3.

Arbitration distinguished from mediation:

• In arbitration, it is the arbitrator who decides the dispute and renders an arbitral award to
conclude the proceeding. In mediation, it is the parties themselves who enter into and execute a
mediated settlement agreement to conclude the proceeding.
• Arbitration is merit/evidence-based. Mediation is not necessarily evidence-based.
4. Arbitration as distinguished from the court trial system:
The basic difference between arbitration and litigation is that court is involved in the case of
litigation, as it is a lawsuit, it is governed by rules of court, whereas, in arbitration, a settlement
between the parties is done out of court, autonomy of parties are encouraged.
5. Advantages of arbitration over court litigation:
“An arrangement for taking and abiding by the judgment of selected persons in some disputed
matter, instead of carrying it to established tribunals of justice, and is intended to avoid the
formalities, the delay, the expense, and vexation of ordinary litigation.” -Uniwide Sales Realty v.
Titan-ikeda Construction
6. . Do arbitral tribunal have the effect of res judicata?
The arbitral award is final and binding on the parties and should bar the parties from relitigating
the same issue in a Phil. Court when there is an identity of parties, subject matter, cause of action
between the arbitration proceeding and the court case.

7. What are some of the advantages of institutional arbitration compared to ad hoc?

-Generally, institutional arbitration has the advantage of predictability and certainty. The
arbitration undergoes a process that both parties accept in advance of the dispute, from the
appointment of the tribunal, to the venue and conduct of the proceeding, to the time limit, up to
the rendition and enforcement of the final award. The parties are also familiar with the cost of
institutional arbitration, which apply uniformly to all disputes.
8.regardless of the agreement of the parties, are there mandatory provisions providing for
the vacation of domestic awards? What are its effect?
Regardless of the agreement of the parties, domestic awards can be vacated on the following
grounds (rule 11.4, Special Rules of Court on Alternative Dispute Resolution):
 The arbitral award was procured through corruption, fraud or other undue means.
 There is evidence of partiality or corruption in the arbitral tribunal or any of its members.
 The arbitral tribunal was guilty of misconduct or any form of misbehaviour that has
materially prejudiced the rights of any party.
 One or more of the arbitrators was disqualified to act as such under the law and deliberately
refrained from disclosing this disqualification.
 The arbitral tribunal exceeded its powers, or imperfectly executed them, so that a complete,
final and definite award on the subject matter submitted to them was not made.
  The arbitration agreement did not exist, is invalid or is otherwise unenforceable.
 A party to arbitration is a minor or a person judicially declared to be incompetent.

9. What matters/issues may not be the subject of arbitration?

Controversies and to cases which are subject to the jurisdiction of the Court of Industrial
Relations (Now NLRC) or which have been submitted to it

10. Does the law of limitation apply to arbitration proceeding? (Broad nung tanung, check
and recheck nlng)
Ans.
The following matters cannot be the subject of arbitration:
 Labour disputes covered by the Labour Code.
 Civil status of persons.
 Validity of marriage.
 Any grounds for legal separation.
 Jurisdiction of courts.
 Future legitime (that is, the future right of an heir to the portion of the deceased's property
which he is entitled under the law regardless of the provisions in the predecessor's will).
 Criminal liability.
 Future support (that is, the right to the support of spouses, descendants, ascendants and
siblings at some future time).
(Section 6, Republic Act 9285 otherwise known as the Alternative Dispute Resolution Act of
2004 and Article 2035, Civil Code of the Philippines

Ans.
A controversy cannot be arbitrated where one of the parties to the controversy is an infant, or a
person judicially declared to be incompetent

Ans.
No person appointed to served as an arbitrator shall be related by blood or marriage within the
sixth degree to either party to the controversy.
No person shall serve as an arbitrator in any proceeding if he has or has had financial, fiduciary
or other interest in the controversy or cause to be decided or in the result of the proceeding, or
has any personal bias, which might prejudice the right of any party to a fair and impartial award.
No party shall select as an arbitrator any person to act as his champion or to advocate his cause.

