Alternative Dispute Resolution bound by it iv. A.M. No.

07-11-08-SC Special ADR

Who Rules (2009)
I. Introduction presides v. New York Convention on the
Participa Parties cannot Parties may Recognition and Enforcement of
A. Definitions tion in agree on presiding select Foreign Arbitral Awards (1958)
choosing officer; judge is arbitrator vi. UNCITRAL Arbitration Rules
Alternative Dispute Resolution a process presiding raffled vii. Katarungang Pambarangay (LGC
or procedure used to resolve a dispute or officer RA 7160)
controversy, other than adjudication of a Composit Judge Arbitrator(s) viii. Pertinent Provisions in the Labor
presiding judge of a court or an officer of a ion of Code (1974)
government agency as defined in this Act, in tribunal ix. Pertinent Provisions in the Civil
which a neutral third party participates to Who Philippine Code
assist in the resolution of issues, which bears government x. Pertinent Provisions in the Family
includes arbitration, mediation, conciliation, the cost Code.
early neutral evaluation, mini-trial or any for
combination thereof (R.A. 9285, Sec 3(a)) salary of II. Arbitration
presiding
Arbitration means a voluntary dispute officer 1. Ad hoc A kind of arbitration where the
resolution process in which one or more Governin Philippine law Parties can parties are responsible for determining
arbitrators, appointed in accordance with the g law governs select and agreeing on their own arbitration
agreement of the parties, or rules promulgated and rules governing procedures rather than being
pursuant to this Act, resolve a dispute by in law that will supervised by the procedures of an
rendering an award (R.A. 9285, Sec 3(d)) settling determine arbitral institution.
the their 2. Institutional a kind of arbitration
Mediation means a voluntary process in dispute substantive which is conducted under the auspices
which a mediator, selected by the disputing rights of an institution.
parties, facilitates communication and Venue Venue depends on Rules of
negotiation, and assist the parties in reaching a agreement Court Examples of Institutional Arbitration:
voluntary agreement regarding a dispute. applies;
Venue may International Chamber of Commerce
B. Overview of the Philippine Judicial also depend CIAC
System on PDRCI
agreement Singapore International Arbitration
i. Basics regarding actions, causes of Speed of Longer shorter Centre
actions and right of action Procedur Hongkong International Arbitration
ii. Overview of Civil Procedure e
iii. Overview of Criminal Procedure Centre
Parties Petitioner v. Claimant v. ICSPI Disp.
iv. Overview of Special Proceedings Defendant, Respondent American Arbitration Association
Petitioner v.
C. Distinction between Conventional Japan Commercial Arbitration
Respondent
Litigation v. Arbitration Kuala Lumpur RCA
Public Private
KCAB
Conventional Arbitration ICC International Court of Arbitration
D. History of Arbitration in the
Litigation ICA not a court of adjudication
Philippines
Nature Not Consensual Consensual
cannot be 3. Domestic Arbitration not international
i. R.A. 876 Arbitration Law (1953)
compelled to 4. International Art. 1.3 Unicitral Model
submit to Law
ii. E.O. 1008 Construction Industry
arbitration; Arbitration Law
but once you a. the parties to an arbitration agreement
iii. R.A. 9285 ADR Law of 2004
agree, youre have at the time of the conclusion of
 that agreement, their places of
business in different States; or
b. one of the following places is situated
outside the State in which the parties
have their places of business:
a. the place of arbitration if
determined in, or pursuant to,
the arbitration agreement:
b. any place where a
substantial part of the
obligations of the
commercial relationship is
to be performed or the
place with which the
subject-matter of the
dispute is most closely
connected; or
c. The parties have expressly
agreed that the subject-matter
of the arbitration agreement
relates to more than one
country.
1.4. For the purposes of paragraph (3) of this
article:
a) if a party has more than one place of
business, the place of business is that
which has the closest relationship to
the arbitration agreement;
b) if a party does not have a place of
business, reference is to be made to
his habitual residence.
- Arbitration agreement
determination of rights, obligations,
procedures and rules
- Arbitration clause any dispute
arising out of his contract shall be
resolved by arbitration.
- Container contract a contract
containing the arbitration clause.
