Lyceum of the Philippine University – College of Law 

Alternative Dispute Resolution 

Prof. Dr. Angela C. Ylagan 

1st Semester SY 2020 -2021 

Introduction 
A.   History 

CASES:

1. Lara v. Del Rosario, G.R. No. L-6339, O.G. 1957

2. Chung Fu Industries (Phils.) Inc. v. Court of Appeals, citing Umbao v. Yap, 100 Phils.
1008 (1957)
3. Del Monte Corporation  - U.S.A. v. Court of Appeals, 351 SCRA 373 (2001)
 
B.   Response of Judiciary 

CASES:

1. La Naval Drug Corporation v. Court of Appeals, 236 SCRA 78 (1994)

2. Insular Savings Bank v. Far East Bank and Trust Company, 492 SCRA 145 (2006)
3. Reyes v. Balde II, 498 SCRA 186 (2006)
4. LM Power Engineering Corporation v. Capitol Industrial Construction Groups, Inc., 399
SCRA 562 (2003)
5. BF Corporation v. Court of Appeals, 288 SCRA 267 (1998) 
 
C.   The Alternative Dispute Resolution Act of 2004 

CASES:

1. Equitable PCI Banking Corporation v. RCBC Capital Corporation, 574 SCRA 858 (2008) 
2. Korea Technologies Co., Ltd. v. Lerma, 542 SCRA 1 (2008)

Basics of Alternative Dispute Resolution 

A. Policy of the State on Alternative Dispute Resolution 

CASES:

1. Insular Savings Bank v. Far East Bank and Trust Company, 492 SCRA 145 (2006) 
2. LM Power Engineering Corporation v. Capitol Industrial Construction Groups, Inc., 399
SCRA 562 (2003)
3. Reyes v. Balde II, 498 SCRA 186 (2006)
 4. Fiesta World Mall Corporation v. Linberg Philippines Inc., 499 SCRA 332 (2006)
5. RCBC Capital Corporation v. Banco de Oro Unibank Inc., 687 SCRA 583 (2012) 
6. Maria Luisa Park Association Inc. v. Almendras, 588 SCRA 663 (2009)
7. Korea Technologies Co., Ltd. v. Lerma, 542 SCRA 1 (2008)
8. Frabelle Fishing Corporation v. Philippine American Life Insurance Company, 530 SCRA
543 (2007)
9. Sea-Land Service Inc. v. Court of Appeals, 327 SCRA 135 (2000)
10. Gerardo Lanuza Jr. v. BF Corporation, G.R. No. 174938, October 1, 2014

B. Principles of Alternative Dispute resolution 

1. Party Autonomy and Self-Determination in Resolution of Disputes

 
CASES:

1. Department of Environment and Natural Resources (DENR) v. United Planners

Consultants, Inc. (UCPI), G.R. No. 212081, February 23, 2015
2. Fruehauf Electronics Philippines Corporation v. Technology Electronics Assembly and
Management Pacific Corporation, G.R. No. 204197, November 23, 2016

2. Alternative Dispute Resolution – An Alternative Procedure for Resolution of Cases 

3. Participation of Private Sector 

C.    Objectives and Benefits of Alternative Dispute Resolution 

1.     Speedy and Impartial Justice 

CASES:

1. Reyes v. Balde II, 498 SCRA 186 (2006) 

2.     De-clogging of Court Dockets 

 D.    Features of Alternative Dispute Resolution 

1. Alternative Dispute Resolution is a Method to Resolve a Dispute or Conflict 

 CASES:

1. Reyes v. Balde II, 498 SCRA 186 (2006) 

2.     Alternative Dispute Resolution uses methods allowed by Law 

3.     Alternative Dispute Resolution is contractual 

CASES:

1. Aboitiz Transport System Corporation v. Carlos A. Gothong Lines, Inc., 730 SCRA 178
(2014)
2. Fruehauf Electronics Philippines Corporation v. Technology Electronics Assembly and
Management Pacific Corporation, G.R. No. 204197, November 23, 2016
 
4. Alternative Dispute Resolution avoids lengthy court trial 

CASES:

1. Chan Kent v. Micarez, 645 SCRA 176 (2011)

2. Real Bank Inc. v. Samsung Mabuhay Corporation, 633 SCRA 124 (2010)
3. Senarlo v. Judge Paderanga, 617 SCRA 247 (2010)
4. Benguet Corporation v Department of Environment and Natural Resources – Mines
Adjudication Board, 545 SCRA 196 (2008)
5. BF Corporation v Court of Appeals, 288 SCRA 267 (1998)
6. LM Power Engineering Corporation v Capitol Industrial Construction Groups, Inc., 399
SCRA 562 (2003)
7. Rizal Commercial Banking Corporation v Magwin Marketing Corporation, 402 SCRA 592
(2003)
8. Korea Technologies Co. Ltd. v. Lerma, 542 SCRA 1 (2008)
9. Transfield Philippines, Inc. v Luzon Hydro Corporation, 490 SCRA 14 (2006)