11. Which arbitration organization are commonly used to resolve large commercial
disputes?
The Construction Industry Arbitration Commission (CIAC) and the Philippine Dispute
Resolution Center Inc (PDRCI) are commonly used to resolve large commercial disputes in the
Philippines.
12. What remedies are available where one party denies that the tribunal has jurisdiction
to determine the disputes?
A party questioning the jurisdiction of an arbitral tribunal can apply to the local courts for
judicial relief in determining the issue of the existence, validity and enforceability of the
arbitration agreement. However, when a court is asked to rule on issues affecting the competence
or jurisdiction of an arbitral tribunal in a dispute brought before it, the court must exercise
judicial restraint and defer to the competence or jurisdiction of the arbitral tribunal by allowing
the arbitral tribunal the first opportunity to rule on such issues (rule 2.4, Special Rules of Court
on Alternative Dispute Resolution) (Special ADR Rules)).
13. Does the tribunal or the local court determine issues of jurisdiction? Does your
jurisdiction recognise the concept of kompetenz-kompetenz?
A party questioning the jurisdiction of an arbitral tribunal can apply to the local courts for
judicial relief in determining the issue of the existence, validity and enforceability of the
arbitration agreement. However, when a court is asked to rule on issues affecting the
competence or jurisdiction of an arbitral tribunal in a dispute brought before it, the court
must exercise judicial restraint and defer to the competence or jurisdiction of the arbitral
tribunal by allowing the arbitral tribunal the first opportunity to rule on such issues (rule
2.4, Special Rules of Court on Alternative Dispute Resolution) (Special ADR Rules)).
However, the Special ADR Rules also recognise the principle of kompetenz-kompetenz,
which means that the arbitral tribunal can initially rule on its own jurisdiction, including
any objections with respect to the existence or validity of the arbitration agreement (rule
2.2, Special ADR Rules).

14. What are the requirements for an arbitration agreement to be enforceable?

The following are the requirements:
a. Substantive/formal requirements
An arbitration agreement can arise in the following ways:
Two more persons can agree to submit to an arbitration of one or more arbitrators,
any controversy existing between them at the time of the submission, which may be the
subject of an action.
The parties to any contract can agree to settle by arbitration a controversy
thereafter arising between them.
Such submission or contract will be valid, enforceable, and irrevocable, save on
such grounds that exist under the law for revocation of any contract (section 2, Republic
Act 9876 otherwise known as the Arbitration Law) (Arbitration Law).
 A contract or a submission to arbitrate, must be in writing and signed by the
parties or their lawful agents (section 4, Arbitration Law).

15. Are unilateral or optional clauses where one party has the right to choose arbitration,
enforceable?
There is no express prohibition on unilateral or optional clauses. Therefore, an arbitration
agreement giving one party the right to choose arbitration is likely to be enforceable under the
principle of party autonomy (section 2, Republic Act 9285 otherwise known as the Alternative
Dispute Resolution Act of 2004 ).
16. In what circumstances can a third party that did not sign the contract incorporating the
arbitral clause in question entitled to compel a party that did not sign the contract to
arbitrate dispute resulting to the contract?
As a general rule, an arbitration agreement is consensual and therefore only binding on the
contracting parties. Therefore, parties that did not sign the contract cannot be compelled to
arbitrate disputes relating to the contract, except when the contract contains a reference to a
document containing an arbitration clause to which the third party is a signatory.
17. In what circumstance is a third party that did not sign the contract incorporating the
arbitral clause in question entitled to compel a party that did sign the contract to arbitrate
disputes relating to the contract?

A third party that did not sign a contract incorporating an arbitral clause may compel a party that
did sign the contract to arbitrate, if the contract contains a reference to a document containing an
arbitral clause and the reference is such as to make that arbitration clause part of the contract
(section 7(2), UNCITRAL Model Law).

