CHAPTER 1

HISTORICAL NOTE
Civil code of the Philippines provisions on compromises and arbitration
The arbitration law, RA 876
The resolution of the senate adhering to the UN convention on recognition and enforcement of foreign arbitral
awards. (ICA)
o
Philippines became a signatory on the UNCITRAL and adopted the Model Law on ICA
ACTION OF THE JUDICIARY
administrative issuances encouraging the use of ADR through PMC and JDR
ACTION OF THE LEGISLATIVE
social legislations, for instance the Labor Code mandated the constitution of the NLRC with an arbitration branch
which is mandatory.
The Local government code enacting the Katarungan pabarangay to settle dispute within the barangay level.
ACTION OF THE EXECUTIVE
the creation of Construction Industry Arbitration Commission or CIAC
also through the OSG, the enactment of rules on ADR for disputes between national government agencies.
ADR ACT OF 2004
RA 9285
this is the first comprehensive ADR law in the Philippines.
General law applicable to all forms of ADR, other than by adjudication of a presiding judge of a court or of an
officer of a government agency.
It recognizes the international application of ADR system.
It adopted the UNCITRAL model law on ICA.
Paved way for Philippines to be a venue for ICA.
o
Salient features in incorporating the UNCITRAL model:

RTC must refer to arbitration in proper cases.

Foreign arbitral awards must be confirmed by the RTC

The RTC has the jurisdiction to review foreign arbitral awards which are appealable

Grounds for judicial review is different in domestic and foreign arbitral award
LAWYERS ROLE
lawyers should assist the courts in encouraging the parties to avail of alternative means of settling dispute. They
have to explain the benefits of the ADR system to them.
Lawyers may also be ADR practitioners or providers.
Chapter 2

ALTERNATIVE DISPUTE RESOLUTION

is a system, using means and methods allowed by law and approved by the parties, for the purpose of resolving or
facilitating the resolution of the disputes and controversies between them, in an expeditious and speedy manner,
without resorting to court adjudication.

DOES THE ADR ACT OF 2004 COVER THE ARBITRAL PROCEEDINGS IN ADMINISTRATIVE AGENCIES?
no. although they are form of ADR, they are not governed by the ADR ACT of 2004 because there are specific laws
and rules governing their procedures.
WAVE OF THE FUTURE IN INTERNATIONAL RELATIONS
ADR in general and arbitration in particular.
PRINCIPLES OF ADR
1. promotion of party autonomy and self determination in the resolution of disputes
2. recognition of ADR as an efficient tool and an alternative procedure for the resolution of cases
3. enlisting of private sector participation
OBJECTIVES AND BENEFITS OF ADR
1. speedy and impartial justice
2. declogging of court dockets
FEATURES OF ADR
1. means to resolve a dispute or controversy
2. utilizes means and methods allowed by law
3. contractual in nature
a. present causal

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4.
5.

b. pre causal
avoids court trial
involves the participation of a neutral third party

SOURCES OF ADR RULES

1. domestic laws and rules
2. acts of the executive branch
3. decisions of the supreme court
4. international laws
5. general principles of law and equity
FORMS OF ADR
1. arbitration
o
arrangement for abiding by the judgment of selected persons in some disputed manner, instead of
carrying it to established tribunals of justice, and is intended to avoid formalities, the delay, the expense,
and vexation of ordinary litigation.
o
Under the ADR act, it is a voluntary dispute resolution in which one or more arbitrators appointed in
accordance with the agreement of the parties, or rules promulgated pursuant to the ADR act, resolve a
dispute by rendering an award.
2. Mediation
o
Voluntary process in which a mediator, selected by the disputing parties, facilitates communication and
negotiation, and assists the parties in reaching a voluntary agreement regarding a dispute.
o
The voluntary agreement is called the mediated settlement agreement
3. Conciliation
o
It is the adjustment and settlement of a dispute in a friendly and unantagonistic manner.
4. Neutral and early neutral evaluation
o
The parties and their lawyers are brought together to present the summaries of their cases and receive a
non-binding assessment by an experienced neutral third person with expertise in the subject.
o
Early neutral evaluation is availed of early in the pre trial phase.
5. Mini trial
o
Merits of the case are argued before a panel composed of senior decision makers, with or without the
presence of a neutral third person, after which parties seek a negotiated settlement.
6. Any combination of the foregoing
o
Any combination approved by the parties as long as not contrary to law, public policy, morals, customs
may be implemented.
o
Example is the med-arb.
7. Any other form of ADR or innominate ADR form
o
Any agreement which satisfies the requirement of ADR.
CLASSIFICATIONS OF FORMS OF ADR
1. as to the number of parties
a. bilateral
b. multilateral
2. as to the number of issues involved
a. simple
b. complex
3. as to the extent of conclusion
a. complete all issues involved are resolved
b. partial not all were resolved
4. as to the role of evidence in the proceeding
a. evidentiary or merit based -like arbitration
b. non evidentiary or non merit based -like mediation
5. as to the pendency of a court case
a. case related if conducted in connection with trial
i. court annexed
ii. court referred
b. independent if conducted irrespective or any pending court case involving the issue
6. as to the applicable law
a. domestic components are within the Philippines
b. international components are outside the Philippines
7. as to the permanence of the ADR provider
a. ad hoc existence of the ADR provider is only temporary for the purpose of a particular dispute or
controversy
b. institutional if the existence of an ADR provider is permanent in character and is not dependent on any
dispute or controversy.
COMPONENTS OF ADR

