CHAPTER 9 SPECIAL RULES OF COURT ON ALTERNATIVE DISPUTE RESOLUTION The Specific Court Reliefs A. Judicial Relief Involving the Issues of Existence, Valid- ity and Enforceability of the Arbitration Agreement (Rules 3.1 to 3.22, Special ADR Rules) The judicial relief referred to in Rule 3 of the Special ADR Rules is a petition for judicial determination of the existence, valid- ity and/or enforceability of an arbitration agreement. The issues involved in these proceedings are: 1. Existence of the arbitration agreement—whether or not there is an arbitration agreement; 2. Validity of the arbitration agreement—whether or not the arbitration agreement complies with all the essential req- uisites for a valid contract; 3. Enforceability of the arbitration agreement—whether or not the arbitration agreement is enforceable in accordance with Article 1403 of the Civil Code.’ * “Article 1403 [Civil Code of the Philippines]. ‘The following con- tracts are unenforceable, unless they are ratified: (1) Those entered into in the name of another person by one who has been given no authority or legal representation, or who has acted beyond his powers; 161 Scanned with CamScanner162 NATIVE Dispute Re OLUTION, This judicial relief is applicable only to arbitration proceed. ings conducted in the Philippines.” Proceedings of this nature are summary. Thus: “This special Proceeding is the procedural mee anism for the enforcement of the contract to arbitrate. The jurisdiction of the courts in relation to Sec. 6 of R.A. No. 876 as well as the nature of the proceedings was expounded upon in La Naval Drug Corporation v. Court of Appeals. There it was held that R.A. No. 876 explicitly confines the court's authority only to the determination of whether or not there is an agreement in writ. ing providing for arbitration. In the affirmative, the statute or- dains that the court shall issue an order ‘summarily directing the parties to proceed with the arbitration in accordance with (2) Those that do not comply with the Statute of Frauds as set forth in this number. In the following cases an agreement hereafter made shall be unenforceable by action, unless the same, or some note or memorandum thereof, be in writing, and subscribed by the party charged, or by his agent; evidence, therefore, of the agreement cannot be received without the writing, or a secondary evidence of its contents: (a) An agreement that by its terms is not to be performed within a year from making thereof; (b) A special promise to answer for the debt, default, or mis- carriage of another; (c) An agreement made in consideration of marriage, other than a mutual promise to marry; (d) An agreement for the sale af goods, chattels or things in action, at a price not less than five hundred pesos, unless the buyer accept and receive part of such goods and chattels, or the evidence, or some of them, of such things in action, or pay at the time some part of the purchase money; but when a sale is made by auction and entry is made by the auctioneer in his sales book, at the time of the sale, of the amount and kind of property sold, terms of sale, price, names of the purchaser and person on whose account the sale is made, it is a sufficient memorandum; (e) An agreement for the leasing for a longer period than one year, or for the sale of real property or of an interest therein; () A representation as to the credit of a third person. (3) | Those where both parties are incapable of giving consent to the contract.” “Rule 3.1, Special ADR Rules. Scanned with CamScanneror Court ON ALTERNATIVE 163 » RESOLUTION urt Reliefs ~ Special Rubes Disrt — The Specific the terms thereof.’ If the court, upon the other hand, finds that no such agreement exists, ‘the proceeding shall be dismissed The cited case also stressed that the proceedings are summary in nature. The same thrust was made in the ear- lier case of Mindanao Portland Cement Corp. v. McDonough Construction Co., of Florida which held, thus: ‘Since there obtains herein a written provi- sion for arbitration as well as failure on respon- dent's part to comply therewith, the court a quo rightly ordered the parties to proceed to arbitration in accordance with the terms of their agreement (Sec. 6, Republic Act 876). Respondent's arguments touching upon the merits of the dispute are im- properly raised herein. They should be.addressed to the arbitrators. This proceeding is merely a summary remedy to enforce the agreement to arbitrate. The duty of the court in this case is not to resolve the merits of the parties’ claims but only to determine if they should proceed to arbitration or not.” (Gonzales v. Climax Mining Ltd., 512 SCRA 148 (20071, p. 169; emphasis supplied); see also: Aboitiz Transport System Corporation v. Carlos A. Gothong Lines, Inc., 730 SCRA 178 [2014], pp. 185-186. : Judicial Relief Before Commencement of Arbitration (Rules 3.2 to 3.11, Special ADR Rules) The rules on judicial relief prior to the commencement of arbi- tration apply when the following circumstances are present: 1. The arbitration proceeding has not yet commenced; and 2. There is between the parties a dispute regarding the exis- tence, validity or enforceability of the arbitration agree- ment. The procedural rules are as follows: 1. Petition. The initiatory pleading for judicial relief before the commencement of arbitration is.a petition filed with the Scanned with CamScanner164 Native Dispute REsoLurion Regional Trial Court where any of the parties resides or has his principal place of business.’ The petition should state facts showing |i] the legal capacity of the parties to sue and be sued; [ii] the nature and substance of the dispute; [iii] the grounds and circumstances relied upon by the petitioner; and [iv] the relief sought. As in all other initiatory pleadings under the Special ADR Rules, the petition must be verified and must be accompanied by a certification of non-forum shopping.’ An authentic copy of the arbitration agreement should be attached to the petition’ unless the ground relied upon is the non-existence or unenforceability of the arbitra- tion agreement. A copy of the petition shall be served upon the respondent before it is filed in court.’ The filing of the petition does not prevent the commence- ment of the arbitration, or the continuation thereof and the rendition of an award therein.” Comment/opposition. Within fifteen (15) days from ser- vice of the petition, the respondent must file his comment or opposition.’ Court action. In resolving the petition, the court must exercise judicial restraint and defer to the competence or jurisdiction of the arbitral tribunal to rule on its compe- tence and jurisdiction.” Relief against court action. The determination by the court upholding the existence, validity or enforceability of the arbitration agreement under these proceedings is merely prima facie. Such prima facie determination, how- ever, shall not be subject to a motion for reconsideration,” * Rules 3.2 and 3.4, Special ADR Rules. ‘Rules 1.5, 1.10 and 3.9, Special ADR Rules. ‘Rules 3.6, Special ADR Rules. “Rule 1.3(A), Special ADR Rules. ‘Rule 3.3, Special ADR Rules. “Rule 3.7, Special ADR Rules. * Rules 2.4 and 3.8, Special ADR Rules. “Rule 19.1, Special ADR Rules. Scanned with CamScannerSprciaL Ruves or Court on At Diseu ~ The Specific Court Reliefs appeal” or certiorari,” but shall be without prejudice to the right of any party to raise the same issues before the arbitral tribunal or the court in a petition to vacate or set aside the arbitral award which shall be‘resolved in accor- dance with the standards set for such proceedings.” On the other hand, if the court finds the arbitration ag- reement inexistent, invalid or unenforceable, the aggrie- ved party may file a motion for reconsideration" or a peti- tion for certiorari." The distinction is necessary in order to provide judicial remedy for a ruling against the juris- diction of an arbitral tribunal in line with the state policy of giving preference to ADR. Judicial Relief After Arbitration Commences (Rules 3.12 to 3.22, Special ADR Rules) While the sub-title of Rule 3 of the Special ADR Rules state that the judicial relief sought from the court pertains to the “exis- tence, validity or enforceability” of the arbitration agreement, that is accurate only for judicial relief prior to the