REY ALMON T.

ALIBUYOG
JD-II
ALTERNATIVE DISPUTE RESOLUTION ACT OF 2004
(RA No. 9285, April 2, 2004)
INTRODUCTION
PURPOSES OF ADR SYSTEM IN THE PHILIPPINES
1. To achieve speedy and impartial justice
2. To declog court dockets
3. To prepare the Philippines for ASEAN integration and globalization

LEGAL BASIS OF ALTERNATIVE DISPUTE RESOLUTION

1. The 1987 Philippine Constitution
2. Philippine Laws
a) Civil Code (Arts. 2028-2047)
b) The Arbitration Law (RA 876)
c) The Alternative Dispute Resolution Act of 2004 (RA 9285)
d) Special Laws
3. Decisions of the Supreme Court
4. Rules and Resolutions issued by the Supreme Court
5. Rules and Regulations issued by administrative agencies
6. International Laws, Treaties or International Agreements
a) Model Law
7. Jurisprudence of Other Countries
8. Equity

DEFINITION OF TERMS
1. ALTERNATIVE DISPUTE RESOLUTION- any process or procedure used
to resolve a dispute or controversy, other than by adjudication of a
presiding judge of a court or an officer of a government agency, in which
a neutral third party participates to assist in the resolution of issues, which
includes arbitration, mediation, conciliation, early neutral evaluation,
mini-trial, or any combination thereof.1
2. ADR PROVIDER- institutions or persons accredited as mediator,
conciliator, arbitrator, nuetral evaluator, or any person exercising similar
functions in any ADR system.2
3. CONCILIATION- process in which a neutral third party (conciliator)
conveys information between parties and attempts to improve direct

1
Sec. 3(a), RA No. 9285
2
Sec. 3(b), RA No. 9285
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communication between them. The conciliator often prepares a report that
describes the scope of agreement and disagreement.3
4. MEDIATION- any voluntary process in which a mediator, selected by
the disputing parties, facilitates communication and negotiation, and
assists the parties in reaching a voluntary agreement regarding a dispute.4
5. ARBITRATION- a voluntary dispute resolution process in which one or
more arbitrators, appointed in accordance with the agreement of the
parties, or rules promulgated pursuant to this Act, resolve a dispute by
rendering an award.5
6. EARLY NEUTRAL EVALUATION- an ADR process wherein parties and
their lawyers are brought together early in a pre-trial phase to present
summaries of their cases and receive a nonbinding assessment by an
experienced, neutral person, with expertise in the subject in the substance
of the dispute.6
7. MINI-TRIAL- a structured dispute resolution method in which the
merits of a case are argued before a panel comprising senior decision
makers with or without the presence of a neutral third person after which
the parties seek a negotiated settlement.7
8. MEDIATION-ARBITRATION- a step dispute resolution process involving
both mediation and arbitration.8

EXCEPTION TO THE APPLICATION OF THIS ACT9

The provisions of this Act shall not apply to resolution or settlement of the
following:
1. Labor disputes covered by the Labor Code of the Philippines
2. Civil status of persons
3. The validity of marriage
4. Any ground for legal separation
5. The jurisdiction of courts
6. Future legitime
7. Criminal Liability
8. Those which by law can not be compromised

3
The Philippine Mediation Center
4
Sec. 3(q), RA No. 9285
5
Sec. 3(d), RA No. 9285
6
Sec. 3(n), RA No. 9285
7
Sec. 3(u), RA No. 9285
8
Sec. 3(t), RA No. 9285
9
Sec. 6, RA No. 9285
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GENERAL PRINCIPLES GOVERNING ADR

1. Party Autonomy
2. Liberal Interpretation In Favor Of ADR
3. Competence-Competence Principle
4. Principle Of Separability
5. Confidential Nature Of ADR
INFORMATION THAT SHALL NOT BE DISCLOSED:
A. Communication, oral or written, made in a dispute resolution
proceeding, including any memoranda, notes or work product of the
neutral party or non-party participant;
B. An oral or written statement made or which occurs during
mediation or for purposes of considering, conducting, participating,
initiating, continuing of reconvening mediation or retaining a mediator;
C. Pleadings, motions, manifestations, witness statements, reports
filed or submitted in an arbitration or for expert evaluation.10

PERSONS INVOLVED OR PREVIOUSLY INVOLVED IN A MEDIATION WHO

MAY NOT BE COMPELLED TO DISCLOSE CONFIDENTIAL INFORMATION
OBTAINED DURING MEDIATION:
A. The parties to the dispute;
B. The mediator/s;
C. The counsel for the parties;
D. The nonparty participants;
E. Any person hired or engaged in connection with the mediation
(secretary, stenographer, clerk or assistant);
F. Any other person who obtains or possesses confidential information by
reason of profession.11

EXCEPTIONS TO CONFIDENTIALITY:
A. There is no privilege against disclosure under Section 9 if mediation
communication is:
i. in an agreement evidenced by a record authenticated by all parties
to the agreement;

10
Sec. 3(h), RA No. 9285
11
Sec. 9(d), RA No. 9285
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ii. available to the public or that is made during a session of a
mediation which is open, or is required by law to be open, to the
public;
iii. a threat or statement of a plan to inflict bodily injury or commit a
crime of violence;
iv. internationally used to plan a crime, attempt to commit, or
commit a crime, or conceal an ongoing crime or criminal activity;
v. sought or offered to prove or disprove abuse, neglect, abandonment,
or exploitation in a proceeding in which a public agency is protecting
the interest of an individual protected by law; but this exception
does not apply where a child protection matter is referred to
mediation by a court or a public agency participates in the child
protection mediation;
vi. sought or offered to prove or disprove a claim or complaint of
professional misconduct or malpractice filed against mediator in a
proceeding; or
vii. sought or offered to prove or disprove a claim of complaint of
professional misconduct of malpractice filed against a party,
nonparty participant, or representative of a party based on conduct
occurring during a mediation.12

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:
i. a court proceeding involving a crime or felony; or
ii. a proceeding to prove a claim or defense that under the law is
sufficient to reform or avoid a liability on a contract arising out of
the mediation.13

C. A mediator may not be compelled to provide evidence of a mediation

communication or testify in such proceeding.

12
Sec. 11(a), RA NO. 9285
13
Sec. 11(b), RA NO. 9285
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D. If a mediation communication is not privileged under an exception in
subsection (a) or (b), only the portion of the communication necessary for
the application of the exception for nondisclosure may be admitted. The
admission of particular evidence for the limited purpose of an exception
does not render that evidence, or any other mediation communication,
admissible for any other purpose.

POWERS AND FUNCTIONS OF THE OFFICE FOR ADR

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 professional training provided by the office;
C. To coordinate the development, implementation, 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.14

MEDIATION

VOLUNTARY MEDIATION- any process in which disputing parties select a

mediator who facilitates communication and negotiation, and assist the
parties in reaching a voluntary agreement.15
A. AD HOC MEDIATION- any mediation other than institutional or
court-annexed.16
B. INSTITUTIONAL MEDIATION- any mediation process conducted
under the rules of a mediation institution.17

COURT-ANNEXED MEDIATION- any mediation process conducted under

the auspices of the court, after such court has acquired jurisdiction of the
dispute.

14
Sec. 50, RA No. 9285
15
Sec. 7, RA No. 9285
16
DOJ Circular No. 98, s. 2009, Chap. 1, Rule 2, Art. 1.6(B)(1)
17
DOJ Circular No. 98, s. 2009, Chap. 1, Rule 2, Art. 1.6(B)(2)
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COURT-REFERRED MEDIATION- ordered by a court to be conducted in
accordance with the Agreement of the Parties when an action is prematurely
commenced in violation of such agreement.

APPLICATION AND INTERPRETATION

A. The need to promote candor of parties and mediators through
confidentiality of the mediation process;
B. The policy of fostering prompt, economical, and amicable resolution
of disputes in accordance with the principles of integrity of
determination by the parties;
C. The policy that the decision-making authority in the mediation
process rests with the parties.18

PLACE OF MEDIATION
Parties are free to agree on the place of mediation. Failing such agreement,
the place of mediation shall be any place convenient and appropriate to all
parties.19

ROLE OF PARTIES AND THEIR COUNSEL

Role of Counsel
A. The lawyer shall view his/her role in the mediation as a collaborator
with the other lawyer in working together toward the common goal of
helping their clients resolve their differences to their mutual
20
advantage.
B. The lawyer shall encourage and assist his/her client to actively
participate in positive discussions and cooperate in crafting an
agreement to resolve their dispute.21
C. The lawyer must assist his/her client to comprehend and appreciate
the mediation process and its benefits, as well as the client’s greater
personal responsibility for the success of mediation in resolving the
dispute.22
D. In preparing for participation in mediation, the lawyer shall confer
and discuss with his/her client the following:

18
Sec. 8, RA No. 9285
19
Sec. 15, RA NO. 9285
20
DOJ Circular No. 98, s. 2009, Chap. 3, Rule 4, Art. 3.15(a)
21
DOJ Circular No. 98, s. 2009, Chap. 3, Rule 4, Art. 3.15(b)
22
DOJ Circular No. 98, s. 2009, Chap. 3, Rule 4, Art. 3.15(c)
REY ALMON T. ALIBUYOG
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i. The mediation process as essentially a negotiation between the
parties assisted by their respective lawyers, and facilitated by a
mediator, stressing it its difference from litigation, its advantages
and benefits, the clients heightened role in mediation and
responsibility for its success and explaining the role of the lawyer
in mediation proceedings.23
ii. The substance of the upcoming mediation such as;
1. The substantive issues involved in the dispute and their
prioritization in terms of importance to his/her client’s real
interests and needs.
2. The study of other party’s position in relation to the issues
with a view to understanding the underlying interests, fears,
concerns and needs;
3. The information or facts to be gathered or sought from the
other side or to be exchanged that are necessary for informed
decision-making;
4. The possible options for settlement but stressing the need to
be open-minded about other possibilities; and
5. The best, worst and most likely alternative to a
non-negotiated settlement.24

SELECTION OF MEDIATOR
The parties have the freedom to select a mediator, a list of which can
be requested from the OADR. The OADR may be requested to inform the
mediator of his/her selection.25

CIRCUMSTANCES WHEN A MEDIATOR MAY REFUSE, WITHDRAW OR MAY

BE COMPELLED TO WITHDRAW:
A. If any of the parties so requests the mediator to withdraw;
B. The mediator does not have the qualifications, training and
experience to enable him/her to meet reasonable expectations to the
parties;
C. Where the mediator’s impartiality is in question;

23
DOJ Circular No. 98, s. 2009, Chap. 3, Rule 4, Art. 3.15(d)
24
DOJ Circular No. 98, s. 2009, Chap. 3, Rule 4, Art. 3.15(d)
25
DOJ Circular No. 98, s. 2009, Chap. 3, Rule 2, Art. 3.3
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D. If the continuation of the process would violate any ethical
standards;
E. If the mediator is unable to provide effective services;
F. In case of conflict of interest; and
G. In any of the following instances, if the mediator is satisfied that:
a) One or more of the parties is/are not acting in good faith;
b) The parties’ agreement would be illegal or involve the
commission of a crime;
c) Continuing the dispute resolution would give rise to an
appearance of impropriety;
d) Continuing with the process would cause significant harm to a
non-participating person or to the public; or
e) Continuing discussion would not be in the best interest of the
parties, their minor children or the dispute resolution process.26

ETHICAL CONDUCT OF A MEDIATOR

COMPETENCE
It is not required that a mediator shall have special qualifications by
background or profession unless the special qualifications of a mediator shall:
A. Continually upgrade his/her professional competence in mediation skills;
B. Ensure that his/her qualifications, training and experience are known to
and accepted by the parties; and
C. Serve only when his/her qualifications, training and experience enable
him/her to meet the reasonable expectations of the parties and shall not
hold himself/herself out or give the impression that he/she does not have.27

IMPARTIALITY
A mediator shall maintain impartiality.
A. Before accepting a mediation, an individual who is requested to serve as
a mediator shall:
i. Make an inquiry that is reasonable under the circumstances to
determine whether there are known facts that a reasonable
individual would consider likely to affect the impartiality of the
mediator, including a financial or personal interest in the outcome

26
DOJ Circular No. 98, s. 2009, Chap. 3, Rule 2, Art. 3.5
27
DOJ Circular No. 98, s. 2009, Chap. 3, Rule 3, Art. 3.6
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of the mediation and any existing or past relationship with a party
of foreseeable participant in the mediation; and
ii. Disclose to the mediation parties any such fact known or learned as
soon as practicable before accepting a mediation.
B. If a mediator learns any fact described in this Article after accepting a
mediation, the mediator shall disclose it as soon as practicable to the
mediation parties.28

CONFIDENTIALITY
A mediator shall keep in utmost confidence all confidential information
obtained in the course of the mediation process. A mediator shall discuss issues
of confidentiality and the extent of confidentiality provided in any private
sessions or caucuses that the mediator holds with a party.29

CONSENT AND SELF-DETERMINATION

A mediator shall make reasonable efforts to ensure that each party
understands the nature and character of the mediation proceeding including
private caucuses, the issues, the available options, the alternatives to
non-settlement, and that each party is free and able to make whatever choices
he/she desires regarding participation in mediation generally and regarding
specific settlement options.
If a mediator believes that a party, who is not represented by counsel, is
unable to understand, or fully participate, the mediation proceedings for any
reason, a mediator may either:
1. limit the scope of the mediation proceedings in a manner
consistent with the party's ability to participate, and/or
recommend that the party obtain appropriate assistance in
order to continue with the process; or
2. terminate the mediation proceedings.
A mediator shall recognize and put in mind that the primary responsibility
of resolving a dispute and the shaping of a voluntary and un-coerced
settlement rests with the parties.30

SEPARATION OF MEDIATION FROM COUNSELLING AND LEGAL ADVICE

28
Sec. 13, RA NO. 9285
29
DOJ Circular No. 98, s. 2009, Chap. 3, Rule 3, Art. 3.8
30
DOJ Circular No. 98, s. 2009, Chap. 3, Rule 3, Art. 3.9(a and b)
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A. Except in evaluative mediation or when the parties so request, a
mediator shall:
i. refrain from giving legal or technical advice and otherwise
engaging in counselling or advocacy; and
ii. abstain from expressing his/her personal opinion on the rights
and duties of the parties and the merits of any proposal made.
B. Where appropriate and where either or both parties are not
represented by counsel, a mediator shall;
a) recommend that the parties seek outside professional advice to
help them make informed decision and to understand the
implication of any proposal; and
b) suggest that the parties seek independent legal and/or technical
advice before a settlement agreement is signed.
C. Without the consent of all parties, and for a reasonable time under
the particular circumstance, a mediator who also practices another
profession shall not establish a professional relationship in that other
profession with one of the parties, or any person or entity, in a
substantially and factually related matter.

