(Source: Arbitration in the Philippines by Atty. Eduardo P.

Lizares and Alternative Dispute Resolution

by Dave Aquino and Filbert Flores III)

 The Republic Act No. 9285, otherwise known as the Alternative Dispute Resolution Act
of 2004 (ADR Law), may be considered a major breakthrough in the Philippine court
system, benefitting not only Filipinos in and out of the country, but also aliens who desire
to achieve justice in the domestic courts.

 RA 9285 is our country’s law that provides for Alternative Dispute Resolution. ADR
refers to 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, as
defined in RA 9285, 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. The law covers mediation, international
commercial arbitration, domestic arbitration, arbitration of construction disputes, and
judicial review of arbitral awards (domestic and foreign)

 The ADR Law responds to numerous calls to address the perennial issues bombarding the
Philippine court system, such as the clogging of court dockets, expensive litigation fees,
slow-paced judicial proceedings and the rigid and adversarial system of courts.

 Court dockets are seriously congested due to indiscriminate filing of cases and delayed
case resolutions because of inefficiency, incompetence, sloth or laziness, corruption or
conflict of interests of court officials.

 Moreover, the ADR Law addresses the indispensable effects of globalization on

commercial transactions, such as the expansion of international trade and foreign
investment,[4] which require domestic laws to adopt alternative means of dispute
resolution applicable and friendly to commerce.

 In the contemplation of RA 9285, there are two basic or general categories of arbitration
that may be held in the Philippines. They are the following:

a. The first category is domestic arbitration

 A domestic arbitration is “an arbitration that is not international as defined in Article

1 (3) of the Model Law” (Sec 32)

 It is an arbitration where the proceedings are held and where the award is rendered in
the Philippines (i.e. where the “seat” of the arbitration is in the Philippines) that does
not have any of the characteristics that make it “international” under Article 1(3) of
the Model Law.
  This is governed by: RA 9285 particlularly sec 22 to 31 of Chapter 4 and secs 32 and
33 of chapter 5 and other relevant provisions thereof; specific provisions of the Model
Law made applicable to domestic arbitration by Section 33 of RA 9285 and to the
extent not inconsistent with the foregoing and the Arbitration Law (RA 876)

b. The second category is international commercial arbitration

 International Commercial Arbitration, is arbitration, where just like domestic

arbitration, the proceedings are held and the award is rendered in the Philippines, but
involves a dispute arising from a “commercial” relationship that possesses any of the
characteristics that make it “international” under Art 1 (3) of the Model Law:

Sec. 1
Sec 2

 What is the policy of the state with regards to resolution of disputes?

 How shall the state achieve ADR?

 Under Sec 2, what is being promoted really is party autonomy in the choice of how their
disputes are to be resolved. In other words, the use of ADR provides empowerment to the
parties to a dispute.
 Cases:
1. Magellan Capital Management Corporation v. Zosa, 355 S 157

2. G.R. No. 143581 KOREA TECHNOLOGIES CO., LTD., Petitionerv.HON.

ALBERTO A. LERMA, in his capacity as Presiding Judge of Branch 256 of
Regional TrialCourt of Muntinlupa City, and PACIFIC GENERAL STEEL
MANUFACTURING CORPORATION

“Being an inexpensive, speedy and amicable method of settling disputes, arbitration––

along with mediation, conciliation and negotiation––is encouraged by the Supreme Court.
Aside from unclogging judicial dockets, arbitration also hastens the resolution of
disputes, especially of the commercial kind. It is thus regarded as the “wave of the
future” in international civil and commercial disputes. Brushing aside a contractual
agreement calling for arbitration between the parties would be a step backward.

Consistent with the above-mentioned policy of encouraging alternative dispute resolution

methods, courts should liberally construe arbitration clauses. Provided such clause is
susceptible of an interpretation that covers the asserted dispute, an order to arbitrate
should be granted. Any doubt should be resolved in favor of arbitration.”