18. Does the applicable law recognise the separability of arbitration agreements?

The Special Rules of Court on Alternative Dispute Resolution (Special ADR Rules) recognize
the principle of separability of the arbitration clause. An arbitration clause must be treated as an
agreement independent of the other terms of the contract of which it forms part. Therefore, a
decision that the contract is null and void will not necessarily lead to the invalidity of the
arbitration clause (rule 2.2, Special ADR Rules).

19. Q. What remedies are available where a party starts court proceedings in breach of an
arbitration agreement or initiates arbitration in breach of a valid jurisdiction clause?
a. Court proceedings in breach of an arbitration agreement.
Where parties have agreed to submit their dispute to arbitration, the local courts must refer the
parties to arbitration, bearing in mind that the arbitration agreement is the law between the
parties and they are expected to abide by it in good faith (rule 2.2 (A), Special Rules of Court on
Alternative Dispute Resolution (Special ADR Rules).
b. Arbitration in breach of a valid jurisdiction clause
A party who initiates arbitration in breach of a valid jurisdiction clause (whether contained in an
arbitration clause or in a submission agreement), can file a motion requesting the local court to
refer the parties to arbitration in accordance with the jurisdiction clause (rule 4.1, Special ADR
Rules).
20. Will the local courts grant an injunction to restrain proceedings started overseas in
breach of an arbitration agreement?
Assuming that a valid application for an injunction has been filed in the local court with
jurisdiction over matter, the court can grant an injunction to restrain the parties to continue
proceedings started overseas in breach of an arbitration agreement.
21. In what circumstance can a third party be joined to an arbitration or otherwise be
bound by an arbitration awards.
A third party can be joined to an arbitration or be bound by an arbitration awards if the
third party is a provider for security. Under the Special Rules for Alternative Dispute Resolution
a third party may be joined and bound by an arbitration award if the party providing for security
is involved in the dispute specifically if the third party agreed to an arbitration agreement.

22. Are there legal requirements relating to the number and qualifications/characteristics
of arbitrators. Must an arbitration be a natural born Filipino?
Under RA 876 an arbitrator must be: a) of legal age; b)in full enjoyment of his civil
rights; and c) know how to read and write. No arbitrator must be appointed who is related by
blood or marriage with either party of the controversy within 6th degree. No arbitrator shall have
or had any financial, fiduciary or other interest in the controversy.
23. Are there any requisites relating to arbitrators independence/Impartiality
Answer:
-The parties are free to determine the number of arbitrators. However, if this is not expressly
agreed, the default position is three (Article 10, UNCITRAL Model Law (Model Law), section
19, Republic Act 9285 otherwise known as the Alternative Dispute Resolution Act of 2004.
A person appointed as an arbitrator must be of legal age, have full civil rights and must know
how to read and write. The person appointed as an arbitrator must not (section 10, Republic Act
9876 otherwise known as the Arbitration Law) (Arbitration Law):
  Be related by blood or marriage up to the sixth degree to either party to the arbitration
agreement.
 Have or have had any financial, fiduciary or other interest in the dispute.
 Have any personal bias that might prejudice the right of any party to a fair and impartial
award.
 No person shall be precluded by reason of his nationality from acting as an arbitrator,
unless otherwise agreed by the parties (Article 11(1), Model Law, section 19, Arbitration
Law)
24. Does the law contain default provision relating to appointment or removal of
arbitrators?