CONDUCT OF MEDIATION
Articles to be Considered in the Conduct of Mediation.
A. The mediator shall not make untruthful or exaggerated claims about the
dispute resolution process, its costs and benefits, its outcome or the
mediator’s qualifications and abilities during the entire mediation process.
B. The mediator shall held the parties reach a satisfactory resolution to
their dispute but has no authority to impose a settlement on the parties.
C. The parties shall personally appear for mediation and may be assisted by
a lawyer. A party maybe represented by an agent who must have full
authority to negotiate and settle the dispute.
D. The mediation process shall, in general, consists of the following stages:
i. Opening statement of the mediator;
ii. Individual narration by the parties;
iii. Exchange by the parties;
iv. Summary of issues;
v. Generation and evaluation of options; and
vi. Closure.
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E. The mediation proceeding shall be held in private. Person, other than the
parties, their representatives and mediator, may attend only with the
consent of all the parties.
F. The mediation shall be closed:
a) by the execution of a settlement agreement by the parties;
b) by the withdrawal of any party from mediation; and
c) by the written declaration of the mediator that any further effort
at mediation would not be helpful.31

EFFECT OF AGREEMENT TO SUBMIT DISPUTE TO MEDIATION UNDER

INSTITUTIONAL RULES
An agreement to submit a dispute to mediation by an institution shall
include an agreement to be bound by the internal mediation and
administrative policies of such institution. Further, an agreement to submit a
dispute to mediation under institutional mediation rules shall be deemed to
include an agreement to have such rules govern the mediation of the dispute
and for the mediator, the parties, their respective counsels and non-party
participants to abide by such rules.
In case of conflict between the institutional mediation rules and the
provisions of this Act, the latter shall prevail.32

ENFORCEMENT OF MEDIATED SETTLEMENT AGREEMENT

As a means of encouraging a recourse to mediation, Sec. 17 provides for a
means of enforcing mediated settlement agreements. The conditions
precedent are:
a. The settlement agreement shall be prepared by the parties with the
assistance of their respective counsel, if any, and by the mediator.33
b. The parties and their respective counsel, if any, shall sign the settlement
agreement;
c. The mediator shall certify in writing that he explained the contents of
the settlement agreement to the parties in a language known to them.34

FEES AND COST OF MEDIATION

31
Art. 3.17, Rule 5, IRR, RA No. 9285
32
Art. 3.19, Rule 7, IRR, RA No. 9285
33
Sec. 17(a), RA No. 9285
34
Sec. 17(b), RA No. 9285
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In ad hoc mediation, the parties are free to make their own arrangement
as to mediation cost and fees. In default thereof, the schedule of cost and fees
to be approved by the OADR shall be followed.35
In institutional mediation, it shall include the administrative charges of the
mediation institution under which the parties have agreed to be bound,
mediator’s fees and associated expenses, if any.36

WHEN VOLUNTARY MEDIATION IS UNSUCCESSFUL

If it proves to be unsuccessful, the parties may revert to other modes of
ADR, such as Med-Arb. In the alternative, the parties may proceed with
adversarial litigation.

DOMESTIC ARBITRATION

SOURCES OF GOVERNING LAW

1. Arbitration Law (RA 876)37
2. Model Law (Arts. 8, 10, 11, 12, 13, 14, 18 and 19 and 29 to 32)
3. ADR Act (Secs. 22 to 31)38
4. Civil Code39

DEFINITION OF TERMS
1. DOMESTIC ARBITRATION- shall mean an arbitration that is not
international as defined in Article 1(3) of the Model Law.40
2. AD HOC ARBITRATION- an arbitration administered by an arbitrator
and/or the parties themselves. An institution may administer ad hoc
arbitration if it is not a permanent or regular arbitration institution in the
Philippines.41
3. INSTITUTIONAL ARBITRATION- an arbitration administered by an
entity, which is registered as a domestic corporation with the SEC and
engaged in the arbitration of disputes in the Philippines on a regular and
permanent basis.42

35
DOJ Circular No. 98, s. 2009, Chap. 3, Rule 10, Art. 3.25
36
DOJ Circular No. 98, s. 2009, Chap. 3, Rule 10, Art. 3.26(a)
37
Sec. 32, RA No. 9285
38
Sec. 33, RA No. 9285
39
Sec. 31, RA No. 9285
40
Sec. 32, RA No. 9285
41
DOJ Circular No. 98, s. 2009, Chap. 1, Rule 2, Art. 1.6(D)(1)
42
DOJ Circular No. 98, s. 2009, Chap. 1, Rule 2, Art. 1.6(D)(10)
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4. APPOINTING AUTHORITY- the person or institution named in the
arbitration agreement as the appointing authority; or the regular
arbitration institution under whose rules arbitration is agreed to be
conducted.43
5. ARBITRAL TRIBUNAL- a sole arbitrator or a panel, board or committee
of arbitrators.44

PERSONS AND MATTERS SUBJECT TO ARBITRATION

Two or more persons or parties may submit to the arbitration of one or
more arbitrators:
a. Any controversy existing between them at the time of the submission
and which may be the subject of an action (submission clause); or
b. The parties to any contract may in such contract agree to settle by
arbitration a controversy thereafter arising between them
(arbitration clause).
Such submission or contract shall be valid, enforceable and irrevocable, save
upon such grounds as exist at law for the revocation of any contract.45
Such submission or contract may include question arising out of valuations,
appraisals or other controversies which may be collateral, incidental,
precedent or subsequent to any issue between the parties.

WHAT CONTROVERSY CANNOT BE ARBITRATED

A controversy cannot be arbitrated where one of the parties to the
controversy is an infant, or a person judicially declared to be incompetent,
unless the appropriate court having jurisdiction approve a petition for
permission to submit such controversy to arbitration made by the general
guardian or guardian ad litem of the infant or of the incompetent.46
But where a person capable of entering into a submission or contract has
knowingly entered into the same with a person incapable of so doing, the
objection on the ground of incapacity can be taken only in behalf of the person
so incapacitated.47

SUBMISSION AGREEMENT AND ARBITRATION AGREEMENT/CLAUSE

43
Sec. 26, RA No. 9285
44
DOJ Circular No. 98, s. 2009, Chap. 1, Rule 2, Art. 1.6(D)(5)
45
Sec. 2, RA 876
46
Sec. 2, RA 876
47
Sec. 2, RA 876
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There is a submission agreement when two or more persons or parties
submit to the arbitration of one or more arbitrators any controversy existing
between them at the time of the submission.
On the other hand, it is an arbitration agreement when the parties to
any contract agree to settle by arbitration a controversy thereafter arising
between them. (RA 876, Section 2)

NOTE: In submission clause, such admission for proceedings and bring it

to arbitration and the award of arbitrator would then be brought to court for
recognition and execution arbitration is deemed a consent of the parties to the
jurisdiction of the RTC of the province or city where any of the parties reside,
to enforce such contract or submission.
Under the arbitration clause, when the contract is brought to court, a
party may request the court to suspend the proceedings and bring it to
arbitration and the award of arbitrator would then be brought to court for
recognition and execution.

FORMAL REQUISITES OF A VALID ARBITRATION AGREEMENT OR

SUBMISSION AGREEMENT
A contract to arbitrate a controversy thereafter arising between the
parties, as well as a submission to arbitrate an existing controversy shall be (1)
in writing and (2) subscribed by the party sought to be charged or by his lawful
agent.48

DISPUTES COVERED BY RULES ON DOMESTIC ARBITRATION

Domestic Arbitration covers both commercial and non-commercial
disputes provided they are susceptible of arbitration and do not fall within the
exclusive original arbitral jurisdiction of quasi-judicial agencies. Whether the
dispute is commercial, as defined in Section 21 of the ADR Act, or
non-commercial, it shall be settled by an arbitrator who is a private individual
appointed by the parties to hear and resolve their dispute by rendering an
award; Provided that, although a construction dispute may be commercial, it
shall continue to be governed by E.O. No. 1008, s.1985 and the rules
promulgated by the Construction Industry Arbitration Commission.

ARBITRATORS MAY BE BINDING OR NON-BINDING

48
Sec. 4, RA No. 876
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It is binding if it results in an award which is subject to confirmation and
when confirmed by a court, is subject to enforcement like any judgment of the
court.
It is non-binding if the award, by agreement of the parties or by law, is
not subject to confirmation and enforcement.

CONFIDENTIAL NATURE OF ARBITRATION PROCEEDINGS

The arbitration proceedings, including the records, evidence and the
arbitral award and other confidential information, shall be considered
privileged and confidential and shall not be published except–
1) with consent of the parties; or
2) for the limited purpose of disclosing to the court relevant
documents in cases where resort to the court is allowed herein:
Provided, however, that the court in which the action or the appeal is
pending may issue a protective order to prevent or prohibit disclosure of
documents or information containing secret processes, developments, research
and other information where it is shown that the applicant shall be materially
prejudiced by an authorized disclosure thereof.49

FORM OF ARBITRATION AGREEMENT

An arbitration agreement shall be in writing. An agreement is in writing
if it is contained in a document signed by the parties or in an exchange of
letters, telex, telegrams or other means of telecommunication which provide
a record of the agreement, or in an exchange of statements of claim and
defense in which the existence of an agreement is alleged by one party and not
denied by the other. The reference in a contract to a document containing an
arbitration clause constitutes an arbitration agreement provided that the
contract is in writing and the reference is such as to make that clause part of
the contract.50

HOW SHOULD THE ARBITRATION BE INSTITUTED?

In the case of a contract to arbitrate future controversies by the service by
either party upon the other of a demand for arbitration in accordance with
the contract.

49
Sec. 23, RA No. 9285
50
Art. 5.6, Rule 2, RA No. 876 (IRR of ADR Act)
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COMMENCEMENT OF ARBITRAL PROCEEDINGS
Where there is a prior arbitration agreement between the parties,
arbitration is deemed commenced:
 In institutional arbitration, it is commenced in accordance with
the arbitration rules of the institution agreed upon by the parties
 In ad hoc arbitration, it is commenced by the claimant upon
delivering to the respondent a demand for arbitration

STATEMENT OF CLAIM AND DEFENSE

 The claimant shall state the facts supporting his claim, the points at
issue and the relief or remedy sought
 The respondent shall state his defense
 They may submit documents they consider to be relevant
 Unless otherwise agreed upon, either party may amend or supplement
his claim or defense during the proceedings, unless the arbitral tribunal
considers it inappropriate

HEARING BY COURT
 A party aggrieved by the failure, neglect or refusal of another to
perform under an agreement in writing providing for arbitration may
petition the court for an order directing that such arbitration proceed
in the manner provided for in such agreement
 The court shall decide all motions, petitions or applications filed within
10 days after being heard by it51

STAY IN CIVIL ACTION

A party to an action may request the court before which it is pending to
stay the action and to refer the dispute to arbitration in accordance with their
arbitration agreement not later than the pre-trial conference.52

APPOINTMENT OF ARBITRATORS
HOW TO APPOINT ARBITRATOR/S?
If, in the contract for arbitration or in the submission described in section
two, provision is made for a method of naming or appointing an arbitrator or

51
Sec. 6, RA No. 876
52
Sec. 7, RA No. 876
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arbitrators, such method shall be followed; but if no method be provided
therein the Court shall designate an arbitrator or arbitrators.53
The Court shall appoint an arbitrator or arbitrators, as the case may be,
in the following instances:
(a) If the parties to the contract or submission are unable to agree
upon a single arbitrator; or
(b) If an arbitrator appointed by the parties is unwilling or unable
to serve, and his successor has not been appointed in the manner
in which he was appointed; or
(c) If either party to the contract fails or refuses to name his
arbitrator within fifteen days after receipt of the demand for
arbitration; or
(d) If the arbitrators appointed by each party to the contract, or
appointed by one party to the contract and by the proper Court,
shall fail to agree upon or to select the third arbitrator.
(e) The court shall, in its discretion appoint one or three
arbitrators, according to the importance of the controversy
involved in any of the preceding cases in which the agreement is
silent as to the number of arbitrators.
(f) Arbitrators appointed under this section shall either accept or
decline their appointments within seven days of the receipt of
their appointments. In case of declination or the failure of an
arbitrator or arbitrators to duly accept their appointments the
parties or the court, as the case may be, shall proceed to appoint
a substitute or substitutes for the arbitrator or arbitrators who
decline or failed to accept his or their appointments.54

APPOINTMENT OF ADDITIONAL ARBITRATORS

Where a submission or contract provides that two or more arbitrators
therein designated or to be thereafter appointed by the parties, may select or
appoint a person as an additional arbitrator, the selection or appointment
must be in writing. Such additional arbitrator must sit with the original
arbitrators upon the hearing.55

53
Sec. 8, RA No. 876
54
Sec. 8(f), RA No. 876
55
Sec. 9, RA No. 876
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NUMBER OF ARBITRATORS
The parties are free to determine the number of arbitrators. Failing such
determination, the number of arbitrators shall be three (3).56

QUALIFICATIONS OF ARBITRATORS
A person appointed as an arbitrator must meet the following qualifications:
1. Must be of legal age, in full enjoyment of his civil rights, knows how to
read and write;
2. Must not be related by blood or marriage within the sixth degree to
either party to the controversy;
3. Must not have or have had financial, fiduciary or other interest in the
controversy or cause to be decided or in the result of the proceeding, or
has any personal bias, which might prejudice the right of any party to a
fair and impartial award.
4. Must not act or acted as a champion of one party to the arbitration
or to advocate his cause. Parties may specify in their arbitration
agreement a nationality and, /or professional qualification for
appointment as arbitrator but the nationality or professional
qualification of an arbitrator is not required.57
Parties are free to agree on a procedure of appointing the arbitrator or
arbitrators. If there is a provision made for a method of appointing an
arbitrator or arbitrators, such method shall be followed.58
Failure such agreement,
i. In an arbitration with three (3) arbitrators, each party shall
appoint one (1) arbitrator, and the two (2) arbitrators thus
appointed shall appoint the third arbitrator; if a party fails to
appoint the arbitrator within thirty (30) days of receipt of a request
to do so from the other party, or if the two arbitrators fail to agree
on the third arbitrator within thirty (30) days of their
appointment, the appointment shall be made, upon request of a
party, by the appointing authority;
ii. In an arbitration with a sole arbitrator, if the parties are unable to
agree on the arbitrator, he/she shall be appointed, upon request of
a party, by the appointing authority.59

