PART I - ARBITRATION

I. General Principles in Arbitration

Fruehauf Electronics Philippines Corporation v. Technology Electronics Assembly and Management

Pacific Corporation, 810 SCRA 280 (2016)

A. Definition
- Elements; When Bound [see Section 3 (d), Republic Act No. 9285 or the
“Alternative Dispute Resolution Act of 2004” (“ADR”)];
- Persons and Matters Subject to Arbitration [see Section 2, Republic Act No. 876
or “The Arbitration Law” (“DAL”)];
- Distinguish Arbitration from Court Litigation [see Fruehauf Electronics
Philippines Corporation v. Technology Electronics Assembly and Management
Pacific Corporation, supra]
- Distinguish Ad Hoc from Institutional Arbitration
- Distinguish Domestic, International, and Commercial Arbitration [see Section 32,
ADR; Rule 1.11 of A.M. No. 07-11-08-SC or the “Special Rules of Court on
Alternative Dispute Resolution” (“Special ADR Rules”); Article 1 (3), UNITRAL
Model Law, as amended (“Model Law”)]

B. The Arbitration Agreement

- Definition [see Article 7(1), Model Law];
- Distinguish Arbitration Agreement and Submission Agreement [see Ormoc
Sugarcane Planters’ Association, Inc. vs. Court of Appeals, 596 SCRA 630
(2009)]
- Principle of Party Autonomy; Private Contract and Consent [see Maria Luisa
Park Association, Inc. vs. Almendras, et al, 606 Phil. 670 (2009)]
- Formal Requisites [see Section 4, DAL; see also National Union Fire Insurance
Co. of Pittsburgh v. Stolt-Nielsen Philippines, Inc., 184 SCRA 682 (1990); BF
Corporation v. C.A., 288 SCRA 267 (1998); Associated Bank v. C.A., 233 SCRA
137 (1994); Ormoc Sugarcane Planters’ Association, Inc. v. C.A., 596 SCRA 630
(2009); Lanuza, Jr. v. BF Corporation, 744 Phil. 612 (2014); Freuhauf Electronics
Philippines Corporation v. Technology Electronics Assembly and Management
Pacific Corporation, 810 SCRA 280 (2016).]
- Effect of Rescission/Resolution under Article 1191 of the Civil Code on an
Arbitration Agreement [see Korea Technologies Co. Ltd. v. Lerma, 542 SCRA 1
(2008)]
- Principle of Separability [See Rule 2.2(B), Special ADR Rules; Article 16, Model
Law; Gonzales, et al. vs. Climax Mining Ltd., et al., 541 Phil. 143 (2007)].
 C. Pathological Arbitration Clause

- Definition [see Lucky Goldstar v Ng Mook Kee Ltd, [1993] 2 HKLR 73];
- Duty of courts [Cf. Mindanao Portland Cement Corp. vs. Mcdonough
Construction Company of Florida, 126 Phil. 78 (1967)];

II. Commencement of Arbitration

A. “When” Commenced

See Section 10 of the Arbitration Law; see also

- Difference between Commencement in Ad Hoc and Institutional Arbitration;

- Demand to Arbitrate; Requirements [see Section 5 of the Arbitration Law, and
Article 5.20 of the ADR Act-IRR];
- Effect of failure to comply with minimum requirements for Demand to Arbitrate
on the Arbitral Tribunal’s jurisdiction [see Article 5.15 of the ADR Act-IRR]; and
- Waiver objections in relation to non-compliance with formal requirements of
the Demand to Arbitrate [see Articles 5.3 and 4.16(b) of the ADR-Act IRR].
B. Judicial Relief Pre and Post Commencement

See Rule 3.1, Special ADR Rules.

- The concept of lex arbitri

o Distinguish between venue [see Section 30, ADR and Section 20, Model
Law], procedural rules, and substantive rules.
o Definition and importance.

B.1. Judicial Relief Pre-Commencement

- Challenge on “existence, validity, and enforceability of [the] arbitration

agreement” [Rule 3.1, Special ADR Rules].
- Grounds and contents of petition [Rules 3.5-3.6, Special ADR Rules].
- Binding nature of determination of the Court vis-à-vis the principle of
Competence-Competence; The “after-after” principle [Rule 3.11, Special ADR
Rules].
- Relief against court action [Rule 3.11, Special ADR Rules].
- Effect on Arbitral Proceedings pending determination [Rule 3.3, Special ADR
Rules].

B.2. Judicial Relief Post-Commencement

- Judicial Relief on finding of Arbitral Tribunal that it has jurisdiction over the
controversy [Rule 3.12, Special ADR Rules]
- Who may file, when it may be filed, and venue [Rules 3.12-3.14, Special ADR
Rules].
- Grounds and contents of petition [Rules 3.15-3.16, Special ADR Rules].
- Judicial restraint vis-à-vis refusal of Arbitral Tribunal to act “on the first
instance” [Rule 3.20, Special ADR Rules; Cf. Article 5.15, ADR Act-IRR; see also
Rule 3.21, Special ADR Rules].
- Relief against court action [Rule 3.19, Special ADR Rules].
- Effect on Arbitral Proceedings pending termination [Rule 3.18(B), Special ADR
Rules]
- Binding nature of determination of the Court after review of the Arbitral
Tribunal’s Decision [See 3.11, Special ADR Rules].
B.3. Referral to Alternative Dispute Resolution