Appointment of arbitrators
The court must act as the appointing authority (the person or institution named as such in an
arbitration agreement) to appoint arbitrators in the following instances (rule 6.1, Special Rules of
Court on Alternative Dispute Resolution (Special ADR Rules)):
 Where any of the parties in an institutional arbitration:
 fail or refuse to appoint an arbitrator; or
 fail to reach an agreement on the sole arbitrator (in an arbitration before a sole
arbitrator).
 When the two designated arbitrators fail to reach an agreement on the third or presiding
arbitrator (in an arbitration to be conducted by three arbitrators), and the institution under
whose rules arbitration is to be conducted fails or is unable to perform its duty as appointing
authority within a reasonable time from receipt of the request for appointment.
 In all instances where arbitration is ad hoc and:
 the parties failed to provide a method for appointing or replacing an arbitrator, or
substitute arbitrator; or
 the method agreed on is ineffective; and
 the National President of the Integrated Bar of the Philippines or his duly authorised
representative fails or refuses to appoint an arbitrator.
 If the appointing authority fails or refuses to act or appoint an arbitrator within a reasonable
time from receipt of the request to do so, any party or the appointed arbitrator(s) can request
the court to appoint an arbitrator or the third arbitrator as the case may be.

Removal of arbitrators
An arbitrator can be removed in accordance with the procedure agreed by the parties or as
provided for in Article 13(2) of the UNCITRAL Model Law. If challenged, an arbitrator can be
removed by an appointing authority or the court, on application, if the appointing authority fail
or refuses to act on the challenge (rule 7.2, Special ADR Rules). The disqualification can occur if
the arbitrator (section 10,Republic Act 9876 otherwise known as the Arbitration Law ):
 Is related by blood or marriage within the sixth degree to either party to the controversy.
 Has or had financial, fiduciary or other interest in the controversy or cause to be decided or
in the result of the proceeding.
 Has any personal bias which might prejudice the right of any party to a fair and impartial
award.
25. Does the law provide default rules governing the commencement of arbitral
proceedings?
Philippine law does not provide for default rules governing the commencement of arbitral
proceedings. The parties are free to agree on the rules governing the commencement of arbitral
proceedings. However, arbitration must commence by service to the other party of a demand for
arbitration (section 5, Republic Act 9876 otherwise known as the Arbitration Law and Article 21,
UNCITRAL Model Law).
26. What procedural rules are arbitrators likely to follow? Can the parties determine the
procedural rules that apply? Does the law provide any default rules governing procedure?
Applicable procedural rules Arbitrators are likely to follow the UNCITRAL Rules of Procedure,
International Chamber of Commerce Rules of Procedure and the Philippine Dispute Resolution
Center Inc Rules of Procedure. The parties are also free to agree on the procedure to be followed
in the conduct of arbitral proceedings, including the adoption of procedural rules of institutional
arbitration (rule 2.3, Special Rules of Court on Alternative Dispute Resolution (Special ADR
Rules)). Default rules If parties fail to agree on the procedure to be followed, the arbitral tribunal
can conduct arbitration in the manner it considers appropriate (rule 2.3, Special ADR Rules),
taking into account the provisions of the Republic Act 9876 otherwise known as the Arbitration
Law and the Alternative Dispute Resolution Act 2004.
27. What procedural rules are arbitrators likely to follow? Can the parties determine the
procedural rules that apply? Does the law provide any default rules governing procedure?
-Applicable procedural rules Arbitrators are likely to follow the UNCITRAL Rules of
Procedure, International Chamber of Commerce Rules of Procedure and the Philippine Dispute
Resolution Center Inc Rules of Procedure. The parties are also free to agree on the procedure to
be followed in the conduct of arbitral proceedings, including the adoption of procedural rules of
institutional arbitration (rule 2.3, Special Rules of Court on Alternative Dispute Resolution
(Special ADR Rules)).
Default rules
If parties fail to agree on the procedure to be followed, the arbitral tribunal can conduct
arbitration in the manner it considers appropriate (rule 2.3, Special ADR Rules), taking into
account the provisions of the Republic Act 9876 otherwise known as the Arbitration Law and the
Alternative Dispute Resolution Act 2004.
28. What procedural powers does the arbitrator have under the applicable law? If there is
no express agreement, can the arbitrator order disclosure of documents and attendance of
witnesses (factual or expert)?
-Regardless of any agreement between the parties, the arbitrators have the power to (section 14,
Republic Act 9876 otherwise known as the Arbitration Law) (Arbitration Law): Require any
person to attend a hearing as a witness. Subpoena witnesses and order the disclosure of
documents when relevant to the case. Take measures to safeguard and/or conserve any matter
that is the subject of the dispute in arbitration (at any time before rendering the award). An
arbitrator can also require the parties to produce additional evidence that it deems necessary for
the understanding and determination of the dispute (section 15, Arbitration Law).