commencement of the arbitration or at the latest, prior to the rendition by the arbitral tribunal of a preliminary ruling on its jurisdiction. After the com- mencement of the arbitration and the constitution of the arbitral tribunal, and after the arbitral tribunal has rendered a prelimi- nary ruling on its jurisdiction, the proper issue for judicial relief is whether or not the arbitral tribunal has jurisdiction over the arbi- tral proceedings. Subsumed into the said issue is the existence, validity or enforceability of the arbitration agreement upon which emanates the jurisdiction and authority of the arbitral tribunal. The rules on judicial relief after the commencement of arbi- tration apply under the following circumstances: * Rule 19.12, Special ADR Rules. * Rules 19.26, Special ADR Rules. * Rules 2.4 and 3.11, Special ADR Rules. “ Rule 19.1, Special ADR Rules * Rule 19.26, Special ADR Rules. ‘ Scanned with CamScanner166 ment of the parties," in the absence of which, it is commen ALTERNATI E Dispur: Resonution 1. The arbitration proceeding has arbitral tribunal has been consti preliminary ruling on its jurisdic already commenced, the tuted and has rendered a ‘tion; and 2. A party desires to challenge the arbitral tr y : ibunal's rulin, on the issue of jurisdiction. 7 The commencement of arbitration is determined by the agree- iced in accordance with the rules of the institutional arbitrator, or upon the delivery by the claimant to the respondent of » demand for arbitration if there is a prior arbitration agreemen _., when there is no prior arbitration agreement, upon the agreement of the re- spondent to submit the dispute to arbitration after being served a demand to arbitrate.” Hereunder are the procedural rules: 1. Petition.* Within thirty (30) days from receipt of the notice ofa ruling from an arbitral tribunal, an aggrieved party may file a petition with the Regional Trial Cour: {i! whore the ar- bitration is taking place, or [ii] where any of the petitioners or respondents has his principal place of business or resi- dence, at the option of the petitioner, for judicial relief from the ruling of the arbitral tribunal on a preliminary question upholding or declining its jurisdiction. The petition shall state [i] the facts showing that the peti- tioner or respondent has legal capacity to sue or be sued; fii] the nature and substance of the dispute; [iii] the grounds and circumstances relied upon for the petition; and [iv] the relief sought. The petitioner shall attach a copy of the request for arbitration and the ruling of the arbitral tribunal. The respondents shall be furnished with a copy of the petition before it is filed.” ———— * Article 5.20, IRR. "Id. “Rules 3.12 to 3.16, Special ADR Rules. Rule 1.3(A), Special ADR Rules. Scanned with CamScannerSreciaL Rutes oF Court on Avrinnate 167 Dispute RESOLUTION = The Specific Court Reliefs ~ 2. Comment/opposition. The respondent should file his comment or opposition within fifteen (15) days from the date of service of the petition.” 3. Court action. The court shall render judgment, on the basis of the pleadings filed and evidence submitted, within thirty (30) days from the time the petition is sub- mitted for resolution.” When ‘the arbitration has commenced, but the arbitral tribunal has not yet been constituted, or although consti- tuted, has not yet rendered a ruling on its jurisdiction, courts are enjoined not to entertain any petition for judi- cial relief on the issue of jurisdiction or, if already pend- ing, to refer the issue back to the arbitral tribunal once constituted. In view of the competence-competence princi- ple, courts are enjoined to exercise judicial restraint and defer to the competence or jurisdiction of the arbitral tri- bunal to rule on its competence or jurisdiction.” The filing and pendency of the petition for judicial relief shall not be a cause for the court to enjoin the arbitration proceeding and the arbitral tribunal may proceed with the arbitration and render the award.” Relief against court action. The aggrieved party may file a motion for reconsideration™ of the order of the court, which shall, however, not be subject to an appeal.” An order affirming the jurisdiction of the arbitral tribu- nal shall not be subject to a petition for certiorari, but an order denying jurisdiction may be the subject of such a petition.” If the arbitral tribunal, instead of rendering a preliminary ruling on its jurisdiction, decides to defer such ruling until * Rule 3.17, Special ADR Rules. * Rule 3.18, Special ADR Rules. * Rules 2.4 and 3.8, Special ADR Rules. * Rule 3.18, Special ADR Rules. * Rule 19.1, Special ADR Rules. * Rule 19.12, Special ADR Rules. “Rules 19.26 and 3.19; Special ADR Rules. Scanned with CamScanner168 Avternative Dispure Resontrion the rendition of the arbitral award, none of the parties can seek judicial relief from the deferment. Motions for reconsideration,” appeal” and petitions for certiorari” are not available to challenge the decision of the arbitral tri- bunal to defer the resolution of the preliminary jurisdic- tional issues.” The parties can, however, await the rendi- tion of the final arbitral award, and raise the same issues before the court in a proceeding for setting aside or vacat- ing the award. If, in the meantime that the resolution of the prelimi- nary jurisdictional issue is deferred, or before the court could render any ruling thereon, the arbitral tribunal renders the final arbitral award, the prospective or pending petition for judicial relief on the preliminary ju- isdictional issue, will be rendered moot and academic, and any pending petition ought to be dismissed. Again, the aggrieved party may raise the same issues before the court in a proceeding to set aside or to vacate the arbi- tral award.” In a petition for judicial relief, the arbi of the arbitral tribunal shall be nominal parties.” A nominal party 's one who is named as party in an action although the real inten st is with some other party. Although the arbitrator or members of the arbitral tribunal are named as nominal ‘parties in these imant and the re- trator or the members Proceedings, the real interest lies with the clait Spondent who stand to be benefited or injured by any decision of the court. As such, said Parties are expected to actively pursue the claim or oppose it as the case may be. As nominal Parties, it is not mandatory for the arbitrator or members of the arbitral tribunal to file pleadings or submissions for the consideration of the court,” Rules 19.1 and 3.1(A), Special ADR Rules. = Rule 19.12, Special ADR Rules. » Rule 19.26, Special ADR Rules », Rule 3.20, Special ADR Rules Rule 3.21, Special ADR Rules o Pia 3.22, Special ADR Rules. Scanned with CamScannerSpecial Ruves oF Court on Aurernarive 169 Dispure Resi ~The Specifie Court Reliefs A nominal party must be distinguished from a real party-in- interest. an indispensable party, and a necessary party. A real artyin-interest is “the party who stands to be benefited or injured by the judgment or the party entitled to the avails of the suit. An indispensable party is “a party who has such an interest in the controversy or subject matter that a final adjudication cannot be made, in his absence, without injuring or affecting that interest."" The absence of an indispensable party renders all subsequent actions of the court null and void for want of author- ity to act, not only as to the absent parties but even as to those present.” A necessary party is one who is not indispensable but “who ought to be joined as a party if complete relief is to be accorded as to those who are already parties, or for a complete determination or settlement of the claim subject of the action.”” The circumstance that not all of the parties to the civil action are bound by the arbitration agreement or that referral to arbitra- tion would result in multiplicity of suits are not grounds to deny the referral of a pending action to arbitration. In such situation, the court may issue an order directing the inclusion in the arbitra. tion of those parties who are not bound by the arbitration agree- ment but who agree to such inclusion provided those originally bound by it do not object to their inclusion.” The included parties are necessary parties to the arbitration proceedings because their non-inclusion, while not affecting the validity of the arbitration, will result in an incomplete determination or settlement of the claim subject of the arbitration. * Heirs of the Late Sps. Luciano P. Lim and Salud Nakpil Bautista v The Presiding Judge of the Regional Trial Court of Quezon City, Br. 216. 