G.R. No.

106879 May 27, 1994

DR. LUCAS G. ADAMSON and ADAMSON MANAGEMENT CORPORATION, petitioners,
vs.
HON. COURT OF APPEALS and APAC HOLDINGS LIMITED, respondents.
Benjamin J. Yap for petitioners.
Bautista, Picazo, Buyco, Tan & Fider for private respondent.
 
ROMERO, J.:
Before us is a petition for review on certiorari of a decision of the Court of Appeals, the dispositive portion of which is
quoted hereunder:
WHEREFORE, judgment is hereby rendered setting aside respondent judge's questioned order dated 23 August 1991
and confirming the subject arbitration award. Costs against private respondents.
SO ORDERED.
The antecedents of this case are as follows:
On June 15, 1990, the parties, Adamson Management Corporation and Lucas Adamson on the one hand, and APAC
Holdings Limited on the other, entered into a contract whereby the former sold 99.97% of outstanding common shares of
stocks of Adamson and Adamson, Inc. to the latter for P24,384,600.00 plus the Net Asset Value (NAV) of Adamson and
Adamson, Inc. as of June 19, 1990. But the parties failed to agree on a reasonable Net Asset Value. This prompted them
to submit the case for arbitration in accordance with Republic Act No. 876, otherwise known as the Arbitration Law.
On May 15, 1991, the Arbitration Committee rendered a decision finding the Net Asset Value of the Company to be
P167,118.00 which was computed on the basis of a pro-forma balance sheet submitted by SGV and which was the
difference between the total assets of the Company amounting to P65,554,258.00 (the sum of the balance sheet asset
amounting to P65,413,978.00 and the increase in Cuevo appraisal amounting to P140,280.00) and total liabilities
amounting to P65,387,140.00 (the difference between current liabilities and long term debt amounting to P68,356,132.00
and Tax Savings for 1987 amounting to P2,968,992).
In so holding that NAV equals P167,118.00, the Arbitration Committee disregarded petitioners' argument that there was a
fixed NAV amounting to P5,146,000.00 as of February 28, 1990 to which should be added the value of intangible assets
(P19,116,000.00), the increment of tangible assets excluding land (P17,003,976.00), the 1987 tax savings
(P2,968,992.00), and estimated net income from February 28, 1990 to June 19, 1990 (P1,500,000.00, later increased to
P3,949,772.00). According to the Committee, however, the amount of P5,146,000.00 which was claimed as initial NAV by
petitioners, was merely an estimate of the Company's NAV as of February 28, 1990 which was still subject to financial
developments until June 19, 1990, the cut-off date. The basis for this ruling was Clause 3(B) of the Agreement which fixed
the said amount; Clause 1(A) which defined NAV and provided that it should be computed in accordance with Clause
7(A); Clause 7(A) which directed the auditors to prepare in accordance with good accounting principles a balance sheet
as of cut-off date which would include the goodwill and intangible assets (P19,116,000.00), the value of tangible assets
excluding the land as per Cuervo appraisal, the adjustment agreed upon by the parties, and the cost of redeeming
preferred shares; and Clause 5(E). Furthermore, the Committee held that the parties used the figures in the pro-forma
balance sheet to arrive at the said amount of P5,146,000.00; that the same had already included the value of the
intangible assets and of the Cuervo appraisal of the tangible assets so that the latter items could not be added again to
what Vendor claimed to be the initial NAV; and that apart from being an estimate, the amount of P5,146,000.00 was
tentative as it was still subject to the adjustments to be made thereto to reflect subsequent financial events up to the cut-
off date.

In the computation of the NAV, the Committee deemed it proper to appreciate in favor of petitioners the 1987 tax savings
because as of the date of the proceedings, no assessment was ever made by the BIR and the three-year prescriptive
period had already expired. However, it did not consider the estimated net income for the period beginning February 28,
1990 to June 19, 1990 as part of the NAV because it found that as of June 1990, the books of the company carried a net
loss of P4,678,627.00 which increased to P8,547,868.00 after the proposed adjustments were included in the computation
of the NAV. The Committee pointed out that although petitioners herein contested the adjustments, they were, however,
not able to prove that these were not valid, except with respect to the tax savings.
Aside from deciding the amount of NAV, the Committee also held that any ambiguity in the contract should not necessarily
be interpreted against herein private respondents because the parties themselves had stipulated that the draft of the
agreement was submitted to petitioners for approval and that the latter even proposed changes which were eventually
incorporated in the final form of the Agreement.

Thereafter, APAC Holdings Ltd. filed a petition for confirmation of the arbitration award before the Regional Trial Court of
Makati. Herein petitioners opposed the petition and prayed for the nullification, modification and/or correction of the same,
alleging that the arbitrators committed evident partiality and grave abuse of discretion as shown by the following errors:
a. In creating an entirely new contract for the parties that contradicts the essence of their agreement and results in the
absurd situation where a seller incurs enormous expense to sell his property;
b. In treating the provisions in the Agreement independently of one another and thereby nullifying the simple, clear and
express stipulations therein;
c. In interpreting the Agreement although it is couched in plain, simple and clear language, contrary to the well established
principle that if the terms of a contract are clear, the literal meaning of its stipulations shall control;
d. In accepting SGV's proposed adjustments, contrary to the parties' stipulation that the final adjustment items shall
pertain to a specific period and subject to their agreement; and in giving full reliance on SGV report despite SGV's
disclosure of its lack of independence because it acted solely to assist petitioner and its report was intended solely for
petitioner's information;
e. In not applying the "suppressed evidence" rule against petitioner inspite of its refusal to present the Company's income
statement or any other similar report for the adjustment period; and in disregarding respondent's estimate of the net
income for the period as "Adjustment" using SGV's figures and ratios;
f. In not awarding damages and attorney's fee to respondents despite petitioner's bad faith in violating the contract. 1
The Regional Trial Court rendered a decision vacating the arbitration award. The dispositive portion of the decision reads
as follows:
WHEREFORE, the Decision/Arbitration Award in question is hereby VACATED, and APAC (herein petitioner) is hereby
ordered to pay ADAMSON (herein respondents) the final NAV of Forty-seven Million One Hundred Twenty-One Thousand
Four Hundred Sixty-Eight Pesos (P47,121,468.00), Philippine Currency, in accordance with the pertinent stipulations
expressed in the Agreement as discussed above, plus twelve (12) percent interest on the above amount which
ADAMSON should have earned had the balance of the final NAV been paid to the Escrow Agent after offset on August 2,
1990.
ADAMSON's claim for moral and exemplary damages and attorney's fees are (sic) dismissed for lack of sufficient merit.
SO ORDERED. 2