However, that the arbitral tribunal has no inherent contempt powers; accordingly, the arbitral
tribunal must apply to the proper court to enforce such orders and request sanctions in instances
of non-compliance. The parties can also request the court for assistance in taking evidence and
the disclosure of documents (rule 9.5, Special Rules of Court on Alternative Dispute Resolution.)
29. Is arbitration confidential? If so, what is the scope of that confidentiality and who is
subject of that obligation? (Parties, arbitrators, institutions, and so on)
ANSWER: The arbitration proceedings, including the records, evidence and the arbitral award,
are confidential and must not be published (section 23, Republic Act 9285 otherwise known as
the Alternative Dispute Resolution Act of 2004 )(Alternative Dispute Resolution Act of 2004).
Information is deemed confidential if it is intended by the source not to be disclosed, or obtained
under circumstances that would create a reasonable expectation on behalf of the source that the
information must not be disclosed. This includes (section 3 (h),Alternative Dispute Resolution
Act of 2004):
* Communications (oral or written) made in a dispute resolution proceedings, including
memoranda, notes or work products of the neutral party or non-party participant.
* Pleadings, motions manifestations, witness statements, reports filed or submitted in arbitration.
The restriction on confidentiality applies to all the participants in the arbitration proceedings,
including parties, arbitrators and non-party participants such as witnesses, resource persons or
experts and institutions.
30. What is the risk of local court intervening to frustrate domestic arbitration? Can a
party delay proceeding by frequent court applications?
ANSWER: The Supreme Court has laid down a policy of judicial restraint when courts are
asked to rule on issues affecting the competence or jurisdiction of an arbitral tribunal, by
allowing the tribunal to have the first opportunity to rule on such issues (rule 2.4, Special Rules
of Court on Alternative Dispute Resolution (Special ADR Rules)). Further, unless the courts
conclude that the arbitration agreement is null and void, inoperative or incapable of being
performed; courts must suspend court proceedings and refer the parties to arbitration under the
arbitration agreement. Only in very specific instances, as expressly stated in the Special ADR
Rules are the courts allowed to intervene in arbitration proceedings, therefore, the risk of local
court intervention to frustrate the arbitration proceedings seated in its jurisdiction is minimal.
Delaying proceedings A party cannot delay proceedings by frequent court applications and as a
general rule, court applications during arbitration proceedings must not suspend or postpone the
arbitration proceedings.
31. What interim remedies are available from the court?
ANS. The following are the interim measures of protection that a court may grant:
a) preliminary injunction directed agains a party to arbitration; b) preliminary attachment against
property or garnishment of funds in the custody of a bank or a third person; c) appointment of a
receiver; d) detention, preservation, delivery or inspection of property; or e) assistance in the
enforcement of an interim measure of protection granted by the arbitral tribunal, which the latter
cannot enforce effectively.
32. What final remedies are available from the tribunal?
ANS. the following are the final remedies available from the court: a) motion for
reconsideration; b) appeal;or c) petition for certiorari
33.Can arbitration proceedings and awards be appealed or challenged in the local courts?
Rights of appeal/challenge
There is no right of appeal for an arbitral award. An arbitral award is final and binding (rule 19.7,
Special Rules of Court on Alternative Dispute Resolution (Special ADR Rules)). Consequently,
a party to an arbitration proceeding is precluded from filing an appeal or a petition for certiorari
(a writ seeking judicial review) questioning the merits of an arbitral award with the courts (rule
19.7, Special ADR Rules). However, an arbitral award can be vacated, modified, corrected, or
set aside under very limited specified grounds by court action (sections 24 and 25, Republic Act
9876 otherwise known as the Arbitration Law , rule 11.1, Special ADR Rules) .
The exception to the general rule is an arbitral award rendered by the Construction Industry
Arbitration Commission (CIAC), which can be appealed to the Court of Appeals (rule 43,
Revised Rules of Court of the Philippines). Furthermore, a party to an arbitration can petition the
Regional Trial Court to confirm, correct or vacate an arbitral award (rule 11.1, Special ADR
Rules). The decision and orders of the Regional Trial Court relating to the arbitral award can be
reviewed by the Court of Appeals and subsequently by the Supreme Court (rules 19.8, 19.12 and
19.36, Special ADR Rules).
34. What legal fee structures can be used? Are fees fixed by law?
Like in court litigation, the legal fees are subject to agreement between the lawyer and his client
such as:
* Hourly rates.
* Contingency basis.
* Based on tasks accomplished.
* Success fees.
* A combination of the enumerated fee structures. Fees may be reduced if found to be
unconscionable or unreasonable (section 24, rule 138, Revised Rules of Court )
.35. Does the unsuccessful party have to pay the successful party's costs? How does the
tribunal usually calculate any costs award and what factors does it consider?