564 SCRA 352 [2008] * Cornes v. Leal Realty Centrum Co., Inc., 560 SCRA 545 [2008]; see also San Pedro v. Ong, 569 SCRA 767 (2008). * Santos v. Heirs of Dominga Iustre, 561 SCRA 120 (2008). * Autocorp Group v. Intra Strata Assurance Corporation, 556 SCRA 250 (2008) * Rule 4.7, Special ADR Rules. Scanned with CamScanner170 Aurernative Dispute Resonution B. Referral to ADR (Rules 4.1 to 4.8, Special ADR Rules) While the sub-title of Rule 4 of the Special ADR Rules is “Re- ferral to ADR,” this Rule actually pertains to the referral of a pond. ing court action to arbitration rather than any other form of ADR. The situation contemplated by this Rule is that where: 1, There is already a pending court action; 2. There is either a pre-action arbitration agreement or a pre- sent-action arbitration agreement; and 3. One or both parties desire to undergo arbitration. The arbitration agreement is pre-action if ex ted prior to the filing of an action, and it is present-action if execute after the filing of the action. This classification of arbitration agreements based on the time of execution relative to the filing of the action should be dis- tinguished from the classification based on the time of execution relative to the existence of the dispute, i.e., pre-causal arbitration agreement (agreement to submit to arbitration) or present-causal arbitration agreement (submission agreement). For purposes of determining the timeliness of the request for referral to arbitration and the number of the parties who are required to make the re- quest, the relevant classification is that based on the time of the execution of the arbitration agreement relative to the filing of the action, i.e., pre-action or present-action arbitration agreement. On the other hand, in determining the date of commencement of the arbitration, the pertinent classification is that based on the time of the execution of the arbitration agreement relative to the existence of the dispute, i.e., pre-causal or present-causal arbitration agree- ment. If there is a pre-action arbitration agreement, which may ei- ther be an agreement to submit to arbitration or a submission Agreement, the request for referral to arbitration may be made by any one of the parties not later than the pre-trial conference. A Tequest made after the pre-trial conference must be with the agree- ment of both parties. Scanned with CamScannerSpeciat, Runes or Court on Avrernative 71 Dispu' The Specific ‘ourt Reliefs In the case of a present-action arbitration agreement, which is necessarily a submission agreement, the parties may request the referral to arbitration at any time during the proceedings.” Hereunder are the procedural rules: a Request /motion.. The pleading that initiates the referral to arbitration is a “request” or a “motion” and not a peti- tion because the rules on referral to ADR contemplate the existence of a pending court action already initiated ei- ther by a complaint or a petition. Apart from the allega- tions and submissions in support of the request for refer- ral to arbitration, the motion shall contain an authentic copy of the arbitration agreement and, as in the case of litigated motions, must be served upon the respondent” and be set for hearing.” Comment/opposition. The comment or opposition must be filed within fifteen (15) days from service of the request or motion and must show that [i] there is no agreement to refer the dispute to arbitration; [ii] the agreement is null and void; or [iii] the subject matter of the dispute is not capable of settlement or resolution by arbitration.” Court action. The court may [i] grant the motion if it finds prima facie that there is a valid and enforceable ar- bitration agreement and that the subject matter of the dispute is capable of arbitration; or [ii] deny it if the court finds otherwise.“ Either way, the court should stay the judicial proceedings while the motion for referral is pend- ing resolution. Arbitral proceedings, however, may be commenced or continued, and an award may be made thereon, while the action is pending in court. As in the case of judicial relief involving the issues of exis- tence, validity and enforceability of an arbitration agree- * Rule 4.2, Special ADR Rules © Rule 1.3(A), Special ADR Rules. “ Rules 4.2 and 4.3, Special ADR Rules, “ Rule 4.4, Special ADR Rules. © Rule 4.5, Special ADR Rules. “ Rule 4.8, Special ADR Rules. Scanned with CamScanner172 Avrernative Dispute ResoLurion ment, the finding of the court that a valid and enforceable arbitration agreement exists and that the dispute in- volved is capable of arbitration, resulting in the grant of the motion for referral, is prima facie, and not conclusive upon the parties. 4 Relief against court action. The order granting the mo- tion for referral to arbitration shall be immediately execu- tory and shall not be subject to a motion for reconsidera- tion,” appeal" or petition for certiorari.” On the other hand, an order denying the request for referral, although not subject to appeal, may be the subject of a motion for reconsideration“ and a petition for certiorari.” The oppor- tunity to reverse a ruling adverse to arbitration is made available by way of a motion for reconsideration or a peti- tion for certiorari. In accordance with the principle of preference for alternative dispute resolution, courts are prohibited from denying the request for referral of some or all of the parties to arbitration for any of the following reasons: 1. Not all of the disputes subject of the civil action may be referred to arbitration; 2. Not all of the parties to the civil action are bound by the arbitration agreement and referral to arbitration would result in multiplicity of suits; 3. The issues raised in the civil action could be speedily and efficiently resolved in its entirety by the court rather than in an arbitration; 4. Referral to arbitration does not appear to be the most pru- dent action; or «Rule 19.1, Special ADR Rules. «; Rule 19.12, Special ADR Rules. « Rule 19.26, Special ADR Rules, «Rule 19.1, Special ADR Rules «, Rules 19.26 and 4.6, Special ADR Rules Rule 4.7, Special ADR Rules; see also Rule 2.2, Special ADR Rules, Scanned with CamScannerpo Special Runes or Court oN AvreRNattive 173 Dispute Reso.ution The Specific Court Reliefs 5. The stay of the action would prejudice the rights of the parties to the civil action who are not bound, by the arbi- tration agreement. The court may, however, issue an or- der directing the inclusion in the arbitration of those par- ties who are not bound by the arbitration agreement but who agree to such inclusion provided that those originally bound by it do not object to their inclusion. In Koppel, Inc. v. Makati Rotary Club Foundation, Inc.,” the Supreme Court discussed the legal effects of the non-application of the arbitration clause to a case, as follows: [i] the judicial pro- ceedings conducted beyond the point when the dispute should have been referred to arbitration are rendered invalid; [ii] the decisions, including those of the appellate courts, must be vacated and set aside; [iii] the case must be remanded to the court a quo to be suspended at said point; and [iv] the petitioner and respon- dent must then be referred to arbitration pursuant to the ar- bitration clause. C. Interim Measures of Protection (Rules 5.1 to 5.6, Special ADR Rules) The rules on judicial issuance of interim measures of protec- tion contemplate the situation: 1. Either [i] before the commencement of arbitration, or ii] after the commencement of the arbitration but prior to the constitution of the arbitral tribunal, or [iii] after the arbitral tribunal's constitution but it has no power to act or is unable to act effectively; and 2. Where a party desires to secure interim measures of pro- tection. A measure of protection may either be interim or temporary. 