B. Exclusions from the coverage of
arbitration
R.A. 9285, Sec. 6. Exception to the
application of this Act. The provisions of this
Act shall not apply to resolution or settlement
of the following:
(a) labor disputes covered by P.D. 442 or
the Labor Code of the Philippines
(b) the civil status of persons
(c) the validity of marriage
Art. 48. In all cases of annulment or
declaration of absolute nullity of marriage, the
Court shall order the prosecuting attorney or
fiscal assigned to it to appear on behalf of the
State to take steps to prevent collusion
between the parties and to take care that
evidence is not fabricated or suppressed.
In the cases referred to in the preceding
paragraph, no judgment shall be based upon a
stipulation of facts or confession of judgment.
(d) any ground for legal separation
Art. 60. No decree of legal separation shall be
based upon a stipulation of facts or a
confession of judgment.
In any case, the Court shall order the
prosecuting attorney or fiscal assigned to it to
take steps to prevent collusion between the
parties and to take care that the evidence is
not fabricated or suppressed.
(e) the jurisdiction of courts
Section 9. Jurisdiction. The Court of Appeals
shall Exercise:
1. Original jurisdiction to issue writs
of mandamus, prohibition, certiorari,
habeas corpus, and quo warranto, and
auxiliary writs or processes, whether or
not in aid of its appellate jurisdiction;
2. Exclusive original jurisdiction over
actions for annulment of judgements of
Regional Trial Courts; and
3. Exclusive appellate jurisdiction over all
final judgements, resolutions, orders or
awards of Regional Trial Courts and
quasi-judicial agencies,
instrumentalities, boards or
commission, including the Securities
and Exchange Commission, the Social
Security Commission, the Employees
Compensation Commission and the
Civil Service Commission, Except those
falling within the appellate jurisdiction
of the Supreme Court in accordance
with the Constitution, the Labor Code
of the Philippines under Presidential
Decree No. 442, as amended, the
provisions of this Act, and of
subparagraph (1) of the third
paragraph and subparagraph 4 of the
fourth paragraph od Section 17 of the
Judiciary Act of 1948.
The court of Appeals shall have the power to
try cases and conduct hearings, receive
evidence and perform any and all acts
necessary to resolve factual issues raised in
cases falling within its original and appellate
jurisdiction, including the power to grant and
conduct new trials or Appeals must be
continuous and must be completed within
three (3) months, unless extended by the Chief
Justice. (as amended by R.A. No. 7902.)
Section 19. Jurisdiction in civil cases.
Regional Trial Courts shall exercise exclusive
original jurisdiction:
1. In all civil actions in which the subject
of the litigation is incapable of
pecuniary estimation;
2. In all civil actions which involve the
title to, or possession of, real property,
or any interest therein, where the
assessed value of the property
involved exceeds Twenty thousand
pesos (P20,000.00) or for civil actions
in Metro Manila, where such the value
exceeds Fifty thousand pesos
(50,000.00) except actions for forcible
entry into and unlawful detainer of
lands or buildings, original jurisdiction
over which is conferred upon
Metropolitan Trial Courts, Municipal
Trial Courts, and Municipal Circuit Trial
Courts;
3. In all actions in admiralty and maritime
jurisdiction where he demand or claim
exceeds One hundred thousand pesos
(P100,000.00) or , in Metro Manila,
where such demand or claim exceeds
 Two hundred thousand pesos
(200,000.00);
4. In all matters of probate, both testate
and intestate, where the gross value of
the estate exceeds One hundred
thousand pesos (P100,000.00) or, in
probate matters in Metro Manila, where
such gross value exceeds Two hundred
thousand pesos (200,000.00);
5. In all actions involving the contract of
marriage and marital relations;
6. In all cases not within the exclusive
jurisdiction of any court, tribunal,
person or body exercising jurisdiction
or any court, tribunal, person or body
exercising judicial or quasi-judicial
functions;
7. In all civil actions and special
proceedings falling within the exclusive
original jurisdiction of a Juvenile and
Domestic Relations Court and of the
Courts of Agrarian Relations as now
provided by law; and
8. In all other cases in which the demand,
exclusive of interest, damages of
whatever kind, attorney's fees,
litigation expenses, and costs or the
value of the property in controversy
exceeds One hundred thousand pesos
(100,000.00) or, in such other
abovementioned items exceeds Two
hundred thousand pesos (200,000.00).
(as amended by R.A. No. 7691*)
Section 20. Jurisdiction in criminal cases.
Regional Trial Courts shall exercise exclusive
original jurisdiction in all criminal cases not
within the exclusive jurisdiction of any court,
tribunal or body, except those now falling
under the exclusive and concurrent jurisdiction
of the Sandiganbayan which shall hereafter be
exclusively taken cognizance of by the latter.