3. DEPARTMENT OF FOREIGN AFFAIRS (DFA), PETITIONER, VS. BCA

INTERNATIONAL CORPORATION & AD HOC ARBITRAL TRIBUNAL,
 COMPOSED OF CHAIRMAN DANILO L. CONCEPCION AND MEMBERS,
CUSTODIO O. PARLADE AND ANTONIO P. JAMON, JR., RESPONDENTS.
[ G.R. No. 225051, July 19, 2017 ]

“RA No. 9285 declares the policy of the State to actively

promote party autonomy in the resolution of disputes or the
freedom of the parties to make their own arrangements to
resolve their disputes.[23] Towards this end, the State shall
encourage and actively promote the use of Alternative Dispute
Resolution as an important means to achieve speedy and
impartial justice and declog court dockets.”

Sec 3 (definition of terms)

Sec 4
 The provisions of the Electronic Signatures in the Global and E-commerce Act, and its
implementing rules and regulations, shall apply to proceedings contemplated in RA 9285.
This is because of advances in electronic communications and E-Commerce.
 What is an electronic signature?
 Case:
1. MCC INDUSTRIAL SALES CORPORATION VS. SSANGYONG
CORPORATION, GR NO. 170633, October 17, 2007
"We, therefore, conclude that the terms "electronic data message" and "electronic document," as defined
under the Electronic Commerce Act of 2000, do not include a facsimile transmission. Accordingly,
a facsimile transmission cannot be considered as electronic evidence. It is not the functional equivalent of
an original under the Best Evidence Rule and is not admissible as electronic evidence.

Since a facsimile transmission is not an "electronic data message" or an "electronic document," and
cannot be considered as electronic evidence by the Court, with greater reason is a photocopy of such a fax
transmission not electronic evidence.

Sec 5

 GR: ADR Providers and practitioners are not civilly liable for acts done in the
performance of their official duties.

Exceptions: there is a clear showing of bad faith, malice or gross negligence.

Sec 6
 What cannot be subject to the application of RA 9285?
 CHAPTER 2 – MEDIATION

Sec 7

 This section expressly excludes court annexed mediation.

 Why is court-annexed mediation not covered? It would be duplicating the existing

mediation procedure already established in the Judiciary, such inclusion would
encroach on the separation of powers doctrine between Judiciary and Congress, and
also with respect to the rule making power of the SC. Further, such cases currently
under the court-annexed mediation program of the Judiciary Department are cases
that are already within the cognizance of the court. Thus, to include court-annexed
mediation cases under the application of this act is tantamount to depriving the
courts’ of their jurisdiction over the same.

Sec 8
 This section reiterates the state policy of promoting alternative modes of dispute
resolution in order to avoid a protracted litigation that would entail unnecessary
expenses, ill will between the parties and delay. Emphasis is made on the need to
promote candor of parties through confidentiality of the mediation process, which is
the key features of ADR- other features being- swift, cost effective, private and
within the power of the parties.

Sec 9
 Are proceedings under RA 9285 confidential?

 This section provides for guidelines on confidentiality of information obtained in

mediation proceedings.

 In the law on evidence, they are considered privileged communication.

 To what extent does this confidentiality of information apply?

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

Answer: Rule 9 Sec 3.21 (d) IRR of RA 9285

(i) the parties to the dispute;

(ii) the mediator or mediators;

 (iii) the counsel for the parties;

(iv) the non-party participants;

(v) any person hired or engaged in connection with the mediation as secretary,
stenographer, clerk or assistant; and

(vi) any other person who obtains or possesses confidential information by reason
of his/her profession.

Sec 10
 May the confidentiality provided under Sec 9 of RA 9285 be waived?

 Who may waive the confidentiality of information?

 How is the privilege waived?



Sec 11

 What are the exceptions to the confidentiality rule?

Sec 12

 IRR of RA 9285 Rule 9 Sec 3.24

Sec 13

 How can the parties be sure that the mediator is not biased towards one party and that there is
no conflict of interest?