7 705 SCRA 142 (2013), pp. 168-169. Rule 5.1 and 5.2, Special ADR Rules. Scanned with CamScanner174 Avrernative Dispute Resovurion Interim Measures of Protection The parties may request from the court, among others, the following interim measures:* a. Preliminary injunction directed against a party to arbi- tration; Preliminary attachment against property or garnishment of funds in the custody of a bank or third person; Appointment of a receiver; Detention, preservation, delivery or inspection of prop- erty; or Assistance in the enforcement of an interim measure of protection granted by the arbitral tribunal which it can- not enforce effectively. The following are the rules of procedure for the application for interim measures of protection with the court: 1. Petition. The application for an interim measure of pro- tection is initiated by filing a petition with the Regional Trial Court of the place where [i] any of the parties has his principal place of business or residence; or [ii] any of the acts sought to be enjoined are being performed or threatened to be performed; or [iii] the real property sub- ject of the arbitration is situated, at the option of the peti- tioner.* Prior notice must be served upon the adverse party unless the petitioner alleges in the petition an application for an ex parte temporary protective measure to the effect that there is an urgent need to either [i] preserve property; [ii] prevent the respondent from disposing of, or concealing, the property, [iii] or prevent the relief prayed for from be- coming illusory because of prior notice, and the court finds that the reasons given are meritorious. : Rule 5.6, Special ADR Rules. “Rule 5.3, Special ADR Rules. Rule 5:7, Special ADR Rules. Scanned with CamScannerSpectr, Runes oF Court on Aurensarive 175 Dispute: Reso.rrion The Spee Court Reliefs ~ 2, Comment opposition. The comment or opposition must be filed within fifteen (15) days from service of the peti- tion.” 3. Court action. The court shall resolve the petition within thirty (30) days from the |i] submission of the opposition, or [ii] upon the lapse of the period to file the same, or [iii] from the termination of the hearing that may be set if there is need for clarification or further argumentation. In resolving the petition, the court is required to balance the relative interests of the parties and the inconveniences that may be caused.” If the basis for the petition for an interim measure is the non-constitution of the arbitral tribunal, the court, upon being informed of the subsequent constitution of the arbi- tral tribunal, shall defer action on the petition unless it is established that the arbitral tribunal has.no power to act on any such interim measure of protection or is unable to act thereon effectively. The interim measure of protection issued by the court is without prejudice to the subsequent grant, modification, amendment, revision or revocation thereof by the arbitral tribunal.” . 4. Relief against court action. An order of the court grant- ing or denying an interim measure may be the subject of a motion for reconsideration,” appeal” or a petition for cer- tiorari.” If the protective measure was issued in a pro- ceeding whereat the adverse party was given an opportu- nity to be heard, the order of the court granting the peti- tion shall be immediately executory. Otherwise, the order * Rule 5:8, Special ADR Rules. * Rule 6.9, Special ADR Rules * Rule 6.15, Special ADR Rules, “ Rule 5.8, Special ADR Rules “Rule 19.1, Special ADR Rules {Rule 19.12, Special ADR Rules Rule 19.26, Special ADR Rules Scanned with CamScanner176 Avrernarive Dispute RESOLUTION of the court shall not be immediately executory, except if it is a temporary protective measure.” Temporary Order of Protection or Temporary Protective Measure A temporary protective measure (TPM), otherwise referred to as temporary order of protection (TOP), is an injunctive relief the office of which is to preserve property subject matter of the arbitra- tion, prevent the disposition or concealment thereof, or prevent the relief prayed for from becoming moot and academic, during the period that the court is resolving the application for the interim protective measure. A TOP or TPM is applied for ex parte, is im- mediately executory, and has a lifetime of only twenty (20) days from issuance unless extended for another twenty (20) days. A TOP or TPM may be issued by the court under the following condi- tions“ 1. There is an urgent need to [i] preserve Property; [ii] pre- vent the respondent from disposing of, or concealing the property; or [iii] prevent the relief prayed for from being illusory because of prior notice; 2. The petitioner shall post a bond to answer for any damage that the respondent may suffer as a result thereof; 3. It shall be valid only for twenty (20) days from the service on the party required to comply therewith, unless ex- tended but not for more than twenty (20) days; 4. During the twenty (20) day period and any extension thereof, the court shall determine the Propriety of issuing the principal interim protective measure requested; and 5. It can be lifted by the respondent by posting an appropri- ate counter-bond as determined by the court. A TOP or TPM is similar to a temporary restraining order Papel in that these measures are temporary in character, intended “asure the efficacy of the principal relief (interim protective . “Rule 5.10, Special ADR Rules. Rule 5.9, Special ADR Rules, Scanned with CamScannerSOURT ON ALTERNATIVE 177 SOLUTION r writ of preliminary injunction for a cure for a TPO or TPM, or writ of preliminary injunc TRO}, and have, as a general rule, a lifetime of twenty (20) days. They are, however, different in the following respects: 1. The effectivity of a TOP or TPM is susceptible of exten- sion for not more than twenty (20) days, while a TRO is non-extendible and becomes functus oficio after the lapse of twenty (20) days from the service thereof.” 2. A bond is required for a TOP or TPM unlike a TRO which does not generally require the posting of a bond. Instead, a bond is required for the issuance of a writ of preliminary injunction.” 8. And a TOP or TPM may be lifted through the posting of a counter-bond which is not true of a TRO. Instead, a counter-bond may lift a writ of preliminary injunction.” Preference for Arbitration The rules on interim measures of protection recognize the principle of preference for arbitration over judicial proceedings. The following instances illustrate this principle: 1. Any court order granting or denying an interim measure of protection is without prejudice to the subsequent grant, modification, amendment, revision or revocation thereof by the arbitral tribunal. An interim measure of protection issued by the arbitral tribunal shall, upon its issuance be deemed to have ipso Jure modified, amended, revised or revoked an interim measure of protection issued by the court to the extent that it is inconsistent with the subsequent interim meas- ure of protection issued by the arbitral tribunal.” Section 5, Rule 58, 1997 Rules of Civil Proce ,_ Section 4, Rule 58, 1997 Rules of Civil Pi o Section 6, Rule 58, 1997 Rules of Civil P: ole 5.13, Special ADR Rules. dure. ‘rocedure. rocedure. Scanned with CamScanner17 Avrernative Disbure RESonurion 3. Any question involving a conflict or inconsistency between an interim measure of protection issu one issued by an arbitral tribunal shall be immediately referred by the court to the arbitral tribunal which shall have the authority to decide such question.” ed by a court and 4. The court shall defer action on any pending petition for an interim measure of protection filed by a party to an arbitra- tion agreement arising from or in connection with a dispute thereunder upon being informed that an arbitral tribunal has been constituted pursuant to such an agreement.” 