On appeal, the above decision was reversed and a petition for review was filed in this Court. Petitioners allege that the
Court of Appeals erred and acted in excess of jurisdiction or with grave abuse of discretion in holding that: (a) the trial
judge reversed the arbitration award solely on the basis of the pleadings submitted by the parties; (b) petitioners failed to
substantiate with proofs their imputation of partiality to the members of the arbitration committee; (c) the nullification by the
trial court of the award was not based on any of the grounds provided by law; (d) to allow the trial judge to substitute his
own findings in lieu of the arbitrators' would defeat the object of arbitration which is to avoid litigation; and (e) if there really
was a ground for vacating the award, it was improper for trial judge to reverse the decision because it contravened
Section 25 of R.A. No. 876.
Did the Court of Appeals err in affirming the arbitration award and in reversing the decision of the trial court?

The Court of Appeals, in reversing the trial court's decision held that the nullification of the decision of the Arbitration
Committee was not based on the grounds provided by the Arbitration Law and that ". . . private respondents [petitioners
herein] have failed to substantiate with any evidence their claim of partiality. Significantly, even as respondent judge ruled
against the arbitrators' award, he could not find fault with their impartiality and integrity. Evidently, the nullification of the
award rendered at the case at bar was made not on the basis of any of the grounds provided by law." 3
Assailing the above conclusion, petitioners argue that ". . . evident partiality is a state of mind that need not be proved by
direct evidence but may be inferred from the circumstances of the case (citations omitted). It is related to intention which
is a mental process, an internal state of mind that must be judged by the person's conduct and acts which are the best
index of his intention (citations omitted)." 4 They pointed out that from the following circumstances may be inferred the
arbitrators' evident partiality:
1. the material difference between the results of the arbitrators' computation of the NAV and that of petitioners;
2. the alleged piecemeal interpretation by the arbitrators of the Agreement which went beyond the clear provisions of the
contract and negated the obvious intention of the parties;
3. reliance by the arbitrators on the financial statements and reports submitted by SGV which, according to petitioners,
acted solely for the interests of private respondents; and
4. the finding of the trial court that "the arbitration committee has advanced no valid justification to warrant a departure
from the well-settled rule in contract interpretation that if the terms of the contract are clear and leave no doubt upon the
intention of the contracting parties the literal meaning of its interpretation shall control." 5
We find no reason to depart from the Court of Appeal's conclusion.

Section 24 of the Arbitration Law provides as follows:

Sec. 24. Grounds for vacating award. — In any one of the following cases, the court must make an order vacating the
award upon the petition of any party to the controversy when such party proves affirmatively that in the arbitration
proceedings:
(a) The award was procured by corruption, fraud or other undue means; or
(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 willfully refrained from disclosing such disqualifications or 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. . . .

Petitioners herein failed to prove their allegation of partiality on the part of the arbitrators. Proofs other than mere
inferences are needed to establish evident partiality. That they were disadvantaged by the decision of the Arbitration
Committee does not prove evident partiality.
Too much reliance has been accorded by petitioners on the decision of the trial court. However, we find that the same is
but an adaptation of the arguments of petitioners to defeat the petition for confirmation of the arbitral award in the trial
court by herein private respondent. The trial court itself stated as follows:
In resolving the issues in favor of respondents, the Court has no alternative but to agree with the contention of said party,
as supported by their exhaustive and very convincing arguments contained in more than twenty-one (21) pages, doubled-
spaced, which are adopted and reproduced herein by reference. Said arguments may be CAPSULIZED as follows:
The penultimate paragraph of its decision reads, thus:
To allay any fear of petitioner that its reply and opposition, dated 11 June 1991, has not been taken into account in
resolving this case, it will be well to state that the court has carefully read the same and, what is more, it has also read
respondents' comment, dated 19 June 1991, wherein they made convincing arguments which are likewise adopted and
incorporated herein by reference. 6
The justifications advanced by the trial court for vacating the arbitration award are the following: (a) ". . . that the
arbitration committee had advanced no valid justification to warrant a departure from the well-settled rule in contract
interpretation that if the terms of the contract are clear and leave no doubt upon the intention of the contracting parties the
literal meaning of its interpretation shall control; (b) that the final NAV of P47,121,468.00 as computed by herein
petitioners was well within APAC's normal investment level which was at least US$1 million and to say that the NAV was
merely P167,118.00 would negate Clause 6 of the Agreement which provided that the purchaser would deposit in escrow
P5,146,000.00 to be held for two (2) years and to be used to satisfy any actual or contingent liability of the vendor under
the Agreement; (c) that the provision for an escrow account negated any idea of the NAV being less than P5,146,000.00;
and (d) that herein private respondent, being the drafter of the Agreement could not avoid performance of its obligations
by raising ambiguity of the contract, or its failure to express the intention of the parties, or the difficulty of performing the
same.
It is clear therefore, that the award was vacated not because of evident partiality of the arbitrators but because the latter
interpreted the contract in a way which was not favorable to herein petitioners and because it considered that herein
private respondents, by submitting the controversy to arbitration, was seeking to renege on its obligations under the
contract.
That the award was unfavorable to petitioners herein did not prove evident partiality. That the arbitrators resorted to
contract interpretation neither constituted a ground for vacating the award because under the circumstances, the same
was necessary to settle the controversy between the parties regarding the amount of the NAV. In any case, this Court
finds that the interpretation made by the arbitrators did not create a new contract, as alleged by herein petitioners but was
a faithful application of the provisions of the Agreement. Neither was the award arbitrary for it was based on the
statements prepared by the SGV which was chosen by both parties to be the "auditors."
The trial court held that herein private respondent could not shirk from performing its obligations on account of the
difficulty of complying with the terms of the contract. It said further that the contract may be harsh but private respondent
could not excuse itself from performing its obligations on account of the ambiguity of the contract because as its drafter,
private respondent was well aware of the implications of the Agreement. We note herein that during the arbitration
proceedings, the parties agreed that the contract as prepared by private respondent, was submitted to petitioners for
approval. Petitioners, therefore, are presumed to have studied the provisions of the Agreement and agreed to its import
when they approved and signed the same. When it was submitted to arbitration to settle the issue regarding the
computation of the NAV, petitioners agreed to be bound by the judgment of the arbitration committee, except in cases
where the grounds for vacating the award existed. Petitioners cannot now refuse to perform its obligation after realizing
that it had erred in its understanding of the Agreement.
Petitioners also assailed the arbitrator's reliance upon the financial statements submitted by SGV as they allegedly served
the interests of private respondents and did not reflect the true intention of the parties. We agree with the observation
made by the arbitrators that SGV, being a reputable firm, it should be presumed to have prepared the statements in
accordance with sound accounting principles. Petitioners have presented no proof to establish that SGV's computation
was erroneous and biased.
Petitioners likewise pointed out that the computation of the arbitrators leads to the absurd result of petitioners incurring
great expense just to sell its properties. In arguing that the NAV could not be less than P5,146,000, petitioners quote
Clause (B) of the Agreement as follows:

CLAUSE 3(B)
The consideration for the purchase of the Sale Shares by the Purchaser shall be equivalent to the Net Asset Value of the
Company, . . . which the parties HAVE FIXED at P5,146,000.00 prior to Adjustments . . .
However, such quotation is incomplete and, therefore, misleading. The full text of the above provision as quoted by the
arbitration committee reads as follows:
(B) The consideration for the purchase of the Sale Shares by the purchaser shall be equivalent to the Net Asset Value of
the Company, without the Property, which the parties have fixed at P5,146,000 prior to Adjustments plus P24,384,600.
The consideration for the sale of the Sale Shares by the Vendor, is the acquisition of the property by the Vendor, through
Aloha, from the Company at historical cost plus all Taxes due on said transfer of Property, and the release of all
collaterals of the Vendor securing the RSBS Credit Facility. However, in the implementation of this Agreement, the parties
shall designate the amounts specified in Clause 5 as the purchaser prices in the pro-forma deeds of sale and other
documents required to effect the transfers contemplated in this Agreement.
Thus, petitioner cannot claim that the consideration for private respondent's acquisition of the outstanding common shares
of stock was grossly inadequate. If the NAV as computed was small, the result was not due to error in the computations
made by the arbitrators but due to the extent of the liabilities being borne by petitioners. During the arbitration
proceedings, the committee found that petitioner has been suffering losses since 1983, a fact which was not denied by
petitioner. We cannot sustain the argument of petitioners that the amount of P5,146,000.00 was an initial NAV as of
February 28, 1990 to which should still be added the value of tangible assets (excluding the land) and of intangible assets.
If indeed the P5,146,000.00 was the initial NAV as of February 28, 1990, then as of said date, the total assets and
liabilities of the company have already been set off against each other. NET ASSET VALUE is arrived at only after
deducting TOTAL LIABILITIES from TOTAL ASSETS. "TOTAL ASSETS" includes those that are tangible and intangible.
If the amount of the tangible and intangible assets would still be added to the "initial NAV," this would constitute double
counting. Unless the company acquired new assets from February 28, 1990 up to June 19, 1990, no value corresponding
to tangible and intangible assets may be added to the NAV.
We also note that the computation by petitioners of the NAV did not reflect the liabilities of the company. The term "net
asset value" indicates the amount of assets exceeding the liabilities as differentiated from total assets which include the
liabilities. If petitioners were not satisfied, they could have presented their own financial statements to rebut SGV's report
but this, they did not do.

Lastly, in assailing the decision of the Court of Appeals, petitioners would have this Court believe that the respondent
court held that the decision of the arbitrators was not subject to review by the courts. This was not the position taken by
the respondent court.

The Court of Appeals, in its decision stated, thus:

It is settled that arbitration awards are subject to judicial review. In the recent case of Chung Fu Industries (Philippines),
Inc., et. al. v. Court of Appeals, Hon Francisco X. Velez, et. al., G. R. No. 96283, February 25, 1992, the Supreme Court
categorically ruled that:

It is stated expressly under Art. 2044 of the Civil Code that the finality of the arbitrators' award is not absolute and without
exceptions. Where the conditions described in Articles 2038, 2039 and 2040 applicable to both compromises and
arbitrations are obtaining, the arbitrators' award may be annulled or rescinded. Additionally, under Sections 24 and 25 of
the Arbitration Law, there are grounds for vacating, modifying or rescinding an arbitrators' award. Thus, if and when the
factual circumstances referred to in the above-cited provisions are present, judicial review of the award is properly
warranted.
Clearly, though recourse to the courts may be availed of by parties aggrieved by decisions or awards rendered by
arbitrator/s, the extent of such is neither absolute nor all encompassing. . . . 7

It is clear then that the Court of Appeals reversed the trial court not because the latter reviewed the arbitration award
involved herein, but because the respondent appellate court found that the trial court had no legal basis for vacating the
award.
WHEREFORE, in view of the foregoing, this petition is hereby DISMISSED and the decision of the Court of Appeals
AFFIRMED.
SO ORDERED.
Feliciano, Bidin, Melo and Vitug, JJ., concur.

HEUNGHWA INDUSTRY CO.,

LTD.,

Petitioner,

- versus -

DJ BUILDERS CORPORATION,

Respondent.
x----------------------------------------------------------x
 
 
DECISION
 
 
AUSTRIA-MARTINEZ, J.:

Before this Court is a Petition for Review on Certiorari[if !supportFootnotes][1][endif] under Rule 45 of the Rules of Court, seeking to
set aside the August 20, 2004 Decision[if !supportFootnotes][2][endif] and August 1, 2005 Resolution[if !supportFootnotes][3][endif] of the Court of
Appeals (CA) in CA-G.R. SP Nos. 70001 and 71621.
 
The facts of the case, as aptly presented by the CA, are as follows:
 
Heunghwa Industry Co., Ltd. (petitioner) is a Korean corporation doing business in the Philippines, while DJ Builders
Corporation (respondent) is a corporation duly organized under the laws of the Philippines. Petitioner was able to secure a
contract with the Department of Public Works and Highways (DPWH) to construct the Roxas-Langogan Road in Palawan.
 