Cost allocation
The arbitral tribunal has discretion as to how the costs of the arbitration process are awarded
(section 20, Republic Act 9876 otherwise known as the Arbitration Law).

Cost calculation
Awarded costs usually include the expenses (or a portion of them) of any party against another
party. Whether a successful party’s costs (in full or partially), can be recovered is at the tribunal's
discretion.
Following the general rule in evidence, the party who asserts that he is entitled to costs has the
burden of proving the same. The tribunal is prohibited from awarding costs that cannot be proved.

Factors considered
The tribunal can take into consideration all the circumstances of the case. An example is whether
the arbitration case presented difficult questions of law and therefore, that the losing party acted
sincerely in pursuing or resisting the claims.

36. To what extent is an arbitration award made in your jurisdiction enforceable in the local
courts?

The petition for enforcement and recognition of an arbitral award can be filed any time
after the award is made. Once the court is satisfied that the petition filed meets the requirements
of rule 12 of the Special Rules of Court on Alternative Dispute Resolution (Special ADR Rules),
the court must serve a copy of it on the respondent, directing him to file an opposition within 15
days of receipt. The respondent can file a petition to set aside the award in opposition to the
applicant's petition to recognise and enforce, or a petition to recognise and enforce the award in
opposition to the applicant's petition to set aside (rule 12.8, Special ADR Rules).

A petition to recognise and enforce or set aside an arbitral award can be filed with the
regional trial court (rule 12.3, Special ADR Rules):
• Where arbitration proceedings were conducted.


• Where any of the assets to be attached or levied on are located.


• Where the act ordered in the award will be or is being performed.


 • Where any of the parties to the arbitration resides or has its place of business.


• In the National Capital Judicial Region.



If the court finds that the issue between the parties is mainly one of law, the parties may be
required to submit briefs of legal arguments, not more than 15 days of receipt of the order, which
sufficiently discuss the legal issues and the legal basis for the relief prayed (rule 12.9, Special ADR
Rules).
Unless a ground to set aside an arbitral award has been fully established, the court must
dismiss the petition. If, in the same proceedings, there is a petition to recognise and enforce the
arbitral award filed in opposition to the petition to set aside, the court must recognise and enforce
it (rule 12.13, Special ADR Rules).

37 . What is the proper attitude of the courts towards arbitration?

The rule is that unless the agreement is such as to absolutely close the doors of the courts against
the parties which agreement would be void, the court will look with favor upon such amicable
agreements and will only with great reluctance interference to anticipate or nullify the action of
the arbitrator
38. Do arbitral tribunal have the effect of res judicata?
The arbitral award is final and binding on the parties and should bar the parties from relitigating
the same issue in a Phil. Court when there is an identity of parties, subject matter, cause of action
between the arbitration proceeding and the court case.