5. And the court shall assist in the enforcement of an in- terim measure of protection issued by the arbitral tribu- nal which the latter is unable to effectively enforce.” D. Appointment of Arbitrators Rules 6.1 to 6.9, Special ADR Rules) The rules on the judicial appointment of arbitrators apply if 1. There is a failure to appoint an arbitrator under the fol- lowing circumstances:” a. Where any of the parties in an institutional arbitra- tion failed or refused to appoint an arbitrator, or the parties have failed to reach an agreement on the sole arbitrator (in an arbitration before a sole arbitrator), or when the two designated arbitrators have failed to reach an agreement on the third or presiding arbitra- tor (in an arbitration before a panel of three arbitra- tors), and the institution under whose rules arbitra- tion 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; * Rule 5.14, Special ADR Rules. * Rule 5.15, Special ADR Rules. Rule 5.6(¢) and 5.16, Special ADR Rules. Rule 6.1, Special ADR Rules. Scanned with CamScannerSpecial Runes oF Court oN ALrerNative 179 = The Spe ourt Reliefs — b. Where the arbitration is ad hoc and the parties failed to provide a method for appointing or replacing an ar- bitrator, or substitute arbitrator, or the method agreed upon is ineffective, and the National President of the Integrated Bar of the Philippines (IBP) or his duly authorized representative fails or refuses to act within such period as may be allowed under the per- tinent rules of the IBP or within such period as may be agreed upon by the parties, or in the absence thereof, within thirty (30) days from receipt of such request for appointment; or c. Where the parties agreed that their dispute shall be resolved by three arbitrators but no method of ap- pointing those arbitrators has been agreed. upon, and the parties, and subsequently, the appointing author- ity, fails or refuses to appoint the arbitrator within a reasonable time from receipt of the request to do so. And any party or the appointed arbitrators request’ the court to act as the appointing authority and appoint the arbitrator or third arbitrator as the case may be.“ Hereunder are the rules of procedure for the judicial ap- pointment of arbitrators: & * Rules 6.1 and 6.2, 8) Petition. The petition for the appointment of an arbitra- tor shall be filed with the Regional Trial Court [i] where the principal place of business of any of the parties is lo- cated; [ii] if any of the parties are individuals, where those individuals reside; or [iii] in the National Capital Judicial Region, at the option of the petitioner.” The petition shall state [i] the general nature of the dis- pute; lii] a description of the procedure for the appoint- ment of the arbitrators, if there is any, and the agreement containing such procedure; [iii] the number of the arbitra- tors agreed upon or the absence of such an agreement; [iv] the special qualifications of the arbitrators if there is any pecial ADR Rules. ™ Rule 6.3, Special ADR Rules. Scanned with CamScanner180 ALTERNATIVE Dispute REesonurion agreement thereon; |v] the fact that the thority, without justifiable cause, has faile act as such within the time prescribed or within a reason. able time, from the date a request was made; and [vil the petitioner is not the cause of the delay or in the failure of the appointment of the arbitrator. The petition should contain an authentic copy of the arbitration agreement, and proof that the appointing authority has been notified of the filing of the petition for appointment with the court.” The petition shall be served upon the respondent, before it is filed in court.” appointing au- d or refused to 2. Comment/opposition: The comment or opposition must be filed within fifteen (15) days from the service of the pe- tition.” 3. Court action. In addition to making the appointment, the court may require each party to submit a list of not less than three (3) proposed arbitrators together with their curriculum vitae from whom the court may appoint the arbitrator.” Prior to the appointment, if the court is informed that the appointing authority has already made an appointment, it shall dismiss the petition.” 4. Relief against court action. The order of the court ap- pointing an arbitrator shall be immediately executory and shall not be the subject of a motion for reconsideration, appeal or certiorari.” An order of the court denying the petition for appointment of an arbitrator may, however, be the subject of a motion for reconsideration, appeal or certiorari.” * Rule 6.4, Special ADR Rules "Rule 1.3(A), Special ADR Rules. >, Rule 6.5, Special ADK Rules. «, Rule 6.6, Special ADR Rules. », Rule 6.7, Special ADR Rules. " Rules 19.1, 19.12 and 19.26, Special ADR Rules. “Rules 19.1, 19.12, 19.26 and 6.9, Special ADR Rules. Scanned with CamScannerSpeci Rues oF Courr on Atreenarive 181 Di LUTION ~The Specific Ce Reliefs E, Challenge to Appointment of Arbitrator (Rules 7.1 to 7.9, Special ADR Rules) The rules of procedure on the judicial challenge to the ap- pointment of arbitrators apply to the following situation: 1. The challenge to the appointment of an arbitrator before the arbitral tribunal is not successful, and the appointing authority fails or refuses to act on the challenge within such period of time as may be allowed under the applicable rule or, in the absence thereof, within thirty (30) days from receipt of the request; and ‘The aggrieved party wants to secure judicial action on the challenge. The procedure for the challenge to the appointment of an ar- bitrator before the court is as follows: 1 Petition. The petition for the judicial challenge shall be filed with the Regional Trial Court [i] where the principal place of business of any of the parties is located, [ii] if any of the parties are individuals, where those individuals re- side, or [iii] in the National Capital Judicial Region, at the option of the petitioner.“ The petition shall state [i] the name of the arbitrator chal- lenged and his address; {ii] the grounds for the challenge; iii] the facts showing that the ground for the challenge has been expressly or impliedly rejected by the challenged arbitrator; and [iv] the facts showing that the appointing authority failed or refused to act on the challenge. of the petition shall be served upon the responde: itis filed in court.” “A copy nt before © Rule 7.2, Special ADR Rules. “ Rule 7.3, Special ADR Rules. * Rule 7.5, Special ADR Rules. “Rule 1.3(A), Special ADR Rules. Scanned with CamScanner182 Avrernative Dispur Resoution 2. Comment opposition. The challenged arbitrator or other parties may file a comment or opposition within fifteen (15) days from service of the petition.” 3. Court action. The court has an of the following options in resolving the petition: a. Grant the petition by removing the challenged arbi. trator if it finds merit in the petition; b. Dismiss the petition if there is no merit thereto; c. Allow the challenged arbitrator to withdraw as arbi- trator; d. Accept the challenge and remove the arbitrator if [i] the party or parties who named and appointed the challenged arbitrator agree to the ch. allenge and with- draw the appointment; [ii] the other arbitrators in the arbitral tribunal agree to the removal of the chal- lenged arbitrator; or [iii] the challenged arbitrator fails or refuses to submit his comment on the petition or the brief of legal arguments as directed by the court, or he fails to object to his removal. 4. No relief against court action. Any order of the court re- solving the petition shall be immediately executory and shall not be subject to a motion for reconsideration, ap- peal or certiorari.” F. Termination of Mandate of Arbitrator Rules 8.1 to 8.8, Special ADR Rules) The rules on the judicial termination of mandate of an arbi- trator apply when:” 1. An arbitrator becomes de jure or de facto unable to per- form his functions or for other reasons fail to act without undue delay; “ Rule 7.6, Special ADR Rules. “ Rule 7.7, Special ADR Rules. = Rules 19.1, 19.12 and 19.26, Special ADR Rules. ® Rule 8.1, Special ADR Rules. Scanned with CamScanner2. Specta. Rutes oF Court oN AvTERNATIVE 183 Di RESOLUTION The Specific Court Reliefs The arbitrator, upon request of any party, fails or refuses to withdraw from his office; The appointing authority fails or refuses to decide on the termination of the mandate of the arbitrator within such period of time as may be allowed under the applicable rule or, in the absence thereof, within thirty (30) days from the time the request is brought before him;” and Any party seeks judicial action in terminating the man- date of the arbitrator, The relief for the termination of the mandate of an arbitrator is different from a challenge to an arbitrator. In the judicial chal- lenge to an arbitrator, the arbitrator is sought to be removed on the ground of partiality or non-compliance with the qualifications required of him. In the judicial termination of the mandate of an arbitrator, the arbitrator who has been validly appointed has be- come incapable of performing his functions or has become unable to do so. The procedure for the judicial termination of the mandate of an arbitrator is as follows: 4. e Petition. The petition shall be filed with the Regional Trial Court |i] where the principal place of business of any of the parties is located, [ii] where any of the parties who are individuals reside, or liii] in the National Capital Ju- dicial Region, at the option of the petitioner.” The petition shall state [i] the name of the arbitrator whose mandate is sought to be terminated; [ii] the grounds for the termination; [iii] the fact that one or all of the parties had requested the arbitrator to withdraw but he failed or refused to accede; and [iv] the fact that one or all of the parties requested the appointing authority to act on the request but is unable or has failed to act within thirty (30) days from the request or within such period of time as may have been agreed upon by the parties or al- * Rule 8.2, Special ADR Rules. Rule 8.3, Special ADR Rules. Scanned with CamScanner184 2. Comment /opposition. 