56
Art. 5.9, Rule 3, IRR of ADR Act
57
Sec. 10, RA No. 9285
58
Art. 5.10(b), IRR of ADR Act
59
Art. 5.10(c), IRR of ADR Act
REY ALMON T. ALIBUYOG
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CHALLENGE OF ARBITRATORS
HOW TO CHALLENGE ARBITRATORS?
Arbitrators may be challenged only for the reasons mentioned in the
preceding section which may have arisen after the arbitration agreement or
were unknown at the time of arbitration. The challenge shall be made before
them.
If they do not yield to the challenge, the challenging party may renew the
challenge before the Court of the province or city in which the challenged
arbitrator, or, any of them, if there be more than one, resides. While the
challenging incident is discussed before the court, the hearing or arbitration
shall be suspended, and it shall be continued immediately after the court has
delivered an order on the challenging incident.60

GROUNDS TO CHALLENGE ARBITRATORS

A person, who is appointed as an arbitrator notwithstanding the disclosure
made in accordance with this Article, shall reduce the disclosure to writing and
provide a copy of such written disclosure to all parties in the arbitration.
(i) Circumstances exist that give rise to justifiable doubts as to his/her
impartiality or independence;
(ii) He/she does not possess qualifications as provided for in this
Chapter or those agreed to by the parties;
(iii) He/she is disqualified to act as arbitration under these Rules;
(iv) He refuses to respond to questions by a party regarding the
nature and extent of his professional dealings with a party or its
counsel.61
If, after appointment but before or during hearing, a person appointed to
serve as an arbitrator shall discover any circumstance likely to create a
presumption of bias, or which he/she believes might disqualify him/her as an
impartial arbitrator, the arbitrator shall immediately disclose such
information to the parties. Thereafter, the parties may agree in writing:
(i) To waive the presumptive disqualifying circumstances; or
(ii) To declare the office of such arbitrator vacant. Any such vacancy shall
be filled in the same manner the original appointment was made.62

60
Sec. 11, RA No. 876
61
Art. 5.11(b), IRR of ADR Act
62
Art. 5.11(c), IRR of ADR Act
REY ALMON T. ALIBUYOG
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After initial disclosure is made and in the course of the arbitration
proceedings, when the arbitrator discovers circumstances that are likely to
create a presumption of bias, he/she shall immediately disclose those
circumstances to the parties. A written disclosure is not required where it is
made during the arbitration and it appears in a written record of the
arbitration proceedings.63
An arbitrator who has or has had financial or professional dealings with a
party to the arbitration or to the counsel of either party shall disclose in
writing such fact to the parties, and shall, in good faith, promptly respond to
questions from a party regarding the nature, extent and age of such financial
or professional dealings.64

WHEN CHALLENGED ARBITRATOR SHALL BE REPLACE

1. he/she withdraws as arbitrator, or
2. the parties agree in writing to declare the office of arbitrator vacant,
or
3. The arbitral tribunal decides the challenge and declares the office of
the challenged arbitrator vacant, or
4. The appointing authority decides the challenge and declares the office
of the challenged arbitrator vacant, or
5. In default of the appointing authority, the court decides the challenge
and declares the office of the challenged arbitrator vacant.65

FAILURE OR IMPOSSIBILITY TO ACT

If an arbitrator becomes de jure or de facto unable to perform his/her
functions or for other reasons fails to act without undue delay, his/her
mandate terminates if he/she withdraws from his/her office or if the parties
agree on the termination. Otherwise, if a controversy remains concerning any
of these grounds, any party may request the appointing authority to decide on
the termination of the mandate, which decision shall be immediately
executory and not subject to appeal or motion for reconsideration.
If, under this Article or Article 5.12 (Challenge Procedure), an arbitrator
withdraws from his/her office or a party agrees to the termination of the

63
Art. 5.11(d), IRR of ADR Act
64
Art. 5.11(e), IRR of ADR Act
65
Art. 5.11(m), IRR of ADR Act
REY ALMON T. ALIBUYOG
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mandate of an arbitrator, this does not imply acceptance of the validity of any
ground referred to sin this Article or in Article 5.12.66

APPOINTMENT OF SUBSTITUTE ARBITRATOR

Where the mandate of an arbitrator terminates under Articles 5.12
(Challenge Procedure) or 5.13 (Failure or/impossibility) or because of his
withdrawal from office for any other reason or because of the revocation of his
mandate by agreement of the parties or in any other case of termination of
his/her mandate, a substitute arbitrator shall be appointed according to the
rules applicable to the appointment of the arbitrator being replaced.67

COMPETENCE OF ARBITRAL TRIBUNAL TO RULE ON ITS JURISDICTION

When a demand for arbitration made by a party to a dispute is objected
to by the adverse party, the arbitral tribunal shall, in the first instance, resolve
the objection when made on any of the following grounds:
(i) the arbitration agreement is inexistent, void, unenforceable or not
binding upon a person for any reason, including the fact that the
adverse party is not privy to said agreement; or
(ii) The dispute is not arbitrable or is outside the scope of the
arbitration agreement; or
(iii) The dispute is under the original and exclusive jurisdiction of a court
or quasi-judicial body.68

EQUAL TREATMENT OF PARTIES

The parties shall be treated with equality and each party shall be given a
full opportunity of presenting his/her/its case.69

DETERMINATION OF RULES OF PROCEDURE

Subject to the provisions of these Rules, the parties are free to agree on the
procedure to be followed by the arbitral tribunal in conducting the
proceedings.

Failing such agreement, the arbitral tribunal may, subject to the provision
of the ADR Act, conduct the arbitration in such manner as it considers

66
Art. 5.13, IRR of ADR Act
67
Art. 5.14, IRR of ADR Act
68
Art. 5.15, IRR of ADR Act
69
Art. 5.17, IRR of ADR Act
REY ALMON T. ALIBUYOG
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appropriate. The power conferred upon the arbitral tribunal includes the
power to determine admissibility, relevance, materiality and weight of
evidence.70

PLACE OF ARBITRATION
The parties are free to agree on the place of arbitration. Failing such
agreement, the place of arbitration shall be in Metro Manila unless the arbitral
tribunal, having regard to the circumstances of the case, including the
convenience of the parties, shall decide on a different place of arbitration.
The arbitral tribunal may, unless otherwise agreed by the parties, meet at
any place it considers appropriate for consultation among its members, for
hearing witnesses, experts or the parties, or for inspection of goods, other
property or documents.71

LANGUAGE
The parties are free to agree on the language or languages to be used in the
arbitral proceedings. Failing such agreement, the language to be used shall be
English or Filipino. The language/s agreed, unless otherwise specified therein,
shall be used in all hearings and all written statements, orders or other
communication by the parties and the arbitral tribunal.

The arbitral tribunal may order that any documentary evidence shall be
accompanied by a translation into the language or languages agreed upon by
the parties in accordance with paragraph above paragraph.72

DEATH OF A PARTY
Where a party dies after making a submission or a contract to arbitrate as
prescribed in these Rules, the proceeding may be begun or continued upon the
application of, or notice to, his/her executor or administrator, or temporary
administrator of his/her estate. In any such case, the court may issue an order
extending the time within which notice of a motion to recognize or vacate an
award must be served. Upon recognizing an award, where a party has died
since it was filed or delivered, the court must enter judgment in the name of

70
Art. 5.18, IRR of ADR Act
71
Art. 5.19, IRR of ADR Act
72
Art. 5.21, IRR of ADR Act
REY ALMON T. ALIBUYOG
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the original party; and the proceedings thereupon are the same as where a
party dies after a verdict.73

MULTI-PARTY ARBITRATION
When a single arbitration involves more than two parties, these Rules, to
the extent possible, shall be used subject to such modifications consistent with
Articles 5.17 (Equal Treatment of Parties) and 5.18 (Determination of Rules
of Procedure) as the arbitral tribunal shall deem appropriate to address
possible complexities of a multi-party arbitration.
When a claimant includes persons who are not parties to or otherwise
bound by the arbitration agreement, directly or by reference, between
him/her and the respondent as additional claimants or additional respondents,
the respondent shall be deemed to have consented to the inclusion of the
additional claimants or the additional respondents unless not later than the
date of communicating his/her answer to the request for arbitration, either by
motion or by a special defense in his answer, he objects, on jurisdictional
grounds, to the inclusion of such additional claimants or additional
respondents. The additional respondents shall be deemed to have consented to
their inclusion in the arbitration unless, not later than the date of
communicating their answer to the request for arbitration, either by motion
or a special defense in their answer, they object, on jurisdictional grounds, to
their inclusion.74

CONDUCT OF ARBITRAL PROCEEDINGS

HEARING AND WRITTEN PROCEDURES
In the conduct of hearing of the arbitral tribunal, the kind of arbitration
agreement shall determine the arbitration procedures that shall be used.
When an arbitration procedure has been agreed upon by the parties prior
to the actual dispute
a) Ad hoc Arbitration. - the procedure determined by the arbitrator, with
the agreement of the parties, shall be followed.
b) Institutional Arbitration - the applicable rules of procedure of the
arbitration institution shall be followed.
When arbitration procedure has not been agreed upon prior to the actual
dispute

73
Art. 5.21, IRR of ADR Act; RA 876, Sec. 30)
74
Art.5.44, Rule 6, IRR of ADR Act
REY ALMON T. ALIBUYOG
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In case there is no agreement between the parties (in default of agreement),
arbitration procedure shall be as provided by Rule 5.23 of the IRR on
Alternative Dispute Resolution Act of 2004.

A NEED TO CONDUCT A PRE-HEARING CONFERENCE

After thirty (30) days from the appointment of the arbitrator or the
constitution of an arbitral tribunal, the arbitral tribunal shall call the parties
and their respective counsels to a pre-hearing conference to discuss the
following matters:
(i) The venue or place/s where the arbitration proceeding may be
conducted in an office space, a business center, a function room or any
suitable place agreed upon by the parties and the arbitral tribunal which
may vary per session/hearing/conference.
(ii) The manner of recording the proceedings;
(iii) The periods for the communication of the statement of claims,
answer to the claims with or without counterclaims, and answer to the
counterclaims/ and the form and contents of such pleadings;
(iv) The definition of the issues submitted to the arbitral tribunal for
determination and the summary of the claims and counterclaims of the
parties;
(v) The manner by which evidence may be offered if an oral hearing is
required, the submission of sworn written statements in lieu of oral
testimony, the cross-examination and further examination of witnesses;
(vi) The delivery of certain types of communications such as pleadings,
terms of reference, order granting interim relief, final award and the like,
if made by electronic or similar means, shall require further confirmation
in the form of a hard copy or hard copies delivered personally or by
registered post;
(vii) The issuance of a subpoena or a subpoena duces tecum by the
arbitral tribunal to compel the production of evidence if either party shall
or is likely to request it;
(viii) The manner by which expert testimony will be received if a party
will or is likely to request the arbitral tribunal to appoint one or more
experts, and in such case, the period for the submission to the arbitrator
by the requesting party of the proposed terms of reference for the expert,
the fees to be paid, the manner of payment to the expert and the deposit
by the parties or of the requesting party of such amount necessary to cover
REY ALMON T. ALIBUYOG
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all expenses associated with the referral of such issues to the expert before
the expert is appointed;
(ix) The possibility of either party applying for an order granting
interim relief either with the arbitral tribunal or with the court, and, in
such case, the nature of the relief to be applied for;
(x) The possibility of a site or ocular inspection, the purpose of such
inspection, and in such case, the date, place and time of the inspection and
the manner of conducting it, and the sharing and deposit of any associated
fees and expenses;
(xi) The amount to be paid to the arbitral tribunal as fees and the
associated costs, charges and expenses of arbitration and the manner and
timing of such payments; and
(xii) Such other relevant matters as the parties and the arbitral
tribunal may consider necessary to provide for a speedy and efficient
arbitration of the dispute.75

DISCRETION OF ARBITRAL TRIBUNAL ON OTHER RELEVANT MATTERS OF

THE PROCEEDINGS
As a general rule, to the extent possible, the arbitral tribunal and the
parties shall agree upon any such matters deemed relevant and necessary. In
default of agreement, the arbitral tribunal shall have the discretion and
authority to make the decision, although in making a decision, regard shall be
given to the views expressed by both parties.76

DATE AND TIME OF HEARING

The arbitral tribunal shall, in consultation with the parties, fix the date/s
and the time of hearing, regard being given to the desirability of conducting
and concluding an arbitration without undue delay.77

POSTPONEMENT OF HEARING
As a general rule, the hearing set shall not be postponed except with the
conformity of the arbitrator and the parties and only for a good and sufficient
cause. The arbitral tribunal may deny a request to postpone or to cancel a
scheduled hearing on the ground that a party has requested or is intending to

75
Art. 5.23(b), IRR of ADR Act
76
Art. 5.23(c), IRR of ADR Act
77
Art. 5.23(d), IRR of ADR Act
REY ALMON T. ALIBUYOG
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request from the court or from the arbitrator an order granting interim
relief.78

REPRESENTATION OF A PARTY
A party may, during the proceedings, represent himself/herself/itself or be
represented or assisted by a representative or assisted by a representative as
defined by these Rules.79

PRESENCE AND ABSENCE OF A PARTY

The hearing may proceed in the absence of a party who fails to obtain an
adjournment thereof or who, despite due notice, fails to be present, by
himself/herself/itself or through a representative, at such hearing.
An award shall not be made solely on the default of a party. The arbitrators
shall require the other party to submit such evidence as they may require for
making an award.

WHO HAS THE RIGHT TO BE PRESENT TO THE HEARING?

Only parties, their respective representatives, the witnesses and the
administrative staff of the arbitral tribunal shall have the right to be present
during the hearing. Any other person may be allowed by the arbitrator to be
present if the parties, upon being informed of the presence, interpose no
objection thereof.80

ISSUES OF JURISDICTION AND ARBITRALITY OF CLAIMS OR

COUNTER-CLAIMS
Issues raised during the arbitration proceeding relating to the following
shall be resolved by the the arbitral tribunal as threshold issues, if the parties
so request, unless they are intertwined with factual issues that they cannot be
resolved ahead of the hearing on the merits of the dispute:
a) the jurisdiction of the arbitral tribunal over one or more of the
claims or counter-claims, or
b) the arbitrality of a particular claim or counter-claim.81

ARBITRATORS’ POWER TO ISSUE SUBPOENA

78
Art. 5.23(e), IRR of ADR Act
79
Art. 5.23(f), IRR of ADR Act
80
Art. 5.23(h), IRR of ADR Act
81
Art. 5.23(i), IRR of ADR Act
REY ALMON T. ALIBUYOG
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The arbitral tribunal shall have the power to require any person to attend
a hearing as a witness. It shall have the power to subpoena witnesses, to testify
and/or produce documents when the relevancy and materiality thereof has
been shown to the arbitral tribunal. The abitral tribunal may also require the
exclusion of any witness during the testimony of any other witness.82
The law explicitly states that all of the arbitrators appointed in any
controversy must attend all the hearings in that matter and hear all the
allegations and proofs of the parties.