Section 21. Original jurisdiction in other
cases. Regional Trial Courts shall exercise
original jurisdiction:
1. In the issuance of writs of certiorari,
prohibition, mandamus, quo warranto,
habeas corpus and injunction which
may be enforced in any part of their
respective regions; and
2. In actions affecting ambassadors and
other public ministers and consuls.
Section 22. Appellate jurisdiction. Regional
Trial Courts shall exercise appellate jurisdiction
over all cases decided by Metropolitan Trial
Courts, Municipal Trial Courts, and Municipal
Circuit Trial Courts in their respective territorial
jurisdictions. Such cases shall be decided on
the basis of the entire record of the
proceedings had in the court of origin and such
memoranda and/or briefs as may be submitted
by the parties or required by the Regional Trial
Courts. The decision of the Regional Trial
Courts in such cases shall be appealable by
petition for review to the
Court of Appeals which may give it due course
only when the petition shows prima facie that
the lower court has committed an error of fact
or law that will warrant a reversal or
modification of the decision or judgment
sought to be reviewed.
Section 23. Special jurisdiction to try special
cases. The Supreme Court may designate
certain branches of the Regional Trial Courts to
handle exclusively criminal cases, juvenile and
domestic relations cases, agrarian cases, urban
land reform cases which do not fall under the
jurisdiction of quasi-judicial bodies and
agencies, and/or such other special cases as
the Supreme Court may determine in the
interest of a speedy and efficient
administration of justice.
Jurisdiction of Metropolitan Trial Courts,
Municipal Trial Courts and Municipal Circuit
Trial Courts in criminal cases. Except in cases
falling within the exclusive original jurisdiction
of Regional Trial Courts and of the
Sandiganbayan, the Metropolitan Trial Courts,
Municipal Trial Courts, and Municipal Circuit
Trial Courts shall exercise:
1. Exclusive original jurisdiction over all
violations of city or municipal
ordinances committed within their
respective territorial jurisdiction; and
2. Exclusive original jurisdiction over all
offenses punishable with imprisonment
not exceeding six (6) years irrespective
of the amount of fine, and regardless of
other imposable accessory or other
penalties, including the civil liability
arising from such offenses or
predicated thereon, irrespective of
kind, nature, value, or amount
thereof:Provided, however, That in
offenses involving damage to property
through criminal negligence they shall
have exclusive original jurisdiction
thereof. (as amended by R.A, No. 7691)
Section 33. Jurisdiction of Metropolitan Trial
Courts, Municipal Trial Courts and Municipal
Circuit Trial Courts in civil cases. Metropolitan
Trial Courts, Municipal Trial Courts, and
Municipal Circuit Trial Courts shall exercise:
1. Exclusive original jurisdiction over civil
actions and probate proceedings,
testate and intestate, including the
grant of provisional remedies in proper
cases, where the value of the personal
property, estate, or amount of the
demand does not exceed One hundred
thousand pesos (P100,000.00) or, in
Metro Manila where such personal
property, estate, or amount of the
demand does not exceed Two hundred
thousand pesos (P200,000.00)
exclusive of interest damages of
whatever kind, attorney's fees,
litigation expenses, and costs, the
amount of which must be specifically
alleged: Provided, That where there are
several claims or causes of action
between the same or different parties,
embodied in the same complaint, the
amount of the demand shall be the
totality of the claims in all the causes
of action, irrespective of whether the
causes of action arose out of the same
or different transactions;
2. Exclusive original jurisdiction over
cases of forcible entry and unlawful
detainer: Provided, That when, in such
cases, the defendant raises the
question of ownership in his pleadings
and the question of possession cannot
be resolved without deciding the issue
of ownership, the issue of ownership
 shall be resolved only to determine the
issue of possession.
3. Exclusive original jurisdiction in all civil
actions which involve title to, or
possession of, real property, or any
interest therein where the assessed
value of the property or interest therein
does not exceed Twenty thousand
pesos (P20,000.00) or, in civil actions
in Metro Manila, where such assessed
value does not exceed Fifty thousand
pesos (P50,000.00) exclusive of
interest, damages of whatever kind,
attorney's fees, litigation expenses and
costs:Provided, That value of such
property shall be determined by the
assessed value of the adjacent lots. (as
amended by R.A. No. 7691).
