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FYFE v PHILIPPINE AIRLINES

G.R. No. 160071. June 6, 2016.

DOCTRINE:

Appeal as a remedy is not a matter of right, but a mere statutory privilege to be


exercised only in the manner and strictly in accordance with the provisions of the law.

Facts:

Philippine Airlines Inc (PAL) underwent rehabilitation proceedings in the Securities


Exchange Commission (SEC). To convince its creditors, they decided to hire technical
advisers. Peter Foster of Cathay Pacific and Michael Scantlebury organized Regent Star
Services Ltd. (Regent Star). Regent Star and PAL entered into a Technical Services
Agreement (TSA) effective for five years. Regent Star subsequently engaged with Fyfe,
Wald and Nuttall and commenced to render their services immediately after the TSA was
executed. PAL dispatched a notice to Regent Star terminating the TSA on the ground of
lack of confidence. In its notice the respondent demanded the offsetting of the penalties
due with the two year advance advisory fees it had paid to Regent Star. Regent Star
proposed that the issue be submitted to arbitration with the Philippine Dispute Resolution
Center Inc (PDRCI) pursuant to the TSA. PDRCI rendered judgment ordering PAL to pay
the termination penalties. PAL filed its application to Vacate Arbitral Award in the RTC of
Manila.

Issue:

Whether or not the CA erred in dismissing their appeal for being an inappropriate
remedy that a petition for review on certiorari under Rule 45 is the sole remedy?

Held:

No. The CA emphasized that the petitioners should have led the petition for review
on certiorari under Rule 45 considering that Section 29 of the Arbitration Law has limited
the ground of review to "questions of law." Although the Special Rules of Court on
Alternative Dispute Resolution provides that the appropriate remedy from an order of the
RTC vacating a domestic arbitral award is an appeal by petition for review in the CA, not
an ordinary appeal under Rule 41 of the Rules of Court, the Court cannot set aside and
reverse the assailed decision on that basis because the decision was in full accord with
the law or rule in force at the time of its promulgation.