Sec 14

 A lawyer or a non-lawyer may be designated to provide assistance in the mediation,

except as otherwise provided in RA 9285. A waiver of this right shall be made in
writing by the party waiving it. A waiver of legal representation may be rescinded at
any time.
Sec 15

 The place of mediation shall be by agreement of the parties. In case of disagreement

of the parties, the place of mediation shall be any place convenient and appropriate to
all parties. This place shall also be by the parties.

Sec 16

 This section mandates that any agreement to submit a future dispute to an institution
that provides mediation services shall also include submission to said institution’s
rules and regulations governing the conduct of the mediation.

Sec 17

 Co-relate this with Rule 15 of A.M. No. 17-11-08-SC entitled Special Rules of Court
on Alternative Dispute Resolution

 This another instance when court intervention is needed in arbitration

 Case: 1. DFA vs BCA,G.R. No. 225051, July 19, 2017, the SC enumerated the
instances when court intervention is allowed:

(1) Specific Court Relief, which includes Judicial Relief Involving the Issue
of Existence, Validity and Enforceability of the Arbitral Agreement, [28]
Interim Measures of Protection,[29] Challenge to the Appointment of
Arbitrator,[30] Termination of Mandate of Arbitrator, [31] Assistance in Taking
Evidence,[32] Confidentiality/Protective Orders,[33] Confirmation, Correction
or Vacation of Award in Domestic Arbitration,[34] all to be filed with the
RTC;

(2) a motion for reconsideration may be filed by a party with the RTC on
the grounds specified in Rule 19.1;

(3) an appeal to the Court of Appeals through a petition for review under
Rule 19.2 or through a special civil action for certiorari under Rule 19.26;
and (4) a petition for certiorari with the Supreme Court from a judgment
or final order or resolution of the Court of Appeals, raising only questions
of law.

2. DENR vs. United Planters Consultants, GR No. 212081, Feb. 23, 2015

“the Special ADR Rules, as far as practicable, should be made to apply not
only to the proceedings on confirmation but also to the confirmed award’s
execution.”
  Who may petition to Enforce Settlement?

 When do you file a petition to enforce settlement?

CHAPTER 3 - OTHER ADR FORMS

Sec 18

 What are the other forms of ADR?

Sec 19

 When it comes to International Commercial Arbitration, the same shall be governed

by the Model Law.

 This begs the question of what is an International Commercial Arbitration. To answer

this, one must refer to Section 32 of the ADR Act of 2004 which defines domestic
arbitration, which provision in turn refers to Article 1 (3) of the Model Law. Section
32 provides:

SEC. 32. Law Governing Domestic Arbitration. - Domestic arbitration shall

continue to be governed by Republic Act No. 876, otherwise known as "The
Arbitration Law" as amended by this Chapter. The term "domestic arbitration" as
used herein shall mean an arbitration that is not international as defined in Article (3)
of the Model Law.

While Article 1, paragraphs (3) and (4) of the Model Law provides:

(3) An arbitration is international if:

(a) the parties to an arbitration agreement have, at the time of the conclusion of
that agreement, their places of business in different States; or

(b) one of the following places is situated outside the State in which the parties
have their places of business:

(i) the place of arbitration if determined in, or pursuant to, the arbitration
agreement;
 (ii) 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

(c) the parties have expressly agreed that the subject matter of the arbitration
agreement relates to more than one country.

(4) For the purposes of paragraph (3) of this article:

(a) if a party has more than one place of business, the place of business is that
which has the closest relationship to the arbitration agreement;

(b) if a party does not have a place of business, reference is to be made to his
habitual residence.

Place of Arbitration Type of Award or Applicable Law or Treaty

Arbitration
Convention Award New York Convention
(Award made in a of 1958 as provided by
State that is a member the ADR Act of 2004,
of the New York § 42
Foreign Arbitration Convention)
(Outside of the
Philippines) ADR Act of 2004, §
Non-Convention 43 Consistent with
Award (Award made Article 35 of the
in a State that is not a UNCITRAL Model
member of the New Law
York Convention)
International (One of UNCITRAL Model
the elements is Law as provided by the
international according ADR Act of 2004, § 19
to Article 1 (3) of the
Domestic Arbitration Model Law)
(Within the Philippines)

Non-International R.A. No. 876 as

(Does not fall under provided by the ADR
Article 1 (3) of the Act of 2004,
Model Law)
Sec 20

 Recognizing the international origin of the Model Law and the need for uniformity in
its interpretation, RA 9285 provides in Sec 20 that in interpreting the Model Law
resort may be made to the travaux preparatoire and the report of the Secretary General
of the UN on International Trade Law.