3. Court action. 4. No relief against court action. ALTERNATIVE Dispute Resonurion lowed under the applicable shall be served w court.” rule.” "A copy of the petition pon the respond. lent before it is filed in The comment or opposition must be filed within fifteen (15) days from service of the peti- tion.” The court shall grant the petition and ter- minate the mandate of the arbitrator if it finds merit in the petition; otherwise it shall dismiss the petition.” If the petition is granted, a substitute arbitrator shall be ap- pointed according to the rules that were applicable to the appointment of the arbitrator being replaced.” Any order of the court re- solving the petition shall be immediately executory and shall not be subject to a motion for reconsideration, ap- peal or petition for certiorari.” G. Assistance in Taking Evidence (Rules 9.1 to 9.11, Special ADR Rules) The specific, relief for judicial assistance in taking evidence is an exception to the principle that the Special ADR Rules are appli. cable only to domestic arbitration and Philippine ICA. The relief is available whether the arbitration is domestic or foreign. The rules on judicial assistance in takin, situation: g evidence apply in the following 1. There is a pending arbitration, whether domestic or for- eign; “ Rule 8.4, Special ADR Rules. “Rule 1.3(A), Special ADR Rules. “Rule 8.5, Special ADR Rules. * Rule 8.6, Special ADR Rules. " Rule 8.8, Special ADR Rules = Rules 19.1, 19.12, 19.26 and 8.7, Special ADR Rules. * Rules 9.1 and 9.4, Special ADR Rules. Scanned with CamScannerSpecial. Ruies or Court on ALrERNATIVE 185, ISPUTE RESOLUTION pecific Court Reliefs 2. A party desires to present evidence or the arbitral tribu- nal ordered the taking of evidence, necessitating court as- sistance; and 3. The evidence is sought from a person, including a repre- sentative of a corporation, association, partnership or other entity, other than a party to the arbitration or its of- ficers, found in the Philippines. When, however, arbitration has not yet commenced or the ar- bitral tribunal has not yet been constituted, any person who de- sires to perpetuate his testimony or that of another may avail of the rule on depositions before action or pending appeal under Rule 24 of the 1997 Rules of Civil Procedure which provides that: “SECTION 1. Depositions before action; petition —A person who desires to perpetuate his own.testimony or that of another regarding any matter that may be cognizable in any court of the Philippines, may file a verified petition in the court of the place of the residence of any expected adverse party.” Examples of court assistance in taking evidence are enumer- ated in Rule 9.5 of the Special ADR Rules. They correspond to the different classes of evidence under the Rules of Court. Thus: 1. On testimonial evidence: a. To comply with a subpoena ad testificandum;" and b. To appear as witness before an officer for the taking of his deposition upon oral examination or written inter- rogatories."* 2. On documentary evidence: a. To comply with a subpoena duces tecum;"" and b. To allow the examination and copying of documents." “ Rule 9.10, Special ADR Rules. * Rule 9.5(a), Special ADR Rules. * Rule 9.5(b), Special ADR Rules. “ Rule 9.5(a), Special ADR Rules. “Rule 9.5(d), Special ADR Rules. Scanned with CamScanner186 ALTERNATIVE Dispure: Res 3. On real evidence: To allow the physical examination of the condition of per. sons, or the inspection of things or premises and, when appropriate, to allow the recording or documentation ot the conditions of Persons, things or premises (i.c., taking photographs, video recording or using other means of re cording or documentation)."” The foregoing enumeration of the types of court assistance in taking evidence under Rule 9.5 of the Special ADR Rules is not exclusive." The arbitral tribunal is not clothed with authority to cite per- sons or parties in contempt. However, the court may impose sanc- tions, including the citation for contempt, against persons who violate its orders issued in assisting the arbitral tribunal in taking evidence.'” The procedure for judicial assistance in taking evidence is as follows: 1. Petition. The petition shall be filed with the Regional Trial Court where [i] arbitration proceedings are taking place; [ii] the witness resides or may be found; or [iii] -the evidence may be found, at the option of the peti- tioner."* The petition must state [i] the fact there is an on-going arbitration proceeding even if such proceeding cannot con- tinue due to some legal impediments; [ii] the arbitral tri- bunal ordered the taking of evidence or a party desires to Present evidence to the arbitral tribunal; [iii] the materi- ality or relevance of the evidence to be taken; and [iv] the names and addresses of the intended witnesses, place where the evidence may be found, or the place where the * Rule 9.5(c), Special ADR Rules. 'S Rule 9.5(e), Special ADR Rules. Rule 9.11, Special ADR Rules. Rule 9.3, Special ADR Rules. Scanned with CamScannerSpectat. Runes or Court oN ALTERNATIVE 187 Dispute Resoiurion ~The Specific Court Reliefs acts required are to be done."” A copy of the petition shall be served upon the respondent before it is filed in court.'"” 2, Comment /opposition. The comment or opposition must be filed within fifteen (15) days from service of the peti- tion. 3. Court action. If the evidence sought is not privileged, and is material and relevant, the court shall grant the re- quest for assistance in taking evidence and shall order the petitioner to pay the costs attendant to such assistance." 4. Relief against court action. The order granting the re- quest for assistance in taking evidence shall be immedi- ately executory and not subject to a motion for reconsid- eration, appeal or petition for certiorari.'” If the court de- clines to grant assistance in taking evidence, the peti- tioner may file a motion for reconsideration, appeal or pe- tition for certiorari.”* H. Confidentiality/Protective Orders (Rules 10.1 to 10.10, Special ADR Rules) The protective order referred to under the rules on judicial en- forcement of confidentiality is different from the interim protective measures under Rule 5 of the Special ADR Rules. The protective order under Rule 10 of the Special ADR Rules refers to the judicial enforcement of the confidential nature of information disclosed or obtained during an ADR proceeding. The rules on confidentiality and protective orders apply when: 1, An ADR proceeding is pending; “* Rule 9.6, Special ADR Rules. “* Rule 1.3(A), Special ADR Rules. E Rule 9.8, Special ADR Rules ‘y; Rules 19.1, 19.12 and 19.26, Special ADR Rules. 