspurE REsorurror.i Acr oF 2004
..,1i3'i i")"?.,'i3io, " "

t'vo different corporations with personalities distinct and separate "From the foregoing arbitration clause, it appears that the
lrom each other and that a corporation has a personality distinct (MCMC and MCHC) have one
two (2) defendants [petitioners]
and separate from those persons composing the corporation as (t) arbitrator each to compose thepanel of three (3) arbitrators'
MCHC,
well as from that of any other legal entity to which it may be i, tf"," defendant MCMCis the Manager of defendant would n^htTt]I
related. its decision or vote in the arbitration proceeding
the defendant MCHC
"But as the defendants [herein petitioner] represent the same anJ.urtuir.,ty be in favor of its employer and
own interest; hence' the
interest, it could never be expected, in the arbitration proceedings, would have to Protect and preserve its
(MCMC and MCHC) would
that they would not protect and preserve their own interest, *nih i*" tZl votes of both defendants
certainly be against the lone arbitrator for
the plaintiff [herein
less, would both or either favor the interest of the plaintiff. The
apparently, plaintiff would never
arbitration law, as all other laws, is intended for the good and defendint]. HJnce, [defendant]
welfare of everybody. In fac! what is being challenged by the getorreceivejusticeandfairnessinthearbitrationproceedings
plaintiff herein is not the law itself but the provision of the ?-* tn" putt"t of arbitratois as provided in thethe aforequoted
plaintiff
arbitration clause. In fairness and justice to
Employment Agreement based on the said law, which is the
arbitration clause but only as regards the composition of the panel iJ.f"r,au"tl, the two defendants (MCMC and MCHC) [herein
the same interest should be
of arbitrators. The arbitration clause in question provides, thus: fetitioneril which represent entitled to only one arbitrator.to
ionsidered as one and should be
'In the event that any dispute, controversy or claim arise proceedings' Accordingly' the
out of or under any provisions of this Agreement, then the
."p."t"", them in the arbitratior
artitration clause, insofar as the composition of the panel of
parties hereto agree to submit such dispute, controversy or void and of no effect,
arbitrators is concerned should be declared
claim to arbitration as set forth in this Section and the the parties q9*ul
because the law says, "Any clause giving one of
determination to be made in such arbitration shall be final arbitrators than the other is void and of no effect'"
to choose more
and binding. Arbitration shall be effected by a panel of three (Article 2045, Civil Code).
arbitrators. The Manager, Employee, and Corporation shall (MCMC
designate one (1) arbitrator who shall, in turn, nominate and "The dispute or controversy between the defendants
elect as who among them shall be the chairman of the and MCHC' lherein petitioners] and the plaintiff [herein
in
committee. Any such arbitration, including the rendering of defendant] should be iettled in the arbitration proceeding
under panei
an arbitration award, shall take place in Metro Manila. The ul.ordu.t." *ith the EmploymentAgreement, but the

arbitrators shall interpret this Agreement in accordance with
the substantive laws of the Republic of the Philippines. The
arbitrators shall have no power to add to, subtract from or
otherwise modify the terms of this Agreement or to grant
injunctive relief of anynature. Any judgment upon the award
of the arbitrators may be entered in any iourt having
jurisdiction thereof, with costs of the arbitration to be borne
equally by the parties, except that each party shall pay the
fees and expenses of its own counsel in the arbitration.'
(Emphasis supplied)
of three (3) arbitratott, ott.i1) arbitrator to representt\e-gllntift,
(MCMC and
one (1) arbitrator to represent both defendants
MCHC)[hereinpetitioners]andthethirdarbitratortobechosen
(petitioners)'
by the plaintiff [defendant Zosa] and defendants
,,XXX XXX xxx"
In this connection, petitioners' attempt to put respondent in
estoppel in assailing the arbitration clause must be struck
down'
no. f.,", this issue Jf estoppel, as likewise noted by the C9y19f
Well-
Appeals, found its way foi the first time-only on appeal'
raised below cannotbe resolved
,"iti"a i's the rule that issues/not

014 7

lbwrfirtrfEt
 RrPuercAcr No 92B5
Dtspure RrsoLurtol Acr or 2004
ALTERNATIvE
ChaPter I Provtston
-General
a govern-
a presiding judge of a court or an officer of
orr review in higher courts.s Secondly, employment-agreements
il;;;;;:i as?efined inthis Act' in which a neutral
sr-rch as the one at bar are usually contracts of adhesion' Aty resolution of
,rmbiguity in its provisions is generally resolved against the party i-iita pl"y participates to assist in the
mediation' conci-
who lrafied the document. Thus, in the relatively recent case of i;;;;t; *rii.n includes arbitration' mini-trial' or any
plil. Federation of credit cooperatiaes,Inc. (PFCCI) and Fr, Benedicto iiatiorr, early neutral evaluation'
lauoma rrs. NLRC and victoria Abril,6 we had the occasion to stress combination thereof;
iliut "*hure a contract of employment, being a contract of (b) 'ADR Provider" means institutions or
adhesion, is ambiguous, any ambiguity therein should be p"tto"t accredited as mediator' :"":lt^t:^t:t arbitrator'
similar
construed strictly agiinst the party who prepared it'" And.,. finally' neutral evaluator, or any person.exercising
Dispute Resolution
respondent Zosa submitted himself to arbitration proceedrngs (as ?"".ti""" in any Alternaiive t-".t|: rights of the
there was none yet) before bewailing the composition of the panel ryr't".* infs is without preiudice to act as
of arbitrato.r. H" in fact, lost no time in assailing the "arbitration narties to choose nonaccredited individuals
neutral evaluator
clause" upon realizing the inequities that may mar the arbitration il;il;; conciliator, arbitrator' or
proceedings if the existing lit u-up of arbitrators remained of their disPute.
term "ADR
unchecked. Whenever referred to in this Act' the
Weneedonlytoemphasizeinclosingthatarbitration oractitioners"
t;;;i"to" shall refer to individuals acting as
proceedings are designed io level the playing field among the ;onciliator, arbitrator or neutral evaluator;
parties in pursuit of a mutually acceptable solution to thetr (c) "Authenticate" means to sign' execute oradopt
conflictingilaims. Any arrangement or scheme that would give in wholsor in part' intended
a symbol, or encrypt a record
accept
undue advantage to a party in the negotiating table.is anathema i" ii""itiy ,r," utth""tituting party and to-adopt'
a record or term;
to the ,r"ry prripot" of uibit.ation and should, therefore' be or establistr the authenticity of
resisted. (d) "Arbitration" means a voluntary dispute
more arbitrators'
WHEREFORE, premises considered, the petition is hereby resolution process in which one or
DISMISSED and the iecision of the trial court dated luly 18,1997 appointed in accordance with the agreement of the
this Act'
is AFFIRMED. o"iti"r, or rules promulgated pursuant to
SO ORDERED.
I"t"f"" a disputeiy rendering an award;
(e) "Arbitrator" means the person appointed to
SEC. 3. Definition of Terms' For purposes of render.anaward,aloneorwithothers,inadispute
this Act, the term:
- that is the subject of an arbitration
agreemen[

(a)"Alternative Dispute Resolution System" (f) "Award" means any partial or final decision
issue in a controversy;
means any Process or procedure used to resolve a by an arbitrator in resolving the
is
dispute oi controversy, other than by adjudication of (g) "Commercial Arbitration" An arbitration
from all rela'
"com'ilercia l" if itcovers
matter arising
contractual
5casolita. Sr. vs. Court of Appeals,275 SCM257 ll997l Manalili vs. Court of APPeals tionships of a commercial nature' whether
ii
280 SCRA 40O lt997l. or noU

' sr$
6300 scRA 72 11998). ,t,:.
,,
a
;_1.

t
l':
 REPuertc Ao No 92B5
Arl or 2004
Arrnruqrvr DtspurE Rrsorurtoru ChaPter | Provision
-General

(h) "Confidential information" means any maries of their cases and receive a nonbonding
person' with
mediation or assessment by an experienced, neutral
information, relative to the subiect of in t'he subiect in the substance of the dis-
arbitration, expressly intended by the source not to
"*p*,it"
ie disclosed, or oUtained under circumstances that pute;
would create a reasonable expectation on behalf of (o) "Government Agency" means any govern-
court' that
the source that the information shall not be disclosed' mental'entity, office or officer, other than a
is ,restea ty law with quasi-iudicial Power or
the
It shall include (1) communication, oral or written'
made in a dispute resolution proceedings' including po*"t to resolve or adiudicatedisputes involving the
'gorr..rr*".t, its agencies and instrumentalities' or
any memorania, notes or work product of the neutral
purty o, non-party participant, as d-efined in this Act; private Persons;
iz) att or"t or writlen statement made or
which occurs (p) "International Party" shall-mean an entity
during mediation or for purpos€s of considering *f,or'" pta.e of business is outside the Philippines'
condu"cting, participating, initiating, continuing or ii rft"fi not include a domestic subsidiary of such
ven-
reconveniig mediaiion oi retaining a mediator' and
international party or a co-venturer in a ioint
(3) pleadings, motions, manifestations' witness in
ture with a Party which has its place o-f.business
shall
statiments, rlports filed or submitted in an arbitration ifr" nnifippir."r. Th" term foreign arbitratorPhilip-
or for expert evaluation; ;;; u p"irot who is not a national of the
(i) "Convention Award" means a foreign pines;
rn
arbitral award made in a Convention State; (q) "Mediation" means a voluntary Ptocess
by the disputing parties'
(i) "Convention State" means a State that is a which a mediator, selected
and assists
member of the New York Convention;
facilitates communication and negotiation,
agreement
the parties in reaching a voluntary
(k) "Colttt" as referred to in Article 6 of the regarding a disPute;
Model Law shall mean a Regional Trial Cour! (r) "Mediator" means a pelson who conducts
(l) "Court-Annexed Mediation" means any mediation;
mediation process conducted under the auspices of (s) "Mediation Pafiy" means a person wh.o
the court, alter such coutt has acquired iurisdiction consent is
narticipates in a mediation and whose
of the disPute; to resolve the disPute;
,r"."ttiry
(m) "Court-Referred Mediation" means media- is a
(t) "Mediation-Arbitration" or Med-Arb
tion ordered by a court to be conducted in accordance involving both
two-step dispute resolution Process
with the Agreement of the Parties when an action is
mediation and arbitration;
prematurely commenced in violation of such agree-
men! (u) "Mini-trial" means a structured dispute
of a case ate
(n) "Early Neutral Evaluation" means an ADR resolution method in which the merits
decision
argued before a panel comprising senior
process wherein parties and theirlawyers are brought pi"t"ot" of a neutral third
iogether early in a pre-trial phase to present sum- -iturc with orwithout the

11
10
 -l

Arrnrunrtvr Dtsrurr Rrsorurtotl

Ac or 2004 . *:::: T i3").?,,ni,3i,, " "
a government
negotiated hv adiudication of a presiding iudge or officer of
person after which the parties seek a llunin," as defined in Republic Act No' 9285' "in which a neutral
settlement; resolution of issue, which
Law on ,fitJ i..,y participates to assist in the
(v) "Model Law" means the Model early neutral
irr.tri"r aibitration, mediation, conciliation,thereof'"7
International Commercial Arbitration adopted by the The
Trade evaluation, mini-trial or any combination
United Nations Commission on International arbitration, mediation, contemplated in Republic
Act No' 9285 is
Law on 21 june 1985; liii"ru", from similar amicable settlement processes envisioned
(w) "New York Convention" means the United in Republic Act No. 7160, inthelupon or
pangkat'

Nations Convention on the Recognition and

Enforcement of Foreign Arbitral Awards approved,in Arbitration defined and exPlained'
1958 and ratified Uy ttre Philippine Senate
under
Arbitrationmeans a voluntary dispute resolution process-in
Senate Resolution No' 71; which one or more arbitrators, appoinied in accordance
with the
pursuant to
(x) "Non-Convention Award" means a foreign aqreement of the parties, or rules promulgated
arbitral award made in a State which is not a dispute by renderings an award'
n?fublic ect No. 9i85, resolve a
Convention State; g"ior" Republic Act No. 9285, arbitratiory in its broad sense, is
the parties' of
(y) "Non-Convention State" means a State that understood to mean a substitution, by consent of
1

another tribunal or the tribunals provided by

the ordinary
is not a member of the New York Convention; domestic tribunal, as contradistinguished
pro."rr", of law. It is a
(z) "Non-Party Participant" means a Person' ?rom ,"g,rlurly organized court proceeding
according to the course
in a
other than a party or mediator, who participates of the Jo**n law, depending upon the voluntary act.of the
person
rnediation proceeding as a witness' resource judges of their own choice.e
or exPert;
;;*, disputant in the selection-of the
(aa) "Proceeding" means a iudicial' adminis- ADR provider defined.
trative, or other adfudicative Process' including An',ADRproaider,,meansinstitutionsorPersonsaccredited
con-
related pre-hearing or post-hearing motions' as mediator, conciliator, neutral evaluator' or any
person
ferences and discoverY; similar functions in any Alternative Dispute Resolution
(bb) "Records" means an information written on "*"r.ising parties to
sfstem. fhi, it without prejudice to the rights of the
or other non-accredited individuals to act as mediator' conciliator
a tangible medium or stored in an electronic
and "i,oor"
arbitrator or neutral evaluator' Non-accredited individuals'
similar medium, retrievable in a perceivable form;
themselves
(cc) "Roster" means a list of persons qualified therefore, who are chosen by the parties to a dispute
are also considered by law as "ADR providers'"r0
to provide ADR services as neutrals or to serve
as

arbitrators. :
I

Alternative Dispute Resolution System defined' 3{a), Republic Act No 9285

':

'5"" S".ti.t
i. ssee Section lldl, Ibid'
"any
An Alternatiae Dispute Resohttion System means Process
, 'Chan Limte vs Law Union
& Rock Insurance ' 42 Phil 555'
dispute or controversy' other than roSee Section 3lb), Republic Act No. 9285
or procedure used to resolve a 'ri

I 1?
T2 r
s
t
,F
 Repuauc Ao No. 9285
Acr ot 2004 Chaoter I --General Provision
ALrEnrurtvE Dtseurr REsorr-nroN

For purpost: Rules on Electronic

or electronic document' jg"J*tl "l lh:
Commercial arbitration defined' Evidence, an electronic
includes digital signatures'1s

Anarbitrationis"commercial"ifitcoversmattersarising
from all relationships of a commercial nature, whether contractual Liability of ADR Proaidetsl Practitioners'
SEC. 5.
shall have
or not.11 The nOn providttt una practitioners
-the same civii tiaUility ?or acts done in the
that of public offic.ers
Arbitrator defined' o"rtor*"r,." of iheir duties aschapter e' Book I of the
" Arbitrator" means the Person appointed to render an award' :;;il;;;ln section 38(1)'
alone or with others, in a dispute subject to an arbitration Administrative Code of 1987'
agreement.l2 He is a neutral person who resolve disputc's betwccn
tlie parties, especially by means of formal arbitration'r3 Liability of ADR providers/practitioners'
shall have the same
The ADR providers and practitioners duties
SEC. 4. Electtonic Signatures in Global and E- in the perfo-rnury" of their public
civil liability fo, utt' io"" 9, Book I of the
Commetce Act, The provisions of the Electronic s"ction 38(1). Chapter
- as that of public
Signatures in Global and E-Commerce Act, and its "fd";;l;1987 '1b
,q.d.rrittittiutive Code of
Imiplementing Rules and Regulations shall apply to
proceedings contemplated in this AcL Section 38tll, Chapter 9' Book l' Revised Administrative
Code.
Effect of Signatures in Globat and E-Commerce Act' The liability of ADR providers
and practitioners are similar
forth in Section
The provisions of the Electronic Signatures in the Global and to the liability ofsuperioi putfit officers as set
gSokiJf tn" Administrative Code of 1987
E-Commerce Act, and its implementing rules and regulations' 38(L), Chaptu, q,
shall apply to proceedingt.ottte*plated in RepublicAct
No'9V8:
pertinentlY Provides that:
This is because of advarices in eleitronic communications and E- liable for acts
'(1) A public officer shall not be civilly unless there is
commerce.l4 his official duties'
done in tht P";i;;;;ce of
malice or gross negligence'"
a clearcho*i";;;;;Jfaith'
Elecffonic signature defined.
" Electronic signature" refers to any distinctive.mark' SEC. 6' Exception to the Applicatioryg{thk'Ot.t''
to
characteristic and/or sound in electronic form, representing the The p'oul'io'"t of this Ait shall(not'hpply
t+:
identity of a person and attached to and logically associated with -resolution of the followii-g:
!"]
an electronk date message, or electronic document or any disputes
"t;;i;;;nt
to""*d by Decree No' 442'
-frelid.ential
Code of the Philip-
methodology or procedure employed or adopted-by l person and otherwise k";;; oJtn" "Labor Rules
executed Ji adopted by such Person, with the intention of pines," uitoa"d and its Implementing
authenticating, signing, or approving an electronic data message
"'
and Regulati""q tfl the civil
status of persons; (c)