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1.
2.
3.
4.

contending parties
dispute or controversy
form of ADR
ADR practitioner or provider

ADR PRACTITIONER
Is an individual acting as
mediator, conciliator, neutral
party evaluator or any person
exercising similar functions in
any ADR system

ADR PROVIDER
Is an institution or person
accredited
as
mediator,
conciliator, arbitrator, neutral
party evaluator, or
any
person
exercising
similar
functions in any ADR system.

SUBJECT MATTERS OF ADR

all adversarial disputes and controversies can be the subject of ADR, except those by law or reasons of public
policy are declared not capable of being subjected to ADR.
The following are NOT susceptible of ADR:
o
Civil status of persons
o
Validity of marriage or any ground for legal separation
o
The jurisdiction of the courts
o
Future legitime

Inexistent and cannot be waived

o
Criminal liability

The civil liability arising from the offense and the separate civil liability for quasi delict based on
the act or omission constituting the offense are proper subjects of ADR.
o
Those, which, by law, cannot be compromised. Among others are:

Validity of a legal separation

Future support
INAPPLICABILITY OF ADR ON FUTURE SUPPORT
it is against public policy to waive or enter into a compromise agreement regarding future support because in
principle, support is the basis for life and sustenance which no one can contract away.
Only future support cannot be subject of compromise. Accrued support and support pendente lite can be a valid
subject of ADR being no longer indispensable for life and sustenance of the person entitled thereto.
BASIC CONCEPTS
CONCLUDING ACTS OR AGREEMENTS
Mediated settlement agreement (mediation)
o
Contract executed by the mediating parties, with the assistance of their respective counsels, certified by
a mediator, evidencing a successful mediation.
Compromise agreement (mediation)
o
Parties make reciprocal concessions to avoid litigation or put an end to one already existing.
Judgment based on compromise (court annexed mediation)
o
If the subject of the compromise is also subject of a court litigation, the compromise may be submitted to
the court for approval.
Waiver or quitclaim (conciliation)
o
A statement renouncing any right or claim involved in a controversy by one party in favor of the other. If
the subject of a waiver is also a subject of litigation, this may cause the dismissal of the court action.
Arbitral award (arbitration)
o
Is the partial or final decision by an arbitrator in resolving the issue in a controversy
Award on agreed terms (arbitration)
Consent award (arbitration)
Award based on compromise (arbitration)
ADR PROVIDERS AND PRACTITIONERS
they are acting in a quasi-judicial capacity and are quasi-judicial agencies or instrumentalities.
Their decisions are generally reviewable by special civil action.
The civil liability of ADR providers and practitioners for acts done in the performance of their duties is the same as
that for public officers under the administrative code.
PREFERENCE FOR ADR
the courts may suspend proceedings if the possibility of settlement through the different modes of ADR is present.
Even if the case is already pending in court, either party may, before or during the pre trial, file a motion for the
court to refer the parties to ADR. Or even after the pre trial, the parties may jointly move for the suspension or
dismissal of the action to allow a compromise agreement.

ALTERNATIVE DISPUTE
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If the ADR materialize, either party may submit the agreement to the court before which the action is pending and
move for the approval thereof.
If the agreement is approved in court, either party may ask for the execution of the agreement in the same
manner that a judgment is executed if necessary, to compel the other party to comply therewith.

