ALTERNATIVE DISPUTE RESOLUTION

Atty. Guerzo
Forms of ADR

November 20, 2018 1. Mediation- a voluntary process in which a mediator,

RA 9285
THE ALTERNATIVE DISPUTE RESOLUTION ACT OF
2004
 Approved on April 2, 2004 and took effect on
April 28, 2004
 A special law which institutionalizes the use of
alternative dispute resolution system in the
Philippines.
(SEC. 1, RA 9285)
State Policy
1. 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.
2. promote the use of Alternative Dispute
Resolution (ADR) as an important means to
achieve speedy and impartial justice and
declog court dockets.
3. enlist active private sector participation in the
settlement of disputes through ADR.
LM POWER ENGINEERING VS
Alternative dispute resolution or ADRs provide solution
that are less consuming, less tedious, less confrontational
and more productive of goodwill and lasting
relationships.
selected by the disputing parties, facilitates
communication and negotiation, and assist the parties in
reaching a voluntary agreement regarding a dispute.
a) Court Annexed Mediation- any mediation
process conducted under the auspices of the
court and in accordance with Supreme Court
approved guidelines, after such court has
acquired jurisdiction of the dispute.
b) Court Referred Mediation- mediation
ordered by a court to be conducted in
accordance with the agreement of the parties
when an action is prematurely commenced in
violation of such agreement.
2. Evaluation of a third person- ADR process wherein
the parties and their lawyers are brought together early
in pre-trial phase to present summaries of their cases and
receive a non-binding assessment by an experienced,
neutral person with expertise in the subject in the
substance of this dispute.
3. Mini-trial- a structure dispute resolution method in
which the merits of a case are argued before a panel
comprising senior decision makers with or without the
presence of a neutral third person after which the parties
seek a negotiated settlement. The neutral third person
may be asked to render a non-binding adversary opinion.
4. Mediation-arbitration- a two-step dispute
resolution process involving both mediation and
arbitration

5. Judicial Dispute Resolution- third party who assists

CARGILL PHIL. VS. SAN FERNANDO in resolution of dispute is a judge.

6. Negotiation– Collaborative negotiation – proceeds

from the joint efforts of the parties in reaching an
RCBC VS BDO acceptable settlement of all their concern.

7. Conciliation– Section 7 of RA 9285: The term

"mediation' shall include conciliation.
A third party, who is usually but not necessarily
BDO VS CA neutral, meets with the parties and assists them to
find a way to settle their dispute.

Historical Antecedent of Alternative Dispute Exceptions from application of RA 9285:

Resolution
(a) labor disputes covered by Presidential Decree No. 442,
1. Spanish Civil Code of 1889 otherwise known as the Labor Code of the Philippines, as
CONDOBA VS CONDE amended and its Implementing Rules and Regulations;
2. Civil Code of 1950, art 2024 recognizes validity (b) the civil status of persons;
of arbitration clause (finality of award) (c) the validity of a marriage;
3. Arbitration Law RA 876 (d) any ground for legal separation;
4. Construction Industry Arbitration Law EO (e) the jurisdiction of courts;
1008 (f) future legitime;
5. ADR ACT of 2004, RA 9285 (g) criminal liability; and
(h) those which by law cannot be compromised.

Q: Did RA 9285 repeal or amend our system of Reasons:

barangay justice? NO. Labor disputes – This is governed by Labor Code.
The civil status of persons – This cannot be subjected to
compromise. Participation are strictly rules allow for
The validity of a marriage – Again, this cannot be bound by their party
subjected to compromise. It is fixed by law. national rules of participation,
The jurisdiction of courts – This is conferred by law. procedure. Thus, and thus greater
Future legitime – Still inchoate; this cannot be the subject procedures are flexibility, in
of compromise/ dictated by rules defining the
Criminal liability – This cannot be compromised. But the of litigation. arbitral
civil aspect may be compromised. procedures.
Specialized Not all judges Parties may
Competence are specialized. select highly
Q: How about status of a child, can that be For example, in specialized
compromised? patent, banking arbitrators of
disputes, their choice,
No. Civil status is determined by law. technical provided they
expertise is are independent.
necessary. The Usually, the
Perceived Benefits of Arbitration: duration of the arbitrators will
Arbitration vs. Litigation litigation may follow the case
lead to several from the first
Litigation Arbitration judges hearing day to the last.
Finality Court decisions Most arbitral one case.
are, as a general awards are not Speed Procedures may Arbitration is
rule, subject to subject to be delayed and faster than
various appeals. appeal. They lengthy. Party litigation
may be may get especially where
challenged entangled in a the right to
before the court prolonged and appeal is not
only on very costly series of unrestricted.
limited grounds. appeals.
In any case, most Privacy Court hearings Arbitration
court espouse a as well as the hearings are not
“pro-arbitration judgments are public and only
bias” public. the parties
Enforceability Usually difficult. Yes. Through Moreover, under receive copies of
A court various Philippine law, the award, which
judgment will be international rules and is a great
recognized in conventions, and regulation, all advantage where
another country especially the documents, trade secrets and
generally by New York pleadings and inventions are at
application of a Convention, pieces of stake. In
bilateral treaty signed by some evidence addition, most
or by virtue of 120 countries submitted in arbitration laws
rather strict including the courts are a provide for strict
rules. Philippines, a matter of public confidentiality of
foreign arbitral record, and as a arbitration
award is general rule, proceedings.
typically easier accessible to the Underlying
to enforce than a public. provisions in a
foreign contract
judgment. containing
Neutrality Although Parties can place secrecy
national judges themselves on provisions
may be an equal footing should hold for
impartial, they with regard to: the arbitration
apply the the place of procedure.
language and arbitration (in a
procedural rules neutral country); Predictability In the absence of The dispute will
of their country the language an agreement of be received in
and are often of used; the the parties one place and
the same procedural rules; limiting the not by a race to
nationality as the nationality of forum for judgment in the
one of the arbitrators; and litigation, party- courts of two
parties, thereby legal litigants may nations.
giving rise to the representation. obtain
perceived judgments in
“home-court” their respective
advantage. national courts,
Party National courts Most arbitral which may or
 may not be 3. Executive Order No. 1008 effective February 4, 1985
consistent with which governs construction disputes;
one another.
Cost Court hearings Arbitration 4. Articles 2042-2046 (Arbitration) in relation to Articles
as well as the proceedings 2028-2041 (Compromises) of the Civil Code which refer
judgments are normally do not to arbitration and compromise under the New Civil Code;
public. involve
Moreover, under extensive 5. The pertinent provisions of the Labor Code of the
Philippine law, discovery Philippines, rules and regulations relating to the
rules and processes and resolution of grievances arising from interpretation and
regulation, all trial settings. implementation of CBA;
documents, Thus, costs are
pleadings and reduced 6. The provisions on arbitration in the Clearing House
pieces of somewhat. Rules and Regulations of the Philippine Clearing House
evidence Corporation and its Arbitration Rules and Procedure;
submitted in
courts are a 7. Doctrines or law principles dealing with arbitration
matter of public established by the Supreme Court;
record, and as a
general rule, 8. Convention on the Recognition and Enforcement of
accessible to the Foreign Arbitral Awards (New York Convention of 1958)
public. adhered to by the Philippines in 1965; and

9. World Bank Convention creating the International

Q: What are the salient features of our Arbitration
Law?
Salient Features of RA 9285:
a) It prescribes rules on mediation;
b) It incorporates, as part of the law, the Model Law on
International Commercial Arbitration adopted by the
United National Commission on International Trade Law;
Center for the Settlement of Investment Disputes.
Q: What is the definition of 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 RA 9285, resolve a dispute by rendering an award;

c) It makes the Model Law applicable to international
commercial arbitration and strengthening it thru specific
provisions of RA 9285;
d) It strengthens domestic arbitration by making specific
provisions of the Model Law and RA 9285 pertaining to
international commercial arbitration;
e) It designates an appointing authority with the power to
designate an arbitrator for the parties in default
situations;
f) Provides a broad and uniform scope of interim or
provisional relief in international commercial arbitration
and domestic arbitration;
g) Sets the basic principles in the enforcement of foreign
arbitral award, whether or not they fall within the
coverage of the New York Convention
Q: What are the Primary Sources/Laws in ADR?
Q: What are the two general categories of arbitration
that may be held in the Philippines?
1. Domestic Arbitration -
an arbitration that is not international where the
proceedings are held or the award is rendered or the seat
of arbitration in the Philippines and does not have any of
the characteristics that make it international.
2. International Commercial Arbitration –
Under the Model Law, it is international if the parties
made an agreement at the time of the conclusion of that
agreement their place of business in the different states
or where the place of arbitration as determined under the
agreement of the place where the substantial part of the
obligations of the commercial relationships is to be
performed or with which the subject matter of the
dispute is most closely connected and situated outside the
state where the parties have their places of business or
that the parties had expressly agreed that the subject
matter of the arbitration agreement is international.
(different definition)