"S"" S..t,".' :(g), lbid 0l-07-0l'July11'2001

r25ee Section 3{el, lbid ---=S."Gct|of|l0)'Rule2'RuleonElectronicEvidence'AM
rr8lacks Law Dictionary, 7th Edition. p l00' Republic Act No. 9285
raSee Section 4. Republic Act No 9285
'tsee Section 5'
15
t4
 ArenN,'\rtve Dtspurr Rrsorurtol Acr or 2004

the validity of marriage; (d) any ground for legal

separation; (e) the iurisdiction of courts; (f) future
tegitlme; (g) criminal liability, and (h) those which CHAPTER 2
by law cannot be comPromised.
MEDIATION
Non-applicability of Republic Act No. 9285'
The provisions of Republic Act No. 9285 "shall not apply to Scope'- The provisions of this Chapter
SEC. 7.
whether ad hoc or
resolution or settlement of the following: (L) labor disputes shall cover voluntary medlation'
The term
covered by Presidential Decree No. 442, otherwise knowtr as the institutional, other than court-annexed'
"Labor Code of the Philippines," as anrenclccl and its lmediation" shall include conciliation'
implementing Rules and Regulations; (2) the civil status of
p"iro.,r; (3) tle validity of marriage; (4) any.ground for,legal Act No' 9285'
Scope of Chapter 2, Republic
separation; (5) the jurisdiction of the courts; and (6) future legitime; Act No' 9285' shall
The provisions of Chapter 2' Republic
(7) criminal liability; and (8) those which by law cannot be o' institutional' other
i .ou".uofir.tury rntaiutio""*h"th"t odho'
compromised. Republic Act No. 9285 does not aPply to non- mediation shall include
than court u,,,'u*"J'-the term mutually agreed upon by
1

compromiseable cases, because the law prohibits it'17 conciliation. Mediation isuoluntary
if
i
the Parties.l
:r

Mediation defined'
" Mediation" means a voluntary Process in which a mediator'
:::
and
selectedby the ditdil; parties' iutilitut"'t communication
r;achinq
nesotiation, and assist"s ihe parties..in "-:-:"Y1^TI
wno
;;:;;;"i;garding dispute'2 "Mediator" means a person
a
cJnclucts mediation'3

Mediation-Arbitration defined'
dispute resolution
Mediation-arbitration is a two-step
pr"."r, *lving both mediation and arbitration'a

SEC. 8' Application and Intetpretation'

of-.1"
this
applying u^d'Jo"'t'uing the provisions

?, Republic Act No 9285

'S." S".lt"
--_ ?See
Section 3{q}, lbid.
rSee Section 3lr)' lbid
aSee Section 3(t), lbid'
rTSee Section 6. Republic Act No. 9285. *i
17
1.6 s
.E
a
..t

ArrrnN,artvr DtspurE RrsoLurtoru Act or 2004
Chapter, consideration must be given to 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 principles
of integrity of determination by the parties, and the
policy that the decision-making authority in the
mediation process rests with the parties.
Considerations in applying and construing mediation
provisions.
ln applying and construing mediation provisions,
consideration must be given: (1) to the need to prornotc ci.rrrc'krr
of the parties and nrediators through confiientiulity of the
mediation process; (2) the policy of fostering prompt, ecorronrical
and amicable resolutions of disputes in accordancc with thc
principles of integrity of determination by the parties; and (3) the
policy that the decision-making authority in the mediation proccss
rests with the parties.5
fntegrity defined.
- lntagritv means thc soundness of moral principles and
character of a public officer in the discharge of ttre trusi reposed
in such officer.6
SEC. 9. Confidentiality of Information.
- mediator who is wrongfully subpoenaed shall be
Information obtained through mediation proceedings
shall be subject to the following principles and
guidelines:
(a) Information obtained through mediation
shall be privileged and confidential.
ft) A party, a mediatoq, or a non-party partici-
pant may refuse to disclose and may prevent any
5See Section
6. Republic Act No. 9285
"Dizon vs. Dollete, 120 SCRA 456.
t?rPuelc Ao No 9285
Chapter Medratlon
'2
-
other person from disclosing a mediation communi-
cation.
(c) Confidential information shall not be
subiect to discovery and shall be inadmissible in any
a dvlrsaria-l-P4qeedin g, whether i
ud ici al o r q u as i-
iudicial.Gio*"u)t, evidence or information that is
;h;il or sub j ect to di scove ry cloes ri6!
"*niiisiUte
become inadmissible or protected from discovery
solely by reason of its use in a mediation'
(d) In such an advcrsarial procecding' the
following persons involved or previously involved
in a mediition may not be compelled to disclose
confidential information obtained during the me-
diation: (1) the parties to the dispute; (2) the mediator
(4) the
or mediators; (3) the counsel for the parties;
non-party participants; (5) any persons hired or
engaged in connection with the mediation as secretary
(6) any other
ste"no-gtapher, clerk or assistant; and
p"rrJrl who obtains or possesses confidential
information by reason of his/her profession'
(e) The protections of this Act shall continue
to apply even i] a mediator is found to have failed
to
act imPartiallY.
(f)
A mediator may not be called to testify to
provide information gathered in mediation' A
reimbursed the full cost of his attorney's fees and
related exPenses.
Confidentiality defined and explained'
the
Confidentiality means secrecy, the state of having
dissemination of certain information restricted. The guidelines
o" .orrria""tiality of int'ormation obtained in mediation proceedings
are set forth in iection 9, Republic Act No' 9285'
In the law on
evidence, they are considered privileged communication'
19
 ALrEBNartvE Drspurr Resorurtoru
Acr ot 2004 :#ffi'lT,?.?.fl:
representation of dis-
preiudiced to respond to the
Privileged communication defined' closure.
Priuileged communication is a doctrine that utterances made
in the course of judicial proceedings, including all kinds of of confidentiality explained'
Waiver defined and waiver
pleadings, petitions and motions belong to the class of Waiaer means the voluntary
relinquishment or abandon-
communications that are absolutely privileged, if the same are of a right'8 In Section L0' Republic
Act
rnent, express or implied
relevant, pertinenf or material to the cause at hand or subject of the confidentiality of
No. 9285, a privitefe u'lt1te'from
inquiry.T lt is communication which in the context of legal or other in a record' or orally during a
recognized professional confidentiality. The fact that ccrtain i^i"r*"ri"" ^uy U""*uived and the mediation parties' However'
communication is termed privileged allows the spcakt'rs to rcsist rt'".*Ji"; Oy th! mediator of information may
legal pressures to disclose its contents.
|'oritif"gJ uiiri,'g from the confidentiality if the information
ii;i.;'b" wuive? by a non-party participant
is I'rovided by the non-party Partlcrpanr'
SEC. L0. Waioer of Confiilentiality.- Aprivilege
arising from the confidentiality of information may (a) There is
SEC. 1"L. Exceptions to Priailege' -
be waived in a record, or orally during a proceeding uttdet Section 9 if
no privilege alai"st disclosure
by the mediator and the mediation parties. communication is:
A privilege arising from the confidentiality of ^"iiutiot(1) in an agreement evidenced by a record
information may likewise be waived by a non-party authenticated by all parties to the
agreemen!
participant if the information is provided by such non-
party participant.
(2) available to the public or that is made
is open'
during a session of a mediation which
A person who discloses confidential information to the public;
or is required by law to be open'
shall be precluded from asserting the privilege under
Section 9 of this Chapter to bar disclosure of the rest
(3) a threat or statement of a plan to inflict
of the information necessary to a complete under- bodily iniury or commit a crime of violence;
standing of the previously disclosed information. If (4) intentionally used to plan a crime'
a crime' or conceal
a person suffers loss or damage as a result of the attempt to fommit' or commit
an ongoing crime or criminal
activity;
disclosure of the confidential information, he shall
be entitled to damages in a iudicial proceeding against (5) sought or offered to prove 9t-di:PtoY"
or exploitation in
the person who made the disclosure. abuse, o"!t"i, abandonment'
pro-tec-
is
A person who discloses or makes a repre- a proce"di"g in which u.pt1lllt agency
protecled by
sentation about a mediation is precluded from ting the i"t!'est of an individual
aPply wfer'e a
asserting the privilege under Section 9, to the extent law; but this exception does.not
to mediation
that the communication prejudices another person in child protection matter is referred
the proceeding and it is necessary for the person
L"w Dictionary' 7th Edition'
p l5l +
"Ge".K RepublicAct No 9285
7See Black3 Law Dictionary.
tseeI st and 2nd paragraphs' Section I 0'
7th Edition, p 1285
27
20
 or 2004
Arenrunrvr DtspurE Resorurtoru Acr
bv a court or public agency participates in the
child Protection mediation;
(6) sought or offered to prove or disprove
a claim or complaint of professional misconduct
or malpractice filed against mediator in a
proceeding;or
(71 sought or offered to prove or disprove
a claim or complaint of professional misconduct
or malpractice filed against a party, nonparty
participant, or representative of a party based on
conduct occurring during a mediation.
(b) There is no privilege under Section 9 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:
(1) a court proceeding involving
felony; or
(21 a proceeding to prove a claim or
defense 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
such proceeding.
(d) If a mediation communication is not
privileged under an exception in subsection (a) or (b),
only the portion of the comrnunication necessary for
the application of the exception for non-disclosure
may be admitted. The admission of particular
evidence for the limited purpose of an exception does
22
Rrpusrtc Acr No. 9285
Chapter 2 Mediation
-
not render that evidence/ or any other mediation
communication, admissible for any other purpose'
against disclosure'
lnstances when there is no Privilege
the instances
Section 11(a), Republic Act No' 9285 enumerates
disclosure' In those instances'r0
when there is no privilege against
ine prirriteg" .un b".rtei uJthi"ld against the law itself which is
;;;fu puflic policv. Alaw cannotbe used against the law Section
;?i"i";"*erates' the instances when allowing disclosure
nr'rt*"ight tl-re reasons for existence of the privilege'l1
SEC. 12. Prchibited Mediator Reports' - A
mediator may not make a report, assessment' evalua-
tion, recommendation, findinp or other communi'
cation regarding a mediation to a court or agency
or
other autiority that may make a ruling on dispute
that
is the subiect of a mediation, except:
a) where the mediation occurred or has termi-
nated, or where a settlement was reached'
a crime or b) as permitted to be disclosed under Section
13 of this ChaPter'
Prohibited mediation rePorts'
evaluation'
A mediator may not make a rePort' assessment'
or other communication regarding a
recommendation, finding,
that may make
mediation to a court o, u[""ty or other authority
u firrair,g on a dispute that is the subject
of a mediation' except:
in the meiiation occurred or has terminated' or where
at;h;" (2) as permitted to be disclosed
the settlement was reached; and
under Section 13 of Republic Act No' 9285'12
roSee Section I lla). Republic Act No 92B5
rrsee Section I I {b), lbid.
r2See Section I2. Republic Act No 92B5.
23
 ALTERMTIvE DtspurE RrsorurtoN
Atr or 2004 :ffi5iiYJ"fl:
any known facts that a reasonable
and Conflict -of determine whether there are
SEC. 13. Mediator's Disclosure to affect the impartiality of the
individual would consider likely
The mediation shall be guided by
the interest in the outcome of the
Interest,- mediatioru including the financial
following oPerative PrinciPles: relationship.ryth.a party,or
mediation and any existing or past
(a) Before accepting mediation' an individual
a foreseeable participant in
ihe mediation; and (2) disclose to the
learned as soon as
*ho i, ,"qoested to t"*" "t a mediator shall: mediation parties-any such fact ftt?t"tt,:tThe purpose of this
(1) make an inquiry that is reasonable under pr".,i.^f before u"t"'p'ing a mediation-13 mediator to convince
the circumstances to determine whether
there are nrovision is transparency 6n the part of thc
individual i#;ffiJn^it Jn"t p""o'til agenda to pursue in the course
any known facts that a reasonable "o
of
would .o,,,ia"' titely to affect the impartiality of the mediation'
or pers'onal
the mediatoi-i"ttttdittg a financial Except as
and any SEC. 14. Participation in Mediation' -
interest in the outcome-of the mediation a party may designate
existing or past relationship with
a party or otherwise provided in this Act'
assistance in
and a lawyer or any other person to grgvide
foreseeible participant in the mediatiory shall be made in
the mediation. A waiver of this right
(2) disclose to the mediation parties any writing by the party waiving it' Awaiver of participa-
as is practical
such fact t.o*" or learned as soon
I at any
I oilegal repreientation may be rescinded
tion
before accePting a mediation' I time.
(b) If a mediator learns any fact described ina i
a
* to assist in mediation'
p"rugruplt (a)(1) of this section after accepting ti
t Designation of lawyer or non-lawyer
*"a[tiot, the mediator shall disclose it as soon as i A lawyer or a non-lawyer may be designated
to provide
as otherwise provided in
practicable. assistance in the mediation, except in
individual be made.
At the request of a mediation party' an s n"fJii. Act No. gzBS' Awaiver ot thit right shall

who is ,"qo"r,"J to serve as mediator shall disclose * our'i,irlg by the party waiving it'
A waiver of legal representation
his/her qualifications to mediate a dispute' may be rescinded at anY time'14
shall
This Act does not require that a mediator explained'
have special qualifications by background or f19f;s- Rescind and rescission defined and
the special qualifications of a mediator Torescittdmeanstoabrogate,annul,avoidorcancela
sion unless
or by the party's unilateral unmaking of a contract
uru ,"q.rir"d in tire mediation agreement contract.ls Rescission is a

mediation Parties. for a legally sufficient such as the other party's material
"l'o'1 as a remedy or defense
rv breach. Rescission is generally available
to their
Mediator3 disclosure and conflict of interest' $
E
for a nondegalltinf party and restores the parties
is
At the request of a mediation party' an individualwfS pr('contractual Positions'tn
E

disclose his/her
g

requested to r"r.'J^ul^"-*"ai"tor sirall accepting a

l'
I
----E""G.KI. 13. RepublicAct No 92U5
before
qualifications to mediate a dispute' But shall:
!
't
I ISec Ar t N r' 9285
S|clion I 4' Republrc - . Pilil
5l
.
BB
to be a mediator r5Tan Chay vs' west Coast Lt[e Insut'rtrce Co '
med.iation, an individual who is requested s loBlack\ Liw Dictionary' 7th edition' p l30B.
(L) make an inquiry that is under the circumstances to s
'"u'o"ubl" rt:
25
24
 ALrenN'qttvr Dtspurr Resorurloru
Acr c:r 2004 :r;;[:ltT:.iil,,
by institution'
The parties are Effectof submission to mediation
SEC' 15' Place of Mediation-''- An agreement to submit a dispute to mediation
by an
Failing such
free to agree o" ih" place .mediation'
of
agreement to be bound by the internal
shall be any place instliution"shall include an
ulr""t,""nt, the place of mediation the administrative policies of such institution
to all parties' ;;;ii"" and of conflict between the
"Snrnenient "t'd "pptopriate ir,.f.raing the rules thereof'le In cise
Ilepublic Act No' 9285' the latter
of mediation' institutio"nal mediation rules and
Ptace
parties' shall Prevail.20
The place of mediation shall be by agreement of the
parties, the place of mediation shall
In case of disagreement of the
place SEC. 1'7. Enforcement of Mediated Settlement
to all parties' This
be any place c6nvenient and appropriate Agreements. Tire mediation shall be guided by the
shall also be by the Parties.lT -
f oltowing oPerative PrinciPles:

SEC. 1,5. Effect of Agreement to Submit Dispute to

(a) A settlement agreement following succes-
with
Mediation lJnilet Institutional Rules' - Anagreement sful mediation shall be plepared by the parties
the assistance of their reipective counsel'
if any' and
to submit a dispute to mediation by an institution
by the mediator'
shall includu un ugru"-ent to be bound by the internal
mediation and administrative policies of such The parties and their respective counsels shall
thereof
institution. Further, an agreement to submit a dispute endeavor to make the terms and condition
prov-isions for the con-
to mediation under institutional mediation rules shall complete and make adequate
interpretations
be deemed to include an agreement to have such rules tingency of breach to avoid conflicting
govern the mediation of the dispute and for the of the agreement'
irediator, the parties, their respective counsel' and (b) The parties and their respective counsels' if
non-party participants to abide by such rules' any, shall signihe settlement agreement'
The mediator
the contents of the
In case of conflict between the institutional sfrait certify that he/she explained
in a language
settlement agreement to the parties
mediation rules and the provisions of this Act' the
latter shall Prevail. known to them'
(c) If the parties so desire' they may deposit
"Model Law" on mediation. such settlementigreementwith the
appropriate Clerk
one of
The "ModelLaw" on mediation means the Model Law on of a Regional tr[l Court of the place where
to enforce
International Commercial Arbitration adopted by the United the pariies resides' Where there is a need
a petition may be filed by
Nations Commission on International Trade Law on 21 June 1983' the settlement agreement,
court' in which case'
International Agreements are agreements between nations such any of the partie"s with the same
to hear the petition'
as treaties, conventions and protocols'r8 the court shall proceed summarily

reBaron's Law Dictionary' 2001 Editron' p

ri
See Section 16, Republic Act No 92B5. ZoSee Section I 6, supra
rssee Section 3{v). Republic Act No. 9285
27
26