OATH OF ARBITRATORS
Before assuming the duties of his/her office, arbitrators must be sworn
before any officer authorized by law to administer an oath for the following
acts or duties:
1) To faithfully and fairly to hear and examine the matters in controversy;
and
2) To make a just award according to the best of their ability and
understanding.
A copy of the arbitrator’s oath and affirmation shall be furnished each
party the arbitration.83

EFFECT OF NOT TAKING OATH

Either party may object to the commencement of continuation of an
arbitration proceeding unless the arbitrator takes oath of affirmation as
required by the IRR on ADR 2004.
If the arbitrator shall refuse to take an oath or affirmation as required by
law and this Rule, he/she shall be replaced. The failure to object to the absence
of an oath of affirmation shall be deemed as a waiver of such objection and the
proceedings shall continue in due course and may not later be used as a ground
to invalidate the proceedings.84

POWER OF ARBITRATORS TO ADMINISTER OATHS OF WITNESSES

Arbitrators shall have the power to administer the oaths to all witnesses
requiring them to tell the whole truth and nothing but the truth in any

82
Art. 5.23(v), IRR of ADR; Sec. 14, RA 876
83
Art. 5.23(s), IRR of ADR Act
84
Art. 5.23(t), IRR of ADR Act
REY ALMON T. ALIBUYOG
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testimony which they may give in any arbitration hearing. This oath shall be
required of every witness before any of his testimony is heard.85

TESTIMONY OF WITNESS
Each witness shall, before giving testimony, be required to take an
oath/affirmation before the arbitral tribunal, to tell the whole truth and
nothing but the truth during the hearing.86

POWER AND DUTY TO ADMINISTER OATH OF WITNESSES

The arbitral tribunal shall have the power to administer oaths to, or require
affirmation from, all witnesses directing them to tell the truth, the whole
truth and nothing but the truth in any testimony, oral or written, which they
may give or offer in any arbitration hearing. The oath of affirmation shall be
required of every witness before his/her testimony, oral or written, is heard or
considered.87

RECORDING OF TESTIMONY OF WITNESSES

The arbitral tribunal shall arrange for the transcription of the recorded
testimony of each witness and require each party to share the cost of recording
and transcription of the testimony of each witness.

SUBMISSION OF NECESSARY DOCUMENTS AND INFORMATION

Each party shall provide the other party with a copy of each statement or
document submitted to the arbitral tribunal and shall have an opportunity to
reply in writing to the other party’s statements and proofs.88
The arbitral tribunal may require the parties to produce such other
documents or provide such information as in its judgment would be necessary
for it to render complete, fair and impartial award.89
The arbitral tribunal shall receive as evidence all exhibits submitted by a
party properly marked and identified at the time of submission.90

INQUIRY OF ADDITIONAL PROOF OR WITNESS TO BE PRESENTED BEFORE

CLOSE OF HEARING

85
Sec. 13, RA 876
86
Art. 5.23(j), IRR of ADR Act
87
Art. 5.23(u), IRR of ADR Act
88
Art. 5.23(l), IRR of ADR Act
89
Art. 5.23(m), IRR of ADR Act
90
Art. 5.23(n), IRR of ADR Act
REY ALMON T. ALIBUYOG
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At the close of the hearing, the arbitral tribunal shall specifically inquire of
all parties whether they have further proof or witnesses to present; upon
receiving a negative reply, the arbitral tribunal shall declare the hearing
closed.91
After the hearing is declared closed, no further motion or manifestation or
submission may be allowed except for post-hearing briefs and reply briefs that
the parties have agreed to submit within a fixed period after the hearing is
declared closed, or when the tribunal, motu proprio or upon request of a party,
allows the reopening of the hearing.92

Definite time limit for the filing of such briefs must be fixed by the
arbitrators at the close of the hearing. Briefs may filed by the parties within
fifteen days after the close of the oral hearings; the reply briefs, if any, shall be
filed within five days following such fifteen-day period.93

REOPENING OF HEARING
The hearing may be reopened by the arbitrators on their own motion or
upon the request of any party, upon good cause, shown at any time before the
award is rendered. When hearings are thus reopened, the effective date for the
closing of the hearings shall be the date of the closing of the reopened hearing.94

PROCEEDING IN LIEU OF HEARING

The parties to a submission or contract to arbitrate may, by written
agreement, submit their dispute to arbitration by other than oral hearing
through:
a) Submission of agreed statement of facts; or
b) Submission of their heir respective contentions to the duly
appointed arbitrators in writing and shall include a statement of
facts, together with all documentary proof; or
c) Submission of a written argument.
Each party shall provide all other parties to the dispute with a copy of all
statements and documents submitted to the arbitrators. Each party shall have
an opportunity to reply in writing to any other party's statements and proofs;
but if such party fails to do so within seven (7) days after receipt of such
statements and proofs, he shall be deemed to have waived his right to reply.

91
Art. 5.23(o), IRR of ADR Act
92
Art. 5.23(p), IRR of ADR Act
93
Sec. 16, RA 876
94
Sec. 17, RA 876
REY ALMON T. ALIBUYOG
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Upon the delivery to the arbitrators of all statements and documents,
together with any reply statements, the arbitrators shall declare the
proceedings in lieu of hearing closed.95

ARBITRATOR AS MEDIATOR
Except as provided in Section 17 (d) of the ADR Act, no arbitrator shall act
as a mediator in any proceeding in which he/she is acting as arbitrator even
if requested by the parties; and all negotiations towards settlement of the
dispute must take place without the presence of the arbitrators.96

DECISION ON INTERLOCUTORY MATTERS

Interlocutory Orders are those issued by the tribunal while the arbitral
proceeding is still pending. These orders are not meant to be final.
Decisions on interlocutory matters shall be made by the sole arbitrator or
by the majority of the arbitral tribunal. The arbitral tribunal may authorize its
chairman to issue or release, on behalf of the arbitral tribunal, its decision on
interlocutory matters.

POWER OF ARBITRAL TRIBUNAL TO ORDER INTERIM MEASURES.

The rules in Interim Measures in Domestic Arbitration is similar to those of
International Arbitration.

INTERIM MEASURE DEFINED

Interim Measure is any temporary measure, whether in the form of an
award or in another form, by which, at any time prior to the issuance of an
award by which the dispute is finally decided.97

POWER OF THE ARBITRAL TRIBUNAL

The arbitral tribunal may, at the request of a party order any party to take
such interim measures of protection as the arbitral tribunal may consider
necessary in respect of the subject matter of the dispute or the procedure.98

RULES ON INTERIM OR PROVISIONAL RELIEF

95
Sec. 18, RA 876
96
Art. 5.23(r), IRR of ADR Act
97
Art. 17(2) on UNCITRAL Model Law)
98
Art. 5.23(r), IRR of ADR Act
REY ALMON T. ALIBUYOG
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The arbitrator or arbitrators shall have the power at any time, before
rendering the award, without prejudice to the rights of any party to petition
the court to take measures to safeguard and/or conserve any matter which is
the subject of the dispute in arbitration.
An Interim measure may be granted:
a. To prevent irreparable loss or injury;
b. To provide security for the performance of an obligation;
c. To produce or preserve evidence; or
d. To compel any other appropriate act or omissions.99

ORDER OF ARBITRAL TRIBUNAL

The order granting provisional relief may be conditioned upon the provision
of security or any act or omission specified in the order.
Form of Request:
1) The request shall be in writing and transmitted by reasonable
means to the arbitral tribunal.
2) A copy shall be provided to the party against whom relief is
sought

Contents of Request:
a) It shall describe the appropriate detail of the precise relief
b) The party against whom the relief is requested
c) The ground for the relief
d) The evidence supporting the request

RELIEF SOUGHT IN COURT

The grant of an interim relief shall not prejudice the rights of any party to
petition the court to take measure to safeguard and conserve any matter
which is the subject of the dispute in arbitration.100

DEFAULT OF A PARTY
When is a party considered in default
In case of a Claimant:

99
Sec. 14, RA 876
100
Art. 5.23(r), IRR of ADR Act
REY ALMON T. ALIBUYOG
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When the claimant fails to communicate his/her/its statement of claim in
accordance with paragraph (a) of Article 5.22 (Statements of Claim and
Defense), the arbitral tribunal shall terminate the proceedings.
In case of a Respondent:
The respondent fails to communicate his/her/its statement of defense in
accordance with paragraph (a) of Article 5.22 (Statements of Claim and
Defense), the arbitral tribunal shall continue the proceedings without treating
such failure in itself as an admission of the claimant's allegations;
Other cases:
Any party may be considered in default if he/she/it :
a) fails to appear at a hearing; or
b) fails to produce documentary evidence

EFFECT OF DEFAULT OF A PARTY

In such case, the arbitral tribunal may continue the proceedings and make
the award based on the evidence before it.101

EXPERT APPOINTED BY THE ARBITRAL TRIBUNAL.

EXPERT DEFINED
An expert is a person that had knowledge and skills learned over years of
experience in a subject. Their opinion can be helpful in problem solving.

POWER OF THE ARBITRAL TRIBUNAL TO APPOINT AND REQUIRE AN

EXPERT
Unless otherwise agreed by the parties, the arbitral tribunal:
a) may appoint one or more experts to report to it on specific issues to
be determined by the arbitral tribunal; or
b) may require a party to give the expert any relevant information or
to produce, or to provide access to, any relevant documents, goods
or other property for his/her inspection.
Unless otherwise agreed by the parties, if a party so requests or if the
arbitral tribunal considers it necessary, the expert shall, after delivery of
his/her written or oral report, participate in a hearing where the parties have
the opportunity to put questions to him/her and to present expert witnesses
in order to testify on the points at issue.

101
Art. 5.2(c), IRR of ADR Act
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Upon agreement of the parties, the finding of the expert engaged by the
arbitral tribunal on the matter/s referred to him shall be binding upon the
parties and the arbitral tribunal.

COURT ASSISTANCE IN TAKING EVIDENCE AND OTHER MATTERS.

ASSISTANCE IN TAKING EVIDENCE
The arbitral tribunal or a party, with the approval of the arbitral tribunal
may request from a court, assistance in taking evidence such as the issuance of
subpoena ad testificandum, and subpoena duces tecum, deposition taking, site
or ocular inspection, and physical examination of properties. The court may
grant the request within its competence and according to its rules on taking
evidence.102

ASSISTANCE IN ENFORCING INTERLOCUTORY ORDER OF THE ARBITRAL

TRIBUNAL
The arbitral tribunal or a party to the dispute interested in enforcing an
order of the arbitral tribunal may request from a competent court, assistance
in enforcing orders of the arbitral tribunal, including but not limited, to the
following:
a) Interim or provisional relief;
b) Protective orders with respect to confidentiality;
c) Orders of the arbitral tribunal pertaining to the subject matter
of the dispute that may affect third persons and/or their
properties; and/or
d) Examination of debtors.

RULES APPLICABLE TO THE SUBSTANCE OF DISPUTE.

The arbitral tribunal shall decide the dispute in accordance with such law
as is chosen by the parties. In the absence of such agreement, Philippine law
shall apply.103
The arbitral tribunal may grant any remedy or relief which it deems just
and equitable and within the scope of the agreement of the parties, which shall
include, but not be limited to, the specific performance of a contract.104

102
Art. 5.27(a), IRR of ADR Act
103
Art. 5.28(a), IRR of ADR Act
104
Art. 5.27(b), IRR of ADR Act
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In all cases, the arbitral tribunal shall decide in accordance with the terms
of the contract and shall take into account the usages of the trade applicable
to the transaction.105

TIME FOR RENDERING AWARD

Unless the parties shall have stipulated by written agreement the time
within which the arbitrators must render their award, the written award of
the arbitrators shall be rendered within thirty days after the closing of the
hearings or if the oral hearings shall have been waived, within thirty days after
the arbitrators shall have declared such proceedings in lieu of hearing closed.
This period may be extended by mutual consent of the parties.

FORM AND CONTENTS OF AN ARBITRAL AWARD

The award must be made in writing and signed and acknowledged by a
majority of the arbitrators, if more than one; and by the sole arbitrator, if
there is only one. Each party shall be furnished with a copy of the award. The
arbitrators in their award may grant any remedy or relief which they deem
just and equitable and within the scope of the agreement of the parties, which
shall include, but not be limited to, the specific performance of a contract.106
In the event that the parties to an arbitration have, during the course of
such arbitration, settled their dispute, they may request of the arbitrators that
such settlement be embodied in an award which shall be signed by the
arbitrators.
The arbitrators shall have the power to decide only those matters which
have been submitted to them. The terms of the award shall be confined to such
disputes.
The arbitrators shall have the power to assess in their award the expenses
of any party against another party, when such assessment shall be deemed
necessary.

CONFIRMATION OF ARBITRAL AWARD

At any time within one month after the award is made, any party to the
controversy which was arbitrated may apply to the court having jurisdiction,
as provided in section twenty-eight, for an order confirming the award; and
thereupon the court must grant such order unless the award is vacated,

105
Art. 5.27(c), IRR of ADR Act
106
Art. 5.31, IRR of ADR Act
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modified or corrected, as prescribed herein. Notice of such motion must be
served upon the adverse party or his attorney as prescribed by law for the
service of such notice upon an attorney in action in the same court.