5.     Alternative Dispute Resolution involves a neutral third (3rd ) party 

E. Sources of ADR Rules

1. Domestic Laws and Rules

LAWS:

General ADR Laws 

 Article III, Section 16, 1987 Constitution 
 Chapters 1 and 2, Title IX, Book IV, Civil Code 
 R.A. 876 Arbitration Law 
 R.A. 9285 ADR Act of 2004 
 IRR of R.A. 9285 
Special ADR Laws 
 Katarungang Pambarangay in the Local Government Code of 1991 
 Mediation and Voluntary Arbitration in the Labor Code and IRR of Labor Code

2. Acts of the Executive Branch

LAWS:
  Rules of ADR for Disputes between National Government Agencies 22 March 2010 
 E.O. 1008 Construction Industry Arbitration Commission (CIAC) 
 CIAC Revised Rules of Procedure Governing Construction Arbitration

3. Decision of the Supreme Court

4. International Laws

LAWS:

 UNCITRAL Model Law on International Commercial Arbitration 

 Convention on Recognition and Implementation of Foreign Arbitral Awards

5. General Principles of Law and Equity

F. Forms of ADR

1. Arbitration

LAW:

 Section 3 (d), ADR Act

CASE:

1. Uniwide Sales Realty and Resources Corporation vs. Titan-Ikeda Construction and
Development Corporation, 511 SCRA 355 (2006)

2. Mediation

LAW:
 Section 3 (q), ADR Act

3. Conciliation

4. Neutral and Early Neutral Evaluation

LAW:
 Section 3 (n), ADR Act

5. Mini-trial

LAW:
 Section 3 (u), ADR Act

6. Combination
LAW:
 Section 3 (t), ADR Act
 Article 7.7 (b), IRR

7. Other ADR Form (Innominate ADR Form)

LAWS:
 Section 3 (a), ADR Act
 Article 1318, Civil Code
 Article 1347, Civil Code

G. Classification of Forms of ADR

1. Number of Parties Bi-lateral or Multi-lateral

2.Number of Issues; Simple of Complex

3. Extent of Conclusion; Complete of Partial

4. Evidence in Proceedings; Evidentiary/ Merit Based or Non-Evidentiary/ Non-Merit Based

5. Pendency of Court Case; Case-Related of Independent

6. Applicable Law; Domestic of International

LAWS:
 Article 1.6 B (8), IRR of ADR Act 
 Rule 1.11 (d), Special ADR Rules 

7. Permanence of ADR Provider or Practitioner; Ad hoc of Institutional

H. Components of ADR

1. Contending Parties

2. Dispute of Controversy

3. Form of ADR

4. ADR Provider or Practitioner

LAW:
 Section 3 (b), ADR Act
I. Subject Matters of ADR (Matters NOT subject to ADR)

LAW:
 Section 6 (b) to (h), ADR Act

1. Civil Status of Persons

2. Validity of Marriage or Any Ground for Legal Separation

LAWS:
 Article 48, Family Code
 Article 60, Family Code

3. Jurisdiction of courts

CASES:

1. People v. Vanzuela, 559 SCRA 234 (2008)

2. Salmorin v. Zaldivar, 559 SCRA 564 (2008)
3. Tijam et. al. v. Sibonghanoy, et. al., 131 Phil. 556, (1968)

4. Future Legitime

LAWS:

 Article 772, Civil Code

 Article 905, Civil Code

5. Criminal Liability 

LAWS:

 Articles 29 to 35, 2176, 2177, Civil Code

 Article 100, RPC
 Article 2034, Civil Code

6. Those which, by law, cannot be compromised

1. Civil status of persons 

2. Validity of marriage or legal separation 
3. Ground for legal separation 
4. Future support 
5. Jurisdiction of courts 
6. Future legitime 

LAWS:

 Article 2035, Civil Code

J. Seat and Venue of ADR

G. Basic Concepts

1. Concluding Acts or Agreements

1. Arbitral Award 
2. Mediated Settlement Agreement 
3. Compromise Agreement 
4. Waiver or Quitclaim

LAWS:

 Section 3 (f), ADR Act

 Section 17, ADR Act
 Article 2018, Civil Code

2. ADR Providers and Practitioners

LAWS:

 Section 5, ADR Act

 Article 1.5, IRR
 Section 38 (1), Chapter 9, Book I, Administrative Code of 1987

CASES:

1. Freuhauf Electronics Phils. Corp. v. Technology Electronics Assembly and Management

Pacific Corp., G.R. No. 204197, November 23, 2016
2. ABS-CBN Broadcasting Corp. v. World Interactive Network Systems (WINS) Japan Co.
Ltd., 544 SCRA 308 (2008)

3. Preferences for ADR

LAWS:

 Article 7.5, IRR

 Rule 39, 1997 Rules of Civil Procedure

CASES:

1. Mabuhay Holdings Corp. v. Sembcorp Logistics Limited, G.R. No. 212734, December 5,
2018
2. Bases Conversion Development Authority v. DMCI Project Developers Inc., G.R. Nos.
173137 and 173170, January 11, 2016
3. Luzon Iron Development Group Corp. and Consolidated Iron Sands Ltd. v. Bridestone
Mining and Development Corp. and Anaconda Mining and Development Corp., G.R. No.
220546, December 7, 2016
 4. Koppel Inc. v. Makati Rotary Club Foundation, Inc., 705 SCRA 142 (2013)

H. Office for Alternative Dispute Resolution (OADR) attached to the Department of Justice (DoJ)

LAWS:

 Section 49 and 50, ADR Act

 Articles 2.1 to 2.3, IRR

Mediation Under ADR Act 2004

A. Mediation in General

LAWS: - DARLING

 Sec. 7 and 8 of ADR Act of 2004 

1. Mediation Definition

LAWS: - DARLING
 Sec (q), ADR Act 
 Art. 1.6, B. 6, IRR 

2. Coverage of ADR Act of 2004, R.A. 9285

LAWS: - DARLING
 Sec. 3 (l), ADR Act
 Article 1.6, B. 3, IRR 
 Consolidated and Revised Guidelines to Implement the Expanded Coverage of Court-
Annexed Mediation (CAM) and Judicial Dispute Resolution (JDR)

CASE:
 Koppel, Inc. v. Makati Rotary club Foundation, Inc., 705 SCRA 142 (2013) - DOMINGO

a. Classification of Mediation

LAWS: -DARLING
 Article 3.10, IRR 
 Articles 1.6, B. 1 and 2, IRR 
  Section 16, ADR Act 
 Article 3.19, IRR 

b. Place of Mediation

LAWS: - DALRING
 Section 15, ADR Act 

c. Stage in Mediation
1. Opening Statement of Mediator 
2. Individual Narration by the Parties 
3. Exchange by the Parties 
4. Summary of Issues 
5. Generalization and Evaluation of Options 
6. Closure 
 Execution of Settlement Agreement by the Parties
 Withdrawal of Any Party from Mediation 
 Written Declaration of Mediator that any further effort at mediation would not be
helpful. 

LAWS: - DARLING
 Article 3.17, IRR 
 Section 2, ADR Act 
 Article 1.2 (a), IRR 

d. Advantages of Mediation
1. Confidentiality in the Mediation Process 
2. Prompt, economical and amicable resolution of disputes 
3. The decision-making authority rests in the parties 

LAWS: - FRANCISCO
 Section 8, ADR Act 

B. Confidential and Privileged Nature of Meditation Communication

LAWS:- FRANCISCO
 Sections 9, 10, 11, and 12, ADR Act 
 Section 3 (h), ADR Act 
 Article 1.6, A (7), IRR

CASES:
 Federal Express Corporation v. Airfreight 2100, Inc., G.R. No. 216600, November 21,
2016- GIGANTE

1. Legal Effects of Confidential and Privileged Nature

LAWS: - FRANCISCO
 Section 9 (b), ADR Act 
 Article 3.21 (b), IRR 
  Section 9 (c), ADR Act 
 Article 3.21 (c), IRR 
 Section 9 (d), ADR Act 
 Article 3.21 (e), IRR 
 Section 9 (e), ADR Act 
 Article 3.21 (e), IRR 
 Section 9 (f), ADR Act 
 Article 3.21 (f), IRR  

2. Exceptions Based on Agreement, Nature of Proceedings, Crime or Social Justice

LAWS: - GUITIERREZ
 Section 11 (a), ADR Act 
 Article 3.23 (a), IRR 

3. Exceptions Based on Public Policy

LAWS: - GUITIERREZ
 Section 11 (b), ADR Act 
 Article 3.23 (b), IRR 
 Section 11 (d), ADR Act 
 Article 3.23 (d), IRR