Petitioner entered into a subcontract agreement with respondent to do earthwork, sub base course and box culvert of said
project in the amount of Php113, 228, 918.00. The agreement contained an arbitration clause. The agreed price was not
fully paid; hence, on January 19, 2000, respondent filed before the Regional Trial Court (RTC) of Puerto Princesa, Branch
51, a Complaint for Breach of Contract, Collection of Sum of Money with Application for Preliminary Injunction, Preliminary
Attachment, and Prayer for Temporary Restraining Order and Damages docketed as Civil Case No. 3421. [if !supportFootnotes][4]
[endif]

 
Petitioner's Amended Answer[if !supportFootnotes][5][endif] averred that it was not obliged to pay respondent because the latter
caused the stoppage of work. Petitioner further claimed that it failed to collect from the DPWH due to respondent's poor
equipment performance. The Amended Answer also contained a counterclaim for Php24,293,878.60.

On September 27, 2000, parties through their respective counsels, filed a Joint Motion to Submit Specific Issues To The
Construction Industry Arbitration Commission[if !supportFootnotes][6][endif] (CIAC), to wit:
 
5. Parties would submit only specific issues to the CIAC for arbitration, leaving other claims to this
Honorable Court for further hearing and adjudication. Specifically, the issues to
be submitted to the CIAC are as follows:

a. Manpower and equipment standby time;

b. Unrecouped mobilization expenses;

c. Retention;

d. Discrepancy of billings; and

e. Price escalation for fuel and oil usage.[if !supportFootnotes][7][endif]

 
On the same day, the RTC issued an Order[if !supportFootnotes][8][endif] granting the motion.
 
On October 9, 2000, petitioner, through its counsel, filed an Urgent Manifestation [if !supportFootnotes][9][endif] praying that additional
matters be referred to CIAC for arbitration, to wit:
 
[if !supportLists]1.              [endif]Additional mobilization costs incurred by [petitioner] for work abandoned by [respondent];
[if !supportLists]2.              [endif]Propriety of liquidated damages in favor of [petitioner] for delay incurred by [respondent];
[if !supportLists]3.              [endif]Propriety of downtime costs on a daily basis during the period of the existence of the
previous temporary restraining order against [petitioner]. [if !supportFootnotes][10][endif]
 
On October 24, 2000, respondent filed with CIAC a Request for Adjudication [if !supportFootnotes][11][endif] accompanied by a
Complaint. Petitioner, in turn filed a Reply/ Manifestation informing the CIAC that it was abandoning the submission to
CIAC and pursuing the case before the RTC. In respondent's Comment on petitioner's Manifestation, it prayed for CIAC to
declare petitioner in default.
 
CIAC then issued an Order[if !supportFootnotes][12][endif] dated November 27, 2000 ordering respondent to move for the dismissal of
Civil Case No. 3421 pending before the RTC of Palawan and directing petitioner to file anew its answer. The said Order
also denied respondent's motion to declare petitioner in default.
 
Respondent filed a Motion for Partial Reconsideration of the November 27, 2000 Order while petitioner moved to suspend
the proceeding before the CIAC until the RTC had dismissed Civil Case No. 3421.
 
On January 8, 2000, CIAC issued an Order [if !supportFootnotes][13][endif] setting aside its Order of November 27, 2000
by directing the dismissal of Civil Case No. 3421 only insofar as the five issues referred to it were concerned. It also
directed respondent to file a request for adjudication. In compliance, respondent filed anew a Revised Complaint [if !
supportFootnotes][14][endif]
which increased the amount of the claim from Php23,391,654.22 to Php65,393,773.42.
 
On February 22 2001, petitioner, through its new counsel, filed with the RTC a motion to withdraw the Order dated
September 27, 2000 which referred the case to the CIAC, claiming it never authorized the referral. Respondent opposed
the motion[if !supportFootnotes][15][endif] contending that petitioner was already estopped from asking for the recall of the Order.
 
Petitioner filed in the CIAC its opposition to the second motion to declare it in default, with a motion to dismiss informing
the CIAC that it was abandoning the submission of the case to it and asserting that the RTC had original and exclusive
jurisdiction over Civil Case No. 3421, including the five issues referred to the CIAC.
 
On March 5, 2001, the CIAC denied petitioner's motion to dismiss on the ground that the November 27, 2000 Order had
already been superseded by its Order of January 8, 2001. [if !supportFootnotes][16][endif]
 
On March 13, 2001, the CIAC issued an Order setting the preliminary conference on April 10, 2001. [if !supportFootnotes][17][endif]
 
On March 23, 2001 petitioner filed with the CIAC a motion for reconsideration of the March 5, 2001 Order.
 
For clarity, the succeeding proceedings before the RTC and CIAC are presented in graph form in chronological order.
 
RTC CIAC

  April 5, 2001 Petitioner filed a Motion to Suspend

proceedings because of the Motion to Recall it filed with the
RTC.

  April 6, 2001 CIAC granted petitioner's motion and

suspended the hearings dated April 10 and 17, 2001.

May 16, 2001 the RTC issued a Resolution[if !supportFootnotes]  

[18][endif]
granting petitioner's Motion to Recall.[if !supportFootnotes]
[19][endif]

June 1, 2001- Respondent moved for a reconsideration  

of the May 16, 2001 Resolution and prayed for the
dismissal of the case without prejudice to the filing of a
complaint with the CIAC.[if !supportFootnotes][20][endif]

June 11, 2001- Petitioner opposed respondent's motion  

for reconsideration and also prayed for the dismissal of
the case but with prejudice.[if !supportFootnotes][21][endif]

July 6, 2001 - The RTC denied respondent's motion for  

reconsideration but stated that respondent may file a
formal motion to dismiss if it so desired.[if !supportFootnotes][22]
[endif]

July 16, 2001- Respondent filed with the RTC a Motion  

to Dismiss[if !supportFootnotes][23][endif] Civil Case No. 3421
praying for the dismissal of the complaint without
prejudice to the filing of the proper complaint with the
CIAC.
 
On the same day, the RTC granted the motion
without prejudice to petitioner's counterclaim.[if !
supportFootnotes][24][endif]

 
 August 1, 2001- Petitioner  
moved for a
reconsideration of the
July 16, 2001 Order
claiming it was denied
due process.[if !supportFootnotes]
[25][endif]

  August 7, 2001 Respondent filed with the CIAC a motion for the resumption of the
proceedings claiming that the dismissal of Civil Case No. 3421 became final on August 3,
2001.