Agrnruartvr f)tseurr Rrsorurtoxt Act or 2004
in accordance with such rules of procedure as may be
promulgated bY the SuPreme Court'
(d) The parties may agree in the settlement
agreement thit the mediator shall become a sole
aibitrator forthe dispute and shall treat the settlement
agreement as an arbitral award which shall be subject
to enforcement under Republic Act No' 876, otherwise
known as the "Arbitratio nLaw," notwithstanding the
provisions of Executive Order No' 1008 for mediated
disputes outside of the CIAC.
Deposit of mediated settlement agreement'
If the parties so desire, they may deposit the mediated
settlement igreement with the appropnate Clerk of the Regional
Trial Court Jf thu place where o"u oi the parties resides- Where
there is need to u.,iot." the settlement agreement, a petition may
be filed by any of the parties with the same court, in which case'
the couri shitl proc-eed summarily to hear the petition' in
accordance with iuch rules of procedure as may be promulgated
by the Supreme Court.2r
Enforcement if mediator is sole arbitrator'
The parties may agree in the settlement agreement that the
mediatorihall becomei sole arbitrator for the dispute and treat
the mediation agreeme nt as an arbitral auard which shall be subject
to enforcement under Republic Act No' 876, otherwise known as
the "Arbitration Law,'; notwithstanding the provisions of
Executive Order No. 1000 for mediated disputes outside of the
CIAC.22
Award defined.
Awardmeans any partial or final decision by an arbitrator in
resolving the issue in a iontroversy.23 An arb itrnl awar d is an awa rd
2rSee Section l7(c). Republic Act No 9285
225ee Section l7{d}. Republic Act No. 9285
?rsee Section 39(f), Republic Act No 9285.
28
Recueuc Ao No. 9285
:j
i Mediation
*
Chaoter 2
-
iI "Conuentiott Award"
resulting from arbitration or mediation.
award in Convention State'24
i:: means aloreign arbitral a
4
c Convention state defined.
Conaention Sfnfe means a State that is a member of the New
York Convention.25
The case Metro Construction, lnc. vs. Chatham Properties,
tnc. 1365 SCRA 6971
In this case, the Supreme Court held that: "Executive Order
(E.O.) No. 1008 vests upon the CIAC original and exclusive
iuririi.tlott over dispuies arising from, or connected with,
contracts entered into by the parties involved in construction
in
the dispute arises before or after the
the Philippines, whether
completion of the contract, or after abandonment or breach
thereof." Moreover, "Circular No. 1-91 covers the CIAC' A quasi-
iudicial agency or body has been defined as an organ of
'nou".rr*"rit, other than a court and other than a legislature, which
Xffects the rights of the parties through adjudication or rule-
making." Portions of the decision follow'
In sum, un<ler Circular No. 1-19, appeals from the arbitral
awards of the CIAC may be brought to the Court of Appeals, and
not to the supreme Court alone. The grounds for the appeal are
likewise broadened to include appeals on questions of facts and
appeals involving mixed questions of fact and law'
The jurisdiction of the Court of Appeals over appeals from
final orders or decisions of the CIAC is further fortified by the
amendments to B.P. Blg.129,as introduced by R'A' No' 7902' With
the amendments, the Court of Appeals is vested with appellate
jurisdiction over all final judgments, decisions, resolutions, orders
o. awards of Regional Trial Courts and quasi-iudicial agencies,
instrumentalities, boards or commissions, except "those within
the appellate jurisdiction of the supreme Court in accordance with
2'See Section 3{,), lbid.
2tSee Section 3U), lbid.
n
+
I 29
*
?
 REpusuc Acr No. c)285
ALtgnlnrvE DtspurE Resorurtox Acr or 2004 Chapter 2 Mediation
-
enumeration of quasi-iudicial agencies
include the CIAC in the
the Constitution, the Labor Code of the Philippines under and Section 3' Rule
therein' Section 3 of the former
iiresidential Decree No. 442, as amended, the provisions of this
l"",pr"n""a"d
43 of the latter, exptrcitly
expand the issues that may be raisedin
Act, and of subparagraph (1) of the third paragraph and to the
fro* q,'u'iit"aicial agencies or instrumentalitiestherein
,ubpurugruph (a) of the fburth paragraph of Section 17 of the "" "pp""f Appeais wldhin the p"eriod and in the manner
il"li"f
fudiciary Act of 1948." tht ievilw of the CIAC award may
Jrouid"d. indisputably,
While, agait-t, the CIAC was not specifically named in said either questions of fact' of law' or of
lnuol-,r"
fact and law'
provision, itslnclusion therein is irrefutable' The CIAC was not MCI's submission that
In view of all the foregoing' we reiect
covered in the exclusion. Further, it is a quasi-judicial
No' 1-91, B'P'Blg'"129'"as amended by-R,A 1?93'It'tO"1
;
"xpressly Luzon D eu elop ment B ank CircuJar
o glrrry or instrumentality. The decisio n in 43 of the 1997 Rules ot
oi. Luro, Deuelopment Bank Employees26 sheds light on the mattef,
Ia-i.,irr.utive Circulait-gS' and Rulemodifv the provision on
Ci"ii pt.."aure failed to efficaciously
thus: We furthei discard MCis claim that
appeals in E.O. No' iOOS'
Assuming a rguendothat the voluntary arbitrator or the panel changing the forum
.iJr;;;;ments have the effect oftomerely
the Court of Appeals'
of voluntary uibitiuto.s may not strictlybe considered as a quasi- il;;;;;;il; the Supreme court
judicial ugin"y,board or commission, still both he and the panel that the,right to
There is no controversy on the principle
u." .o*i.ehended within the concept of a 'quasi-judicial ,nneal is statutory. However, the mode or manner by wrucn mIS
instrumentality.' It may even be stated that it was to meet the is a question of procedure which may
be
very situation present"a uy the quasi-judicial functions of the
t#ni?ly il"""7tit"a not impaired'
modified provided that vested rights
are
voluntary arbitiators here, as well as the subsequent arbitrator/ "f?"t"l^ia by the Constitution with the
The Supreme Court'is bestowed
arbitral iribunal operating under the Construction Industry rules concerning
Arbitration Commiision, thit the broader term'instrumentalities'
p"*"ti"a prerogative ,inter alfu'to promulgate well as to review
oleadings, prachce and procedure
inill courts' as
was purposely included in (Section 9 of B'P' Blg'729 as amended ipecial courts and quasi-judicial,bodies,
by R.A. No.7902).
ffi;;iffiJrr* "f in force until disapproved- by the
*i].n, ni*ever, shall remain enshrined to
An'instrumentality' is anything used as a means or agency' ;;;**" Court'27 This power.is -constitutionally
Thus, the terms governmental 'agency' or'instrumentality' are ;"f,;;;" ,h" i.ta.p"ttauttce of the Supreme Court'28
synonymous in tf,e sense that either of them is a means by which awards' or final ordcrs
The right to appeal from judgmentq
a government acts, or by which a certain government act or g'O' Ni' The procedure
of the CIAC i, g.u,["J i" l"*1"
1008'
fuiction is performed. The word 'instrumenl-ality,'with respect exercise or application of this right was initially outlined in E'O'
to a state, contemplates an authority to which the state delegates subsequently issued
No. 1008. While n'e' No' 7902aJnd'circulars
governmental power for the performance of a state function' to the 1997 Rules on
;;;h; S;Pteme Court and its amendments right to
Any remaining doubt on the procedural mutation of the p';;1".; effectively modified the mannerby which theimpaired
provisions on appeal in E.o. No. 1008, ais-a-uis circular No. L-91 t"gftt Jxercised' nothing in these changes
to be
and R.A. No. ZqOZ, was completely removed with the issuance "p'pJ
by the supreme Court of Revised Administrative Circular No. 1-
----,'mirt"vlll, section 5 0f the 1987 Constitution
96 and the 7997 Rules of Civil Procedure. Both categorically 2ssee Echegaray * *tlr"iuw oil'stice' 30 | SCRA 96 {| 999}; See also GslS vs court

,6249 SCRA 162 of Appeals. 2225cr.a.685 {1993)

ll995l
31
30
 Rrsoruttol Acr or 2004
Arenru,qrtve Dtspure
vcsted rights. The new rules do not take away the right to appeal
,rllowed in E.O. No. 1008. They only prescribe a new procedure
to enforce the right.2e No litigant has a vested right in a particular
rt'rnedy, which may be changed by substitution without impairing
vt'sted rights; hence, he canhave none in rules of procedure which
rr'late to remedy.3o
The foregoing discussion renders academic MCI's assertion
orr the binding effect of its stipulation with CHATHAM in the
l()R that the decision of the CIAC shall be final and non-
.rppealable except on questions of law. The agreement merely
,rtlopted Section 19 of E.O. No. 1008, which, as shown above, had
I'ten modified.
The TOR, any contract or agreement of the parties cannot
limit, restrict or circumscribe legal remedies or
,rrnend, modify,
the jurisdiction of courts. Rules of procedure are matters of
public order and interest and unless the rules themselves so
allow, they cannot be altered, changed or regulated by agree-
ments between or stipulations of the parties for their singular
convenience.3l
Having resolved the existence of the authority of the Court
of Appeals to review the decisions, awards, or final orders of the
CIAC, the Court shall now determine whether the Court of
Appeals erred in rendering the questioned decision of 30
September 1999.
Settled is the general rule that the findings of facts of the
Court of Appeals are binding on us. There are recognized
exceptions to the rule, such as when the findings are contrary to
those of the trial court, as in this case. Hence, we have to take a
closer re-examination of this case.
The CIAC is certain that the evidence overwhelmingly
tended to prove that the manner by which CHATHAM took
charge in the procurement of materials, fielding of labot, control
?'See Fabian vs. Desierto. 295
SCRA 470 (ll9981.
r0lbid.
rrSee Republic of the Philippines
vs. Hernandez. 253 SCI?A 509 ll996l
:#Jr:liT?;,i::
of various phases of the
of MCI engineers and the subcontracting
*ork, .or,itituted an implied takeover of the project' The CIAq
th"r, .orr.l,rdes that the cut-off date for delineating the fiscal
iiubiti,i", of the parties is 23 May 1996 when CHATHAM
evaluated MCI's work accomplishment at 94'L2'/o and then
suspended all further progress paynlents to MCI'
For these
whether MCI
,"uronr, the CIAC found it trifling to determine
wu, ir, delay based on the overall schedule. Howeveq the CIAC
discovereithat MCI was in-as-in delay for 294 days in the
concrcting milestone and held the latter liable for liquidated
dan'rages in the amount of P3,062,498'78'
The Court of Appeals made a contrary conclusion and
the overall
declared that MCI *ui it, delay for 193 days based on
schedule of completion of the project and should incur
liquidatecl
damages in the amount of P24,125,000'00'
It is undisputed that the CIAC and the Court of Appeals
found MCI liable for liquidated damages but on different
premises. Based on the CIAC's assessment, MCI's
responsibility
iuus u.,chored, on its delay in lhe concreting milestone'
while the
Court of Appeals' evaluation concentrated on MCI's delay in
The
completing tire proiect based on the oaernll schedule of utork.
,rariance ii the evaluation spells a staggering difference in the
amount
party who should ultimately be held liable and the net
involved.
Astudyofthefinalcomputationofthenetamountdtrein
both the finildisquisitions of the CIAC and the Court of Appeals
,r-,"*, that all the other figures therein are constant, save for the
amount of liquidated damages for which MCI should be
accountable. the CIAC's conclusions,
Iithis Court concurs with
tttct', responsibility for liquidated damages is' as already stated'
p3,062,49A.78. Setting this bff against CHATHAM's overall fiscal
accountability would bring the latter's total liability to MCI to
MCI would be
P16,126,922.qf . tf th" Couri of Appeals is correct'
P24,125,000liquidated damages.
held liable for a much hlgher
responsibilities,
setting this off against cHATHAM',s monetary
MCI #ould still have to pay CHATHAM P4'935'578'31'
 Attrnruattvr Dtsputr RrsorurtoN
Act or 2004 [n1],T,f tT,?#31

Metro-Construction' Inc' to pay

the voluminous setting aside the order directing
After painstakingly combing through-The evidence taken Chatham Properties, Inc' the
am"ount of P4'935'578'31' The arbitral
the
,".orar, *" affirm tn" fl"al"gt Arbitration Commission in
of
IIAC
that there was an implied award of the Construction Industry
;;;;il"i" or in their totalityireveals CIAC Case 10-98, promulgated on
lg.October L998' directing
;"kJ;;;;f CHATHAM ott th" completion of the proiect'.The
the Court of Appeals' decision Chatham Properties, Inc' tcr"paylvltjig:g:ttt"ction'
lnc' the sum
'IWENTY'SIX
evidence that appears to accenttlate
uolsiered the CIAC's conclusion. The testimonies
of Of SIXTEEN MILiIOX'OfuT IIUNDRED
,rr"*iry of Engr' Ruiz' THOUSAND NIN; HUNDRED
TWENTY-TWO & 91i 1Oi)
f r',gr. K^p'.r.an, Engr. Bautista, Dr' Lai, and the letter PESOS, i s acco rd in gly REINSTATED'
takeovet" by CHATHAM. of the U' 16,126Bzz.91)
* f a ging the" " temporary
".f1"" that there was indeed a as to costs'
project, ,nl"ri.or" the palpibb {1t!
" No Pronouncement
Dr' Lai's testimony that
takeover. We confer purtic.tiut credit to SO ORDERED.
as of L5 February fdqS, I{Ct was relieved of bill
control of the
supplier
construction operations, that it was relegated to a mere
and that the alleged interim
of labor, materials and equipment,
completion of the,project'
takeover actually extended through the
the^same
Even CHATHAM admits the takeover but sugarcoated
to MCl'"32 With
r,vith words like "interim" and "charging the costs
the takeover
these glaring admissions, we can even consider that
was not imPlied but blatant'
tt3-1"' !t3-
Exhibits "4," "4-A," "4-c:"'8A," "8," "4-D:',tt3/"
lvlr',"Nr' "3-W-7," "3-X:' "3'Y," "3'Zi' "5," "5'A," "5-B:'"5'::'
,,5-D,,, ),5-8,,, ,,5-F," "S-O," "C-7:' "E-9;'etc., relied uponby the
Cr.rurlt of Appeals when considered by themselves
and singly'
th'e project'
seemingly una it-titiutty evince M!I's.control over
ftowevir, they eventuilly lot" evidentiary puissance to support
the
the Court of ippeals' conclusion when reckoned against
that CHATHAM took charge of- tfre
totality of the
.o*pfltlo" of the "rrid"r,."
project, particularly, the fact that CHATHAM
suspended all progress biliing"MCi payments to MCI' The continued
pr"r"rl"" and partiiipation of in the project was' as found-by
ih" CIAC, a matter of mutual benefit to and conveniencc ot the
parties.
thc
WHEREFORE, IN VIEW OF ALL THE FOREGOING,
assailed 30 Septemb er 1999 decision of the Court of Appeals.in
by
CA-G.R. SP No. 4g42g is hereby PARTIALLY MODIFIED
-"-i|.-]],""'{ourtofAppeals,2S6SCRAl36(1998);Rosariovs'CourtofAppeals.
3 I 4 SCRA 230 ll999l
.l I 0 SCRA +t + lesO1; Republic vs. Court of Appeals'
35
 CHAPTER
CHAPTER 3
I NTE RNAilONAL COMME RCIAL
OTHER ADR FORMS ARBITRATION

. SEC .lS.Refenat of Dispute-to Othet ADRForms' Law on Inter-

or all SEC. 19. Adoption of the Model
The parties -uy ug'"" to reJer- one or more International
-issues in a dispute or during its pendency-to national comie'icial Atbitration' -
shall be governed by the
"iirirrg to: (a) the commercial arbitration
other forms of npn such as but not limited Commercial Arbitration
(b) a mini-trial, (c) Model Law on International
I evaluation of a third person, or (the "Model Law") adopted by th; United Nations
i or a combination thereof' Law on 21|une
-"ai",-*arbitration, ADR Commission on Internaiional Trade
For purposes of this Act' the use of other 1985 (United Nations Document
A/40/L7) and
forms shall be governed by Chaptet 2 of this Act
in which recommendedforenactment.bytheGeneral
where it is combined with arbitration approved- on 11
Assembly in Resolution No' 40172
"*""pt
case it shall likewise be governed by
Chapter 5 of this hereto attached as
December 1985, copy of which is
Act. APPendix "A"'