- Who may file and when it may be made [Rules 4.1-4.2, Special ADR Rules].
- Forms and contents of petition [Rule 4.3, Special ADR Rules; see also Rule 15 of
A.M. No. 19-10-20-SC (2019 Rules)].
- Court action and relief [Rules 2.4 and 4.5-4.6, Special ADR Rules].
- Apparent exception to forum shopping [Rule 4.7, Special ADR Rules].
- Effect on Arbitral Proceedings [Rule 4.8, Special ADR Rules; Vega vs. San Carlos
Milling Co., Ltd., G.R. No. 21549, (22 October 1924)].
- Distinguish with Petition to Compel Arbitration.
C. Appointment of Arbitrators

- Qualifications of Arbitrators [see Section 10, DAL; Magellan Capital

Management Corp. vs. Zosa, 355 SCRA 157 (2001)].
- Procedure for Appointment [see Section 5, DAL; Article 5.20, ADR Act-IRR; and
Article 2045 of the Civil Code. see also Sections 8-9, DAL; Section 26, ADR;
Article 1.6(D)(2), ADR Act-IRR. See also Article 5.5, ADR Act-IRR, and Rule 6.1,
Special ADR Rules. see further Rules 6.7 and 6.9 of the Special ADR Rules].
- Appointment of Substitute Arbitrator [see Article 5.14, ADR Act-IRR].
 - Disclosure of potential conflict of interest [see Article 5.11, ADR Act-IRR,
Sections 10-11, DAL]
- Acceptance of appointment [see Article 5.10, ADR Act-IRR]
- Constitution of the Arbitral Tribunal [Section 28, ADR]
- Court intervention in issues concerning appointment of arbitrators [Article 5.12,
ADR Act-IRR; compare with Section 8, DAL on Appointing Authority]
o Venue [Rule 6.3, Special ADR Rules]
o Court Action [Rule 6.7, Special ADR Rules]
o Forum Shopping [Rule 6.8, Special ADR Rules]
o Relief [Rule 6.9, Special ADR Rules]

D. Challenge Procedure

[see Section 20, DAL]

- Grounds for Challenge [Article 5.11, ADR Act-IRR; see Article 12, Model Law].
- Procedure and Resolution [Article 5.12, ADR Act-IRR; compare with Section 8,
DAL on Appointing Authority; see also Article 13, Model Law; Oil and Natural
Gas Commission vs. C.A., G.R. No. 114323 (1998)]
- Court intervention [Rule 7.2, Special ADR Rules]
o Grounds [Rule 7.4, Special ADR Rules]
o Venue [Rule 7.5, Special ADR Rules]
o Court Action [Rule 7.7, Special ADR Rules]
o Relief [Rules 7.8-7.9, Special ADR Rules]
- Effect on pendency of challenge outside court system and within [Article 5.12,
ADR Act-IRR]

E. Termination of Mandate

- Distinguish with Challenge [Rule 8.1, Special ADR Rules; see also Article 14,
Model Law].
- Court intervention [Rule 8.2, Special ADR Rules]
o Venue [Rule 8.3, Special ADR Rules]
o Court Action [Rule 8.6, Special ADR Rules]
o Relief [Rule 8.7, Special ADR Rules]
- Appointment of substitute in case of termination of mandate [Rule 8.8, Special
ADR Rules]
F. Interim Measures of Protection

F.1. Interim Relief By The Arbitral Tribunal

- Power of the Arbitral Tribunal to Issue Interim Measures of Protection

[Sections 28-29, ADR; Article 5.24 (a), ADR Act-IRR; see also Rule
5.13,Special ADR Rules]
- When may issue [Article 5.24 (B), ADR Act-IRR]
- Grounds [Article 5.24 (c) of the ADR Act-IRR]
- Necessity of security [Article 5.24 (C), ADR Act-IRR].
- Binding nature [Article 5.24 (c) (v) and Article 5.24 (vii), ADR Act-IRR]

F.2. Interim Relief By The Courts Of Law

- Who, when, and where may an application be filed [Section 28, ADR;
Rules 5.1-5.3 and of the Special ADR Rules; see also Section 14 of The
Arbitration Law; Korea Technologies Co. Ltd. v. Lerma, 542 SCRA 1
(2008); Toyota Motors Phils. Corp. vs. Court of Appeals, 216 SCRA 336
(1992)]
- Grounds for issuance [Rule 5.4, Special ADR Rules]
- Types of Interim Measures of Protection that may issue [5.6, Special
ADR Rules]
- Dispensing with prior notice – when applicable; limitations if ex parte
[Rules 5.7 and 5.9, Special ADR Rules]
- Period for court action [Rule 5.9, Special ADR Rules; see Rule 5.15,
Special ADR Rules]
- Relief against court action [Rule 5.10, Special ADR Rules]
- Duty of court to assist [Rules 5.11 and 5.16, Special ADR Rules]

G. Conduct of Arbitration Proceedings

G.1. Case Management Conference

- Section 12, Arbitration Law; Article 5.23 (b), ADR Act-IRR; see Article
5.23 (b) (iii), ADR Act-IRR]
- Jurisdictional Challenge during Case Management Conference [Article
5.15 (d), ADR Act-IRR; Oil and Natural Gas vs. Court of Appeals, G.R.
No. 114323 (1998)]