  August 15, 2001 - Petitioner filed a counter-manifestation[if !supportFootnotes][26][endif] asserting that

the RTC Order dated July 16, 2001 was not yet final. Petitioner reiterated the prayer to
dismiss the case.

  August 27, 2001 CIAC issued an Order maintaining the suspension but did not rule on
petitioner's Motion to Dismiss.

  January 22, 2002 CIAC issued an Order setting the case for Preliminary Conference on
February 7, 2002.

  February 1, 2002 - Petitioner filed a Motion for Reconsideration of the January 22, 2002
Order which also included a prayer to resolve the Motion for Reconsideration of the July
16, 2001 Order.

  February 5, 2002 CIAC denied petitioner's Motion for Reconsideration.

  February 7, 2002 CIAC conducted a preliminary conference. [if !supportFootnotes][27][endif]

March 13, 2002 the RTC  

issued a Resolution[if !
supportFootnotes][28][endif]

declaring the July 16,

2001 Order which
dismissed the case
without force and effect
and set the case for
hearing on May 30,
2002.

  March 15, 2002 Petitioner filed a Manifestation before the CIAC that the CIAC had no
authority to hear the case.

  March 18, 2002 CIAC issued an Order setting the hearing on April 2, 2002.

  March 21, 2002 Petitioner filed a Manifestation/Motion that the RTC had recalled the July
16, 2001 Order and had asserted jurisdiction over the entire case and praying for the
dismissal of the pending case.[if !supportFootnotes][29][endif]

  March 22, 2002 CIAC issued an Order [if !supportFootnotes][30][endif] denying the Motion to
Dismiss filed by petitioner and holding that the CIAC had jurisdiction over the case.

March 25, 2002- March 26, 2002 CIAC ordered respondent to file a reply to petitioner's March 21, 2002
Respondent moved for a Manifestation.
reconsideration[if !
supportFootnotes][31][endif]
of the
March 13, 2002 Order
recalling the July 16,
2001 Order which
petitioner opposed.

June 17, 2002 RTC  

denied respondent's
Motion for
Reconsideration.
 
The parties, without waiting for the reply required by the CIAC, [if !supportFootnotes][32][endif] filed two separate petitions for certiorari:
petitioner, on April 5, 2002, docketed as CA-G.R. SP No. 70001; and respondent, on July 5, 2002, docketed as CA-G.R.
SP No. 71621 with the CA.
 
In CA-G.R. SP No. 70001, petitioner assailed the denial by the CIAC of its motion to dismiss and sought to
enjoin the CIAC from proceeding with the case.
 
In CA-G.R. SP No. 71621, respondent questioned the March 13, 2002 Order of the RTC which reinstated Civil Case No.
3421 as well as the Order dated June 17, 2002 which denied respondent's motion for reconsideration. Respondent also
sought to restrain the RTC from further proceeding with the civil case.
 
In other words, petitioner is questioning the jurisdiction of the CIAC; while respondent is questioning the jurisdiction of the
RTC over the case.
 
Both cases were consolidated by the CA.
 
The CA ruled against petitioner on procedural and substantive grounds.
 
On matters of procedure, the CA took note of the fact that petitioner did not file a motion for reconsideration of the March
22, 2002 Order of the CIAC and held that it is in violation of the well-settled rule that a motion for reconsideration should
be filed to allow the respondent tribunal to correct its error before a petition can be entertained. [if !supportFootnotes][33][endif]
Moreover, the CA ruled that it is well-settled that a denial of a motion to dismiss, being an interlocutory order, is not the
proper subject for a petition for certiorari.[if !supportFootnotes][34][endif]
 
Moreover, the CA ruled against petitioner's main argument that the arbitration clause found in the subcontract agreement
between the parties did not refer to CIAC as the arbitral body. The CA held that the CIAC had jurisdiction over the
controversy because the construction agreement contained a provision to submit any dispute for arbitration, and there
was a joint motion to submit certain issues to the CIAC for arbitration. [if !supportFootnotes][35][endif]
 
Anent petitioner's argument that its previous lawyer was not authorized to submit the case for arbitration, the
CA held that what is required for a dispute to fall under the jurisdiction of the CIAC is for the parties to agree to submit to
voluntary arbitration. Since the parties agreed to submit to voluntary arbitration in the construction contract, the
authorization insisted upon by petitioner was a mere superfluity.[if !supportFootnotes][36][endif]
 
The CA further cited National Irrigation Administration v. Court of Appeals [if !supportFootnotes][37][endif] (NIA), where
this Court ruled that active participation in the arbitration proceedings serves to estop a party from denying that it had in
fact agreed to submit the dispute for arbitration.
 
Lastly, the CA found no merit in petitioner's prayer to remand the case to the CIAC.
 
Petitioner's Motion for Reconsideration was denied by the CA. Hence, herein petition raising the following assignment of
errors:
 
A.
THE COURT OF APPEALS COMMITTED SERIOUS ERROR WHEN IT RULED THAT THE PETITION SUFFERED
FROM PROCEDURAL INFIRMITIES WHEN PETITIONER HEUNGHWA, IN VIEW OF THE QUESTIONS OF LAW
INVOLVED IN THE CASE, IMMEDIATELY INVOKED ITS AID BY WAY OF PETITION FOR CERTIORARI WITHOUT
FIRST FILING A MOTION FOR RECONSIDERATION OF THE CIAC'S ORDER DATED 22 MARCH 2002. THE COURT
OF APPEALS FURTHER ERRED IN RULING THAT A DENIAL OF A MOTION TO DISMISS (IN REFERENCE TO THE
ORDER DATED 22 MARCH 2002), BEING AN INTERLOCUTORY ORDER, IS NOT THE PROPER SUBJECT OF A
PETITION FOR CERTIORARI.
 
B.
THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN CONFIRMING THE JURISDICTION OF THE CIAC
OVER THE CASE. ITS RELIANCE ON THE NATIONAL IRRIGATION AUTHORITY VS. COURT OF APPEALS (NIA
VS. CA) WAS MISPLACED AS THE FACTS OF THE INSTANT CASE ARE SERIOUSLY AND SUBSTANTIALLY
DIFFERENT FROM THOSE OF NIA VS. CA.
 