Other forms of ADR defined' "Model Law" on international commercial mediation'

(1) Evaluation of third shall be governed by
Thcre are other forms of AD& namely: International commercial arbitration
or (4) a pgm4lerpial- Arbitration'' the
person; (2) Mini-trial;. (3) mediation-arbitration; the ModeIJ.q* o" Ltttt"uti914
i. *U i i i o n th e re o fiV[jg]:f r i a lfocarn-str.u c tu {e d S before
i s pu t e Commission on
. -#;iiil)adopted by the Uniied- Nations
(.r#"i","Ji;";JL;;6n
""
;;;.I",i;n -sth--q.d,in
*ifrfrfrr""riis of a case are argued 21June 1e85 and recommended for
a panel comprising ,"nio' a"tision'makers
with or without the Resolution No' 10/72 on 11
the parties seek a enactment Uy C"""'ut Assemily
oresrintti oI a, ,,".rtruiihird liefson after which
or Med-Arb is a December 1985'i
i;;;;;J tuiii"'"""t.' Meiiation-arbitrationboth mediation and Law' - ln
two-steP dispute ,"roi.,,iot' process involving SEC. 20' lntetpretation of Model
shall be had to its
arbitration.2 interpreting the Model Law',regard
for uniformity in
internationuf otigi" and to the need
be made to the
it-s interpr";"\uqd t::9tt may
of the Secretary
,,trnaau{ pts4'atdoW4nd. the r:pgrt
bener{ -of-ff uJ;d N":t^"i.' commissiontn entitled'
Internationu'ft"at Law dated 25 March 1985
-- 'G"l"aio", :trl Republic Act No. 9285 ---1S"" S".tb-l B, Republic Act No 9285'
tbid
'zSee Section 3{t).
37
36
 F
,
i
t
Repuertc Ao No. 9285
AnEnruqrtvr Dlseure Resorurtoru
Acr or 2004 International Commercial Arbitration
Chapter 4
-
Commercial arbitration defined'
1'InternationalCommercialArbitration:Analytical
Commentary on Dtaft Text identified by reference An arbitration is "commercial" if it covers matters arising
number A/CN 91264." from all relationships of a commercial nature, whether contractual
ardnot
or.rot. Relationships of a commercial nature include' but
"Modet Act" defined and distinguished from "Model Law"' limited to the foltowing transactions: (1) any trade transaction
(2) distribution
AModetAcf is statute drafted by the National Conference of for the supply or exchange of goods or services;
Commissioners in Uniform State Laws and proposed as ugr""*".,tr, construction of works, engineering' licensing'
(4) jointventure
irivestment, financing; (3)banking and insurance;
guidelines for legislation for the states to borrow from or adapt oi business corporation; and (5)
ancl other forms of Industrial
to suit their individual needs. It is different from "Modcl Law" as
carriage of goods or passengers by air, sea, rail or road'a
defined here.2
SEC. 22. Legal Representation in International
How to interpret "Model Law." I n i n!g3g!9!g-!-gbitr3ti o n co g{ ucted
Arbitr ati o n
Interpreting the Model Law, regard shall be had to its -
i n th e Phitippi nesF p"tty ggf.lsopresen terl byany
international orlgin and to the need for uniformity in the p-C6on of his choice: Proiided, That such representa-
interpretation and regard may be had to the traaaux preparatories iive,rrnless admiftiidto the practice of law in the Philip-
and the report of the Secretary General Commission on pines, shall not be authorized to appear as counsel in
International Trade Law dated 25 March 1985 entitled, any Philippine court, or any other quasi-iudicial body
International Commercial Arbitration: Analytical Documentary whether or not such appearance is in relation to the
on Draft Text identified bv reference number A/CN 91264'3 arbitration in which he aPPears'
*'1
'' \, \ L.t
SBc;2l.CatnmercialAtbitration--Anarbitration Representation in international arbltration'
..is.."coryterciall'if it covers matters arGing from all Representation in international arbitration could be by
a
retifr*oilffiipJ of a commercial nature, whethercontrac- in
lawyer t. no.,_luwyer.In international arbitration conducted
tual or not. Relationships of a cornmercial nature person of his
the i'hitippines, a party may be represented by any
include, but are not limited to, the following tran- to the
choice: iiouided, thut t,t.t' representative, unless admitted
sactions: any trade transaction for the supply or
practice of in the Philippines, shall not be authorized to appear
laz.o
exchange of goods or services; distribution agree- 'u,
ments; construction of works; commercial repre- .orrr,r"l in any Philippine Court, or any quasi-judicial.body
sentation or agency; factorinp leasing consulting; *h"thurornotsnchupp"utanceisinrelationtothearbitrationin
engineering; licensing; investmenf financing; banking
which he aPPears.s
insurance; ioint venfure and other forms of industrial
or business cooperation; carriage of goods or SEC. 29. Confidentiality of Arbitration
proceedings' including
passengers by aft, sea, rail or road. - Thi arbitration
Proceedings.
therecords,evidenceandthearbitralaward'shallbe

zsee Black3 Law Dictionary, 7th Edition.

45ee Section 2l. Republic Act No 9285
p. l9 |9
rsee Section 20. Republic Act No. 9285.
sSee Section 22, RepublicAct No 92B5

39
38
 REpuertc Acr No. 9285
t
Atrrnrvnrtvt pseu1t $ircrrurror'r
Aa ot 7004 Chapter 4 Internatlonal Commercial Arbitration
-
(4LLl('t; h (r\{"1''1'' i
unless it
not be published thereafter, refer the parties to arbitration
considergd confidential and shall finds that the arbitration agreement is
null and void'
qrJl}for
...""i.iiii*i,r, ,r," consent of the partiesl
to the'tourt of i.of"tuti"" or incapable of being performed'
;;:-itffi;';;';;'" of disclosiog the court
relevant documentgin ca3es wheie'rqsort to Court referal to arbitration proceedings'
oiiled, haw el; That the court
is allowed hereirf-Pro eo
but subject to
ih which the actibn or the appeal is pending mayls-s*le- Arbitration proceedings are not mandatory
Strictly' it is consensual'
a protective order to preveni or prohibit disclosure
oF the will of the parties to a lontroversy'
"a court before which an action is brought in a matter
doturirents or information contiining Secret processes/ Ho*"u",
if at least one party so requests
developments, research and other information where of an arbitration agreement shall, upon or
it is shown that the .4p,pl-icant shall be materially iut". than the" period of the pre-trial conference'
,-roi
to an arbitration
,"ot"t, of both parties thereafter; refer the partiesis null and void'
.

proiuaia"a 6/ i" u"*.oiired disilosut" tt'"i6of'

the arbitration agreement
"i"tt'tiit"Jr'ttut
inoperative or incapable of being
performed'"7
Rule on confidentiality of arbitration proceedings'
Arbitration proceedings are confidential because arbitration
than a udicial No referral of arbitration allowed'
is more of an amicable settlelment proceeding rather f
is null and aoid'
process where discussions and records are privile8ed;om1ru- In instances when the arbitration agreement
at the determination of
nications. It has to be recorded for practical reasons'
Thus' tht: inupr-roti, o, in,opoat' of being p.ufo:*:l' if the
For instance'
arbitration proceedings, including the records, evidence and the ,f-,J."tra, no referral to'arbitiaiion is allowed'
is prohibited by laws
arbitral award shall b"e considered confidential and shall not be ;;;il;; .he arbitration agreement
of the pa{1e.s' or (2) for
;;;iith;, except: (1) with the consent the action SEC. 25' lnterpretation of the Act' -
In inter-
ih" li*it"d p,rrpor" of disclosing to the court in which regard to the
or appeal it p"tlai.rg may issue a protective order to
prevent or preting the Act, thecourt shallhave.due
Where action
pronitit disciosure o1 do".r*"'tts or information containing secret iolicv"of the law in favor of arbitration' or
one
other information where i,.ott-""ced by or against multiple parties'
iro."rr"r, developments, research and more of who* ui" parties to an arbitration
agreement'
it is shown that the applicant shall be materially prejudiced by
an authorized disclosure thereof. For inq!3-nce trade thecourtshallrefertoarbitrationthoseparties.who
secrets
the
agreement although
revealg5!!y.*y- ot"-tft" j" ut utUi6uii"n ptt"Aaiiig is
-pur,i* are bound by the arbitration
who are not
civil action may continue as to those
highly confidentjal.6
bound by such arbitration agreement'
Atbittation'
SEC. 24. Refertal to Acourt before q285'
- lnterpretation of Republic Act No'
which an action is brought in a matter which is the
the court shall have
subject matter of an arbiiration agreement shall' if at In interpreting Republic Act No'.9285'
favor of arbitration' Where
least one Party so requests not later than the pre-trial au" *gura to the p"iity of the law in
conference, ot .rpor, the request of both parties
Sectton 24, Republlc Act No'
9285'
- 's""
8lbid.
6See Section 23, Republic Act No. 9285

41
40
 Repuarc Acr No 9285
Acr or 2004
Alrenru'qrvr Dlspr-nr REsolurtoru Chapter 4 International Commercial Arbitration
-
September 1995 is
multiplg parties' one of whom interest thereon at the rate of.6% from 26
action is commenced by or against
lo u' utUltiation agreement, the court shall refer to Proper.
"r" "lrrf", those parties who are bound by the arbitration
,rUi'tr"ti"" ,D.
uer""-"nt although the civil action may continue as those who
aie not bound by such arbitration agreement.e of P65'000'00 as
Whether or not the awarding of the amount
retrofitting costs rs ProPer'
The case of Philrog!.lnc. vs, Coqstruction IndustryArbitration
Commission 1359 SCRA 6331. i "8.
tn this(tlie,'{he-Supreme Court ruled that: "The Supreme' Whether or not the awarding of the amount
of P1'340'454
Court will not countenance the effort of any party to subvert or
f"; th" value of the delivered but the allegedly unworkable
defeat the objective of voluntary arbitration." Moreover, "by the
concrete which was wasted is proper'
nature of their functions, acts in a quasi-judicial capacity, such
that their decisions are within the scope of judicial review." "F.
Portions of the decision follow.
and nominal
Whether or not the awarding o[f] moral
of litigation in
Issues damages and attorney's fees and expenses
favor of resPondents is ProPer'
The petitioner, in its Memorandum, raises the following
be held liable for
issues: Whether or not Petitioner Philrock should
the PaYment of arbitration fees'"
,'4.
to the CA: (1) for
In sum, petitioner imputes reversible error
Whether or not the CIAC could take jurisdiction over the after the latter had
.rphotair,g tire lurisJiction of the CIAC (2) for ruling
case of Respondent Cid spouses against Petitioner Philrock and referred it to the regular court'
dismissed the case
after the case had been dismissed by both the RTC and the of action against petitioner'
that respondent spouses had a cause
CIAC. and (3) ior sustaining the award
of damages'

"8.
This Court's Ruling
Whether or not Respondent Cid spouses have a cause of
action against Petitioner Philrock. The Petition has no merit'

,,C. First Issue:

lurisdiction
Whether or not the awarding of the amount of P23,276.75
for materials ordered by Respondent Spouses Cid plus jurisdiction over the
Petitioner avers that the CIAC lost
withdrawn their conscnt
eSee Section
arbitration case after both parties had
25. Republic Act No 9285
43
42
 '2004
ArtEnrunttve Dtspurr Rgsorurton Acr c>r
arguing that the regular court also lost jurisdiction after the
to arbitrate. The June 73,lg95 RTC Order remanding the case to
ur6it.uittibunal's April 13, 1994 Order referring the case Back
the CIAC for arbitration was allegedly an invalid mode of
to the RTC.
referring a case for arbitration'
We disagree. Section 4 of Executive Order 1008 expressly
vests in the CIAC original and exclusive jurisdiction over disputes
arising from or connected with construction contracts entered into
by paities that have agreed to submit their dispute to voluntary
arbitration.
It is undisputed that the parties submitted themselves to the
jurisdiction of the Commission by virtue of their Agreement to
Arbitrate dated Novernber24,1993. Signatories to the Agreement
were Attys. Ismael j. Andres and Perry Y. Uy (president of
Philippine Rock Products, Inc.) for petitionet and Nelia G. Cid
and Atty. Esteban A. Bautista for respondent spouses.
Petitioner claims, on the other hand, that this Agreement
was withdrawn by respondents on April 8,7994, because of tlre:
exclusion of the seven engineers of petitioners in the arbitration
case. This withdrawal became the basis for the April 13,1994 CIAC
Order dismissing the arbitration case and referring the dispute
back to the RTC. Consequently, the CIAC was divested of its
jurisdiction to hear and decide the case.
This contention is untenable. First, private respondents
removed the obstacle to the continuation of the arbitration,
precisely by withdrawing their objection to the exclusion of the
i"rr".t engineers. Second, petitioner continued participating in the
arbitration even after the CIAC Order had been issued. It even
concluded and signed the Terms of References onAugust 2I,7995,
in which the parties stipulated the circumstances leading to the
dispute; summarized their respective positions, issues, and claims;
and identified the composition of the tribunal of arbitrators. I'he
document clearly confirms both parties' intention and agreement
to submit the dispute to voluntary arbitration. In view of this
fact. we fail to see how the CIAC could have been divested of its
jurisdiction.
Finally, as pointed out by the solicitor general, petitioner
maneuvered to avoid the RTC's final resolution of the dispute by
AA
1t
Repueuc Acr No. 9285
International Commercial Arbitration
Chapter 4
-
Section 4.lurisdiction' The CIAC shall have original
-
jurisdiction over disputes arising from' or
and exclusive
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' For the Board to acquire
j"urisdiction, the parties to a dispute must agree to submit
the same to voluntary arbitration'
"The jurisdiction of the CIAC may include bttt is not
limited to violation of specifications for materials and
workmanship; violation of the terms of agreement;
interpretation and / or application of contractual provisions
amount of damages and penalties; commencement time and
delays; mainteiance and defects; payment; default of
or contractor and changes in contract cost'
"*pioy".
"Excluded from the coverage of this law are disputes
arising from employer-employee relationships which shall
contin-ue to be covered by the Labor Code of the Philippines."
(EO 1008)
In so doing, petitioner conceded and estopped itself from
further questioiing the jurisdiction of the CIAC' The Court
will
the
,,ot .orrnt"rrance tie effort of any party to subvert or defeat
objective of voluntary arbitration.for its own private-molive.s'
Afier submitting itseif to arbitration proceedings and actively
participating thlrein, petitioner is estopped from assailing the
i,r.iriiitlonir tn" CIAC, merely because thc latter rendered an
adverse decision.lo
16,ll997
'See Spouses Benitez
vs. Court of Appeals ' 266 Sclpf' 242 )anuary
45
 Repuelc Ao No. 9285
Acr or 2004 International Commercial Arbirration
ArEnn'qrve Dtspure Resorurtoru Chapter 4
-
that all the transit mixers arrived at the site
within the
Second Issue: ensure the workability of the
uifo*uff" time that would
Cause of Action
concrete mix delivered'
"On the other hand, there is sufficiently strong evidence
Petitioner contends that respondent spouses were negligent in the pouringof
the services of an engineer or architect who should to show that difficulties were encountered
ir-r r,oi the
"r,guging of the concrete mix from certain transit mixers necessitating
oversee their construction, in violation of section 308 pushinq tl,:
National Building Code. It adds that even if the concrete it iadditionl of water and physically T,lll
workable' I tus
Lbrriously because the same [was] no longer
the loss
delivered was defective, respondent spouses should bear mix
i.it,urlut t',olds that the unworkability of said concrete
arising from their illegal operation. In short, it alleges that they
has been firmlY established'
had no cause of action against it' are
"There is no dispute, however, to the fact that there
We disagre e. Cause of action is defined as an act or omission In this regard'
is defects in some areas of the poured structures'
by which a p"arty violates the right of another'll A complaint reason is that the
dlemed to have itut"d a cause of lction provided it has indicated ihi, t iU.rr,al holds that the only logical
the one that was poured in the
(2) the correlative unworkable concrete was
the following: (1) the legal right of the plaintiff ,
(3) act or the omission of the defective sections."13
oUfrguai"" oith"d"f"niant,ind the
defe"ndant in violation of the said legal right.l2 The cause of
Respondents Third lssue:
action against petitioner was clearly established'
petitioner' The Monetary Awards
*"* p"l.nasers of ready-mix concrete from
delivered by the iatter turned out to be of substandard by the arbitral
"on.r"tu
q"ufi,y. As a result, respondents sustained damages when the Petitioner assails the monetary awards given
and in law' The solicitor
built tt^it g such cement developed cracks and
they'Cor,r"qt"ntiy, triUur',ut for alleged lack of basis in fact
"i*.trr.", basis for petitioner's assigned errors
honeycombr. the construction of their residence *"""t"f .""nteis that the uevond
i'ih;;;;;Jto the monetary awards is purelv !9tu1t 1nd
had to be stopped. 19' EO 1008' expressly
if," r"ui"* of this Court' Blsides, Section
Further, the CIAC Decision clearly spelled out respondents' that monetary awards by the CIAC are final and
cause of action against petitioner, as follows:
pt"tia"t
unappealable.
-
We disagree with the solicitor general'
As-pointed out earlier'
"Accordingly, this Tribunal finds that the mix was of have acquired
the right propJtiio.ts at the time it left the
plant' This' factual findi.tg, of quasi-iudicial bodies that
greatrespect and even finality'
however,doesnotnecessarilymeanthatalloftheconcrete ;;;;iJ"tu gln".utly accorded
mix delivered had remained workable when it reached the ii it ur" ripported by substantial :Yid:it:'li T:^S:::l
"y
how"rrer, has cbnsistently held that despite
statutory Provlslons
jobsite. It should be noted that there is no evidence to show