4. Limited Use of Exempted Evidence 

LAWS: - GUITIERREZ
 Section 11 (d), ADR Act 
 Article 3.23 (d), IRR 

5. Privilege of the Mediator 

LAWS: - GUITIERREZ
 Section 3.8, IRR 
 Section 11 (c), ADR Act 
 Article 3.23 (c), IRR 
 Section 12, ADR Act 
 Article 3.24, IRR 
 Section 13, ADR Act 
 Article 3.7, IRR 

6. Waiver of Confidentiality

LAWS: - LAURENTE
 Section 10, ADR Act 
 Article 3.22, IRR 

C. The Mediator

LAWS: - LAURENTE
 Section 13, ADR Act 
  Article 3.3, IRR 
 Article 3.4, IRR 
 Article 3.5, IRR 
 Article 3.6, IRR 
 Article 7.8 (b), IRR 
 Rule 2.7, Special ADR Rules 

1. Duties and Functions of Mediators 

a. Prior to Mediation
1. On Competence 
2. On Impartiality 

LAWS: - MAGARZO
 Section 13, ADR Act 
 Article 3.6, IRR 
 Article 3.7, IRR

b. During Mediation
1. Confidentiality 
2. On Consent and Self-Determination 
3. On Promotion of Respect and Control of Abuse of Process 

LAWS: - MAGARZO
 Article 33.9, IRR 
 Article 3.12, IRR 

2. Mediator’s Cost and Fees

LAWS: - MAGARZO
 Article 3.25, IRR 
 Article 3.26, IRR 
 Article 3.11, IRR 
 Article 3.13, IRR

D. Mediated Settlement Agreements

LAWS: - MARATA
 Section 17, ADR Act
 Article 3.20, IRR
 Article 2037, Civil Code 
 Section 17, ADR Act
 Article 3.20, IRR
 Section 1 (j), Rule 16, 1997 Rules of Civil Procedure
 Rule 15.5, Special ADR Rules

CASE:
  Miguel v. Montanex, 664 SCRA 345 (2012) - MENDOZA

E. Role of Counsel in Mediation

LAWS: - MARATA
 Section 14, ADR Act
 Article 3.14, IRR
 Article 3.15, IRR 
 Consolidated and Revised Guidelines to Implement the Expanded Coverage of court-
Annexed Mediation (CAM) and Judicial Dispute Resolution (JDR) A.M. No. 11-1-SC-
PHILJA, 11 January 2011 on the Role of Lawyers in Mediation

International Commercial Arbitration (ICA)

Waiver of Right to Object in ICA (Article 4.4 IRR)
Rockland Construction Company v. Mid Pasig Land Development Corporation, 543 SCRA 596
(2008) -
Ellijah Ong

Applicable Law in ICA (Article 4.2 IRR)

Mabuhay Holdings Corporation v. Sembcorp Logistics, G.R. No. 212734, December 5, 2018 -
Eenah Padilla

Grounds to Challenge Arbitrator in ICA (Article 4.12 IRR)

Equitable PCI Bank Corporation v. RCBC Capital Corporation, 547 SCRA 858 (2008) -
Reynaldo C. Paruñgao Jr.

Jurisdiction of Arbitral Tribunal in ICA (Article 4.16 IRR)

Gomez v. Montalban, 548 SCRA 693 (2008) -
Daniel Roleda

Lack of Jurisdiction (Article 4.16 (b) IRR)

Gonzalez v.Climax Mining, 512 SCRA 142 (2007) -
James San Diego

Judicial Review of Jurisdictional Issue

Setting Aside ICA Award (Articles 4.34, 4.36 IRR)
Fruehauf Electronics Phils. v. Technology Electronics Assembly , G.R. No. 204197, November 23,
2016. -
Aizelle Sietereales

Jurisdiction over the Parties

Ormoc Sugarcane Planters' Association (OSPA) v. CA, 596 SCRA 630 (2009) -
Patrick Sorsona
Costs in ICA
Keppel Cebu Shipyard Inc. v. Pioneer and Surety Corporation,601 SCRA 96 (2009) -
Jaz Sumalinog

Recognition and Enforcement of ICA and Foreign Arbitral Award

Korea Technologies Co. Ltd. v. Lerma, 542 SCRA 1 (2008) -
Pretzel Tsang

Grounds for Refusing Recognition

Tuna Processing, Inc. v. Philippine Kingford Inc., G.R. No. 185582, 29 February 2012. -
Vnee Villanueva