C.
THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN DISREGARDING PETITIONER'S REQUEST TO AT
LEAST REMAND THE CASE TO THE CIAC FOR FURTHER RECEPTION OF EVIDENCE IN THE INTEREST OF
JUSTICE AND EQUITY AS PETITIONER COULD NOT HAVE AVAILED OF ITS OPPORTUNITY TO PRESENT ITS
SIDE ON ACCOUNT OF ITS JURISDICTIONAL OBJECTION. [if !supportFootnotes][38][endif]
 
The petition is devoid of merit.
 
The first assignment of error raises two issues: first, whether or not the non-filing of a motion for reconsideration was fatal
to the petition for certiorari filed before the CA; and second, whether or not a petition for certiorari is the proper remedy to
assail an order denying a motion to dismiss as in the case at bar .
 
As a general rule, a petition for certiorari before a higher court will not prosper unless the inferior court has been given,
through a motion for reconsideration, a chance to correct the errors imputed to it. This rule, though, has certain
exceptions: (1) when the issue raised is purely of law, (2) when public interest is involved, or (3) in case of urgency. As a
fourth exception, it has been held that the filing of a motion for reconsideration before availment of the remedy of certiorari
is not a condition sine qua non when the questions raised are the same as those that have already been squarely argued
and exhaustively passed upon by the lower court.[if !supportFootnotes][39][endif]
 
The Court agrees with petitioner that the main issue of the petition for certiorari filed before the CA
undoubtedly involved a question of jurisdiction as to which between the RTC and the CIAC had authority to hear the case.
Whether the subject matter falls within the exclusive jurisdiction of a quasi-judicial agency is a question of law. [if !supportFootnotes]
[40][endif]
Thus, given the circumstances present in the case at bar, the non-filing of a motion for reconsideration by petitioner
to the CIAC Order should have been recognized as an exception to the rule.
 
Anent the second issue, petitioner argues that when its motion to dismiss was denied by the CIAC, the latter acted without
jurisdiction or with grave abuse of discretion amounting to lack or excess of jurisdiction; thus, the same is the proper
subject of a petition for certiorari.
As a general rule, an order denying a motion to dismiss cannot be the subject of a petition for certiorari. However, this
Court has provided exceptions thereto:
 
Under certain situations, recourse to certiorari or mandamus is considered
appropriate, i.e., (a) when the trial court issued the order without or in excess of
jurisdiction; (b) where there is patent grave abuse of discretion by the trial court; or (c)
appeal would not prove to be a speedy and adequate remedy as when appeal would not
promptly relieve a defendant from the injurious effects of the patently mistaken order
maintaining the plaintiff's baseless action and compelling the defendant needlessly to go
through a protracted trial and clogging the court dockets by another futile case. [if !supportFootnotes][41]
[endif]
(Emphasis supplied)

 
The term grave abuse of discretion in its judicial sense connotes a capricious, despotic, oppressive or whimsical exercise
of judgment as is equivalent to lack of jurisdiction. The word capricious, usually used in tandem with the term arbitrary,
conveys the notion of willful and unreasoning action. [if !supportFootnotes][42][endif]
 
The question then is: Did the denial by the CIAC of the motion to dismiss constitute a patent grave abuse of discretion?
 
Records show that the CIAC acted within its jurisdiction and it did not commit patent grave abuse of
discretion when it issued the assailed Order denying petitioner's motion to dismiss. Thus, this Court rules in the negative.
 
Based on law and jurisprudence, the CIAC has jurisdiction over the present dispute.
 
The CIAC, in its assailed Order, correctly applied the doctrine laid down in Philrock, Inc. v. Construction Industry
Arbitration Commission[if !supportFootnotes][43][endif] (Philrock) where this Court held that what vested in the CIAC original and
exclusive jurisdiction over the construction dispute was the agreement of the parties and not the Court's referral order.
The CIAC aptly ruled that the recall of the referral order by the RTC did not deprive the CIAC of the jurisdiction it had
already acquired,[if !supportFootnotes][44][endif] thus:

x x x The position of CIAC is anchored on Executive Order No. 1008 (1985) which created CIAC and vested in
it original and exclusive jurisdiction over construction disputes in construction projects in the
Philippines provided the parties agreed to submit such disputes to arbitration. The basis of the
Court referral is precisely the agreement of the parties in court, and that, by this agreement as
well as by the court referral of the specified issues to arbitration, under Executive Order No. 1008
(1985), the CIAC had in fact acquired original and exclusive jurisdiction over these issues. [if !
supportFootnotes][45][endif]

 
In the case at bar, the RTC was indecisive of its authority and capacity to hear the case. Respondent first sought redress
from the RTC for its claim against petitioner. Thereafter, upon motion by both counsels for petitioner and respondent, the
RTC allowed the referral of five specific issues to the CIAC. However, the RTC later recalled the case from the CIAC
because of the alleged lack of authority of the counsel for petitioner to submit the case for arbitration. The RTC recalled
the case even if it already admitted its lack of expertise to deal with the intricacies of the construction business. [if !
supportFootnotes][46][endif]

 
Afterwards, the RTC issued a Resolution recommending that respondent file a motion to dismiss without prejudice to the
counterclaim of petitioner, so that it could pursue arbitration proceedings under the CIAC. [if !supportFootnotes][47][endif] Respondent
complied with the recommendation of the RTC and filed a motion to dismiss which was granted by the said court. [if !
supportFootnotes][48][endif]
Later, however, the RTC again asserted jurisdiction over the dispute because it apparently made a
mistake in granting respondents motion to dismiss without conducting any hearing on the motion. [if !supportFootnotes][49][endif]
 
On the other hand, the CIAC's assertion of its jurisdiction over the dispute was consistent from the moment the RTC
allowed the referral of specific issues to it.
 