Sec 21
 When is arbitration considered commercial?

Sec 22

 Representation in international arbitration could be by a lawyer or non-lawyer. This

provision allows a party to be represented by any person of his choice.

 It however prohibits anyone who is not admitted to the practice of law from
representing them before any judicial and quasi-judicial body even if the proceeding
is connected to the arbitration process.

Sec 23
 As a general rule: Everything connected to an arbitration proceedings are
confidential in nature.

Exceptions: (1) with the consent of the parties, or (2) for the limited purpose of
disclosing to the court of relevant documents in cases where resort to the court is
allowed herein.

Sec 24

 Arbitration proceedings are not mandatory but subject to the will of the parties to a
controversy. Strictly, it is consensual.

 In the case of Vega v. San Carlos Milling, 51 P 917, the SC has consistently ruled that
unless the agreement is such as absolutely to close the doors of the courts against the
parties which agreement would be void, the courts will look with favour upon such
amicable arrangements and will only with great reluctance interfere to anticipate or
nullify the action of arbitration.
  Relate this with Rule 4 A.M. No. 07-11-08-SC (Special ADR Rules)

 Who may file request for referral to ADR? Any party to a pending action filed in
violation of the arbitration agreement may request Court to refer parties to arbitration
(Rule 4.1)

 When must be done? Request for referral not later than pre-trial conference. After
pre-trial conference, referral made with agreement of all parties.

Sec 25

 Although the law favors arbitration, the existence of an arbitration agreement is

needed.

 The law provides that in interpreting R.A. No. 9285, the courts are directed to give due regard
to the policy of favoring arbitration. 
 This emphasizes the rule of Liberality in favor of arbitration.
 In the case of LM Power Eng’g Corp. v. Capitol Industry Construction Groups, 399 S
562 (2003), the SC took a significant step in giving life to the law on arbitration when
it ruled that courts should “liberally construe arbitration clauses” to encourage
alternative dispute resolution. Under this liberal approach so long as a clause “is
susceptible of an interpretation that covers the asserted dispute, an order to arbitrate
should be granted” since any doubt should be resolved in favor of arbitration”.

 Cases:

1. Western Minolco Corp. v. CA, 157 S 592

2. BF Corp. v. CA, 288 S 285
3. Toyota v. CA, 216 S 236
4. Philrock, Inc. v. CIAC, 359 S 633

Sec 26
 In arbitration, the “Appointing Authority” is by agreement of the parties.

 This section provides that if the parties agree to subject their dispute to institutional
arbitration, they are deemed to have agree to the procedure of the institution for the
selection and appointment of arbitrators unless they have agreed to a different
procedure. Thus, if the parties agree to an institutional arbitration under the ICC, they
are bound by the rules of the ICC for the selection or appointment of arbitrators,
unless they have agreed on other rules.
Sec 27
 Functions that may be performed by Appointing Authority

Sec 28

 The ADR Law expanded the powers of the arbitrators and defined clearly the role of
courts, as well as the arbitral tribunal, in the issuance and enforcement of
interim/conservatory measures.

 Courts are permitted, as a rule, to grant interim and provisional reliefs during the
pendency of arbitral proceedings.  It is also recognized that arbitral tribunals are
authorized authority to grant interim measures such as preliminary injunction,
appointment of receivers, detention, preservation and inspection of property, among
others. Even granting that both the courts and the arbitral tribunal are given the same
power, parties cannot avail of these simultaneously. Court has only authority to grant
interim measures “to the extent that the arbitral tribunal has no power to act or is
unable to act effectively.” The law does not provide for concurrent power of the
courts and the arbitral tribunal to grant interim measure of protection.  The court must
exercise this power sparingly, giving way or precedence to the exercise thereof by the
arbitral tribunal.