--"C"""t^,tfourtofAppeals,SloSCRA608'618')uly20'1999:DelosReyesvsvs ---;CLqC CA rollo for G R SP No 42443' p' l2'

Dec15bns dated September 24. 1996;
Realty Corporatron
Court of Appeals. 285 SCRA I l, 85. Jun,ory 27, 1998: Leberman IaVi||af|orVs'CourtorAppeats,280SCRA297'33o,October9,|997;Philippne
316, 327. July 29, l99B' of Appeals, 224 SCRA 7lO. 785, June 7, 1995:
Typingco, 293 Merchant Marine school, rn.. ii coru
SCRA
r2Bafuyotvs. t-otrrtofAppeals,3lt SCRA29' 45'July22' 1'999;vergaravs Co-urtof February | 5' I 995'
vs Typinco' ibid ' p 328. ioioifo vs. Trajano. 24 I scRA 262' 268'
Appeals, : t S SCRA 3- -1, 327, Nove mber 26' I 999' Leberman
47
46
 Rrpueric Acr No. 9285
ALtrnNnttvE DtspurE REsorurloN
Act or 2004 International Commercial Arbitration
Chapter 4
-
before the
agencies "-f.in1li' The same issue was discussed during the hearing
making the decisions of certain administrative arbitration tribunal on Decembe t 19 , 1995.It
was also mentioned
it still takes cognizance of petitions
showing want of jurisdiction' September 24' 7996'
inthat tribunal's Decision dated
o"f discretion, violation of due process' denial of
;;;;; The payment of interest is based on Article 2209
of the Civil
substantialjustrceorerroneousinterpretationofthelaw.15 act in a consists of the payment
code, which provides that if the obligation
ilir.tury arbitrators, by the nature of their functions' delay' the-indemnity for
are within the
capacity, such that their decisions of a sum of money, and the debtor incurs
q"mi-;"il.ial percent
scope of judicial review.'o lu*ug"t shallbeihe payment of legal interest which is six
rate'
of pu or"nu*, in the abs-ence of a stipulation of the
Petitioner protests the award to respondent spou.ses.
interest beginning
P23,276.25as excess payment with six percent Retr ofit ting Co st s' W as t e d
this.item neither t"-t::d,"t Aru ar ds for
Sepiember 26,1'gg5'it utt"g"t that :vas nuo rkabl e Bu t D el iuere d
case' nor was lts Ll
o.r irr.," by the parties during the arbitration
contetrcls Cttncrete, and Arbitration Fees
iustification discussed in the CIAC Decision. It further
il;il;;;ld not be held liable for interest, because it had earlier Petitionermaintainsthatthedefectsintheconcretestructure
to secure the services of
tendered a checkin the same amount to respondent
spouses' wl'to were due to respondent spouses' failure
or architect to supervise their.project' Hence' it
claims
refused to receive it. "" ""gi"""t was without legal basis. It also
that tf,e award for retrofitting cost
Petitioner's contentions are completely untenable' J"ni", liability for the wasted unworkable but delivered concrete'
Respondent Nelia G. Cid had already raised tn" 1111:,"t for which the arbitral court awarded P13,404.54.
Finally, it
paragraph 9
overpayment even prior to the formal arbitration' In ;;H", against the award of litigation expenses, inasmuch as
of the T"t*t of Reference, she stated: ;il.'";; ,noita not have been instituted at all had respondents
"g. Claimants were assured that the problem and that her
."*pft"a with the requirements of the National Building Code'
and
demands had been the subject of several staff meetings We are unconvinced' Not only did respondents
disprove the
memorandum having been
Arteche was very much aware of it, a
contention of petitioner; they also showed
that they sustained
submitted citing all the demands of [c]laimants' This assurance These were
when Responden!1.S":illu"o' a"*"g"t a"e to the defective ioncrete it had delivered'
was made onluly g1", 1.gg2
itemsif actual damages they sustained due to its breach
of contract.
Martillano and Lomibao came to see Clalmant Nelia Cid and
the billing
offered to refund I'2g,276.25, [t]he difference between Moral and Nominal Damages,
of PI25'586'25
bv Philrock's Marketing Department in the amount
Batching PIant Departm,ent AttorneY's Fees and Costs
ui-ta tft. amount cha.ged by Philrock's damages, claiming no
to petitioner assails the award of noral
in the amount of ority pioz,sge'zs, which claimant refused
accept by saYing 'Saka na lang'' malice or bad faith on its Part'
of the comfort and
We disagree. Respondents were deprived
to the agony of witnessing
the safety of Jhouse uttd *ttu exposed
structure for more than seven
ItVillaflor vs. CA. ibid . De Ysasi lli vs National Labor Relations Commission' 23 |
;il;;;;"g" and the decay of the
C' Cid describes
Respondent Nelia
vcars. ln her Memorandum,
SCRA 173. l85. March 1l'.1994. fiom the unreasonable delay in
l6ChungFuIndustries{Philsl. Inc vs CourtofAppeals'206SCRA545'556'February i'-t it-iru't arising
sufferings
25. 1992.
49
48

ALrenN'qrtvr Drspurr Rrsorurtoru Acr or 2004
the construction of their residence, as follows:
"The family lives
r"r^r",au for lack of space to stay in' Mrs' Cid is staying in
r"Irff at"gy bodega, *itil" her son occupies another makeshift
;;;. rhJir only Jaughter stayed with her aunt from 1992untt'l
,h* not married in1995. x x x. The court also notes that during
the of the case, Respondent Vicente Cid died without
iendency
seeing the completion of their home'17 Under the circumstances'
the award of moral damages is proper'
Petitioner also contends that nominal di'rmages should not
to
have been granted, because it did not breach its obligation
respondent sPouses.
Nominal damages are recoverable only if no actual or
substantial damages resulted from the breach, or no damage
wrrs
been proven by
or can be shown. Since actual damages have
private respondents for which they were amply compensated'
ihuy utu t o lo.tget entitled to nominal damages'
Petitioner protests the grant of attorney's fees' argling that
respondent rpolr", did notlngage the services of legal counsel'
Also, it contends that attorney's fees and litigation exPenses.are
u*ur,lud only if the opposiug party acted in gross and evident
bad faith in refusing'to sitisfy plaintiff's valid' just and
demandable claim.
for attorney's fees' bttt
We disagree. The award is not only
Hence, it does not matter if
also for of litigation.
"*p"nre, court, because it is obvious
respondents represented themselves in
the
that they incurred expenses in pursuing their action before
We find no
CIAC, as well as the regular and the appellate courts'
reason to disturb this award.
WHEREFORE, the Petition is DENIED and the assailed
Decision AFFIRMED; however, the award of nominal damages
is DELETED for lack of legal basis. Costs against petitioner'
SO ORDERED.
SCRA22' ?-t)?'9'May l3' l99 l;Ventenilla
''GovsiltermecliateAppellate Court. 197
vs. Centeno. 1 SCRA215,226,'Junuu,y28' 1961; Robes-FranciscoRealtyvs
lnstance, 86 SCRA 59, 65-66' October 30. i 978
50
Rrruettc Acr No. 9285
Chapter 4 - International Commercial Arbitration
SWZS'Ues*inSAf ointing Authoity
" App
-
in the Model "'Law
'Appoi."litg Aut\.orttf'as used
a
{halt ^ea" the person or institution named in the
arbitration agreement as the appointing authority; or
the regular arbitration institution under whose rules
the arbitration is agreed to be conducted. Where the
parties have agreed to submit their dispute to insti-
iutional arbitration rules, and unless they have agreed
to a different procedure, they shall be deemed to have
agreed to the procedure under such arbitration rules
for the selection and appointment of arbitrators' In
ad hoc arbitration, the default appointment of an
arbitrator shall be made by the National President of
the Integrated Bar of the Philippines (IBP) or his duly
authorized rePresentative.
Appointing authority defined and explatryfr'
In arbitration, the " Appointing AutJtorrty:-isbAageemen t
of the parties. Thus, in the Model La,wiappolnting authoritybfrall
mean the pelsin.-lgllp-d-1Ltbe arffipqig9ehe-nt as the
n ti nE u ulE-oiirp o t th e re gu la r i.t-! i qqggg t defl"hoseru
t,
t
u p-ri o_-i
"
uiii ,nl"ti they haffig;eed to-a differe-nt-Procedgre-they shall
bedeemed to have agreed tothe procedure under sttch arbitration
rules-for th6-Selee6ofrlid ippoin tmen t of arbitrator s. In a d ho c
arbitration, the default appointment of an arbitrator shall be made
by the National President of the Integrated Bar of the Philippines
(tgp) ot his duly authorized representative'l8 The appointing
authority, therefore of the National President of the Integrated
Bar of the Philippines may be delegated'te
SEC.27. What Emctions May be Performed by
Appointing Authority.- The functions referred to in
Ariicles 11(3),11(4),13(3) and f4(1) of the Model Law
shall be performed by the Appointing Authority,
Courtof First
I'rSee Section 26. Republic Act No 92B5,
reSee last sentence, Ibid.
(1
 RtPuetlc Acr No. c/285
Arrnnqrtvr DlspurE Rrsorurtoru Ao or 2004 International Commercial Arbitratiorl
Chapter 4
-
'1. (i) to prevent irreParable loss or
unless the latter shall fail or refuse to act within thirty L

(30) days from receipt of the request in which case ,iniury;

the applicant may renew the application with the ,- -tl -.to provide
security for the perfor-
Court. mance of anY obligation;
|- (iii) to produce or Preserve any evl-
Function defined. i- -/dencei or
Function means an activity that is appropriate to a particular (iv) -io compel any other appropriate
lrusiness or profession.2o The functions of the "Appoir-rting act or omission'
are enumerated in Section 27, Republic Act No. 9285.
'\trthority" (3) The order granting provisional relief
may be conditioned upon the provision
SEC. 28. Grant of Interim Measure of Protection.
of security or any act or omission speci-
It is not incompatible with an arbitration
(a)
-agreement for a party to request, before constitution
fied in the order.
of the tribunal, from a Court an interim measure of (4) Interim or provisigna[slief is-tg:.
protection and for the Court to grant such measure. ,' t_' quested UV *f!rf6 application ttans-
A ,^jlnt' {tl :r^}1 I, mift-ed by reasirnable rileans to the Court
After constitution of the arbitral tribunal and during
arbitral proceedings, a request for an interim measure 4v,rt.'t',1 \t'-s'Kl ftifmd as'the ciie may te
"t-tfftt'af
and the party against whom the relief is
of prote-ction, or rioililiciTlon fnereot qr4tbe rurade
with th-e aibitral triblifrCl br to the exten!.that the sought, describing in appropriate detail
arbitral'tribundl haC ntrPower to act or is unable to the precise relief, the party against -

act-effect-lVtily, ihe request may be made-with the whom the relief is requested, the
Coilit."The arbitral tribunal is deemed constituted grounds for the relief, and the evidence
when the sole arbitrator or the third arbitrator, who supporting the request.
has been nominated, has accepted the nomination and (s) The order shall bg bindi4g uPon the
written communication of said nomination and !'/.. /,tlt/.. parties.
acceptance has been received by the party making the (6) Either party may apply with the Court
request. :,i] )i2f:i'<- for assistance in imPlementing or
-:t#lli/iii]:)
(b) The following rules on interim or iL!. enforcing an interim measure ordered
provisional relief shall be observed: by an arbitral tribunal.
f-:ti,lt.t:1"
(1) Any party may request that provisional ' (71 A party who doeiiqt,co!!Ply,I{!th-!!'g -
relief be granted against the adverse order shall be lie!]g-fj! tlJi"1*g9l-,
party. tr9lllrre-lroqr no n-coqtPr4lqe' -r1-
(2) Such relief maY be granted: .t"a",g gtryIPels*e.g and reasonable
attorney's fees, paid in obtaining the
order's judicial enforcement'
'?osee Sectron 27 Republic Act No. 9285

53
52

ArEnr.lqrtve Dtsewr Rrscrurioru Acr or 2004
Court may grant interim measure'
It is not incompatible with an arbitration aSreement for a
party to request, before constitution of the tribunal, to request_from
u court arr interim measure. After constitution of the arbitral
tribunal and during arbitral proceedings, a request for an interim
measure of protectibry or modification thereof, may be made with
the arbitraliribunal or to the extent that the arbitral tribunal has
no power to act for an interim measure of protectiory the request
may be made with the Court.2r
lnterim defined.
Interim means in the meantime.22 An interim order is
temporary order, made until another or final order takes its place
or final event occurs.23
RepuaricAcr No. 9285
Chapter 4 International Commercial Arbitration
-
of the dispute in arbitration. Either party may aPply
with the Court for assistance in implementing or
enforcing an interim measure ordered by an arbitral
tribunal.
tnterim measures of protection by arbitrator'
Anarbitraltribunalmaygrantinterimmeasuresofprotection
as it may consider necessary, in respect of the subject matter in
airp.tt", otherwise agreed up9-l by the parties' It shall
""less
inciude but shall not be limited to:"(i) preliminary injunction
directed against apar\;12)appointment of receivers or detention;
the subject of
{3}r:reservation, insp6ction of the property that is
a
{h" aispute in arbitr;tion. Either party may apply with the Court
for assiitance in the implementing or enforcing an interim measure
ordered by the arbitral tribunal'2s

When arbitral tribunal deemed constituted. SEC. 30. Place of Atbitration.- The Par{ies are '}7vf:lrx#}
The arbitral tribunal is deemed constituted WbSL !\1:g!" of arbitqati-o.n"{aitiry ' I
tryglt-Ag1gg -on the place 31cn
arbitrator or the thir.d-3Jh'igg,Igl who-has been nomina the place of arbitration shall be inMetrg-/d"it t l,hn.l'll
4*and rvlitten communicaJion of sai4, Manila, unless the arbitral tribunal, having regard to
"[t""-."1,
".lgplgd &g ryIl4qlig party making the requestza the circumstances of the case, including the --iyf;lStarX
'1,

"@by.the c*q4venience of the parties shall d,ecide 94 a {{fslqnt

SEC.2g.Eurther Authotity for Atbittatot to Grant
Interim Measure of Protectiolz. Unless otherwise
- The atbitral tribunal may, unless otherwise
agreed by the parties, the arbitral tribunal may, at the
request of aparty,ordet any party to take such interim
measures of protection as the arbitral tribunal may
consider necessary in respect of the subiect-matter of
the dispute following the rules in Section 28,
paragraph 2. Such interim measures may include but
shall not be limited to preliminaryiniunction directed
against a party, appoiffienTo-f GIdivtirs or detention,
presenratffij-nspeiiion of property thatis the subiect
2rSee Section 28{a). Republic Act No. 9285.
z?Bouvier3 Law Dictaonary. citing 2 Bell Comm.265. p.
rrBarrons Law Dictionary 2003 Edition, p.254.
2'3rd sentence. Section 28{aJ, Republic Act No. 9285.
place of arbitration-.
agreed by the parties, meet at any place it considers
aiptopriute foi consultation among its members' for
trearing witnesses, experts or the parties' or for
inspection of goods, other property or documents'
Rules on Place of arbitration.
Failing
The parties are free to agree on the place-of arbitration'
shall be in Metro Manila'
srrch ugreu*ent, the place oi arbitration
u.rless the arbitral tribunal, having regard to the circumstances
shall decide
of the case, including the convenience of the parties
1649
z5See Section 29, Republic Act No 9285

55
54
 Acr or 2004 Rrpusirc Acr No. 9285
ALrenruqttvr DtspurE REsorurtotl
International Commercial Arbitration
Chapter 4
-
arbitral tribunal may, unless may order that any documentary evidence shall be accompanied
on a different place of arbitration. The
by a translation into the language or languages agreed upon by
rin"r-i* agreed by the parties, meet at any place it considcrs
appropriatJfor consultation among its members, for hearirrg the parties or determined in accordance with paragraph 1, Section
*iin"rr"t,experts or the parties, or for the inspection of goods' 31, Republic Act No. 9285.27
other property or documents.26

SEC. 31. Language of the Atbitration - The *, f"^,i.t I

parties are free to agree on the language or languages
io be used in the arbitral proceedings. Failing such
agreement, the language to be used shall be English * inf'l 6ybil.
in international arbitration, and English or Filipino
for domestic arbitration, unless the arbitral tribunal
shall determine a different or another language or th
languages to be used in the proceedings. This agree- ',*smrth"c-
ment or determination, unless otherwise specified r"Ai/- '
therein, shall aPPly to 3nlr-1v11[ten statement by.a
party, any hearing 4l@ any awa5d, 49!19!9njl !t\er
cpilmunication by the arbitral tribu44,l.
!_,_r,_,<.+-

The arbitral tribunal may order that any docu'-

mentary evidence shall be accompanied by a trans-
lation into the language or languages agreed upon by
the parties or determined in accordance with para-
graph 1. of this Section.