(f) future legitime
Art. 886. Legitime is that part of the testators
property which he cannot dispose of because
the law has reserved it for certain heirs who
are, therefore, called compulsory heirs.
(g) criminal liability
(h) those which by law cannot be
compromised
C. Domestic Arbitration
Definition
Arbitration a voluntary dispute resolution
process in which one or more arbitrators,
appointed in accordance with the agreement of
the parties, or rules promulgated pursuant to
this Act, resolve a dispute by rendering an
award (R.A. 9285, Sec 3(d)).
Principle of Party Autonomy
R.A. 9285, Sec. 2. Declaration of Policy - it is
hereby declared the policy of the State to
actively promote party autonomy in the
resolution of disputes or the freedom of the
party to make their own arrangements to
resolve their disputes. Towards this end, the
State shall encourage and actively promote the
use of Alternative Dispute Resolution (ADR) as
an important means to achieve speedy and
impartial justice and declog court dockets. As
such, the State shall provide means for the use
of ADR as an efficient tool and an alternative
procedure for the resolution of appropriate
cases. Likewise, the State shall enlist active
private sector participation in the settlement of
disputes through ADR. This Act shall be without
prejudice to the adoption by the Supreme
Court of any ADR system, such as mediation,
conciliation, arbitration, or any combination
thereof as a means of achieving speedy and
efficient means of resolving cases pending
before all courts in the Philippines which shall
be governed by such rules as the Supreme
Court may approve from time to time
Party autonomy freedom of the party to
make their own arrangements to resolve their
disputes.
Objective:
1. speedy and efficient resolution of
disputes.
2. declog court dockets
SADR, Rule 2.1. It is the policy of the State to
actively promote the use of various modes of
ADR and to respect party autonomy or the
freedom of the parties to make their own
arrangements in the resolution of disputes with
the greatest cooperation of and the least
intervention from the courts. To this end, the
objectives of the Special ADR Rules are to
encourage and promote the use of ADR,
particularly arbitration and mediation, as an
important means to achieve speedy and
efficient resolution of disputes, impartial
justice, curb a litigious culture and to de-clog
court dockets.
Objectives:
1. achieve speedy and efficient resolution
of disputes
2. achieve speedy impartial justice
3. curb a litigious culture
4. declog court dockets
Uncitral Model Law, Article 19 -
[Determination of rules of procedure]
1) Subject to the provisions of this Law,
the parties are free to agree on the
procedure to be followed by the arbitral
tribunal in conducting the
proceedings.
2) Failing such agreement, the arbitral
tribunal may, subject to the provisions
of this Law, conduct the arbitration in
such manner as it considers
appropriate. The power conferred upon
the arbitral tribunal includes the power
to determine the admissibility,
relevance, materiality and weight of
any evidence.
Arbitration Agreement v. (Submission
agreement)
R.A. 876, Sec. 2. Persons and matters
subject to arbitration. - Two or more persons or
parties may submit to the arbitration of one or
more arbitrators any controversy existing
between them at the time of the submission
and which may be the subject of an action, or
the parties to any contract may in such
contract agree to settle by arbitration a
controversy thereafter arising between them.
Such submission or contract shall be valid,
enforceable and irrevocable, save upon such
grounds as exist at law for the revocation of
any contract.
Such submission or contract may include
question arising out of valuations, appraisals or
other controversies which may be collateral,
incidental, precedent or subsequent to any
issue between the parties.
A controversy cannot be arbitrated where one
of the parties to the controversy is an infant, or
a person judicially declared to be incompetent,
unless the appropriate court having jurisdiction
approve a petition for permission to submit
such controversy to arbitration made by the
general guardian or guardian ad litem of the
infant or of the incompetent.
But where a person capable of entering into a
submission or contract has knowingly entered
into the same with a person incapable of so
doing, the objection on the ground of
incapacity can be taken only in behalf of the
person so incapacitated.
- Two or more persons or parties may
submit to the arbitration of one or
more arbitrators any controversy
existing between them at the time of
the submission and which may be the
subject of an action.
- Such submission or contract may
include questions arising from:
o Valuations
o Appraisals
o Other controversies which may
be collateral, incidental,
precedent or subsequent to
any issue between the parties.
- A controversy cannot be arbitrated
when one of the parties is:
o An infant
o Judicially declared incompetent
unless the appropriate
court having
jurisdiction approve a
petition for permission
to submit such
controversy to
arbitration made by the
general guardian or
guardian ad litem of
the infant or of the
incompetent.