1, Rules 9.9, 19.1, 19.12 and 19.26, Special ADR Rules. Rule 10.1, Special ADR Rules. Scanned with CamScanner188 Avrernative Dispure 2. A party, counsel or witness y disclosed information or was otherwise compelled to disclo: se information; The disclosure was made under circumstances that would create a Teasonable expectation, on behalf of the source, that the information shall be kept confidential; 4. The source of the information or tl disclosure has the right to being disclosed; he party who made the prevent such information from 5. The source of the information or the party who made the disclosure has not given his express consent to any disclo- sure; and 6. The applicant would be materially prejudiced by an unau- thorized disclosure of the information obtained, or to be obtained, during the ADR proceeding.” The benefit of the rule is available not just for arbitration pro- ceedings, but for all other forms of ADR. Hereunder is the procedure for the judicial enforcement of confidentiality or protective measures: 1. Petition or motion. If there is no pending court proceed- ing in which the information obtained in an ADR proceed- ing is required to be divulged or being divulged, the initia- tory pleading shall be a petition to be filed with the Re- gional Trial Court of the place where the order may be implemented. A copy of the petition shall be served upon the respondent before it is filed in court.'" If there is already a pending court proceeding, a separate petition will be improper because that will amount to multiplicity of suits and forum-shopping. Under this situation, the applicant should file with the court where the proceeding is pending a motion to enjoin the disclo- sure or to suppress the confidential information." Being a litigated motion, the movant is required to set the motion 1, Rule 10.4, Special ADR Rules. 1» Rule 1.3(A), Special ADR Rules. “ Rulé 10.3, Special ADR Rules. Scanned with CamScannerSpecia ye Court on AL’ ERNATIVE 189 ESOLUTION, = The Specific Court Reliefs — for hearing in accordance with Rule 15 of the 1997 Rules of Civil Procedure.' Where the situation is more urgent, such as when a question involving confidential informa- tion has already been propounded to a witness, a timely objection must be raised by a party in the case who will be aggrieved by the disclosure before the question is an- swered. The petition or motion must state [i] that the information sought to be protected was obtained, or would be ob- tained, during an ADR proceeding; [ii] the applicant would be materially prejudiced by the disclosure of that information; [iii] the person or persons who are being asked to divulge the confidential information participated in the ADR proceedings; and [iv] the time, date and place when the ADR proceedings took place.’” Comment/opposition. The comment or opposition must be filed within fifteen (15) days from service of the peti- tion or motion. The comment or opposition may be accom- panied by proof that [i] the information is not confidential; i] the information was not obtained during an ADR pro- ceeding; [iii] there was a waiver of confidentiality; or [iv] the petitioner or movant is precluded from asserting con- fidentiality.” . Court action. If the court finds the petition or motion meritorious, it shall issue an order enjoining the persons involved from divulging confidential information,” The court shall impose the proper sanction, including citation for contempt, against any person who disobeys the order of the court to cease from divulging confidential informa- tion.” Relief against court action. The order enjoining the dis- closure of confidential information shall be immediately i ale 10.5, Special ADR Rules. “Rule 10.7, Special ADR Rules a Rule 10.8, Special ADR Rules, Rule 10.10, Special ADR Rules, ' Scanned with ComScanner190 ¢ Disrure: Resontrrion executory and may not be enjoined while the order is be- ing questioned before the appellate courts. The order en- joining or refusing to enjoin persons involved from divulg- ing confidential information may be the subject of a mo- tion for reconsideration or appeal," but not a petition for certiorari." 1. Confirmation, Recognition, Enforcement, Correction, Vacation or Setting Aside of Arbitral Awards (Rules 11 to 13, Special ADR Rules) Rules 11 to 13 of the Special ADR Rules govern the confirma- tion, recognition, enforcement, correction, vacation or setting aside of arbitral awards. The circumstances covered by these rules are as follows: 1. An arbitral award has been rendered either in a [i] do- mestic arbitration; [ii] Philippine ICA; or [iii] foreign arbi- tration resulting in a convention award or non-convention award but with comity and reciprocity (as in convention award). 2. A party seeks to [i] confirm, correct or vacate the domestic arbitral award; [ii] recognize and enforce, or set aside the Philippine ICA award; or [iii] recognize and enforce the foreign convention award or foreign as-in convention award. Ja. Confirmation, Correction or Vacation of Domestic Arbitral Awards (Rules 11.1 to 11.9, Special ADR Rules) A The Special ADR Rules clarify that judicial affirmation of a Comestic arbitral award is done through “confirmation” and not recognition.” “Recognition” pertains to the grant of legal effect by = Rules 19.1, 19.12 and 10.9, Special ADR Rules. Rule 19.26, Special ADR Rules. Scanned with CamScannerSpecial Rutes oF Court on At Diset SOLUTION = The Specific Court Reliefs ~ RNATIVE 191 Philippine courts to an arbitral award with foreign elements, i, sither the arbitral tribunal that rendered the award is foreign, like in the case of a foreign arbitral award, or the basis of the authority for rendering the award is an international convention, treaty or agreement like in the case of an international commercial arbitral 185, award. ‘A domestic arbitral award carries with it the presumption that it was rendered in due course of the arbitration and is, there- fore, entitled to confirmation by the court.” This presumption may be rebutted by evidence of the existence of any of the grounds for vacating or setting aside the arbitral award. Causes of Action and Grounds Three (3) principal causes of action are covered by Rule 11 of the Special ADR Rules, namely:” 1. Confirmation of the domestic arbitral award, the petition for which can be filed at any time after the lapse of thirty (30) days from receipt by the petitioner of the arbitral award, ™ unless it is filed in opposition to a petition for vacation in which case the petition for confirmation may be filed at any time after the filing of the petition for va- cation.” The petition shall be granted unless there exist grounds to vacate the arbitral award.” 2. Correction or modification of the domestic arbitral award, the petition for which must be filed not later than thirty (30) days from receipt of the arbitral award," unless the correction is applied for as a supplementary relief to a pe- tition for confirmation in which case the correction may be ™ See Korea Technologies Co., Ltd. v. Lerma, 542 SCRA 1 [2008], p 29, where “confirmation” was used interchangeably with “recognition.” ** Rule 11.9, Special ADR Rules. * Rule 11.2, Special ADR Rules. ™ Rule 11.2(A), Special ADR Rules. * Rule 11.28), Special ADR Rules “ Rule 11.9, Special ADR Rules but see Section 23, Arbitration Law. Rule 11.2(B), Special ADR Rules. Scanned with CamScanner192 ALTERNATIVE Dispure applied for at the Same time as the filing of the petition for confirmation.’ The grounds are as follows:'"" a. Where there was an evident miscalculation of figures or an evident mistake in the description of any per- son, thing or property referred to in the award: b. Where the arbitrators have awarded upon a matter not submitted to them, not affecting the merits of the decision upon the matter submitted; c. Where the arbitrators have omitted to resolve an is- sue submitted to them for resolution; or Where the award is imperfect in a matter of form not affecting the merits of the controversy, and if it had been a commissioner's report, the defect could have been amended or disregarded by the court. Vacation of the domestic arbitral award, the petition or petition-in-opposition for which must be filed not later than thirty (30) days from receipt of the arbitral award, The grounds are as follows: a. The arbitral award was procured through corruption, fraud or other undue means; b. There was evident partiality or corruption in the arbi- tral tribunal or any of its members; ¢. The arbitral tribunal was guilty of misconduct or any form of misbehavior that has materially prejudiced the rights of any party; d. One or more of the arbitrators was disqualified to act as such under the law and willfully refrained from disclosing such disqualification; ¢. The arbitral