Executive Order 1008[if !supportFootnotes][50][endif] grants to the CIAC original and exclusive jurisdiction over disputes arising from,
or connected with, contracts entered into by parties involved in construction in the Philippines. In the case at the bar, it is
undeniable that the controversy involves a construction dispute as can be seen from the issues referred to the CIAC, to
wit:
 
[if !supportLists]1.              [endif]Manpower and equipment standby time;
[if !supportLists]2.              [endif]Unrecouped mobilization expenses;
[if !supportLists]3.              [endif]Retention;
[if !supportLists]4.              [endif]Discrepancy of billings; and
[if !supportLists]5.              [endif]Price escalation for fuel and oil usage.[if !supportFootnotes][51][endif]
 
xxxx
 
The Court notes that the Subcontract Agreement[if !supportFootnotes][52][endif] between the parties provides an arbitration clause, to
wit:
 
Article 7

Arbitration

[if !supportLists]7.              [endif]Any controversy or claim between the Contractor and the Subcontractor
arising out of or related to this Subcontract, or the breach thereof, shall be settled by
arbitration, which shall be conducted in the same manner and under the same
procedure as provided in the Prime Contract with Respect to claims between the Owner
and the Contractor, except that a decision by the Owner or Consultant shall not be a condition
precedent to arbitration. If the Prime Contract does not provide for arbitration or fails to specify
the manner and procedure for arbitration, it shall be conducted in accordance with the law of
the Philippines currently in effect unless the Parties mutually agree otherwise. [if !supportFootnotes][53]
[endif]
(Emphasis supplied)

 
However, petitioner insists that the General Conditions which form part of the Prime Contract provide for a specific venue
for arbitration, to wit:
 
5.19.3. Any dispute shall be settled under the Rules of Conciliation and Arbitration of the International
Chamber of Commerce by one or more arbitrators appointed under such Rules. [if !supportFootnotes][54]
[endif]
 
The claim of petitioner is not plausible.
In National Irrigation Administration v. Court of Appeals[if !supportFootnotes][55][endif] this Court recognized the new procedure in the
arbitration of disputes before the CIAC, in this wise:
 
It is undisputed that the contracts between HYDRO and NIA contained an arbitration clause wherein they
agreed to submit to arbitration any dispute between them that may arise before or after the
termination of the agreement. Consequently, the claim of HYDRO having arisen from the
contract is arbitrable. NIA's reliance with the ruling on the case of Tesco Services Incorporated
v. Vera, is misplaced.

The 1988 CIAC Rules of Procedure which were applied by this Court in Tesco case had been duly amended
by CIAC Resolutions No. 2-91 and 3-93, Section 1 of Article III of which reads as follows:

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.  When a contract contains a clause for the submission of a future controversy to arbitration, it is not
necessary for the parties to enter into a submission agreement before the claimant may invoke the jurisdiction of CIAC.
 
Under the present Rules of Procedure, for a particular construction contract to fall
within the jurisdiction of CIAC, it is merely required that the parties agree to submit the same to
voluntary arbitration.  Unlike in the original version of Section 1, as applied in the Tesco case,
the law as it now stands does not provide that the parties should agree to submit disputes
arising from their agreement specifically to the CIAC for the latter to acquire jurisdiction over
the same.  Rather, it is plain and clear that as long as the parties agree to submit to
voluntary arbitration, regardless of what forum they may choose, their agreement will
fall within the jurisdiction of the CIAC, such that, even if they specifically choose
another forum, the parties will not be precluded from electing to submit their dispute
before the CIAC because this right has been vested upon each party by law, i.e., E.O.
No. 1008.[if !supportFootnotes][56][endif] (Emphasis and underscoring supplied)

Based on the foregoing, there are two acts which may vest the CIAC with jurisdiction over a construction dispute. One is
the presence of an arbitration clause in a construction contract, and the other is the agreement by the parties to submit
the dispute to the CIAC.
 
The first act is applicable to the case at bar. The bare fact that the parties incorporated an arbitration clause in their
contract is sufficient to vest the CIAC with jurisdiction over any construction controversy or claim between the parties. The
rule is explicit that the CIAC has jurisdiction notwithstanding any reference made to another arbitral body.
It is well-settled that jurisdiction is conferred by law and cannot be waived by agreement or acts of the parties. Thus, the
contention of petitioner that it never authorized its lawyer to submit the case for arbitration must likewise fail. Petitioner
argues that notwithstanding the presence of an arbitration clause, there must be a subsequent consent by the parties to
submit the case for arbitration. To stress, the CIAC was already vested with jurisdiction the moment both parties agreed to
incorporate an arbitration clause in the sub-contract agreement. Thus, a subsequent consent by the parties would be
superfluous and unnecessary.
 
It must be noted however that the reliance of the CIAC in it's assailed Order on Philrock[if !supportFootnotes][57][endif] is inaccurate. In
Philrock, the Court ruled that the CIAC had jurisdiction over the case because of the agreement of the parties to refer the
case to arbitration. In the case at bar, the agreement to refer specific issues to the CIAC is disputed by petitioner on the
ground that such agreement was entered into by its counsel who was not authorized to do so. In addition, in Philrock, the
petitioner therein had actively participated in the arbitration proceedings, while in the case at bar there where only two
instances wherein petitioner participated, to wit: 1) the referral of five specific issues to the CIAC; and 2) the subsequent
manifestation that additional matters be referred to the CIAC.
 
The foregoing notwithstanding, CIAC has jurisdiction over the construction dispute because of the mere presence of the
arbitration clause in the subcontract agreement.
 
Thus, the CIAC did not commit any patent grave abuse of discretion, nor did it act without jurisdiction when it issued the
assailed Order denying petitioner's motion to dismiss. Accordingly, there is no compelling reason for this Court to deviate
from the rule that a denial of a motion to dismiss, absent a showing of lack of jurisdiction or grave abuse of discretion
amounting to lack of or excess jurisdiction, being an interlocutory order, is not the proper subject of a petition for certiorari.
 
Anent the second assigned error, the Court notes that the reliance of the CA on NIA is inaccurate. In NIA,[if !supportFootnotes][58]
[endif]
this Court observed:
 
Moreover, it is undeniable that NIA agreed to submit the dispute for arbitration to the CIAC. NIA through its
counsel actively participated in the arbitration proceedings by filing an answer with
counterclaim, as well as its compliance wherein it nominated arbitrators to the proposed panel,
participating in the deliberations on, and the formulation of the Terms of Reference of the
arbitration proceeding, and examining the documents submitted by HYDRO after NIA asked
for originals of the said documents.[if !supportFootnotes][59][endif]

 
In the case at bar, the only participation that can be attributed to petitioner is the joint referral of specific issues to the
CIAC and the manifestation praying that additional matters be referred to the CIAC. Both acts, however, have been
disputed by petitioner because said acts were performed by their lawyer who was not authorized to submit the case for
arbitration. And even if these were duly authorized, this would still not change the correct finding of the CA that the CIAC
had jurisdiction over the dispute because, as has been earlier stressed, the arbitration clause in the subcontract
agreement ipso facto vested the CIAC with jurisdiction.
 