GROUNDS FOR VACATING AWARD

The arbitral award may be questioned, vacated or set aside by the
appropriate court only on the following grounds:
 The award was procured by corruption, fraud, or other undue
means; or
 That there was evident partiality or corruption in the arbitrators or
any of them; or
 That the arbitrators were guilty of misconduct
 That the arbitrators exceeded their powers
Where a petition to vacate or set aside an award is filed, the petitioner
may simultaneously, or the oppositor may in the alternative, petition the court
to remit the case to the same arbitral tribunal for the purpose of making a new
or revised final and definite award or to direct a new hearing before the same
or new arbitral tribunal, the members of which shall be chosen in the manner
originally provided in the arbitration agreement or submission.
Where a party files a petition with the court to vacate or set aside an award
by reason of omission/s that do not affect the merits of the case and may be
cured or remedied, the adverse party may oppose that petition and instead
request the court to suspend the vacation or setting aside proceedings for a
period of time to give the arbitral tribunal an opportunity to cure or remedy
the award or resume the arbitration proceedings or take such other action as
will eliminate the grounds for vacation or setting aside.107

GROUNDS FOR MODIFYING OR CORRECTING AWARD

 Where there was an evident miscalculation of figures, or an evident
mistake in the description of any person, thing or property referred
to in the award; or
 Where the arbitrators have awarded upon a matter not submitted
to them, no affecting the merits of the decision upon the matter
submitted;

107
Rule 5, Art. 5.35, IRR of ADR)
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 Where the award is imperfect in a matter of form not affecting the
merits of the controversy, and if it had been a commissioner’s report,
the defect could have been amended or disregard by the court.108

MOTION TO VACATE, MODIFY OR CORRECT AWARD; WHEN MADE

 Notice of a motion to vacate, modify, or correct the award must be
served upon the adverse party or his counsel within 30 days after
the award is filed or delivered, as prescribed by law for the service
upon an attorney in action.109

FEES OF ARBITRATION
The fees of the arbitrators shall be fifty pesos per day unless the parties
agree otherwise in writing prior to the arbitration.110

FEES AND COSTS

The fees of the arbitrators shall be agreed upon by the parties and the
arbitrator/s in writing prior to the arbitration. In default of agreement of the
parties as to the amount and manner of payment of arbitrator's fees, the
arbitrator's fees shall be determined in accordance with the applicable internal
rules of the regular arbitration institution under whose rules the arbitration is
conducted; or in ad hoc arbitration, the Schedule of Fees approved by the IBP,
if any, or in default thereof, the Schedule of Fees that may be approved by the
OADR.
The arbitral tribunal shall fix the costs of arbitration in its award. The term
"costs" include only:
(i) The fees of the arbitral tribunal to be stated separately as to each
arbitrator and to be fixed by the arbitral tribunal itself in accordance
with this Article;
(ii) The travel and other expenses incurred by the arbitrators;
(iii) The costs of expert advice and of other assistance required by the
arbitral tribunal, such as site inspection and expenses for the recording
and transcription of the arbitration proceedings;
(iv) The travel and other expenses of witnesses to the extent such
expenses are approved by the arbitral tribunal;

108
Sec. 25, RA 876
109
Sec. 26, RA 876
110
Sec. 21, RA 9285
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(v) The costs for legal representation and assistance of the successful
party if such costs were claimed during the arbitral proceedings, and
only to the extent that the arbitral tribunal determines that the
amount
of such costs is reasonable;
(vi) Any fees and expenses of the appointing authority.
The fees of the arbitral tribunal shall be reasonable in amount, taking into
account the amount in dispute, the complexity of the subject matter, the time
111
spent by the arbitrators and any other relevant circumstances of the case.

JUDGMENT
Upon the granting of an order confirming, modifying or correcting an
award, judgment may be entered in conformity therewith in the court
wherein said application was filed. Costs of the application and the proceedings
subsequent thereto may be awarded by the court in its discretion. If awarded,
the amount thereof must be included in the judgment.112
Upon the grant of an order confirming, modifying or correcting an award,
judgment may be entered in conformity therewith in the court where said
application was filed. Costs of the application and the proceedings subsequent
thereto may be awarded by the court in its discretion. If awarded, the amount
thereof must be included in the judgment. Judgment will be enforced like court
judgments.113

MOTION TO CONFIRM, MODIFY, CORRECT, OR VACATE AWARD

Papers to accompany the motion:
The party moving for an order confirming, modifying, correcting, or
vacating an award, shall at the time that such motion is filed with the court
for the entry of judgment thereon also file the following papers with the Clerk
of Court;
(a) The submission, or contract to arbitrate; the appointment of
the arbitrator or arbitrators; and each written extension of the time, if
any, within which to make the award.
(b) A verified of the award.

111
Art. 5.46, IRR of ADR
112
Sec. 27, RA No. 9285
113
Rule 6, Art. 5.37, IRR of ADR
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(c) Each notice, affidavit, or other paper used upon the application
to confirm, modify, correct or vacate such award, and a copy of
each of the court upon such application.
The judgment shall be docketed as if it were rendered in an action.
The judgment so entered shall have the same force and effect in all respects,
as, and be subject to all the provisions relating to, a judgment in an action; and
it may be enforced as if it had been rendered in the court in which it is
entered.114

APPEALS
HOW APPEAL IS TAKEN?
An appeal may be taken from an order made in a proceeding under this
Act, or from a judgment entered upon an award through certiorari
proceedings, but such appeals shall be limited to questions of law. The
proceedings upon such an appeal, including the judgment thereon shall be
governed by the Rules of Court in so far as they are applicable.115
A decision of the court confirming, vacating, setting aside, modifying or
correcting an arbitral award may be appealed to the Court of Appeals in
accordance with Special ADR Rules. The losing party who appeals from the
judgment of the Court confirming an arbitral award shall be required by the
Court of Appeals to post a counter-bond executed in favor of the prevailing
party equal to the amount of the award in accordance with the Special ADR
Rules.116

VENUE AND JURISDICTION

Proceedings for recognition and enforcement of an arbitration agreement
or for vacation or setting aside of an arbitral award, and any application with
a court for arbitration assistance and supervision, except appeal, shall be
deemed as special proceedings and shall be filed with the court:
(a) Where the arbitration proceedings are conducted;
(b) Where the asset to be attached or levied upon or the act to be
enjoined is located;
(c) Where any of the parties to the dispute resides or has its place
of business; or

114
Sec. 28, RA 9285
115
Sec. 29, RA 9285
116
Rule 6, Art. 5.38, IRR of ADR Act
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(d) In the National Capital Judicial Region at the option of the
applicant.
An agreement to refer a dispute to arbitration shall mean that the arbitral
award shall be final and binding. Consequently, a party to arbitration is
precluded from filing an appeal or a petition for certiorari questioning the
merits of an arbitral award.117

VACATE OR SET ASIDE DECISION

As a general rule, the court can only vacate or set aside the decision of an
arbitral tribunal upon a clear showing that the award suffers from any of the
infirmities or grounds for vacating an arbitral award. The court shall not set
aside or vacate the award of the arbitral tribunal merely on the ground that
the arbitral tribunal committed errors of fact, or of law, or of fact and law,
as the court cannot substitute its judgment for that of the arbitral tribunal.

MOTION FOR RECONSIDERATION

An aggrieved party may file a motion for reconsideration of the order of
the court. The decision of the court shall, however, not be subject to appeal. The
ruling of the court affirming the arbitral tribunal's jurisdiction shall not be
subject to a petition for certiorari.
The ruling of the court that the arbitral tribunal has no jurisdiction may be
the subject of a petition for certiorari.
The following are proper grounds for a motion for reconsideration:
1. That the arbitration agreement is inexistent, invalid unenforceable;
2. Upholding or reversing the arbitral tribunal's jurisdiction;
3. Denying a request to refer the parties to arbitration.
4. Granting or denying a party an interim measure' of protection;
5. Denying a petition for the appointment of an arbitrator;
6. Refusing to grant assistance in taking evidence;
7. Enjoining or refusing to enjoin a person from divulging confidential
information;
8. Domestic arbitral.118

INTERNATIONAL COMMERCIAL ARBITRATION

117
Rule 6, Art. 5.39, IRR of ADR Act
118
A.M. No. 07-11-08-SC
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International commercial arbitration is governed by the Model Law on
International Commercial Arbitration. In interpreting the Model Law, its
international origin and the need for uniformity in its interpretation shall be
considered. The IRR of the ADR Act applies only if the place or seat of
arbitration is the Philippines and in default of any agreement of the parties on
the applicable rules.119

DEFINITION OF TERMS
1. COMMERCIAL ARBITRATION- covers matter arising from all
relationships of a commercial nature, whether contractual or not.
Relationships of a transactions: any trade transaction for the supply or
exchange of goods or services; distribution agreements; construction of works;
commercial representation or agency; factoring; leasing, consulting;
engineering; licensing; investment; financing; banking; insurance; joint
venture and other forms of industrial or business cooperation; carriage of
goods or passengers by air, sea, rail or road.120
2. INTERNATIONAL ARBITRATION
i. The parties to an arbitration agreement have, at the time of the
conclusion of that agreement, their places of business in different
states; or
ii. One of the following places is situated outside the Philippines in
which the parties have their places of business:
a) The place of arbitration if determined in, or pursuant to, the
arbitration agreement;
b) Any place where a substantial part of the obligations of the
commercial relationship is to be performed or the place with
which the subject matter of the dispute is most closely
connected; or
iii. The parties have expressly agreed that the subject matter of the
arbitration agreement relates to more than one country.121

CONFIDENTIAL NATURE OF ARBITRATION

Information obtained in arbitration proceedings, including the records,
evidence and the arbitral award, is confidential and shall not be published. It

119
Sec. 19, RA No. 9285
120
Sec. 21, RA No. 9285
121
DOJ Circular No. 98, s. 2009, Chap. 1, Rule 2, Art. 1.6(C)(8)
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may be published only with the consent of the parties, or for disclosing to the
court of relevant documents in cases where resort to the court is allowed.122

THE ARBITRATION PROCESS

REFERRAL TO ARBITRATION
An arbitration proceeding is not mandatory because it is subject to the will
of the parties to a controversy. It is strictly consensual.
A court before which an action is brought in a matter which is subject
matter of an arbitration shall, if at least one party so requests not later than
the pre-trial conference, or upon the request of both parties thereafter, refer
the parties to arbitration unless if finds that the arbitration agreement is null
and void, inoperative or incapable of being performed.123

INTERIM MEASURE OF PROTECTION

Provisional relief may be granted to prevent irreparable loss or injury, to
provide security for the performance of any obligation, to produce or preserve
any evidence or to compel any other appropriate act or omission. A party may
request, before constitution of the tribunal, from a Court an interim measure
of protection and the Court may grant such measure.124

PLACE OF ARBITRATION
The parties are free to agree on the place of arbitration. If the parties do
not agree on a place, it shall be in Metro Manila, unless the tribunal decides on
a different place of arbitration, considering the circumstances of the case and
the convenience of the parties.125

LANGUAGE OF THE ARBITRATION

Parties are free to agree on the language/s to be used in the arbitral
proceedings. If the parties do not agree on a language, English shall be used,
unless the tribunal shall determine differently.126

JUDICIAL REVIEW IN FOREIGN ARBITRAL AWARDS

122
Sec. 23, RA No. 9285
123
Sec. 24, RA No. 9285
124
Sec. 28, RA No. 9285
125
Sec. 30, RA No. 9285
126
Sec. 31, RA No. 9285
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An arbitration clause stipulating that the award is final and binding oust
our courts of jurisdiction as the award is not absolute and without exceptions
and still judicially reviewable.127

GROUNDS FOR JUDICIAL REVIEW

For foreign or international arbitral awards, it must be first confirmed by
the RTC, the grounds for setting aside, rejecting or vacating the award are
provided under the Model Law.
For final domestic arbitral awards, it need the confirmation of the RTC and
shall be recognized as final and executory decisions of the RTC, may only be
assailed before the RTC and vacated on the grounds under RA 876.

ARBITRAL TRIBUNAL
Parties are free to determine the number of arbitrators. Failing such
determination, it shall be three (3).128

APPOINTMENT OF ARBITRATORS
No person shall be precluded by reason of his/her nationality from acting
as an arbitrator, unless otherwise agreed by the parties.
The parties are free to agree on a procedure of appointing the arbitrator/s.
Failing such agreement in an arbitration with three (3) arbitrators, each party
shall appoint one (1) arbitrator, and the two (2) arbitrators thus appointed
shall appoint the third arbitrator.
Note: In case of failure to follow such procedure, the appointing authority
shall appoint the arbitrator.129

GROUNDS FOR CHALLENGE OF APPOINTMENT OF ARBITRATORS

1. Circumstances exist that give rise to justifiable doubts as to his/her
impartiality or independence; or
2. He/she does not possess qualifications agreed by the parties.130

CHALLENGE PROCEDURE
1. A party who intends to challenge shall send a written statement of the
reasons for the challenge to the tribunal;

127
Korea Technologies Co., LTD vs. Lerma, GR No. 143581, January 7, 2008
128
DOJ Circular No. 98, s. 2009, Chap. 4, Rule 3, Art. 4.10
129
DOJ Circular No. 98, s. 2009, Chap. 4, Rule 3, Art. 4.11
130
DOJ Circular No. 98, s. 2009, Chap. 4, Rule 3, Art. 4.12
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2. Unless the arbitrator withdraws or the other party agrees, the tribunal
shall decide on the challenge;
3. If challenge is unsuccessful, the challenging party may request the
appointing authority to decide on the challenge;
4. The decision of the appointing authority shall be immediately executory
and not subject to MR or appeal;
5. While the challenge is pending, the challenged arbitrator may however
continue the proceedings and make an award.131

FAILURE OR IMPOSSIBILITY TO ACT BY THE ARBITRATOR

If an arbitrator becomes de jure or de facto unable to perform his/her
functions or for other reasons fails to act without undue delay, his/her
mandate terminates if he/she withdraws from his/her office or if the parties
agree on the termination. Otherwise, if a controversy remains concerning any
of these grounds, any party may request the appointing authority to decide on
the termination of the mandate, which decision shall be immediately
executory and not subject to motion for reconsideration or appeal.
If an arbitrator withdraws from his/her office or a party agrees to the
termination of the mandate of an arbitrator, this does not imply acceptance
of the validity of any ground.132

APPOINTMENT IF SUBSTITUTE ARBITRATOR

When the mandate of an arbitrator terminates under the challenge
procedure or failure or impossibility to act or because of withdrawal from office
or by revocation of the parties, a substitute arbitrator shall be appointed.133

JURISDICTION OF ARBITRAL TRIBUNAL

The tribunal may rule on its own jurisdiction, including any objections with
respect to the existence or validity of the agreement or any condition
precedent to the filing of a request for arbitration.
A plea that the tribunal does not have jurisdiction shall be raised not later
than the submission of the statement of defense.