Language or languages of arbitration.

As a general rule, the parties are free to agree on the languagt'
or langua[es to be used in the arbitral proceedings. Failing such
agreement, the language to be used shall be English itl.
interncrtional arbitration, and English and Filipino in domestic
arbitration, unless the arbitral tribunal shall determine a differen t
or another language or languages to be used in the proceedings'
This agreemettt ot determination, unless otherwise specified
therein, shall apply to any hearing and any award, decision or
other communicationby the arbitral tribunal. The arbitral tribunal

26See Section 32. Republic Act No. 9285

2/5ee Section I l. Republir Act No. 9285

56 57
 . ' i
, | ./'
i,
,L.t t,,n1
t
t
',-r-'
" !-t-
i tt"' ;:, ; I r-
1dt
L,' t

CHAPTER 5 CHAPTER 6

DOMESTIC ARBITRATION ARBITRATION OF CONSTRUCTION

SEC. 32. Law G oa eruing D omestic Arbittation'
-
Domestic arbitration shall continue to be governed
by Republic Act No. 875, otherwise known as "The
Arbitrition Law" as amended by this Chapter' The
term "domestic arbitration" as used herein shall mean
an arbitration that is not international as defined in
Article 1(3) of the Model Law.
Domestic Arbitration defined'
The term " domestic arbitration" as used in Republic Act No'
g235, shall mean an arbitration that is not international as defined
in Article 1(3) of the Model Law. Domestic arbitration shall
continue to be governed by Republic Act No' 876' otherwise
krrown as "The Arbitration Law," as amended by Chapter 5'
Republic Act No. 9285.1
DISPUTES
SEC. 34. Arbittation of Construction Disputes:
Goaeming Law. - The arbitration of construction
disputes shall be governed by the Executive Order No'
100^8, otherwise known as the "Construction
Industry
Arbitration Law."
":--..,------*--
Governing law on construction arbitration disputes'
The arbitration of construction disputes shall be governed
by Executive Order No. 1008, otherwise known as the
.tonstruction Industry Arbitration Law."7 Executive Order No.
100g vests upon the Construction Industry Arbitration
Commissio" CnC) original and exclusive iurisdiction.over
into
Jisputes arising from, orlonnected with contracts entered
Uy.if"t" parties iivolved in construction in the Philippines''?

SEC. 33. Applicability to Domestic Arbitration' Effect of decisions of voluntary arbitrators'

Articles 8,10',11',12,1g,14,\8 and 19 and 29 to 32 of
-the Model Law and Sections 22to 31'of the preceding
Chapter 4 shall aPply to domestic arbitration'
Appficability of Model Law and Republic Act No' 9285 to
domestic arbitration.
There are certain provisions of the Model Law and Republic
Act No. 9285 which, by virtue of Section 33, Republic Act No'
9285 are expressly appiicable to domestic arbitration' They are
enumerated in that provision of law.2
rsee Section 32. Republic Act No 92B5
2see Section 32, Republic Act No 9285
58
Whileunderthelawdecisionsofvoluntaryarbitratorsare
judicial review
accorded finality, the same may still be subject to
such as where ih"r. *u, a violation of a party's
right to due
process and to be heard.3
SEC. 35. Couerage of the Laul - Construction
disputes which fall within the original and exclusive
iurisdiction of the Construction Industry Arbitration
'Commission (the
shall include those
"Commission")
rsee Section 34, Republic Act No' 9ZB5
zsee Metro Constructlon, Inc. vs Chatham Properties' Inc.' 365 SCRA 697
runicraft Industries International corporation vs. court ofAppeals, 355 SCR^
59

Auenr'tqrtve DtseurE Rrsorurlorl Acr ot 2OO4
between or among parties to, ot who are otherwise
bound by, an arbitration agreement, directly or by
reference whether such Parties are project owner'
contractor, subcontractor, fabricator, project manager'
design professional, consultant, quantity surveyor/
bondsman or issuer of an insurance policy in a cons-
truction Proiect.
The Commission shall continue to exercise
original and exclusive iurisdiction over construction
dislutes although the arbitratiot-tq 3ggme1giu{
pursuant to Section 21 of this Act'''
Mattersinc|udedinexc|usiveoriginaIjurisdictionofC|AC.
Constructiondisputeswhichfallwithintheexclusive
original jurisdiction of the CIAC shall include those between or
urn"o.tg tire parties, or who are otherwise bound by, ?n arbitration
agreei-,ent, directly or by reference, whether such parties are
pioject ownet contractor, subcontractor, fabricator' project
manager, design professional, consultant, quantity surveyot
bondsman or issuer of an insurance policy in a construction
project.a The Commission shall continue to exercise original and
jurisdiction over construction disputes -although
"".ir.rri.r"
arbitration is "commercial" pursuant to Section 21 of Republic
Act No. 9285.5
SEC. 36. Authority to Act as Mediator or Arbi-
trator.- By written agreement of the parties to a dis-
pute, an arbitrator may act as mediator and a mediator
inay act as arbitrator. The parties may also agree in
mediation, the
*titittg that, following a successful
mediator shall'id3-uithEsetttpment agreement in the
form of an arbitral award. . "'
!:_ _._
4see Section 35, RepublicAct No. 9285
5lbid.
60
Repusuc Acr No. 9285
Arbitration of Construction Disputes
Chapter 6
-
AuthoritY defined.
Authority is the permission or power delegated to another-
This may be or implled. If expreqs, it i9 gsuqlly embraced
"*pt"tt a4dwerof attofney'i
in a documentialled .- -\' .: .it!
' SEC. 37. Appointment of Foreign Arbitrator' -
The Construction 14dustry Arb*i^tration Commission
(CIAC) shall aliomulgate rules-\ allow for the
a p p o i ntme nt o@i- arb itra t o iT3*iii- arb i trator
oTiTi6iffi;I ir- pi:rsonwho{as not-'bEbn
ot t
p reviou
"ittifan
sly ccre dite d by CIAC P r o aid [d]'ITliat:
a 1'
(a) the dispute is a idnstruction dispute in
which one party is an international party;
(b) the person to be appointed agreed to abide
by the arbitration rules and policies of CIAC;
(c) he/she is either co-arbitrator upon the
nomination of the international party; or he/she is the
common choice of the two ClAC-accredited arbitrators
first appointed, one of whom was nominated by the
international PartY; and
(d) the foreign arbitrator shall be of different
nationality from the international party'
International PartY defined.
"International party" shall mean an entity whose place of
a domestic
business is outside the Philippines.It shall not include
subsidiary of such international party or co-venturer in a joint
in the
venture *ith u party which hai its place of business
Irhiilppi.,"s. The iermforeign arbitrator shall mean a personwho
is not a national of the Philippines'7
6Barronb Law Dictionary, 2003 Edition, p 40
rsee Section 3{p}. RepublicAct No 9285'
61
 REcuelrc Ao No 9285
l)tstnrrL Rrsorurtoru Acr ot 2004 Arbitration of Construction Disputes
ALrrnuttvt Chapter 6
-
SEC. 39. Court to Dismiss Case lnaolaing
a
Who shatt aPPoint foreign mediator? ConstructionDispute'- A Regional Trial Court
before
(CIAC)
The Construction Industry Arbitration Commission whichaconstructiondisputeisfiledshall'upon
becoming aware, not later than-the pre-trial
appointment of a foreign con-
,hutt ptom"lgate rules to allow for the
arbitrator as io-arbitrator or chairman of a tribunal Person
a who bi't1,ati1
f erence,thatthepartieshadentetgS^tnl*o-enef

ulr""murrt, dismissTh'[cad ila refet the P,'tt-t:t^::

(1) the
t-,ur U"u" previously accredited by CIAC: Proaided, That:
dispute ii a construction dispute in which one party is.an uitrittation to!g- conducted by th6 clAcxqlle$rs
loth
internation aLparty;(2) the Person to be appointed agreed to abide shall
partiqs; ;rssiJtea Uy 1rylt-t:tPuctive counsel'
by the arbitrition rules and policies of the CIAC; (3) he/she is soU*ii'io tf,e Regional Trial Court a written agreement
eithe, co-arbitrator upon the nomination of the international party, CIAC' to
exclusively for Ine Court, rather than the
or he, she is the common choice of the two CIAC accredited resolve the disPute / ,-
arbitrators first applied, one of whom was nominated by the l,-, j

internationat pariy; and (4) the foreign arbitrator shall be of GeneraIru|eisdismissaIofconstructionarbitrationdispute.

different nationality than the international party'n A regional trial court before which
a construction dispute is
than the pre-trial
Appticability to Construction Atbi- filed shall, upon becoming aware' not later
-r*priiu,inul
SEC. 38. tt't" parties entered into an arbitration agreement'
tration'-The provisions of sections 17(d) of Chapter dismissthecaseandreferthepartiestoarbitrationtobeconductedby
2, and Sectioni 28 and 29 of this Act shall apply to by their respective counsel'
the CIAC, unless both parties, assisted
arbitration of construction disputes covered by this to the regional trial court' a written agreement
;h;ll;*it
Chapter.
il"ri;;itrather thanihe CIAC, to resolve the dispute. Because
theClAChasexclusiveoriginaljurisdictionoverlldisputesarising
Applicability to construction arbitration' in the Philip.pines' whether
from or connected with in Jonstruction or
The provisions of Section 17(d) and Sections 28 and 29' iir;^;i;i;; arises before or after completion if the contract,
Republic Act No. 9285 shall apply to arbitration of construction after abandonment or breach there.of'12
disputes.' ll
' j
l),,,:' I

Construction tndustry Arbitration Commission (ClACf I

\
jurisdiction. i)t'.'t'i' -!'i!
section 4 of Executive order No. 1008 expressly vests in the - Jr;t. Ij ,t t,ti i "iiir, nf'Cl'-ttfi 4r l,rirtt
Construction Industry Arbitration Commission (CIAC) original
and exclusive jurisdiction over dispute arising from or connected f,:. -r-tt,4 ti-i. lt Lft4
with construction contracts enteied into by parties that have ":r-r1 -ofl,n"':-i
agreed to submit their dispute to voluntary arbitration'lo

ssee Section 37, lbid.

esee Section 38. Republic Act No. 9285.
S..tt" :9, RePublic Act No 9285' sC|?A 697
--;G; rzMetro construction, tnl. vs. chatham Properties. lnc..356
roPhilrock. Inc. vs. Construction Industry Arbitration commission' 359 SCRA 382

63
62
 Repueuc Acr No. 9285
Chapter 7 ReviewofArbitral Awards
-ludicial

by the supreme Court. But a CIAC award shall notbe confirmed

ai final and executory as provided in EO No' 1008'1

CHAPTER 7 Final and executory judgment explained'

JUDICIAL REVIEW OF "Fin4l" in the phrase "judgments and final orders" found in
Section 4.9-pf the Rules of Court has two accepted interpretations.
ARBITRAL AWARDS In the fifJt sense, it is an order that one can no longer appeal
because the period. to do so has expiied, orbecatise-the order has
A. DOMESTIC AWARDS been affirm"a uy the highest possible tribunal involved. In the
second sense, it connotes that it is an order that leaves nothing
SEC. 40. Confirmation of AzaariL The confir' else tobe done, as distinguished from that which is interlocutory.2
mation ofdomestic arbitral award shall be governed
a
- Final judgments on the merits rendered by a court of competent
by Section/ of the R.A..{t{o.876. jurisdicti6n is conclusive on the rights of the parties and their
privies and constitutes an absolttte bar to subsequent actions
i4' i !ftWttc-t{hltr?l a*ard when confirmed shall
$b efforcdirrth€ same manner as final and executory involving the same claim, demand or cause of action.3 A final
ions of the Regional Tirial Court. decision- rendered by a competent court can no longer be
relitigated.a
The recognition and enforcement of an award in
nternational commercial arbitration shall be Once a decision becomes final and executory, it is removed
rned by Article 35 of the Model Law. from the power or jurisdiction of the Court which rendered it to
further amend, much less revoke it to further amend, much less
!rhe sslfj{sellgl of a dorye-sl-!9_1y4!d tltllL"", revoke it.5 A judgment becomes final and executory by operation
b y_ tb_C &eglq3-at a!e w i th isr ac co rd anc
{11{e _T?i Q-o_grt-
of law.6 finailtyof ludgmentbecomes a fact upon the lapse of the
the flules of Procedure to be promulgated by the
appeal if no appeal is perfected'7
period for
Suprerrre Court.

,- -' AtnC Arbitral award need irot be co4firmgd by Confirmation defaned.

/thd Regional Tirial Court to be executory as ptovided
_.
Confirmation is the act of giving formal approval'8
'-. under E.O. No.1008.
Confirmation by the Regional Trial Court, therefore, of a domestic
award means court approval thereof'
Section 22, Repubfic Act No. 876 governs domestic awards.
The confirmation of a domestic award shallbe governed by
Section 23, Republic Act No. 876. A domestic award when rSee Section 40, Republic Act No. 9285'
Heirs of Grace M Magalit, 344 SCRA 838
confirmed shall be enforced in the same manner as final and '/Macahilig vs.
SCRA 626
Bank of the Philippines vs Court of Appeals' -357
executory decisions of the Regional Trial Court. The recognition 'Developirent
olbid.
of an international commercial arbitration shall be governed by 5Alabansas vs. Intermedi.lte Appellate Court. )04 SCRA 304'
6city of Manila vs. Court of Appeals, 204 SCRA 162
Article 35 of the Model Law. The confirmation of domestic awarcl /tbid.
shall be in accordance with the Rules of Procedure as promulgated sBlack's Law Dictionary, 7th Edition. p. 382

64 65
 Repuet.tc Ao No. 9285
Atrrtrt'nttvt Dtsltltr REsor'uttot't Act r:t 2004 Chapter 7 Ju(ttcial lleview of Arbitral Awards
-
Thecruxofthecontroversyboilsdowntowhetherthe
Function at ordering execution of judgment' dispute between the parties warrants an order
compelling them
rhe f u nctior, orrgg@.g Ij gl -g$' as1;"+j"ios,
\
to submit to arbitration.
iu{iciaL-de.,,olvq}rPon the judge. WIgt"eSs the act bkFllllrtS-a-l Petitioners contend that the subiect matter of private
wtreaieiriticinlay be peifoimtJa uy another Person, like the respondent's causes of action arises out of or relates
to the
Ct&E:Of couff-" TKe court loses jurisdiction upon finality of the Thys'
Asieement between petitioners and private respondents'
decision, except to order its execution. A final judgment or order clause of the Agreement provid,es
co?rid"tit-tg that the arbitration
becomes "final and executory" upon expiratlo1lof the periodl0 ol.tl"
that all disiutes arising out of or relating to the Agreem:n!
for appeal therefrom where no alpeafhfs been duly pbrfected the termination thereof' shall be
or, ah-appeal therefrom haviir=gbeen taken, the judgment of the fu.ti"r' reiationship, iiclucling insist on the suspension of the-
iesolved by arbitiation, they
appellate court. becomes final-it is called "final and executory in Civil Case No. 2637-MN mandated by Sec' 7 of
judgment because execution at such point issues as a matter of
pr".""ai"$ as

RA 876.13
right.11 Execution-pendi4g appegl is the only exception to the be
general idl;ihii*i dty a findtp"agment may be executed, thus the Sec. 7. Stay of Ciail Action' - If any suit or proceeding
providing for
existence 6f {'good reasons" f6r it is what confers discretionary brought upon an issue arising out of an agreement
is
power to is'siie a-wiit of"exb6ution pending appeal'l2 arbitiation thereof, the court in which such suit or proceeding
in such suit
oending, upon being satisfied that the issue involved
The ca;e6f Del Monte Corporation-USA vs. Court of Appeals i, p-.E"aing is refirable to arbitratiory shall stay the action.orwith
nroceeding .rrrtil u.t arbitration has been had in accordance
lrs.r'scRA373l. "or proaided, That the applicant for the
In this case, the Supreme Court held that: "Even before the
ih;i;;r", tn. agreement.
stay is not in default in proceeding with such arbitration'
enactment of Republic Act No. 876, the Supreme Court has their cause
countenanced the settlement of disputes through arbitration; Unless Private responclents claim, on the other hand' that
Code' the
the agreement is such as absolutely to close the doors of the courts of action ur" ,oot"d in Arts' 20,21 and 23 of the Civil
against the parties, which agreement would be void, the courts a"i"t*i"^tion of which demands a full blown trial' as correctly
will look with favor upon such amicable arrangement and will h;il ;t the Court of Appeals. Moreover, theyclaim that the issues
Honorable judge
only interfere with great reluctance to anticipate or nullify the action before the trial court were not joined so that the
of the arbitrator." Moreoveq, "Only parties to the Agreement their ;;; ;", given the opportuniiy to satisfy. himself that the issue
submit
assigns or heirs have the right to arbitrate or could be compelled to involved"in the case was referable to arbitration' They
proceedings
arbitrate." Finally, "Where the issue before the Court could not be that, apparently, petitioners filed a motion to suspend
to
speedily and efficiently resolved in its entirety if simultaneous instead'of sending a written demand to private respondents
the case could
arbitration proceedings and trial, or suspension of trial pending arbitrate because petitioners were not sure whether
maintain thathad petitioners done
arbitration, is allowed, the trial court should hear and adjudicate be a subject of arbitration. They
so and private respondenis failed to. answer
the demand'
the case in a single proceeding." Portions of the decision follow- demand for
p"riiio"Jrs could have filed with the trial court their
'arbitration that would warrant a cletermination by tlre iuclge
eCasaje vs. Cabalite, 33I SCRA 508.
")Lizardo, Sr. vs. Montano,332 SCRA 163.
rrlntramuros Tennis Club vs. Philippine Racing Authority, 34 I SCRA B0 rrThe Arbitration Law.
r2lbid.