OFFICE FOR ADR

agency attached to the DOJ, and is headed by an executive director appointed by the President upon the
recommendation of the Secretary of Justice.
Powers and functions of OADR:
o
Promote the use of ADR through education
o
Assist the government in the development of ADR particularly Congress for statutory improvement of the
law
o
Act as appointing authority of mediators when the parties agree
o
Compile and publish a list of ADR providers and practitioners.
CHAPTER 3 MEDIATION UNDER THE ADR ACT OF 2004
COURT-REFERRED MEDIATION or CRM
this is covered by the ADR act.
Mediation ordered by the court to be conducted in accordance with the agreement of the parties when an action is
prematurely commenced in violation of such agreement.
COURT-ANNEXED MEDIATION or CAM
mediation process conducted under the auspices of the court.
Conducted prior to the pre trial where the judge refers the parties to the PMC.
JUDICIAL DISPUTE RESOLUTION or JDR
is the mediation, conciliation and early neutral evaluation process conducted by the judge of a pending case after
a failed CAM and before the pre trial stage.
CLASSIFICATION OF MEDIATION

As to form
o
Non merit based or non evidentiary

Mediation focuses on the facilitation of communication and negotiation between the parties in
order to encourage them to voluntarily settle their dispute. Mediator must refrain from giving
technical advise and must abstain from expressing his personal opinion on the rights and duties
of the parties.

As to the basis of the structure of the ADR provider

o
Institutional

An agreement to submit a dispute to mediation by an institution shall include an agreement to

be bound by the internal policies of such institution.
o
Ad hoc

Place of mediation
o
The parties may freely stipulate on the venue
o
Default venue: any place convenient and appropriate to all parties.
STAGES
1.
2.
3.
4.
5.
6.

IN MEDIATION IN GENERAL (in the absence of stipulation by the parties)

opening statement of the mediator
individual narration by the parties
exchange by the parties
summary of issues
generalization and evaluation of options
closure

HOW IS
1.
2.
3.

MEDIATION CLOSED OR CONCLUDED?

by the execution of the settlement agreement by the parties
by withdrawal from the mediation of any party
by the written declaration of the mediator that any further effort would not be helpful

ADVANTAGES OF MEDIATION
1. confidentiality in the mediation process
2. prompt, economical and amicable resolution of the disputes
3. the decision making authority rests in the parties

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CONFIDENTIAL AND PRIVILEGED NATURE OF MEDIATION COMMUNICATION

the ADR act guaranteed this privilege by declaring certain information as confidential and not capable of being
disclosed, and by declaring that privileged information is inadmissible in evidence.
CONFIDENTIAL INFORMATION UNDER THE ADR ACT
any information relative to the subject of mediation or arbitration, (expressed) expressly intended by the source
not to be disclosed, or (implied) obtained under circumstances that would create a reasonable expectation on
behalf of the source that the information shall not be disclosed.
Confidential information includes (not limited to the ff):
o
Communication in the proceeding including memorandum or work product of a neutral party or a non
party participant
o
Statement made during the proceeding for purposes of considering or conducting mediation or retaining
a mediator.
o
Pleadings, etc filed in arbitration for expert evaluation.
LEGAL EFFECTS OF CONFIDENTIAL AND PRIVILEGED NATURE
1. a party, mediator or non party participant may refuse or prevent any person from disclosing confidential
information
2. confidential information shall not be subject to discovery and inadmissible as evidence in court.

But evidence that is admissible or subject to discovery does not become inadmissible solely by
reason of its use in mediation.
3. In adversarial proceedings, the following persons may not be compelled to disclose confidential information
obtained during the mediation:
a. Parties
b. Mediator
c. Counsel of the parties
d. Non party participants
e. Person hired as secretary, stenographer or clerk during the mediation
f.
Persons who obtained the confidential information by reason of his profession
4. The confidentiality rule will continue to apply even if the mediator was found to be biased.
5. Mediator may not be called to testify to provide information gathered during the mediation
THE FOLLOWING ARE NOT COVERED BY THE CONFIDENTIALITY RULE
1. those contained in the agreement evidenced by a record authenticated by all the parties to the agreement
2. those available to the public, or made during mediation sessions which are open or required by law to be open
3. a threat or statement of a plan to inflict bodily injury or any crime of violence
4. communication intentionally used to plan, attempt to commit, or commit, a crime, or conceal an on going crime or
criminal activity
5. communication sought or offered to prove or disprove abuse, neglect, abandonment, or exploitation in a
proceeding in which a public agency is protecting the interest of an individual protected by law.
6. Communication sought or offered to rove or disprove a claim or complaint or professional misconduct or
malpractice filed against a mediator in a proceeding.
7. Communication sought or offered to prove or disprove a claim or complaint of professional misconduct or
malpractice filed against a party, non party participant, or representative of a party based on conduct occurring
during mediation.
8. Exceptions based on public policy
a. When it is needed in a court proceeding involving a crime or felony
b. A proceeding to prove a claim or defense that under the law is sufficient to reform or avoid liability on a
contract arising out of mediation.
LIMITED USE OF EXEMPTED EVIDENCE
only such portion of the communication necessary for the application of the exception can be admitted in
evidence. The admission of the evidence for the limited purpose of the exception does not render that evidence
admissible for any other purpose.
PRIVILEGE OF THE MEDIATOR
the mediator as a rule may not make a report, assessment, evaluation, recommendation, finding or other
communication regarding a mediation to a court or agency or other authority that will make a ruling on a dispute
that is the subject of a mediation.
Exceptions:
o
When the mediation occurred or has terminated or where a settlement was reached.
o
Those permitted to be disclosed

Example is the disclosure of known facts that a reasonable individual would consider likely to
affect the impartiality of the mediator.