DETERMINATION OF RULES OF PROCEDURE

131
DOJ Circular No. 98, s. 2009, Chap. 4, Rule 3, Art. 4.13
132
Rule 3, Art. 4.14 IRR of ADR Act
133
DOJ Circular No. 98, s. 2009, Chap. 4, Rule 3, Art. 4.15
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Parties are free to agree on the procedure to be followed. Failing such
agreement, the tribunal may, conduct the arbitration in such manner it
considers appropriate.
A party is not estopped from invoking the jurisdiction of the tribunal by the
fact that he has appointed or participated in the appointment of an
arbitrator.134

STATEMENTS OF CLAIM AND DEFENSE

The claimant shall state the facts supporting the claim, the points at issue
and the relief or remedy sought.
The respondent shall state its defense in respect of these particulars, unless
the parties have otherwise agreed as to the required elements of such
statements.
Unless otherwise agreed, either party may amend or supplement his claim
or defense during the course of the proceedings, unless the tribunal considers
it inappropriate.135

HEARING AND WRITTEN PROCEEDINGS

Subject to any contrary agreement by the parties, the tribunal shall decide
whether to hold oral hearings for presentation of evidence or for oral
argument. Or whether the proceedings shall be conducted on the basis of
documents and other materials. However, the tribunal shall hold hearings at
any stage if a party requests.136

DEFAULT OF A PARTY
The following rules shall apply in cases of default, unless otherwise agreed
by the parties, if without showing sufficient cause:
1. When the claimant fails to communicate his statement of claim, the
tribunal shall terminate the proceedings;
2. When the respondent fails to communicate his statement of defense,
the proceedings shall continue without treating such failure in itself as an
admission to the claimant’s allegations;

134
DOJ Circular No. 98, s. 2009, Chap. 4, Rule 3, Art. 4.19
135
DOJ Circular No. 98, s. 2009, Chap. 4, Rule 3, Art. 4.23
136
DOJ Circular No. 98, s. 2009, Chap. 4, Rule 3, Art. 4.24
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3. When any party fails to appear at a hearing or to produce
documentary evidence, the tribunal may continue the proceedings and
make on award based on the submitted evidence.137

EXPERT APPOINTED BY THE ARBITRAL TRIBUNAL

Unless otherwise agreed by the parties, the arbitral tribunal may:
1. Appoint one or more experts to report to it on specific issues to be
determined by the tribunal; or
2. Require a party to give the expert any relevant information or to
produce, or to provide access to, any relevant documents, goods or other
property for his inspection.138

COURT ASSISTANCE IN TAKING EVIDENCE

The tribunal or a party with the approval of the tribunal may request from
a court of the Philippines assistance in taking evidence and the court may
execute the request within its competence and according to its rule on taking
evidence.139

SETTLEMENT
If, during arbitral proceedings, the parties settle the dispute, the tribunal
shall terminate the proceedings.140

FORM AND CONTENTS OF AWARD

1. The award shall be made in writing and shall be signed by the
arbitrator/s;
2. If more than one arbitrator, the signatures of the majority of all
members shall suffice and the reason for any omitted signature is stated;
3. The award shall state the reasons upon it is based, unless otherwise
agreed by the parties;
4. The award shall state its date and place of arbitration, and the place
shall be deemed to have been made there; and
5. After the award is made, a copy signed by the arbitrators shall be
delivered to each party.141

137
DOJ Circular No. 98, s. 2009, Chap. 4, Rule 3, Art. 4.25
138
DOJ Circular No. 98, s. 2009, Chap. 4, Rule 3, Art. 4.26
139
DOJ Circular No. 98, s. 2009, Chap. 4, Rule 3, Art. 4.27
140
DOJ Circular No. 98, s. 2009, Chap. 4, Rule 3, Art. 4.30
141
DOJ Circular No. 98, s. 2009, Chap. 4, Rule 3, Art. 4.31
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TERMINATION OF PROCEEDINGS
The arbitral proceedings are terminated by the final award or by an order
of the tribunal. An order of termination is issued when:
1. The claimant withdraws his claim, unless the respondent objects
thereto and the tribunal recognized a legitimate interest on his part in
obtaining a final settlement of the dispute;
2. The parties agree on the termination;
3. The tribunal finds that the continuation of the proceedings has for
any other reason become unnecessary or impossible.142

CORRECTION AND INTERPRETATION OF AWARD, ADDITIONAL AWARD

Within 30 days of receipt of the award, unless another period of time has
been agreed upon by the parties, a party, with notice to the other party, may
request the arbitral tribunal to correct in the award any errors in computation,
any clerical or typographical errors or any errors of similar nature. The
arbitral tribunal may correct any error on its own initiative within thirty days
of the date of the award.
Unless otherwise agreed by the parties, a party, with notice to the other
party, may request, within thirty days of receipt of the award, the arbitral
tribunal to make an additional award as to claims presented in the arbitral
proceedings but omitted from the award. If the arbitral tribunal considers the
request to be justified, it shall make the additional award within sixty days.143

HOW INTERPRETATION OF AWARD MAY BE GIVEN

If so agreed by the parties, a party, with notice to the other party, may
request the arbitral tribunal to give an interpretation of a specific point or part
of the award.
If the arbitral tribunal considers the request to be justified, it shall make the
correction or give the interpretation within thirty days of receipt of the
request. The interpretation shall form part of the award.
The arbitral tribunal may extend, if necessary, the period of time within
which it shall make a correction, interpretation or an additional award.

142
DOJ Circular No. 98, s. 2009, Chap. 4, Rule 3, Art. 4.32
143
DOJ Circular No. 98, s. 2009, Chap. 4, Rule 3, Art. 4.33
REY ALMON T. ALIBUYOG
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RECOURSE AGAINST AWARD

It can only be made by an application for setting aside in accordance of
the following:
a. An arbitral award may be set aside by the court only if the party
making the application furnishes proof that:
 A party to the arbitration agreement was under incapacity or
the said agreement is not valid under the law to which the
parties have subjected it or failing any indication thereon,
under the law of this State
 the party making the application was not given proper
notice of the appointment of an arbitrator or of the arbitral
proceedings or was otherwise unable to present his case
 the award deals with a dispute not contemplated by or not
falling within the terms of the submission to arbitration, or
contains decisions on matters beyond the scope of the
submission to arbitration, provided that, if the decisions on
matters submitted to arbitration can be separated from those
not so submitted, only that part of the award which contains
decisions on matters not submitted to arbitration may be set
aside
 the composition of the arbitral tribunal or the arbitral
procedure was not in accordance with the agreement of the
parties, unless such agreement was in conflict with a provision
of this Law from which the parties cannot derogate, or, failing
such agreement, was not in accordance with this Law
b. When the court finds that:
 the subject-matter of the dispute is not capable of settlement
by arbitration under the law of this State
 the award is in conflict with the public policy of this State144

GROUNDS FOR MODIFYING OR CORRECTING AWARD

144
Art. 4.34, IRR of ADR Act
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1. Where there was an evident miscalculation of figures, or an evident
mistake in the description of any person, thing or property referred to in the
award;
2. Where the arbitrators have awarded upon a matter not submitted to
them, not affecting the merits of the decision upon the matter submitted; or
3. Where the award is imperfect in a matter of form not affecting the
merits of the controversy, and if it had been a commissioner's report, the
defect could have been amended or disregarded by the court.
An application for setting aside may not be made after three months have
elapsed from the date on which the party making that application had
received the award or, if a request had been made under correction and
interpretation of award (article 33), from the date on which that request had
been disposed of by the arbitral tribunal.
The court, when asked to set aside an award, may, where appropriate and
so requested by a party, suspend the setting aside proceedings for a period of
time determined by it in order to give the arbitral tribunal an opportunity to
resume the arbitral proceedings or to take such other action as in the arbitral
tribunal’s opinion will eliminate the grounds for setting aside.

RECOGNITION AND ENFORCEMENT OF AWARDS

An arbitral award, irrespective of the country in which it was made, shall
be recognized as binding and, upon application in writing to the competent
court shall be enforced subject to the provisions pertaining to the grounds for
refusing recognition or enforcement.
The party relying on an award or applying for its enforcement shall supply
the original award or a copy thereof. If the award is not made in an official
language of this State, the court may request the party to supply a translation
thereof into such language.145

GROUNDS FOR REFUSING RECOGNITION OR ENFORCEMENT

Irrespective of the country in which it was made, it will be refused only on
the following grounds.
1. At the request of the party against whom it is invoked, if that party
furnishes to the competent court where recognition or enforcement is
sought proof that:

145
Art. 4.35, IRR of ADR Act
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 a party to the arbitration agreement was under some
incapacity; or the said agreement is not valid under the law to
which the parties have subjected it or, failing any indication
thereon, under the law of the country where the award was
made
 the party against whom the award is invoked was not given
proper notice of the appointment of an arbitrator or of the
arbitral proceedings or was otherwise unable to present his case
 the award deals with a dispute not contemplated by or not
falling within the terms of the submission to arbitration, or it
contains decisions on matters beyond the scope of the
submission to arbitration, provided that, if the decisions on
matters submitted to arbitration can be separated from those
not so submitted, that part of the award which contains
decisions on matters submitted to arbitration may be
recognized and enforced
 the composition of the arbitral tribunal or the arbitral
procedure was not in accordance with the agreement of the
parties or, failing such agreement, was not in accordance with
the law of the country where the arbitration took place
 The award has not yet become binding on the parties or has
been set aside or suspended by a court of the country in which,
or under the law of which, that award was made.
2. If the court finds that
 the subject-matter of the dispute is not capable of
settlement by arbitration under the law of this State

If an application for setting aside or suspension of an award has been made

to a court, the court where recognition or enforcement is sought may, if it
considers it proper, adjourn its decision and may also, on the application of the
party claiming recognition or enforcement of the award, order the other party
to provide appropriate security.146

CONSTRUCTION INDUSTRY ARBITRATION LAW (EO No. 1008)

146
Art. 4.36, IRR of ADR Act
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This law covers construction disputes which fall within the original and
exclusive jurisdiction of the Construction Industry Arbitration Commission
(CIAC) shall include those between or among parties to, or who are otherwise
bound by, an arbitration agreement, directly or by reference whether such
parties are project owner, contractor, subcontractor, quantity surveyor,
bondsman or issuer of an insurance policy in a construction project.
The Commission shall continue to exercise original and exclusive jurisdiction
over construction disputes although the arbitration is commercial pursuant to
Section 21 of the R.A. 9825 or Alternative Dispute Resolution.147

SALIENT FEATURES:
1. Construction arbitration cases are decided by a single arbitrator or an
arbitral tribunal nominated by the parties from the roster of CIAC-
accredited arbitrators.
2. The prevailing rules of evidence in the courts of law need not be
controlling as the arbitrators will use all reasonable means to ascertain
the facts in each case speedily and objectively in the interest of
substantive due process.
3. Arbitral awards are final and binding upon the parties and are not
subject to judicial confirmation. They are enforced by writ of execution
issued by the arbitrator/s as soon as the awards become executory.

JURISDICTION:
Construction arbitration shall cover, among others, dispute(s) arising from:
 Violations of specifications for materials and workmanship;
 Violations of terms of agreement;
 Interpretation and/or application of contractual provisions;
 Commencement time and delays;
 Maintenance and defects;
 Payment defaults of employer or contractor; and 7. Changes in contract
costs.
Exception:
 disputes arising from employer-employee relationships148

CONDITION FOR EXERCISE OF JURISDICTION

147
Rule 2, IRR of CIAC Law
148
Sec. 4, EO No. 1008
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For the CIAC to acquire jurisdiction, the parties to a dispute must be bound
by an arbitration agreement in their contract or subsequently agree to submit
the same to voluntary arbitration.
a. Such arbitration agreement or subsequent submission must be alleged in
the Complaint. Such submission may be an exchange of communication
between the parties or some other form showing that the parties have
agreed to submit their dispute to arbitration. Copies of such
communication or other form shall be attached to the Complaint.
b. If the Complaint is filed without the required arbitration clause or
subsequent submission, the CIAC Secretariat shall within three (3) days
from such filing, notify the Respondent that, if he/it is willing to have the
dispute be resolved by arbitration, such agreement must be clearly
expressed in the Answer.
c. Respondent’s refusal to Answer the Complaint or the filing of a Motion
to Dismiss for lack of jurisdiction shall be deemed a refusal to submit to
arbitration. In either case, the Commission (CIAC) shall dismiss the
Complaint without prejudice to its refiling upon a subsequent submission.
(CIAC Resolution No. 15-2006)

JURISDICTIONAL CHALLENGE
A motion to dismiss based on lack of jurisdiction shall be resolved by the
appointed arbitral tribunal.
The Arbitral Tribunal shall have full authority to resolve all issues raised in
the Motion to Dismiss for lack of jurisdiction on the grounds that the dispute
is not a construction dispute, or that the Respondent was represented by one
without capacity to enter into a binding arbitration agreement, or that said
agreement or submission is not valid for some other reasons, or does not cover
the particular dispute sought to be arbitrated or other issues of interpretation
or non-fulfillment of pre-conditions to arbitration that are raised therein.

NON-WAIVER OF JURISDICTIONAL CHALLENGE

A party does not waive its right to challenge the jurisdiction of CIAC by any
of the following acts:
a. participating in the nomination process including challenging the
qualifications of a nominee;
b. praying for extension of time to file appropriate pleading/motion to
dismiss;
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c. opposing an application for interim relief;
d. filing of a motion to dismiss/suspend

COMPOSITION OF THE BOARD

 Chairman
 2 members149

FUNCTIONS:
1. To formulate and adopt an arbitration program for the construction
industry;
2. To enunciate policies and prescribe rules and procedures for construction
arbitration;
3. To supervise the arbitration program, and exercise such authority
related thereto as regards the appointment, replacement or challenging
of arbitrators; and
4. To direct its officers and employees to perform such functions as may be
assigned to them from time to time.150

COMPENSATION OF THE COMMISSION

The members of the Commission shall receive such per diems and
allowances as may be fixed by the CIAP from time to time.151

TERM
The term of office of the members of the Commission shall be six (6) years;
provided, however, that of the Commission members first appointed, the
chairman shall hold office for six years; the other member for four (4) years;
and the third for two (2) years. The appointment to any vacancy in the
Commission shall only be for the unexpired portion of the term of the
predecessor.152

QUORUM
The presence of a majority of the members of the Commission shall
constitute a quorum for the transaction of business.153

149
Sec. 5, EO No. 1008
150
Sec. 6, EO No. 1008
151
Sec. 7, EO No. 1008
152
Sec. 8, EO No. 1008
153
Sec. 9, EO No. 1008
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DELIBERATIONS
The decisions of the Commission shall be arrived at by majority vote.154

SECRETARIAT
The Commission shall have a Secretariat to be headed by an Executive
Director who shall be responsible for receiving requests for arbitration and
other pleadings; for notifying the parties thereto; and, for fixing and receiving
filing fees, deposits, costs of arbitration, administrative charges, and fees. It
shall be the duty of the Executive Director to notify the parties of the awards
made by the arbitrators.
The Secretariat shall have among others a Publication and a Training
Division.155

AUTHORITY TO APPOINT
The Commission is hereby authorized to appoint the Executive Director, the
consultants, the arbitrators, as well as personnel and staff.156

AUTHORITY TO COLLECT FEES

The Commission is empowered to determine and collect fees, deposits, costs
of arbitration, as well as administrative and other charges as may be necessary
in the performance of its functions and responsibilities. The CIAC is also
authorized to use its receipts and deposits of funds to finance its operations
subject to the approval of the PDCB, the provisions of any law to the contrary
notwithstanding.157

FEES TO BE PAID
 Filing Fee
 Administrative charges
 Arbitrator’s fees
 Arbitration Development Fund (ADF) special assessment fee
 Expenses of an expert (if needed)
 Other fees as may be imposed by the CIAC
REQUEST FOR ARBITRATION/COMPLAINT

154
Sec. 10, EO No. 1008
155
Sec. 11, EO No. 1008
156
Sec. 12, EO No. 1008
157
Sec. 13, EO No. 1008
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1. Filing - Any party to a construction contract desiring to avail of
arbitration shall file its Request for Arbitration in the prescribed form
and number of copies to the Secretariat of the CIAC.
2. Preconditions - The claimant against the government, in a government
construction contract, shall state in the complaint/request for
arbitration that 1) all administrative remedies have been exhausted, or
2) there is unreasonable delay in acting upon the claim by the
government office or officer to whom appeal is made, or 3) due to the
application for interim relief, exhaustion of administrative remedies is
not practicable.
a. The Claimant in a private construction contract has the same
obligation as the above to show similar good faith compliance with
all preconditions imposed therein or exemptions therefrom.
b. In case of non-compliance with the precondition contractually
imposed, absent a showing of justifiable reasons, exemption, or a
waiver thereof, the tribunal shall suspend arbitration proceedings
pending compliance therewith within a reasonable period directed
by the Tribunal
3. Request to answer - The CIAC Secretariat shall within three (3) days
from filing, transmit to the Respondent a request for his Answer,
attaching thereto a copy of the complaint and the Request for
Arbitration together with the annexed documents.
4. Commencement of arbitral proceedings - The date when the Request for
Arbitration is filed with CIAC shall, for all intents and purposes, be
deemed to be the date of commencement of the proceedings.