67
66
 Rrpueuc Acr No 9285
ALtEnurtvc Dtspurr REsorurtoN Acr or 2004 Chapter 7 Judicial Review of Arbitral Awards
-
the
A careful examination of the instant case shows that
whether to refer the case to arbitration' Accordingly, private b9.tyee1
arbitration clause in the Distributorship Agreement
respondents assert that arbitration is out of the question' DMC=USA and private r::Po:gent MMI is valid and
Private respondents further contend that the arbitration
;;iil;;' However' this Court
ihe dispute between the paities is arbitrable'
clause centers more on venue rather than on arbitration. They must denY the Petition'
finally allege that petitioners filed their motion for extension of The Agreement between petitioner DMC-USA and private
time io filelhis petition on the same datera pe'titioner DMC-USA to submit to
r"rporrdunl MMI is a contrict' The provision
filed a petition to compel private respondent MMI to arbitrate the relationship of
arbitration any dispute arising therefrom and
before [h" United States District Court in Northern California, is itself a contract. As a
ihu fu.tl", ls part'or that contract and
docketed as case No. c-98-4446. They insist th.rt the filing of the the contracting
rule, contracts are respected as the law between
petition to compel arbitration in the Ur-rite'cl States made the them' their assigns and
oarties and produce effect as between
petition filed before this Court an alternative remt'dy and, in a petitioners
way, an abandonment of the cause they are fighting for here in
il;i;r.; ctearly, only parties to the Agreement' l'e''Sales Paul E'
DMC-USA and its Managing Director for Export
thc Philippines, thus warranting the dismissal of the present MMI arrd its Managing
D"rby, |r., and private iespondents
petition before this Court. and its arbitration
Direcioi LILY SYare bound by the Agreement petitioners
There is no doubt that arbitration is valid and constitutional Daniel
;;;;;, ahey are the only signatories thereto. SFI' not parties
in our jurisdiction.ls Even before the enactment of RA 876, this a;lli"" and iuis Hidalgo, and private respondent assigns or heirs
Court has countenanced the settlement of disputes through to the Agreement and Lnnot even be
considered
arbitration. unless the agreement is such as absolutely to close of the parties, are not bound by the Agreement and the arbitration
the doors of the courts against the parties, which agreement woulc-l referral to arbitration in the State
clars" therein. Consequently,
be voicl, the courts will look with favor upon such amicable of California pursuant io the arbitration
clause and the su'spension
arrangement and will only interfere with great reluctance to pending the return
of th. pro.""di.rg, in Civil Case No' 2637-MN
petitioners
anticipate or nullify the action of the arbitrator.l6 Moreover, as .i if,. '"rUl,ral aw"ard could be called forle b ut only as to
RA 876 expressly authorizes arbitration of domestic disputes, respondents MMI
DMC-USA and Paul E. Derby, Jr', and private
foreign arbitration as a system of settling commercial disputes and LILY SY and not as to the other parties
in this case' in
was likewise recognized when the Philippines adhered to the u..ora""." with the recent case of Heirs of Augusto I" salas,lr'
us'

United Nations "Conuention ontheRecognition snd the Enforcernent which superseded that of Toyota Motor
frpurl Realty Corporation,2o
of Foreign Arbitral Awsrds of 1958" under the 10 May 1965 Philippines Corp. us' Court of Appeals'z1
Resolution No. 71 of the Philippine Senate, giving reciprocal that the
InToyota, the Court ruled that "[t]he contention
recognition and allowing enforcement of international arbitraticln because of the
arbitration clause has become dysfunctional
agreements between pirties of different nationalities within a
;;;;;." of third parties is untenabie ratiocinating that [c]ontracts
contracting state.l7
ra
lB November 1998.
r5chapter 2, Title XIV Book lV New Civil Code of the Philippines -- -Art i3 | l. New Civil Code of the Philippines
r6Puromines. Inc. vs. Court of Appeals. G.R No 91228,22 March 1993, 220 SCRA DSee Note l 6
2Al 2oG.R. No. 135362, lJ Decentber 1999' 320 SCRA6l0
riNational Union Fire lnsurance Company of Pittsburg vs. Stolt-Nielsen. Philippines' 21G.R. No. l02BBl,7 December 1992'216 SCM216
lnc.. G.R. No. 87958. 26 April l.990. lB4 SCRA 682
69
6B
 RePr-lsrtc Acr No 9,2[Jlr
A[Enuitvr Dtspure Rrsorurloru Acr or 2004 Aw'rr'lr
Chapter 7 Judicial Review of Arbltl'll
-
SEC.41. VacationAwail'- Apafty to a domestic
.--,respected as the law between the contracting parties22 and
are arbitration may question the arbitral award with
the
;1lts such, the parties are thereby expected to abide with with
in Salas' appropriate Regi^onal Trial Court in accordance
eooa faith in their contracfual commitments'23 Howevet' *t"t of ptocedure to be promulgated by the Supreme
or heirs-have the
ii;;;"rties to the Agreem"r,t, thgi, assigns Court only on those grounds enumerated in Section
,igt t to lrbitrate o, .o.,'id be compelled to arbitrate' The Court 25 of Republic Act No' SZO' Any other
ground raised
wZnt futher by declaring that in recognizing the.right of the shall be disregarded
against i domestic arbitral award
contracting parties to arbitrate or to compel arbitratiot' l.h" bY the Regional Trial Court'
splitting ofit proceedings to arbitration as to some of the parties
"
on one hand and trial fo"r the others on the other hand' or the grounds for vacating
Section 25, RePublic Act No' 876 on
suspension of trial pending arbitration between some of
the
'awards.
purii"", should not be allowed as it would, in effect' result in
dom-estic
cases' the court must make an
multiplicity of suits, duplicitous procedure and unnecessary '21'tnanv one of the following awa"d, upon application of any
delay.2a .'roia", iirfying or correcting the
party to the coritroversy which was arbitrated:
The object of arbitration is to allow the expeditious
determination of a dispute.2s Clearly, the issue before us could (a) where there was an evident miscalculation of figures'
of any Person' thing or
not be speedily and efficiently resolved in its entirety if we
allow or an evident mistake in the description
simultaneous arbitration proceedings and trial, or suspension
of property referred to in the award; or
trial pending arbitration. Accordingly, the interest of justice would (b) where the arbitrators have awarded uPon a matter not
onlyle ,ur.i"d if the trial court hears and adjudicates the case in submitied to them, not affecting the merits
of the decision upon
a single and complete proceeding'26 the matter submitted; or
not
WHEREFORE, the petition is DENIED' The Decision of the (c) where tl-re award is imperfect in a matter of form
Court of Appeals affirming the Order of the Regional Trial Court affeciing the merits of the controversv and
if it had been a
or
of Malabon, Metro Maniil, in Civil Case No' 2637-MN' which commissioner's report, the defect could
have been amended
denied petitioners' Motion to Suspend Proceedings, is AFFIRMED' disregarded bY the court'
The Regional Trial Court concerned is directed to proceed
with award so as to cffcct
No costs' The order may modify ancl correct the
the hearing of Civil Case No. 2637-MN with dispatch'
the intent thereof and promote justice between
the parties'27
SO ORDERED.
Methods of vacating an award'
an arbitral
A party to a domestic arbitration may question
Trial Court in accordance
22Citing Mercantile Ins. Co. vs Felipe Ysmael. Jr. & Co ; Inc.. G R No 43862' l3 award *ithrtn" appropriate Regional
the SupT*".C:."tt
January | 9A9. | 69 SCRA 66. with rules of procudur" tob" promulgatedby
ltci,ing ouillian vs. Court of Appeals. G R No 55457 ' 20 January l9B9' 169 SCRA in Siction 25 of Republic Act No'
ortly on those ground'
279. "u*"it'd
24lbid.
R.. Annotation, Arbitration as a Means of Reducing
Court Congestion'
'?"Coquia. Jorge
29 Juty t977. 78 SCRA | 2 I 2i
Section 25. RePublic Act No 876
26see Note 20.
71
70
 Rrpuartc Ao No. 9285
ALtEntlqttvt- Dtsrure Resorurron Acr or 2004 Judicial Review of Arbitral Awards
Chapter 7
-
Philippine Senate
domestic arbitral award Awards approved in 1958 and ratified by the
876. Any other ground raised against a
under Resolution No. 72'2e
shatLUe'dlsregaided by the Regional Trial
Court'28

Application of the New York Convention'

B. FOREIGN ARBITRAL AWARDS"
The New York Convention shall Eiovern the recognition
and
The recognition and
SEC. 42. Application of the New Yotk Conaention' enforcement of awards by said Convention'
The New York Convention shall govern the ;;?;;;";""t of such arbitral awards shall be filed with the
-recognition and enforcement of arbitral awards lleqional Trial Court in accordance with rules of
procedure to b.e
Court' procedqral rqles shall
covered bY said Convention' ;;;;"1;^i; by the Supreme Said
on tlg-a.ry a1d or applyin g. i t?

rhu tggpg!:!19"-e"d
itoriJ"",nalths-pafy iely-ing f "t.

"dqlsgl"s!'t 9!irlh:rbi1t:l enfoicffer,t shall file with the-i6urt the original or authentrcateq
awards tfilii5" fifua *itl1!e Regional Trial Cour{ i1 [t the awaro or
copy'oFth€-dwafd^d-fitl1he arbitration agreeme4t'
the rules of procedure to be promul- the.party
"i-rairr..with asreement is not made in any of the official languages'
gated by the Supreme Court' Said procedural rules siiall apply a duly certified translation thereof in
any ot such
Jndt provide thit the party relying on the award or i^"g""iit]fh" apphcunt shall establish that the counhy in which
applying for its enforcement shall file with the court ih;i;.;g" arbitiaiion award was made a party to theNew York
theqriei"al-oi-gtb9-4$3!e4*coP.y-g-rjbgerye-'Celd susPensron ol.tne
Convention. lf the application for rejection or
the ai6itratio" &t"u*""t' If the award or agreement o*ord hut Ueen maae, the Regional Trial Court may' if it considers
Fnot"daeE-frof ttte official languages' the party i, prop", vacate its decision"and may also' on the application,of
shatl supply a duly certified translation thereof into thl party claiming recognition or enforc.ement of the
award' order
any of such languages. th" pariy to provide appropriate securi$'s
The applicant shall establish that the country in
which foreign arbitration award was made is a party Vacate defined and exPlained'
to the New York Convention' Vacntemeanstorendervoid;tosetaside'3lltisafundamental
If the application for rejection or suspension of or corrected
oreccpt that a final decision cannot be amended
misprisions' Because the
enforcementofanawardhasbeenmade'theRegional 5;.;ili;i".i.ul ",.o", mistakes or except to
Trial Court may, if considers it proper, vacate its .ur.i lnr"t iurisdiction upon the finality of its decision'
being merely a
decision and may also, on the application of the party order its decision within its lifetime'32 An award'
issue in
claiming recognition or enforcement of the award' p"tri"f or final decision of an arbitrator in resolving the
order the party to provide appropriate security' controversy is not a final decision of a court'
E-oreign
New York Convention defined. SEC. 43. Recognition andEnforcement of
New York Convention means the United Nations Con- Arbitral Awatds lf,ot Coaercd by the New York Con-
vention on the Recognition and Enforcement of Foreign Arbitral /'TSection l(wJ, RoPublic Act No 9285
rosection 42, lbid
rrBarTon! Law Dictionary, 2003 Eclttton' p
' tiz.lldo, 5r v\ Montano, 3l? SCRA l6l
2sSee Section 4l, Republic Act No 9285
73
72
 RepueucAcr No 9285
Arrnrunrtvr Drspure REsorurtoru Acr ot 2004 Judicial Review of ArbitralAwards
Chapter 7
-
on the theory that a court which first asserts jurisdiction will not
aentiott. The recognition and enforcement of
- be interferedwith in continuance of its assertion of another court...
foreign arbitral awards not covered by the New York unless it is desirable that one give way to the other'36
Convtntion shall be done in accordance with proce-
dural rules to be promulgated by the Supreme Court' Reciprocity defined and explained.
The Court may, on grounds of comity and reciprocity,
recognize and enforce a non-convention award as a Reciprocity, is generally a relationship betrveen Persons/
states or iountiies whereby favors or privileges granted by
one
convention award.
are returned by the other. Thus, if state "A" certifies engineers
Recognition defined. already certified by state "8" to work in state "A," reciprocity
exists when state "8" similarly certifies engineers certified by state
Recognition is a confirmation that an act done for another
"A." Reciprocity does not involve a vested right but would exist
person was authorized. It is the formal admission that tr persort,
without it.37
entity or thing has a particular status.33
SEC. 44. Eoreign Arbitral Awatd Not Foreign
Enforcement defined.
ludgment.- A foreign arbitral award when confirmed
Enforcement is the act or Process of compelling compliance tyl court of a foreign country shall be recognized
and enforced as a foreign arbitral award and not as a
t
with a law, mandate or command.3a Enforcement can be done
extrajudicially or by means of legitimate law enforcement judgment of a foreign court' ,/
agencies.
A foreign arbitral award, when confirmed by the
Regional Trial Court, shall be enforced in the same
Recognition and enforcement of non-New York Convention of courts of
awards. -""nn". as final and executory decisions
law of the PhiliPPines.
The recognition and enforcement of foreign arbitral awards
not covered by the New York Convention shall be done -in Effect of a foreign arbitral award'
accordance wiih procedural rules to be promulg/ted by the
A foreign arbitral award when confirmed by a court of a
Supreme Court. The Court may, on grounds of,/co*i,t ut'td
foreign .o,rritry shall be enforced as a foreign arbitral nward and
reciprocity, recognize and enforce a non-conventidn award as a
not as a judgment of a foreign totttt'@
convention award.3s
awa"d,iLean5sv-asatedbfaregfi onaltnalmmt"inntiefh-rf fppmeS.
Howeveq, when vJoreign arbitril awatdhas been confirmed
by the
Comity and "judicial comity" defined and explained. -errforcsd-Hs-E-fiffif and
,"e6;;Imi6urt -thrtame-shalt be
Comity is a rule of courtesy by which one court defers to the coq{sqlt
!rytrf Sie tliilip*pin€slETh6-e
f f ec t
concomitant jurisdiction of another. "|udicial comity is not a rule "*!*t"rl.decisroiiS6f
oi.onfi#an6n-bfTEEio-naiTiilcourt of a foreign arbitral award
---:-r-

of law, but one of practical convenience and expediency" based

r6Barron3 Law Dictionary.200l Edition, p BB. citing 177 U S 485, 4BB
rrBlacks Law Dictionary, 7th Edition, p. 1277 r7lbid.. citing 100 S.E 2d 2O5' 208
r4lbid. 3sSee Section 44. Republic Act No. 9285
rtsee Section 43. Republic Act No. 9285.