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WAIVER OF CONFIDENTIALITY
Expressed
o
Contained in a record, or made orally during a proceeding by the mediator and the mediation parties.
Implied
o
By failing to timely object to an objectionable question propounded during a trial or to a document being
offered in evidence.
Testimony
o
Testifying or presenting a witness to testify on confidential and privileged information.
Estoppel
o
When a party participant himself discloses the erstwhile confidential information. A person who discloses
confidential information is barred from invoking the privilege as to the remainder of the information
necessary to a complete understanding of the previously disclosed information.
THE MEDIATOR
the mediation parties are given the freedom to choose their mediator and they may request the OADR for the list
of the mediators and their resumes.
If the mediator selected by the parties is unable to act, the parties may select another mediator.
A mediator may withdraw or be compelled to withdraw under the following instances:
o
If any party request the mediator to withdraw
o
Mediator does not have the qualifications, training and experience to enable him to meet the reasonable
expectations of the parties
o
Mediators impartiality is being questioned
o
The continuation of the process will violate ethical standard
o
The safety of any of the parties will be jeopardized
o
The mediator is unable to provide effective services
o
In case of conflict of interest
o
Other instances under the IRR
DUTIES AND FUNCTIONS OF THE MEDIATOR
1. Prior to mediation
a. Competence
b. Impartiality
2. During the mediation
a. Confidentiality
b. Consent and self determination

Ensure that each party understands the nature and character of the mediation proceedings and the
partys free will.
c. Promotion of respect and control of abuse of process

Encourage mutual respect

MEDIATORS COST AND FEE
mediator is allowed to charge under the obligation to disclose the basis thereof
in ad hoc mediation, the parties are free to make their own arrangement as to the cost. In institutional, mediation
cost shall include administrative charges of the mediation institution, mediators fees and associated expenses.
If the mediator withdraws from the mediation, he shall return any unearned fee and unused deposit.
Mediator shall not enter into any fee arrangement contingent upon the results of the mediation because this would
affect his impartiality.
MEDIATED SETTLEMENT AGREEMENT
PRINCIPLES:
1. settlement agreement is prepared by the parties with the assistance of their counsels and the mediator
2. parties with their counsels shall sign the agreement. Mediator shall certify that he explained the contents thereof
to the parties.
3. If the parties agree, the agreement may be jointly deposited or by only one party with notice to the other, with the
COC of RTC where:
a. Any of the parties reside
b. NCJR
4. In enforcing the agreement, petition may be filed in the same court where it was deposited.
5. Parties may agree in the agreement that the mediator shall be the sole arbitrator for the dispute and shall treat
the agreement as an arbitral award.
The deposit of the agreement is not for validity, but only for enforceability.
ROLE OF COUNSEL IN MEDIATION
1. collaborate with the other lawyer to help their clients resolve their differences

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2.
3.
4.

encourage clients to participate in the discussions to craft an agreement

help the client comprehend the mediation and its benefits
discuss with the client the mediation process and its substance

Discussions
02032015
Preliminary conference is already an ADR act.
02102015
Party who initiates the mediation is called the
Claimant
Party who is ought to answer is called the
Respondent
Lawyers may appear in barangay courts if they are
the parties themselves and in a case involving a
minor child, their father who is a lawyer may appear
because minors cannot be held civilly liable
Voluntary mediation is only in ADR act
Compulsory mediation is done by quasi judicial
agencies like the labor arbiters
Court
referred
mediations
are
institutional
mediations
If a court annexed mediation fails, the judge may
order a JDR conducted by him. If the JDR still fails,
the case will be raffled to another branch or the
parties may file a manifestation to retain the judge.
Court annexed mediations or CAM and JDR are not
covered by the ADR act.
Court referred mediation is covered by the ADR act.
Ad hoc is only created for a certain dispute
General rule of procedure in mediation is party
autonomy
Rule of procedure in institutional- general steps
Rule of procedure in ad hoc- party autonomy
If the parties cannot agree on who will be the
mediator, then the mediation fails.
Depositions and modes of discovery does not apply
to mediation
The role of the mediator in a mediated settlement is
to certify.
Mediators have no qualification to be a mediator. It is
enough that they may enter into a contract.
However, if the parties choose the mediator because
of his qualifications, which turned out to be false, the
parties may expel him.
The
mediated
settlement
agreement
is
unenforceable unless deposited. Belated filing or
depositing of the agreement is allowed.

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