EFFECT OF AGREEMENT TO ARBITRATE

Submission to CIAC jurisdiction – An arbitration clause in a construction
contract or a submission to arbitration of a construction dispute shall be
deemed an agreement to submit an existing or future controversy to CIAC
jurisdiction, notwithstanding the reference to a different arbitration
institution or arbitral body in such contract or submission.
 Submission to CIAC Rules – when the parties have agreed to submit the
dispute/s to arbitration by CIAC, they shall be deemed thereby to have
submitted ipso facto to these Rules and any amendments hereto.
 When a contract contains a clause for the submission of a future
controversy to arbitration, it is not necessary for the parties to enter
REY ALMON T. ALIBUYOG
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into a submission agreement before the Claimant may invoke the
jurisdiction of CIAC.
 An arbitration agreement or a submission to arbitration shall be in
writing, but it need not be signed by the parties, as long as the intent is
clear that the parties agree to submit a present or future controversy
arising from a construction contract to arbitration. It may be in the
form of exchange of letters sent by post or by telefax, telexes, telegrams,
electronic mail or any other mode of communication.
Failure or refusal to arbitrate - Where the jurisdiction of CIAC is properly
invoked by the filing of a Request for Arbitration in accordance with these
Rules, the failure despite due notice which amounts to a refusal of the
Respondent to arbitrate, shall not stay the proceedings notwithstanding the
absence or lack of participation of the Respondent. In such case, CIAC shall
appoint the arbitrator/s in accordance with these Rules. Arbitration
proceedings shall continue, and the award shall be made after receiving the
evidence of the Claimant.
 In the event that, before award, the Respondent who had not earlier
questioned the jurisdiction of the Tribunal, appears and offers to present
his evidence, the Arbitral Tribunal may, for reasons that justifies the
failure to appear, reopen the proceedings, require him to file his answer
with or without counterclaims, pay the fees, where required under these
Rules, and allow him to present his evidence, with limited right to cross
examine witnesses already presented in the discretion of the Tribunal.
Evidence already admitted shall remain. The Tribunal shall decide the
effect of such controverting evidence presented by the Respondent on
evidence already admitted prior to such belated appearance.
When arbitration cannot proceed - Where the contract between the
parties does not provide for arbitration and the parties cannot agree to submit
the dispute(s) to arbitration, the arbitration cannot proceed and the
claimant/s shall be informed of that fact.

ANSWER/COUNTERCLAIMS
Time to answer - The Respondent shall, within fifteen (15) days from
receipt of the Request for Arbitration/Complaint, file its answer thereto
including such counterclaim/s as it may assert. For justifiable reason/s,
Respondent may apply to CIAC for an extension of time to file its answer. If
REY ALMON T. ALIBUYOG
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Respondent fails to do so, the arbitration shall proceed in accordance with
these Rules.
Transmittal of answer - A copy of the answer shall be transmitted in
sufficient copies to the Claimant and to CIAC.
Reply to counterclaim - The Claimant shall file a reply to the counterclaim
with CIAC and shall furnish the Respondent a copy thereof within fifteen (15)
days from date of receipt of the answer with counterclaim.

SUBMISSION AND COMMUNICATIONS/NOTICES

Number of copies - All pleadings and written statements submitted by the
parties, as well as all documents attached thereto, shall be in sufficient copies
to provide one copy for each party, plus one for each Arbitrator, and one for
the Secretariat.
Notices - Notifications or communications from the Secretariat and/or the
Arbitrator(s) shall be validly made if they are delivered personally by an
authorized representative of CIAC, by private courier, by registered mail to the
address(es) or last known address(es) of the party(ies) for whom the same are
intended appearing in the record, and/or by email sent to the email addresses
of the party(ies) on record, at the option of the Secretariat/arbitrator(s).
If the Notice to Respondent/Request to Answer the complaint under
Section 3.3 hereof is not received by Respondent due to wrong address or
because Respondent has moved out from, or cannot be found at, the last
known address provided by the Claimant, the CIAC Secretariat shall inform
the Claimant of the non-delivery/non-receipt of the notice and require
Claimant to provide CIAC with Respondent’s correct/new address within
fifteen (15) days from receipt of advice. If Claimant fails to comply, the
Commission shall dismiss the case without prejudice to its refiling once the
whereabouts of Respondent/s are known to Claimant/s.
 Notification or communication shall be deemed to have been effected on
the date when actually or constructively received.

CONFIDENTIALITY
Confidentiality of proceedings – The arbitration proceedings shall be
considered confidential and shall not be published except:
(i) with the consent of the parties, or
(ii) when necessary in case resort to the Court is made under the Rules of
Court.
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Violation of confidentiality – Any person who violates the immediately

preceding confidentiality provision shall be subject to the following sanctions:
 If the violator is a lawyer, administrative action or proceeding to be
conducted by CIAC, with proper notice and hearing, for inhibition or
prohibition from appearing as counsel for any party in any arbitration
case before CIAC for a period not exceeding six (6) months;
 without prejudice to suspension or disbarment action before the
Integrated Bar of the Philippines (IBP), at the instance of CIAC.

ARBITRATORS
 A sole arbitrator or three arbitrators may settle a dispute.
 Where the parties agree that the dispute shall be settled by a sole
arbitrator, they may, by agreement, nominate him from the list of
arbitrators accredited by the CIAC for appointment and confirmation.
 If the parties fail to agree as to the arbitrator, the CIAC taking into
consideration the complexities and intricacies of the dispute/s has the
option to appoint a single arbitrator or an Arbitral Tribunal.

AUTHORITY TO ACT AS MEDIATOR OR ARBITRATOR

By written agreement of the parties to a dispute, an arbitrator may act as
a mediator and a mediator may act as arbitrator. The parties may also agree
in writing that, following a successful mediation, the mediator shall issue
settlement agreement in the form of an arbitral award.

ACCREDITED ARBITRATORS
People from the government and the private sectors who meet the
technical requirements set by the CIAC shall be accredited and appointed by
the CIAC as arbitrators.

APPOINTMENT OF EXPERTS
The services of technical or legal experts may be utilized in the settlement
of disputes if requested by any of the parties or by the Arbitral Tribunal. If the
request for an expert is done by either or by both of the parties, it is necessary
that the appointment of the expert be confirmed by the Arbitral Tribunal.

APPOINTMENT OF FOREIGN ARBITRATORS

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The Construction Industry Arbitration Commission (CIAC) shall
promulgate rules to allow for the appointment of a foreign arbitrator or
co-arbitrator or chairman of a tribunal a person who has not been previously
accredited by CIAC provided, that:
a. The dispute is a construction 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 CIAC-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.

PROCEDURE IN CHOOSING/APPOINTING THE ARBITRATORS:

1. Sole Arbitrator - where the parties have agreed that the dispute(s) shall
be settled by a sole arbitrator, each shall nominate at least six (6) from
the list of CIAC-accredited arbitrators. The CIAC shall appoint the
common nominee of the parties. If there is no common nominee, the
parties shall be asked to agree on a common nominee within forty- eight
(48) hours otherwise, the CIAC shall appoint either a Sole Arbitrator
who is not a nominee of any of the parties or, if it deems it necessary,
the members of the Arbitral Tribunal.
2. Arbitral Tribunal - where the parties have agreed that the dispute(s)
shall be settled by an arbitral tribunal, each party nominates at least six
(6) arbitrators from the list of arbitrators accredited by the CIAC. The
CIAC then appoints one arbitrator from the claimant's nominees and
another from the respondent's list. The third arbitrator shall be agreed
upon by the two arbitrators first appointed. The three shall decide from
among themselves who shall be the chairman. Common nominees shall
be appointed.

DOCUMENTS REQUIRED AND THE PROCEDURE TO FOLLOW TO AVAIL OF

CONSTRUCTION ARBITRATION
1. The interested party shall submit to the CIAC a request for arbitration
which shall include the following:
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1.1 The names and addresses of the parties;
1.2 A statement of the case/narration of the facts;
1.3 The issues of the case;
1.4 The list of nominees for arbitrator(s) in order of preference;
1.5 Construction contract;
1.6 Agreement to arbitrate;
1.7 Documents establishing the circumstances of the case; and
1.8 In case of government contracts, communications made with the
highest authority for exhaustion of administrative remedies.
2. The CIAC shall evaluate the documents submitted to determine if there
is sufficient ground for arbitration,
3. If the contract does not contain an arbitration clause, the parties shall
be required to submit a duly accomplished “Agreement to Arbitrate.”
4. After the complaint has been filed together with the payment of the
required deposits, CIAC shall notify the respondent and give him fifteen
(15) days from receipt to file his answer with or without a counterclaim.
5. CIAC shall appoint the Sole Arbitrator or the members of the Arbitral
Tribunal, as the case may be, pursuant to the Rules.
6. The appointed arbitrators(s) shall call the parties to a Preliminary
Conference to make the Terms of Reference (TOR) based on the
documents and/or personal accounts of the parties. The TOR shall
include the following:
6.1 A summary of the parties' respective claims;
6.2 The issues involved; and
6.3 Other particulars as may be relevant to make the arbitral award
enforceable.
7. The Terms of Reference shall be signed by the parties and its arbitrators.

REPORTS
The Commission shall within three (3) months after the end of the fiscal
year, submit its annual report to the CIAP. It shall, likewise, submit such
periodic reports as it may be required from time to time.

FINALITY OF AWARDS
The arbitral award shall be binding upon the parties. It shall be final and
unappealable except on questions of law which shall be appealable to the
Supreme Court.
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Exceptions:
1. the award was procured by corruption, fraud, or other undue means;
2. there was evident partiality or corruption of the arbitrators or any of
them;
3. the arbitrators were guilty of misconduct in refusing to hear evidence
pertinent and material to the controversy;
4. one or more of the arbitrators were disqualified to act as such under
Section 10 of Republic Act No. 876 and willfully refrained from disclosing
such disqualifications or of any other misbehavior by which the rights of any
party have been materially prejudiced;
5. the arbitrators exceeded their powers, or so imperfectly executed them,
that a mutual, final, and definite award upon the subject matter submitted
to them was not made;
6. when there is a very clear showing of grave abuse of discretion resulting
in lack or loss of jurisdiction as when a party was deprived of a fair
opportunity to present its position before the arbitral tribunal or when an
award is obtained through fraud or the corruption of arbitrators;
7. when the findings of the CA are contrary to those of the CIAC; or
8. when a party is deprived of administrative due process.

EXECUTION AND ENFORCEMENT OF AWARDS

The award shall be rendered promptly by the arbitrator/arbitral tribunal
as agreed upon by the parties, but in no case beyond thirty (30) days from the
time the case is submitted for resolution or six (6) months from the date of
signing of the TOR (or in cases where a TOR is absent, not more than 6 months
from date of the last preliminary conference). Extensions of time shall be
approved by the CIAC.
As soon as a decision, order or award has become final and executory, the
Arbitral Tribunal or the single arbitrator with the occurrence of the CIAC shall
motu propio, or on motion of any interested party, issue a writ of execution
requiring any sheriff or other proper officer to execute said decision, order or
award.

ISSUANCE OF THE AWARD

The award shall be in writing and signed by the arbitrator(s). If decided by
an arbitral tribunal, the decision of the majority shall prevail.
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Generally, the award shall contain the issues involved, a brief statement
and discussion of the facts, and the authority relied upon to resolve the issues.

ADVANTAGES OF CONSTRUCTION ARBITRATION

1. Arbitrators have technical expertise
2. Parties choose the arbitrators
3. Parties choose the terms of reference
4. Proceedings are simple, faster and less expensive
5. Proceedings are confidential
6. Arbitrator's decision is binding
7. A single forum may be convened for all parties
8. Choice of counsel is not limited to lawyers
9. Work on a contract may continue as arbitration proceeds
10. Arbitration preserves friendly relations

JUDICIAL REVIEW OF ARBITRAL AWARD AND CONVENTION ON THE

RECOGNITION AND ENFORCEMENT OF FOREIGN ARBITRAL AWARDS
Court intervention is allowed under RA No. 9285 in the following instances:
(1) when a party in the arbitration proceedings requests for an interim
measure of protection; (2) judicial review of arbitral awards by the Regional
Trial Court (RTC); and (3) appeal from the RTC decisions on arbitral awards
to the Court of Appeals.158

ARBITRAL AWARD
"Award" means any partial or final decision by an arbitrator in resolving
159
the issue in a controversy.
“Foreign Arbitral Award" is one made in a country other than the
Philippines.160
“Arbitral Awards” shall include not only the awards made by arbitrators
appointed for each case but also those made by permanent arbitral bodies to
161
which the parties have submitted.

DOMESTIC AWARDS

159
RA 9285, Chapter 1, Section 3
160
SPECIAL RULES OF COURT ON ALTERNATIVE DISPUTE RESOLUTION
161
New York Convention, Part 1, Convention on the Recognition and Enforcement of Foreign Arbitral Awards,
Article 1, Par 1.
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The confirmation of a domestic arbitral award shall be governed by Section
23 of R.A. 876.
A domestic arbitral award when confirmed shall be enforced in the same
manner as final and executory decisions of the Regional Trial Court.
The confirmation of a domestic award shall be made by the Regional
Trial Court in accordance with the Rules of Procedure to be promulgated by
the Supreme Court.162

EXCEPTION TO THE REQUIREMENT ON CONFIRMATION OF AWARD

A CIAC arbitral award need not be confirmed by the regional trial court
to be executory as provided under E.O. No. 1008.