In passing, even the RTC in its Resolution recognized the authority of the CIAC to hear the case, to wit:
 
Courts cannot and will not resolve a controversy involving a question which is within the jurisdiction of an
administrative tribunal, especially where the question demands the exercise of sound
administrative discretion requiring the special knowledge, experience and services of the
administrative tribunal to determine technical and intricate matters of fact. And undoubtedly
in this case, the CIAC it cannot be denied, is that administrative tribunal. [if !supportFootnotes][60]
[endif]
(Emphasis supplied)

It puzzles this Court why petitioner would insist that the RTC should hear the case when the CIAC has the required skill
and expertise in addressing construction disputes. Records will bear out the fact that petitioner refused to and did not
participate in the CIAC proceedings. In its defense, petitioner cited jurisprudence to the effect that active participation
before a quasi-judicial body would be tantamount to an invocation of the latter bodies' jurisdiction and a willingness to
abide by the resolution of the case. [if !supportFootnotes][61][endif] Pursuant to such doctrine, petitioner argued that had it participated
in the CIAC proceedings, it would have been barred from impugning the jurisdiction of the CIAC.

Petitioner cannot presume that it would have been estopped from questioning the jurisdiction of the CIAC had it
participated in the proceedings. In fact, estoppel is a matter for the court to consider. The doctrine of laches or of stale
demands is based upon grounds of public policy which requires, for the peace of society, the discouragement of stale
claims and, unlike the statute of limitations, is not a mere question of time but is principally a question of the inequity or
unfairness of permitting a right or claim to be enforced or asserted. [if !supportFootnotes][62][endif] The Court always looks into the
attendant circumstances of the case so as not to subvert public policy. [if !supportFootnotes][63][endif] Given that petitioner questioned
the jurisdiction of the CIAC from the beginning, it was not remiss in enforcing its right. Hence, petitioner's claim that it
would have been estopped is premature.

The Court finds the last assigned error to be without merit.

 
It is well to note that in its petition for certiorari[if !supportFootnotes][64][endif] filed with the CA on April 9, 2002, petitioner prayed for
the issuance of a temporary restraining order and a writ of preliminary injunction to enjoin the CIAC from hearing the case.
On September 27, 2002, the CIAC promulgated its decision awarding Php31,119,465.81 to respondent. It is unfortunate
for petitioner that the CA did not timely act on its petition. Records show that the temporary restraining order [if !supportFootnotes]
[65][endif]
was issued only on October 15, 2002 and a writ of preliminary injunction [if !supportFootnotes][66][endif] was granted on
December 11, 2002, long after the CIAC had concluded its proceedings. The only effect of the writ was to enjoin
temporarily the enforcement of the award of the CIAC.
 
The Court notes that had the CA performed its duty promptly, then this present petition could have been
avoided as the CIAC rules allow for the reopening of hearings, to wit:

SECTION 13.14 Reopening of hearing - The hearing may be reopened by the Arbitral Tribunal 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 hearing shall be the date of closing of the reopened hearing. (Emphasis supplied)

 
But because of the belated action of the CA, the CIAC had to proceed with the hearing notwithstanding the non-
participation of petitioner.

Under the CIAC rules, even without the participation of petitioner in the proceedings, the CIAC was still required to
proceed with the hearing of the construction dispute. Section 4.2 of the CIAC rules provides:
 
SECTION 4.2 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. (Emphasis and underscoring supplied)

 
This Court finds that the CIAC simply followed its rules when it proceeded with the hearing of the dispute notwithstanding
that petitioner refused to participate therein.
To reiterate, the proceedings before the CIAC were valid, for the same had been conducted within its
authority and jurisdiction and in accordance with the rules of procedure provided by Section 4.2 of the CIAC Rules.
 
The ruling of the Supreme Court in Lastimoso v. Asayo[if !supportFootnotes][67][endif] is instructive:
 
xxxx

In addition, it is also understandable why respondent immediately resorted to the remedy of certiorari
instead of pursuing his motion for reconsideration of the PNP Chief's decision as an appeal
before the National Appellate Board (NAB). It was quite easy to get confused as to which
body had jurisdiction over his case. The complaint filed against respondent could fall
 under both Sections 41 and 42 of Republic Act (R.A.) No. 6975 or the Department of
Interior and Local Government Act of 1990. Section 41 states that citizens' complaints
should be brought before the People's Law Enforcement Board (PLEB), while Section 42
states that it is the PNP Chief who has authority to immediately remove or dismiss a PNP
member who is guilty of conduct unbecoming of a police officer.

It was only in Quiambao v. Court of Appeals, promulgated in 2005 or after respondent had already filed the
petition for certiorari with the trial court, when the Court resolved the issue of which body has jurisdiction over
cases that fall under both Sections 41 and 42 of R.A. No. 6975. x x x
 
With the foregoing peculiar circumstances in this case, respondent should not be deprived of the opportunity
to fully ventilate his arguments against the factual findings of the PNP Chief. x x x

Thus, the opportunity to pursue an appeal before the NAB should be deemed available to respondent in the
higher interest of substantial justice.[if !supportFootnotes][68][endif] (Emphasis supplied)

 
In Lastimoso, this Court allowed respondent to appeal his case before the proper agency because of the confusion as to
which agency had jurisdiction over the case. In the case at bar, law and supporting jurisprudence are clear and leave no
room for interpretation that the CIAC has jurisdiction over the present controversy.
 
The proceedings cannot then be voided merely because of the non-participation of petitioner. Section 4.2 of the CIAC
Rules is clear and it leaves no room for interpretation. Therefore, petitioners prayer that the case be remanded to CIAC in
order that it may be given an opportunity to present evidence is untenable. Petitioner had its chance and lost it, more
importantly so, by its own choice. This Court will not afford a relief that is apparently inconsistent with the law.
 
WHEREFORE, the petition is denied for lack of merit. The August 20, 2004 Decision and August 1, 2005 Resolution of
the Court of Appeals in CA-G.R. SP Nos. 70001 and 71621 are AFFIRMED.

Double costs against petitioner.

 
SO ORDERED.