 In the case of Home Bankers Savings and Trust v. CA, 318 S 558, the SC ruled that a
party to a pending arbitration has the right, without violating the rule of forum
shopping, to institute an action to obtain a writ of preliminary attachment from the
court to preserve the property which is the subject matter of the arbitration pursuant to
the last proviso of Sec 14 of the Arbitration Law which accords him the right “to
petition the court to take measures to safeguard and/or conserve any matter which is
the subject matter of the dispute in arbitration.

Sec 29

 Section 29 appear to extend and widen the scope of powers found in Section 28
although it is more a case of an elaboration of the powers set out in Section 28. 
Section 29 specifically refers to the granting of preliminary injunctions but includes
also the power to appoint a receiver, powers of detention and preservation and
inspection of property, which is the subject matter of the arbitration.  Helpfully,
Section 29 makes clear that a party may seek the court’s assistance in enforcing the
interim orders of an arbitral tribunal.

Sec 30

 The place of arbitration is the place so designated by the parties to the arbitration.
  Relate this section with Article 20 of the Model Law which provides:

Article 20. Place of arbitration

(1) The parties are free to agree on the place of arbitration. Failing such agreement, the
place of arbitration shall be determined by the arbitral tribunal having regard to the
circumstances of the case, including the convenience of the parties.

(2) Notwithstanding the provisions of paragraph (1) of this article, 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

Sec 31

 As a general rule, 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 in international arbitration and English and Filipino in domestic arbitration,
unless the arbitral tribunal shall determine a different or another language or
languages to be used in the proceedings.

CHAPTER 5 - DOMESTIC ARBITRATION

Sec 32

 This section categorically states that RA 876 shall continue to be the governing law
over Domestic Arbitration.

Sec 33

 There are certain provisions of the Model Law and RA 9285 which, by virtue of Sec
33 are expressly applicable to domestic arbitration.

CHAPTER 6 - ARBITRATION OF CONSTRUCTION DISPUTES

Sec 34

 Executive Order No. 1008 vests upon the Construction Industry Arbitration
Commission (CIAC) original and exclusive jurisdiction over disputes arising from, or
connected with the contracts entered into by the parties involved in construction in
the Philippines. This is also enunciated in the case of Metro Construction, Inc., v.
Chatham Properties, Inc. 365 S 697
Sec 35

Sec 36

Sec 37

Sec 38

Sec 39

 GR: The RTC upon becoming aware, not later than the PT conference that the parties
had entered into an arbitration shall dismiss the case and refer the parties to
arbitration.

Exception: When both parties assisted by their respective counsel submits a written
agreement that the RTC shall exclusively resolve the dispute. The reason for this is
of course the written agreement of the parties.

CHAPTER 7 - JUDICIAL REVIEW OF ARBITRAL AWARDS

A. DOMESTIC AWARDS

Sec 40

 The ADR Law expressly provides that the Philippine Arbitration Law shall
continuously govern domestic arbitration.   It must be noted that a domestic arbitral
award is not self-executory.  To convert a domestic arbitral award into an
enforceable judgment, the winning party has to file with the courts a petition for
confirmation of the arbitral award within thirty (30) days from receipt of the
arbitral award.  The court should, as a matter of course, grant the petition, unless
there are grounds to vacate the award. However, CIAC arbitral award need not be
confirmed by the RTC to be executory.

 Read the case of Del Monte Corporation USA v. CA, 351 S 373

Sec 41

 Relate this with Rule 11 of A.M. No. 07-11-08-SC

 Case: Equitable PCI Banking Corporation vs. RCBC Capital Corporation

“As a rule, the award of an arbitrator cannot be set aside for mere errors of judgment either as to the law
or as to the facts. Courts are without power to amend or overrule merely because of disagreement with
matters of law or facts determined by the arbitrators. They will not review the findings of law and fact
contained in an award, and will not undertake to substitute their judgment for that of the arbitrators, since
any other rule would make an award the commencement, not the end, of litigation. Errors of law and fact,
or an erroneous decision of matters submitted to the judgment of the arbitrators, are insufficient to
invalidate an award fairly and honestly made. Judicial review of an arbitration is, thus, more limited than
judicial review of a trial.”