A PARTY MAY NOT BE PRECLUDED FROM QUESTIONING THE ARBITRAL

AWARD
A party to a domestic arbitration may question the arbitral award with
the appropriate regional trial court in accordance with the rules of procedure
to be promulgated by the Supreme Court only on those grounds enumerated
in Section 24 of Republic Act No. 876.
(a) The award was procured by corruption, fraud, or other undue means;
(b) That there was evident partiality or corruption in the arbitrators or
any of them; or
(c) That the arbitrators were guilty of misconduct in refusing to
postpone the hearing upon sufficient cause shown, or in refusing to hear
evidence pertinent and material to the controversy; that one or more of
the arbitrators was disqualified to act as such under section nine hereof,
and wilfully refrained from disclosing such disqualifications or of any
other misbehavior by which the rights of any party have been materially
prejudiced; or
(d) That the arbitrators exceeded their powers, or so imperfectly
executed them, that a mutual, final and definite award upon the subject
matter submitted to them was not made.
As a general rule, the court can only vacate or set aside the decision of an
arbitral tribunal upon a clear showing that the award suffers from any of the
infirmities or grounds for vacating an arbitral award under Section 24 of

162
A.M. No. 07-11-08-SC, September 1, 2009, SPECIAL RULES OF COURT ON ALTERNATIVE DISPUTE
RESOLUTION
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Republic Act No. 876 or under Rule 34 of the Model Law in a domestic
arbitration, or for setting aside an award in an international arbitration under
Article 34 of the Model Law, or for such other grounds provided under these
Special Rules.
Any other ground raised against a domestic arbitral award shall be
disregarded by the RTC. However, the court shall entertain such ground for the
setting aside or non-recognition of the arbitral award only if the same
amounts to a violation of public policy.
The court shall not set aside or vacate the award of the arbitral tribunal
merely on the ground that the arbitral tribunal committed errors of fact, or
of law, or of fact and law, as the court cannot substitute its judgment for that
of the arbitral tribunal.163

B. FOREIGN ARBITRAL AWARDS

Application of the New York Convention.
The New York Convention shall govern the recognition and enforcement of
arbitral awards covered by the said Convention.
The recognition and enforcement of such arbitral awards shall be filed
with RTC in accordance with the rules of procedure to be promulgated by the
Supreme Court.164
Said procedural rules shall provide that the party relying on the award
or applying for its enforcement shall file with the court the original or
authenticated copy of the award and the arbitration agreement. If the award
or agreement is not made in any of the official languages, the party shall supply
a duly certified translation thereof into any of such languages.165
When the applicant established that the country in which foreign
arbitration award was made is a party to the New York Convention.
If the application for rejection or suspension of enforcement of an award has
been made, the regional trial court may, if it considers it proper, vacate its
decision and may also, on the application of the party claiming recognition or
enforcement of the award, order the party to provide appropriate security.166

CONVENTION ON THE RECOGNITION AND ENFORCEMENT OF FOREIGN

ARBITRAL AWARDS

163
Special ADR Rules, Rule 19.10
164
Special ADR Rules, Rule 1.1. (j) Recognition and Enforcement of a Foreign Arbitral Award
165
Special ADR Rules , RULE 13: RECOGNITION AND ENFORCEMENT OF A FOREIGN ARBITRAL AWARD
166
Section 42 of RA 9285; read in relation to the discussion on Article 6 of NYC
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(NEW YORK CONVENTION OF 1958)
OBJECTIVES OF THE CONVENTION:
Recognizing the growing importance of international arbitration as a
means of settling international commercial disputes, the Convention on the
Recognition and Enforcement of Foreign Arbitral Awards (the Convention)
seeks to provide common legislative standards for the recognition of
arbitration agreements and court recognition and enforcement of foreign and
non-domestic arbitral awards.

RECOGNITION AND ENFORCEMENT OF ARBITRATION AGREEMENTS

Arbitration is a consensual process. It can only take place if the parties have
agreed to submit their dispute to arbitration. The agreement to refer disputes
to arbitration is called the “arbitration agreement”.
An arbitration agreement has a positive and a negative legal effect:
POSITIVE EFFECT: It obliges the parties to submit disputes to arbitration
and confers jurisdiction on an arbitral tribunal over disputes covered by the
arbitration agreement. If a dispute arises that falls within the scope of the
arbitration agreement, either party may submit it to an arbitral tribunal.
NEGATIVE EFFECT: It prevents the parties from seeking the resolution of
their disputes in court. By concluding an arbitration agreement, the parties
waive their rights to judicial remedies. A party having entered into an
arbitration agreement cannot disregard it and instead go to court.

The New York Convention obliges Contracting States to recognize and

enforce these effects.
1. RECOGNITION AND ENFORCEMENT OF ARBITRAL AWARDS
The recognition of arbitral awards is the process that makes arbitral
awards part of a national legal system.
By contrast, enforcement of arbitral awards is the process where
successful parties in arbitration will seek to obtain what the arbitrators have
awarded them.

ARTICLE I
“This Convention shall apply to the recognition and enforcement of
arbitral awards made in the territory of a State other than the State
where the recognition and enforcement of such awards are sought, and
arising out of differences between persons, whether physical or legal. It
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shall also apply to arbitral awards not considered as domestic awards in
the State where their recognition and enforcement are sought.”
Accordingly, the Convention deals only with the recognition and
enforcement of foreign and non-domestic arbitral awards. It does not apply
to the recognition and enforcement of domestic awards.

CATEGORY OF AWARDS COVERED BY THE CONVENTION

1. FOREIGN AWARDS are awards made in the territory of a State other
than the State where recognition and enforcement are sought.
2. NON-DOMESTIC AWARDS are those which are considered as
non-domestic in the State where recognition or enforcement is sought.
In the exercise of this freedom, States generally consider all or some
of the following awards as non-domestic:
• Awards made under the arbitration law of another State;
• Awards involving a foreign element;
• A-National awards

ARBITRAL AWARDS
The term shall include not only awards made by the arbitrators appointed
for each case but also those made by permanent arbitral bodies to which the
parties have submitted.
Courts have adopted two different methods to determine the meaning of
the terms “ARBITRATION” and “AWARD”.
The following arbitral decisions qualify as awards:
1. Final awards
2. Partial awards
3. Preliminary awards
4. Awards on costs
5. Consent awards
By contrast, the following decisions are generally not deemed
awards:
1. Procedural orders
2. Decisions on provisional or interim measures

RESERVATIONS
In principle, the Convention applies to all foreign or international
arbitration agreements and to all foreign or non-domestic awards. However,
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Contracting States can make two reservations to the application of the
Convention.
RECIPROCITY
Contracting States may declare that they will apply the Convention
only to the recognition and enforcement of awards made in the territory
of another Contracting State.
COMMERCIAL NATURE
Contracting States may also declare that they will apply the
Convention only to differences arising out of legal relationships, whether
contractual or not, which are deemed commercial under the national
law of the State making such declaration.

ARTICLE II
Each Contracting State shall recognize an agreement in writing under
which the parties undertake to submit to arbitration all or any differences
which have arisen or which may arise between them in respect of a defined
legal relationship, whether contractual or not, concerning a subject matter
capable of settlement by arbitration.
The term "agreement in writing" shall include an arbitral clause in a
contract or an arbitration agreement, signed by the parties or contained in an
exchange of letters or telegrams.
The court of a Contracting State, when seized of an action in a matter in
respect of which the parties have made an agreement within the meaning of
this article, shall, at the request of one of the parties, refer the parties to
arbitration, unless it finds that the said agreement is null and void, inoperative
or incapable of being performed.

ARTICLE III
Each Contracting State shall recognize arbitral awards as binding and
enforce them in accordance with the rules of procedure of the territory where
the award is relied upon, under the conditions laid down in the following
articles. There shall not be imposed substantially more onerous conditions or
higher fees or charges on the recognition or enforcement of arbitral awards to
which this Convention applies than are imposed on the recognition or
enforcement of domestic arbitral awards.

ARTICLE IV
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To obtain the recognition and enforcement mentioned in the preceding
article, the party applying for recognition and enforcement shall, at the time
of the application, supply:
(a) The duly authenticated original award or a duly certified copy thereof;
(b) The original agreement referred to in article II or a duly certified copy
thereof.
If the said award or agreement is not made in an official language of the
country in which the award is relied upon, the party applying for recognition
and enforcement of the award shall produce a translation of these documents
into such language. The translation shall be certified by an official or sworn
translator or by a diplomatic or consular agent.

ARTICLE V
Recognition and enforcement of the award may be refused based on the
following grounds:
(a) The parties to the agreement referred to in article II were, under the
law applicable to them, under some incapacity, or the said agreement is
not valid under the law to which the parties have subjected it or, failing any
indication thereon, under the law of the country where the award was
made; or
(b) The party against whom the award is invoked was not given proper
notice of the appointment of the arbitrator or of the arbitration
proceedings or was otherwise unable to present his case; or
(c) The award deals with a difference not contemplated by or not falling
within the terms of the submission to arbitration, or it contains decisions
on matters beyond the scope of the submission to arbitration, provided
that, if the decisions on matters submitted to arbitration can be separated
from those not so submitted, that part of the award which contains
decisions on matters submitted to arbitration may be recognized and
enforced; or
(d) The composition of the arbitral authority or the arbitral procedure
was not in accordance with the agreement of the parties, or, failing such
agreement, was not in accordance with the law of the country where the
arbitration took place; or
(e) The award has not yet become binding on the parties, or has been
set aside or suspended by a competent authority of the country in which,
or under the law of which, that award was made.
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Recognition and enforcement of an arbitral award may also be refused if
the competent authority in the country where recognition and enforcement is
sought finds that:
(a) The subject matter of the difference is not capable of settlement by
arbitration under the law of that country; or
(b) The recognition or enforcement of the award would be contrary to
the public policy of that country.

ARTICLE VI
If an application for the setting aside or suspension of the award has been
made to a competent authority referred to in article V (1) (e), the authority
before which the award is sought to be relied upon may, if it considers it proper,
adjourn the decision on the enforcement of the award and may also, on the
application of the party claiming enforcement of the award, order the other
party to give suitable security.

ARTICLE VII
The provisions of the present Convention shall not affect the validity of
multilateral or bilateral agreements concerning the recognition and
enforcement of arbitral awards entered into by the Contracting States nor
deprive any interested party of any right he may have to avail himself of an
arbitral award in the manner and to the extent allowed by the law or the
treaties of the country where such award is sought to be relied upon.
The Geneva Protocol on Arbitration Clauses of 1923 and the Geneva
Convention on the Execution of Foreign Arbitral Awards of 1927 shall cease
to have effect between Contracting States on their becoming bound and to the
extent that they become bound, by this Convention.

ARTICLE VIII
This Convention shall be open until 31 December 1958 for signature on
behalf of any Member of the United Nations and also on behalf of any other
State which is or hereafter becomes a member of any specialized agency of the
United Nations, or which is or hereafter becomes a party to the Statute of the
International Court of Justice, or any other State to which an invitation has
been addressed by the General Assembly of the United Nations.
This Convention shall be ratified and the instrument of ratification shall be
deposited with the Secretary-General of the United Nations.
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ARTICLE IX
This Convention shall be open for accession to all States referred to in
article VIII.
Accession shall be effected by the deposit of an instrument of accession with
the Secretary-General of the United Nations.

ARTICLE X
Any State may, at the time of signature, ratification or accession, declare
that this Convention shall extend to all or any of the territories for the
international relations of which it is responsible. Such a declaration shall take
effect when the Convention enters into force for the State concerned.
At any time thereafter any such extension shall be made by notification
addressed to the Secretary-General of the United Nations and shall take effect
as from the ninetieth day after the day of receipt by the Secretary-General of
the United Nations of this notification, or as from the date of entry into force
of the Convention for the State concerned, whichever is the later.
With respect to those territories to which this Convention is not extended
at the time of signature, ratification or accession, each State concerned shall
consider the possibility of taking the necessary steps in order to extend the
application of this Convention to such territories, subject, where necessary for
constitutional reasons, to the consent of the Governments of such territories.

ARTICLE XI
In the case of a federal or non-unitary State, the following provisions shall
apply:
(a) With respect to those articles of this Convention that come within
the legislative jurisdiction of the federal authority, the obligations of the
federal Government shall to this extent be the same as those of Contracting
States which are not federal States;
(b) With respect to those articles of this Convention that come within
the legislative jurisdiction of constituent states or provinces which are not,
under the constitutional system of the federation, bound to take legislative
action, the federal Government shall bring such articles with a favourable
recommendation to the notice of the appropriate authorities of constituent
states or provinces at the earliest possible moment;
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(c) A federal State Party to this Convention shall, at the request of any
other Contracting State transmitted through the Secretary-General of the
United Nations, supply a statement of the law and practice of the
federation and its constituent units in regard to any particular provision of
this Convention, showing the extent to which effect has been given to that
provision by legislative or other action.

ARTICLE XII
This Convention shall come into force on the ninetieth day following the
date of deposit of the third instrument of ratification or accession.
For each State ratifying or acceding to this Convention after the deposit of
the third instrument of ratification or accession, this Convention shall enter
into force on the ninetieth day after deposit by such State of its instrument of
ratification or accession.

ARTICLE XIII
Any Contracting State may denounce this Convention by a written
notification to the Secretary-General of the United Nations. Denunciation shall
take effect one year after the date of receipt of the notification by the
Secretary-General.
Any State which has made a declaration or notification under article X
may, at any time thereafter, by notification to the Secretary-General of the
United Nations, declare that this Convention shall cease to extend to the
territory concerned one year after the date of the receipt of the notification
by the Secretary-General.
This Convention shall continue to be applicable to arbitral awards in respect
of which recognition and enforcement proceedings have been instituted before
the denunciation takes effect.

ARTICLE XIV
A Contracting State shall not be entitled to avail itself of the present
Convention against other Contracting States except to the extent that it is
itself bound to apply the Convention.

ARTICLE XV
The Secretary-General of the United Nations shall notify the States
contemplated in article VIII of the following:
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(a) Signatures and ratifications in accordance with article VIII;
(b) Accessions in accordance with article IX;
(c) Declarations and notifications under articles I, X and XI;
(d) The date upon which this Convention enters into force in accordance
with article XII;
(e) Denunciations and notifications in accordance with article XIII.

ARTICLE XVI
This Convention, of which the Chinese, English, French, Russian and
Spanish texts shall be equally authentic, shall be deposited in the archives of the
United Nations.
The Secretary-General of the United Nations shall transmit a certified
copy of this Convention to the States contemplated in article VIII.