75
74
 RePuguc Acr No. 9lu5
ArEnru,qttvL Dt"t'trti l{rsoLL-rttoN Act ot 2004 Chapter 7 Judicial Review of Arbitral Awzrrds
-
ApPeal defined.
is to clothe themwith the force and effect of a final and executory purpose of
court decision in the Philippines' Appent is a resort to a higher court for the
court decision and a reversal of the
obtaining a review of a lower
l,ower coirrt's iudgment or the granting
of new trial'ao
SEC. 45. Reiection of a Foreign Arbittal Award'
A party to a foreign arbitration proceeding may
-oppose an application for recognition and enforce- Appeal from decisions on arbitral awards'
ment of the arbitral award in accordance with the A decision of the Regional Trial Court' confirming'
vacating'
procedural rules to be promulgated by the Supreme setting asicle or modifying or correcting
an arbitrat.iyfl:"y
^Court with the rules
only on those grounds enumerated under llrpi"A"a to the Court o-i Appeals in,accordance
Article V of the New York Convention' Any other Court' However'
oifiJ."a"te to be promulgated by theSupreme
ground raised shall be disregarded by the Regional pu.ty. who apieals from the judgment of thc court
4E|th;-losing appellate court
Trial Court. an arofiral awari shallbe required by the
ffi confrmtng party
E to post alounterbond executed in favor of the prevailing
with the rules to
How foreign arbitral award reiected. f,pj the amount of the award in accordance

A party to a foreign arbitration proceeding may opplsc an

""i"i,"
H U" promulgated by the Supreme Court'ar
I'r
applicaiion for recognition and enforcement of the arbitral award
in accordance with the procedural rules to be promulgated by * -
SEC. 47. Venue and furtsdiction' Proceedings

the Supreme Court only on those grounds enumerated under H for recognition and enforcement of an arbitration
R' t or for vacation, setting aside' correction or
Article v of the New Yoik Convention. Any other ground raised "nr""-Jt
E riodificationof anarbitral awar4 and any application
shall be disregarded by the regional trial court'3e supervision
E! *i,t u court for arbitration assistance and
and shallbe
srriU U" deemed as special proceedings
SEC. 45. Ap p e aI fro m C o urt D e ci si o n s o n Arbitr aI
!t
= iit"a *i,tthe Regional Trial Courh (i) where arbi-
Awards. A decision of the Regional Trial Court (ii) where the asset
-
confirming, vacating, setting aside, modifying. or [[
g tration proceedingi are conducted;
the act to be enioined
l$ to be atiached or levied upon' or
correcting an arbitral award may be appealed to the- f,F the dispute
is located; (iii) where any of the parties to
Court of Appeals in accordance with the rules of (iv) in the
procedure to be promulgated by the Supreme Court'
. resides or has his placl of business; or
of the
National |udicial Cipital Region' at the option
The losing party who appeals from the judgment aPPlicant.
of the court confirming an arbitral award shall be
required by the appellate court to post a counterbond Venue and jurisdiction for recognition etc'
of an arbitral
exicuted in favor of the prevailing party equal to the i
award.
amount of the award in accordance with the rules to of an
Proceedings for recognition and enforcement
be promulgated by the Supreme Court. setting aside' correction or
arbitration agree"ment or for vacation'
a0Barrons Law Dictionary 2003 Editron' p
4rsection 46, Republic Act No 92B5
reSection 45, Republic Act No. 9285

77
76
 Anetooqttvt Dtst'L-rtt RgsoLurtoru Acr or 2404
c ha orer'
jT;::.i;'#; 3#,-50'uu,
^*u.0,
of duc
must be heard before he is condemned.a8 The requirement
mo/ification of an arbitral award, and any application with a court
process is satisfied as long as a party is given a reasonable
fof arbitration assistance and supervision shall be filed with the
Resional Trial Court: (1) where arbitration proceedings are
opportunity to explain his side, even if he chooses not to
paiticipate in the proceedings whenhis request for postponement
./o,ia.rct"d; (2) where the asset to be attached or levied uPory or
is denied.ae
" the act to be enjoined is located; (3) where any of the parties to
the clispute resides; or (4) in the National Judicial capital Region
Notice of Proceedings to Partaes'
at the option of the aPPlicant.a2
In special proceedings for recognition and enforcement of
Venue and jurisdiction distinguished. an arbitral u*uid, the Court shall send notice to the parties at
their address of record in the arbitration or if any party cannot be
Jurisdiction implies the power of a court to decide a
case/
served notice at such address, at such party's last known
address.
rvhile venue is the place of the action.a3 Venue is procedural, not
The notice shall be sent at least fifteen (15) days before the date
jurisdictional, hence maybe waived.4 Thus, the court may dismiss
set for initial hearing of the application's
an action z otu proprio incase of lack of jurisdiction over the subiect,
Iitis pendentia, res judicata, and prescription but not for improper
venue.as |urisdiction is conferred by law and not by mere policy
of any court or tribunal.a6

SEC. 4S. Notice of Ptoceeiling to Parties' - In a

special proceeding for recognition and enforcement
of utt award, the Court shall send notice to
".bitral
the parties at their addtess of record in the arbitration,
or ifany party cannot be served notice at such address,
at such party'q last known address. The notice shall
be sent it leasi fifteen (15) days before the date set for
the initial hearing of the application.

Notice defined and exPlained.

Notice comes from the Latin "notitia," being known or
knowledge , "nltlts," known and "nocere. " It means information
actually ieceived by the Person to whom it is intended to be
impartbd.nT Procedural due process simply means that a Person
4zsection 47, Republic Act No. 9285.
arsulo ng Bayan vs. Gregorio Araneta, lnc., 72 SCRA 352 asUniversity of the lmmaculate Concepcion vs U.l.C. Teaching and Non Teachlng
44He,rs of Pedro Lopez vs. De Castro. 324 SCRA 59 l.
a5Rudolf Liits Holdings, Inc. vs. Reqistry of Deeds, Paraflaque City. 344 SCRA 380 Personnel and Employees Union. 362 SCM242'
{elbid.
46fu(anza vs. BF Homes, Inc.. 333 SCRA 799.
sosee Section 48. Republic Act No' 9285
a1Enrieuez vs. Bautista. 79 Phn.234.

79
78

CHAPTER 8 needlul statutory changes to develop, strengthen and improve
MISCELI.ANEOUS PROVISIONS
SEC. 49. Office for Alternatiae Dispute Resolution.
There is hereby established Officethe for
-Alternative Dispute Resolution/ as an attached agency
to the Department of justice (DOI), which shall have
a Secretariat, headed by an Executive Director. The
Executive Director shall be appointed by the President
of the Philippines.
The obiectives of the Office are:
(a) To promote, develop and expand the use of
ADR in the private and public sectors; and
G) To assist the government to monitor, study
and evaluate the use by the public and the private
sector of ADR, and recommend to Congress needful
statutory changes to develop, strengthen and improve
ADR practices in accordance with world standards.
Office of Alternative Dispute Resolution established.
An office of Alternative Dispute Resolution (ADR) is
established under Republic Act No. 9285, as an agency of the
Department of Justice (DOl). It shall have a secretariat headed by
an executive director who shall be appointed by the President of
the Philippines.l
Objectives of the Office for Alternative Dispute Resofution.
The objectives of the Office for Alternative Dispute
Resolution are as follows: (1) To promote, develop and cxpand
rSee lst paragraph. Section 49, Republic Act No. 9285
80
.n" ?1"",,, *,
",.1'J1''if.'J,,)i#
the ADR in the private and public sectors; and (2) To assist the
government to monitor, study and evaluate the use by the public
and private sectors of the ADR, and recommend to Congress
ADR practices in accordance with world standards'2
SEC. 50. Powers and Eunctions of the Office for
Alternatia e Dispute Resolution. - The Offi ce for Alter-
native Dispute Resolution shall have the following
powers and functions:
(a) To formulate standards for the training of
the ADR practitioners and service providers;
(b) To certify that such ADR practitioners and
ADR service providers have undergone the profes-
sional training provided by the Office;
(c) To coordinate the development, implemen-
tation, monitoring and evaluation of government
ADR Programs;
(d) To charge fees for their services; and
(e) To perform such acts as may be necessary to
carry into effect the provisions of this Act'
Power defined.
Power is the authority granted to by one person to another
to do in his behalf the same thing which he would do himself in
the premises. The Powers and, at the same time, functions of the
Office for Alternative Dispute Resolution is granted by law'3
Functions of the office of Alternative Dispute Resolution
explpined.
When an office is engaged in the performance of the duties
of his office, he is said to rltt his functions. Thus, when the office
2See 2nd paragraPh, lbid
rTipton vs. Andueza. 5 Phil 480
81
 Rrfl-jsuc Acr No. 9285
Arenru,qrtvE DrspurE Resorurroru Acr or 2004
Chapter B Miscellaneous Provisions
-

for Alternative Dispute Resolution engages in the performance
anv of its powers and functions, as enumerated in Section
50'
nepubiic Act No. 9285, that office is engaged in the performance
of its powers and functions.a
Appropriation for Republic Act No' 9285'
Act
Appropriations "to carry out the provisions" of Republic
of
No. 92b5 "shall be included the General Appropriations.Act
ih" y"u. following its enactment into law and thereafter'"8

Formulation of standards for ADR training'
Formulation of standards for training of the ADR
of
practitioners and service providers means the establishment
iraining guidelines for ADR practitio'ers and service providers.
Certification defined'
SEC. 52. lmplementing Rules and Regulations
ORR). Within one (1) month after the approval of
-
this Act, the Secretary of Justice shall convene a
Committee that shall formulate the appropriate rules
and regulations necessary for the implementation of
this Act.

A certification is a written statement legally authentic;rtt-'tl The Committee, composed of representatives

on the accomplishment of something' It is also a writing try
wliich from:
testimony is given that fact has or has not taken place. Certification (a) the DePartment of Justice;
or
may ulso be-a writing that a thing has or has not been done' (b) the Department of Trade and Industry;
the fact exist or does not exist.s (c) the Department of the Interior and Local
amount neces- Governmenf
SEC. 51. Appropriations' -The
sary to ctrry o.tt the provisions of this Act shall be (d) the President of the Integrated Bar of the
inciuded in the General Appropriations Act of the PhilipPines;
year following its enactment into law and thereafter' (e) a rePresentative from the arbitration
profession;
Appropriation defined. (0 a representative from the mediation
Appropriation is an authority from the legislature given at profession; and
the proper time and legal form to the ProPgr officer to apply
a
used in the treasury in a
(d a representative from the ADR organizations;
sum of *on"y out of that which may be
the It is shall, within three (3) months after conveninp submit
given year in specified objects or demand against state-6
it u.iof the legislatu.e s"tti.,g apart or assigning-to a particular the IRR to the Joint Congressional Oversight
" the paymen-t of debt or dues from its creditors. It is the setting
use Committee for review and approval' The Oversight
apart by iaw of a certain sum from the public revenue for a Committee shall be composed of the Chairman of the
specified purpose.T Senate Committee on justice and Human Rights'
Chairman of the House Committee onJustice' and
one-

(1) member each from the Maiority and Minority of

aSee Section 50. Republic Act No 9286 both Houses.
sBoard of Election Inspectors vs. Piccio. B I Phil 580
6Dajao vs. Padilla, | 24 Phtl 6
ssee Section 5 | Republic Act No. 9285
/Bengson vs. Secretary ofJustice, 62 Phtl 9l6'

83
82
 RErueLtc Acr No. 9285
ALTEnru,qrtvE DtspurE RrsoruitoN Acr or 2004
Chapter B Miscellaneous Provisions
-
No. 7160, otherwise known as the "Local Government Code of
The joint Oversight Committee shall become
IRR' 1991."12
functus officio upon apProval of the
SEC. 54. Repealing Clause' All laws, decrees,
Rutes and regulations defined and exPlained' -
regulations, which are
executive orders, rules and
Rule is a prescribed for action or conduct, regulation or inconsistent with the provisions of this Act, are hereby
principle.e Regllations are rules or other directives issued by repealed, amended or modified accordingly'
ud-i.tirtrutive agencies that must have specific authorization
to issue directives and upon such authorization must usually Repealing clause defined.
follow prescribed conditions, such as prior notification of the
A repealing clause is a statutory provision that repeals an
ptopot"d action in a public record and an invitation for public
earlier stitute. it is also called a rcpealer which is a legislative
comment.lo
act abrogating an earlier law. The repeal may be express if
effected 6y specific declaration in the new statute. It is implied
Functus oficio defined.
if it is effect"d by i.r""oncilable conflict between an old law and
Functus oficio means "having performed his office," it is the new law13
without further authority or legal competencebecause the duties
and functions of the original commission have been fully SEC.55. Separubility Clause'- If for any reason
accomplished.ll or reasons, any portion or provision of this Act shall
be held unconstitutional or invalid, all other parts or
SEC. 53. Applicability of the Katarungang provisions not affected shall thereby continue to
Pambarangay. This Act shall not be interpreted to iemain in full force and effect'
-
repeal, amend or modify the iurisdiction of the
Katarungang Pambarangay undet Republic Act No' SeparabilitY clause defined.
7L60, ottterwise known as the "Local Government Code
separabitity clause is a provision_that keeps the remaining
of 1991."
provisions of a contract or statute in force if any portion of that
contract or statute is declared void or unconstitutional. It is also
Katarungang pambarangay provisions not repealed'
called severabilitY clause.ra
The katarungang pambarangay provisions in the Local
Government Code of 1.991also has provisions on arbitration, Separability clause in Republic Act No' 9285'
mediation and conciliation on cases within the iurisdiction of the
Republic Act No. 9285 contains a separability clause in
lupong tagapamayapa. Section 53, Republic Act No' 9285 provides -55
;fhilsAct shail notbe interpreted to repeal, amend, or modify section thereof. It provides that: "If for any reason or reasons
that:
any provision of this Act shall be held unconstitutional or invalid,
the jurisdiction of the Katarungang Pambarangay in Republic Act

r25ee Section 53. Republic Act No 9285'

eBarronb Law Dictionary 2003 Edition, PP. 454'455
rrsee Section 54. Republic Act No 9285
rolbid.. p. 43L
r{Black's Law Dictionary. 7th Edition, p 1379
I rBlackS
Law Dictionary. 7th Edition, p. 682.
85
84
 ALrenru,qrtvr Dtspure Rrsorurtoru Acr or 2004

all other parts or provisions not affected shall continue in full

force and effect.ls APPENDICES
)e;
SEC. 56. Effectiaitu-- This Act shall take effect
fifteen (15) days after its publication in at least two APPENDIXII AI'
(2) national newspapers of general circulation.
Republic of the PhiliPPines
Congress of the PhiliPPines
Approved, Metro Manila

(Sgd.) FRANKLIN M. DRII.ON TWELFTH CONGRESS

(Sgd.) JOSE DE VENECIA, JR.
Speaker of the House Prcsident of tht Scnatr
of Representatittes THIRD REGULAR SESSION
Begun and held in Metro Manila, on Monday, the twenty-eighth day of
This Act which is a consolidation of Senate Bill No' 2671 and
JulY, two thousand three.
House Bill No. 5654 was finally passed by the Senate and the
House of Representatives on February 4,2004.

(Sgd.) OSCAR G. YABES

(Sgd.) RoBERTO P. NAZARENO [Republic Act No.9285]
Seuetary General Secretary of the Senate
House of Representatiaes
AN ACT TO INSTITUTIONALIZE THE USE OF AN ALTERNATIVE
DISPUTE RESOLUTION SYSTEM IN THE PHILIPPINES AND TO
Approved. Apr.2,2004 ESTABLISH THE OFFICE FOR ALTERNATIVE DISPUTE
RESOLUTION, AND FOR OTHER PURPOSES

Re it enacted by the senate and Housc of Representatiuts of the Philipltines itt

(Sgd.) GLORIA MACAPAGAL-ARROYO
Congress assembled:
President of the PhiliPPines
CHAPTER 1 _ GENERAL PROVISION
,,Alternative Dispute
shall be known as the
SECTION 1. Tifle.
- This Act
Resolution Act of 2004."

sEC.2.Declaration of Poticy.*It is hereby declared the policyof the state

the freedom
to actively promote party autonomy in the resolution of disputes or
Towards
of the paities to muke th"ir o*n ur."ngemut ts to resolve their disputes.
this end, the state shall encourage and actively Promote the use of Alternative
fli.rprt" Resolution (ADR) as an important means to achieve speedy and
in.'fa.tial justice and declog court dockets.-As such, the State shall provide
rntians for'the use of ADR ai an efficient tool and an alternative procedure
for
r5See Section 55. Republic Act No. 9285
87
86