B. FOREIGN ARBITRAL AWARDS

Sec 42

 Under this provision, arbitral awards in International Commercial Arbitration are

readily enforced pursuant to the New York Convention of 1958 unlike in other
foreign judgments. Participant countries to the Convention are obliged to enforce
arbitral awards as if they were made domestically, subject to limited grounds on
which enforcement may be refused. These grounds are those enumerated under
Article V of the New York Convention. These grounds must be borne in mind by
judges in order to avoid unlimited interference by the courts, thereby fulfilling its
pronouncement that arbitration is encouraged in this jurisdiction

Sec 43

 Section 43 actually deals with the recognition and enforcement of non-New York
convention awards. Unlike Section 42, this section gives consideration and attends to
the recognition of non-New York Convention awards, which must be in accordance
with the procedural rules to be promulgated by the Supreme Court. However, the
provision refers to international comity and reciprocity as grounds for the recognition
of such awards.

 Hence, on the basis of comity or reciprocity, a Philippine court may also recognize a
non-convention award as a convention award.

Sec 44

 Section 44 distinguishes a foreign arbitral award from a foreign judgment. It is widely

known that foreign judgments are generally not enforceable in other jurisdictions
except in cases of reciprocity and comity. On the other hand, arbitral awards are more
readily enforceable. The law provides that a party applying for the enforcement of the
arbitral award only needs to file with the Regional Trial Court the original or duly
authenticated copy of the award and the arbitration agreement. The law also provides
 that “a foreign arbitral award, when confirmed by the RTC, shall be enforced in the
same manner as final and executory decisions of courts of law of the Philippines.

Sec 45

 This section provides that a party to a foreign arbitration proceeding may oppose an
application for recognition and enforcement of the foreign arbitral award under the
rules to be promulgated by the SC. But the opposition, however, shall be limited only
to those grounds enumerated under Art V of the New York Convention. More,
importantly, the same provisions states that any other ground not enumerated in the
Art. V of the New York Convention shall be disregarded by the RTC. It is implicit, if
not explicit, in this provision that the SC cannot add to the grounds enumerated in the
Art V of the New York Convention for opposing the recognition and enforcement of
foreign arbitral awards, even non-convention awards.

 Relate this with Rule 13 of A.M. No. 07-11-08-SC

 Case: TUNA PROCESSING, INC., PETITIONER, VS. PHILIPPINE KINGFORD, INC.,

RESPONDENT (G.R. No. 185582, February 29, 2012)

Sec 46

 Relate this with Rule 19 of A.M.No. 07-11-SC -08-SC

 Cases: 1. Equitable PCI Banking Corporation vs. RCBC Capital Corporation

“Rule 45 is not the remedy available to petitioners as the proper mode of appeal
assailing the decision of the RTC confirming as arbitral award is an appeal before the
CA pursuant to Sec. 46 of Republic Act No. (RA) 9285, otherwise known as the
Alternative Dispute Resolution Act of 2004, or completely, An Act to Institutionalize
the Use of an Alternative Dispute Resolution System in the Philippines and to
Establish the Office for Alternative Dispute Resolution, and for other Purposes,
promulgated on April 2, 2004 and became effective on April 28, 2004 after its
publication on April 13, 2004.”

2. FRUEHAUF ELECTRONICS PHILIPPINES CORPORATION, PETITIONER,

VS. TECHNOLOGY ELECTRONICS ASSEMBLY AND MANAGEMENT
PACIFIC CORPORATION, RESPONDENT G.R. No. 204197, November 23,
2016

Sec 47

Sec 48

CHAPTER 8 - MISCELLANEOUS PROVISIONS

Sec 49
Sec 50
Sec 51
Sec 52
Sec 53
Sec 54
Sec 55
Sec 56