1. RA 9285 (The ADR Law) and the Model Law, which

governs international commercial arbitration and Q: When is arbitration international?
partially to domestic arbitration;

2. RA 876 (The Arbitration Law approved on June 19,
1953). Take note this is still a good law. It still applies. It
is to the extent that it is not superseded by RA 9285 and
the Model Law.
Q: When is an arbitration commercial?
SEC. 21. Commercial Arbitration. An arbitration is
"commercial" if it covers matters arising from all
relationships of a commercial nature, whether contractual
or not. Relationships of a transactions: any trade
transaction for the supply or exchange of goods or
services; distribution agreements; construction of works;
commercial representation or agency; factoring; leasing,
consulting; engineering; licensing; investment; financing;
banking; insurance; joint venture and other forms of
industrial or business cooperation; carriage of goods or
passengers by air, sea, rail or road.
DOMESTIC ARBITRATION
Governed by sec 32 but is continued to gover by ra 826
concerning as well as 22-31 of RA 9285
Areas of Operation
Bargaining Agreement, except those which are gross in
character, shall no longer be treated as unfair labor
practice and shall be resolved as grievances under the
Collective Bargaining Agreement. For purposes of this
article, gross violations of Collective Bargaining Agreement
shall mean flagrant and/or malicious refusal to comply
with the economic provisions of such agreement.
Art. 262. Jurisdiction over other labor disputes. The
Voluntary Arbitrator or panel of Voluntary Arbitrators,
upon agreement of the parties, shall also hear and decide
all other labor disputes including unfair labor practices and
bargaining deadlocks.

We said that labor disputes are not covered by RA

9285. What then governs Labor- Management
Disputes?

Labor-Management disputes is governed by Articles 260

and 261 of the Labor Code.
Take note that the GENERAL RULE is that, it is the Labor
Arbiter who hears labor disputes.

So important terms or definitions that you must know,

voluntary arbitration in relation to labor cases,
compulsory arbitration and preventive arbitration.

Article. 260. Grievance machinery and voluntary

arbitration. - The parties to a Collective Bargaining
Agreement shall include therein provisions that will ensure
the mutual observance of its terms and conditions. They
shall establish a machinery for the adjustment and
resolution of grievances arising from the interpretation or
implementation of their Collective Bargaining Agreement
and those arising from the interpretation or enforcement of
company personnel policies.

All grievances submitted to the grievance machinery which

are not settled within seven (7) calendar days from the date
of its submission shall automatically be referred to
voluntary arbitration prescribed in the Collective
Bargaining Agreement.

For this purpose, parties to a Collective Bargaining

Agreement shall name and designate in advance a
Voluntary Arbitrator or panel of Voluntary Arbitrators, or
include in the agreement a procedure for the selection of
such Voluntary Arbitrator or panel of Voluntary
Arbitrators, preferably from the listing of qualified
Voluntary Arbitrators duly accredited by the Board
(National Conciliation and Mediation Board). In case the
parties fail to select a Voluntary Arbitrator or panel of
Voluntary Arbitrators, the Board shall designate the
Voluntary Arbitrator or panel of Voluntary Arbitrators, as
may be necessary, pursuant to the selection procedure
agreed upon in the Collective Bargaining Agreement, which
shall act with the same force and effect as if the Arbitrator
or panel of Arbitrators has been selected by the parties as
described above.

Article. 261. Jurisdiction of Voluntary Arbitrators or

panel of Voluntary Arbitrators. - The Voluntary
Arbitrator or panel of Voluntary Arbitrators shall have
original and exclusive jurisdiction to hear and decide all
unresolved grievances arising from the interpretation or
implementation of the Collective Bargaining Agreement
and those arising from the interpretation or enforcement of
company personnel policies referred to in the immediately
preceding article. Accordingly, violations of a Collective