- Note: But where a person capable of
entering into a submission or contract
has knowingly entered into the same
with a person incapable of so doing,
the objection on the ground of
incapacity can be taken only in behalf
of the person so incapacitated.
Uncitral Model Law, Art. 7.1. Arbitration
agreement is an agreement by the parties to
submit to arbitration all or certain disputes
which have arisen or which may arise between
them in respect of a defined legal relationship,
whether contractual or not. An arbitration
agreement may be in the form of an arbitration
clause in a contract or in the form of a separate
agreement.
Arbitration agreement may be in the form of:
- Arbitration clause - any dispute arising
out of his contract shall be resolved by
arbitration.
- Container contract a contract
containing the arbitration clause.
RA 876, Sec. 8 Appointment of
arbitrators
If, in the contract for arbitration or in the
submission described in section two, provision
is made for a method of naming or appointing
an arbitrator or arbitrators, such method shall
be followed; but if no method be provided
therein the Court of First Instance shall
designate an arbitrator or arbitrators.
The Court of First Instance shall appoint an
arbitrator or arbitrators, as the case may be, in
the following instances:
(a) If the parties to the contract or submission
are unable to agree upon a single arbitrator; or
(b) If an arbitrator appointed by the parties is
unwilling or unable to serve, and his successor
has not been appointed in the manner in which
he was appointed; or
(c) If either party to the contract fails or refuses
to name his arbitrator within fifteen days after
receipt of the demand for arbitration; or
(d) If the arbitrators appointed by each party to
the contract, or appointed by one party to the
contract and by the proper Court, shall fail to
agree upon or to select the third arbitrator.
(e) The court shall, in its discretion appoint one
or three arbitrators, according to the
importance of the controversy involved in any
of the preceding cases in which the agreement
is silent as to the number of arbitrators.
(f) Arbitrators appointed under this section
shall either accept or decline their
appointments within seven days of the receipt
of their appointments. In case of declination or
the failure of an arbitrator or arbitrators to duly
accept their appointments the parties or the
court, as the case may be, shall proceed to
appoint a substitute or substitutes for the
arbitrator or arbitrators who decline or failed to
accept his or their appointments.
Sec. 9 Appointment of addnal
arbitrators
Where a submission or contract provides that
two or more arbitrators therein designated or
to be thereafter appointed by the parties, may
select or appoint a person as an additional
arbitrator, the selection or appointment must
be in writing. Such additional arbitrator must
sit with the original arbitrators upon the
hearing.
RA 876, Sec. 5. Preliminary procedure. An
arbitration shall be instituted by:
(a) In the case of a contract to arbitrate future
controversies by the service by either party
upon the other of a demand for arbitration in
accordance with the contract. Such demand
shall be set forth the nature of the controversy,
the amount involved, if any, and the relief
sought, together with a true copy of the
contract providing for arbitration. The demand
shall be served upon any party either in person
or by registered mail. In the event that the
contract between the parties provides for the
appointment of a single arbitrator, the demand
shall be set forth a specific time within which
the parties shall agree upon such arbitrator. If
the contract between the parties provides for
the appointment of three arbitrators, one to be
selected by each party, the demand shall name
the arbitrator appointed by the party making
the demand; and shall require that the party
upon whom the demand is made shall within
fifteen days after receipt thereof advise in
writing the party making such demand of the
name of the person appointed by the second
party; such notice shall require that the two
arbitrators so appointed must agree upon the
third arbitrator within ten days from the date of
such notice.

(b) In the event that one party defaults in

answering the demand, the aggrieved party
may file with the Clerk of the Court of First
Instance having jurisdiction over the parties, a
copy of the demand for arbitration under the
contract to arbitrate, with a notice that the
original demand was sent by registered mail or
delivered in person to the party against whom
the claim is asserted. Such demand shall set
forth the nature of the controversy, the amount
involved, if any, and the relief sought, and shall
be accompanied by a true copy of the contract
providing for arbitration.

(c) In the case of the submission of an existing

controversy by the filing with the Clerk of the
Court of First Instance having jurisdiction, of
the submission agreement, setting forth the
nature of the controversy, and the amount
involved, if any. Such submission may be filed
by any party and shall be duly executed by
both parties.

(d) In the event that one party neglects, fails or

refuses to arbitrate under a submission
agreement, the aggrieved party shall follow the
procedure prescribed in subparagraphs (a) and
(b) of this section.