tribunal exceeded its powers, or so imper- fectly executed them, such that a complete, final and definite award upon the subject matter submitted to them was not made; * Rule 11.2(G), Special ADR Rules ‘* Rule 11.4(B), Special ADR Rules and Section 26, Arbitration Law. “Rule 11.4(A), Special ADR Rules. Scanned with CamScannerSpectaL Rutes oF Court on ALTERNATIVE 193 Dist DLUTION The Specific Court Reliefs {. The arbitration agreement did not exist, or is invalid : for any ground for the revocation of a contract or is otherwise unenforceable; or g. A party to the arbitration is a minor or a person judi- cially declared to be incompetent, in which case, the petition shall be filed only on behalf of the minor or the incompetent person, and shall allege that [i] the other party had knowingly entered into a-submission or agreement with such minor or incompetent; and [ii] the submission to arbitration was made by a guardian or guardian ad litem who was not authorized to do so by a competent court.” The foregoing grounds are exclusive and the court cannot con- sider any other ground.” Combination of Causes of Action The principle of combined reliefs is available in proceedings allowing vacation or setting aside and correction of the arbitral award. These are the proceedings involving domestic arbitral awards and Philippine ICA awards, but not for foreign arbitral awards which cannot be vacated or set aside. In brief, the principle allows the combination of two (2) or more reliefs to be pleaded in. the same proceeding. The initiatory relief is that which is pleaded in the initiatory petition, while the relief:in-opposition is that prayed for in order to oppose the initiatory relief. A relief may also be a supplementary relief as in the case of a prayer for correction of an arbitral award in support of a petition for confirmation. And a relief may also be an alternative relief as in the case of a prayer for correction as an alternative to a petition to vacate in opposition to a petition for confirmation. Specifically, the following combinations are possible: J. Confirmation /vacation. A petition for confirmation of a domestic award can be opposed by a petition-in-opposition seeking to vacate the award.” ‘See also Section 2, Arbitration Law. Rule 11.4(A), Special ADR. Rules. Scanned with CamScanner194 Avrennative Dispure: Resoirrions 2. Confirmation / correction. A petition for confirmation of a domestic award may include a petition for the correction of the arbitral award." The correction of the arbitral award necessarily implies the confirmation of the cor- rected or modified award. A petition for confirmation of the award may also be opposed by a petition-in-opposition seeking the correction or modification of the award in or- der to make the award acceptable to the party moving for its correction. 3. Vacation /correction. A petition to vacate an award may include a petition for the correction of the domestic arbi- tral award. It may also be opposed by a petition-in-oppo- sition seeking the correction or modification of the award in order to make the award acceptable to the party seek- ing its vacation. While the foregoing combinations may come into play in a single petition, the rules do not allow the filing of petitions-in- opposition to vacate or correct a domestic arbitral award beyond the reglementary period for the filing of the petition had it been filed in the first instance. Hence, a petition for confirmation filed more than thirty (30) days from receipt of the arbitral award, and therefore, filed within the reglementary period for such petitions, may no longer be opposed via a petition-in-opposition to vacate or correct the award.” This does not, however, prevent the oppositor from filing an opposition to the petition except that he can no longer seek the affirmative relief of vacating or modifying the award on the grounds provided therefor. A petition for the vacation of a domestic arbitral award filed beyond the reglementary period shall be dismissed but that dis- missal will not render dismissible a petition-in-opposition seeking to confirm the arbitral award.’ While the petition to vacate the award was filed beyond the reglementary period, the petition-in- ® Rule 11.2(D), Special ADR Rules. “ Rules 11. 2(G) and 11.5, Special ADR Rules. “Id. “* Rules 11.2(D) and (F), Special ADR Rules. Rule 11.28), Special ADR Rules. Scanned with CamScannerSprciat RULES Dispu ~ The Speeific oF Court ON ALTERNATIVE 195 p RESOLUTION ourt Reliefs ition to confirm the award not having any reglementary pe- opr nas been filed on time and, therefore, is not dismissible. In- rion, the petition-in-opposition for confirmation will be considered = petition for confirmation filed in the first instance. Combination is possible only in the following instances: 1, If the petition to vacate, with a filing period of thirty (30) days from receipt of the arbitral award, is filed first as it can be opposed by a petition-in-opposition for confirma- tion which can be filed at any time after the petition to vacate has been filed.'* 2. Or if the arbitral award is received ahead by the party intending to confirm it and it is received later by the party intending to vacate it, in which case, the filing pe- riod for the petition to set aside the arbitral award will overlap with the filing period for the petition for confir- mation. In the foregoing instances, the earlier petition can be opposed by a petition-in-opposition during the overlapping period. The rules prohibit forum shopping and multiplicity of suits. If a petition for confirmation is already pending before a court, no petition-in-opposition seeking to vacate the same arbitral award may be filed with any other court. So also, if a petition for vacation is already pending before a court, no petition-in-opposition seeking to confirm the same arbitral award may be filed with any other court. Any such subsequent petition may be dismissed for being violative of the rule against forum shopping or consolidated with the petition filed earlier. If the petitions were filed simultaneously, upon motion of either party, the cases may be consolidated in ei- ther court.“ Procedural Rules Hereunder is the : i procedure for the judicial confirmation, cor- rection or vacation of d lomestic arbitral awards: aed *© Rule 11.5, Special ADR Rules. Scanned with CamScanner196 I. Petition. The initiator ALTERNATIVE Dispur: RESOLUTION y pleading for confirmation, cor- a domestic arbitral award in the a petition to be filed with the Regional Trial Court having jurisdiction over the place [i] in which one of the parties is doing business; [ii] where any of the parties resides; or [iii] where the arbitration proceeding was conducted." rection or vacation of first instance is The petition must state the [i] addresses of the parties and any change thereof; [ii] the jurisdictional issues raised by a party during arbitration proceedings: [iii] the grounds relied upon; and [iv] the date of receipt of the ar- bitral award and the circumstances under which it was received by the petitioner. The petition must contain an authentic copy of the arbitration agreement, an authentic copy of the arbitral award, a certification against forum shopping, and an authentic copy of the appointment of the arbitral tribunal.'’* Where, however, confirmation, correction or vacation of the domestic arbitral award is to be pleaded in opposition to a pending petition, the oppository pleading to be filed is a petition-in-opposition. Comment / opposition / petition-in-opposition. If the peti- tion is sufficient in form and substance, the court shall cause notice and a copy of the petition to be delivered to the respondent. Within fifteen (15) days from receipt of such notice, the respondents may file a comment, opposi- tion, or a petition-in-opposition'® unless the period for the filing thereof has prescribed. Reply. The petitioner may file a reply within fifteen (5) days from receipt of the comment or opposition, or a com- ment or opposition to the petition-in-opposition."” Hearing. The proceeding for the confirmation, correction or vacation of domestic arbitral awards may be summary “Rule 11.3, Special ADR Rules. vw Rule 11.6, Special ADR Rules. wo pale 11.7, Special ADR Rules. Scanned with CamScanneror Court oN ALTERNATIVE, 197 RESOLUTION cific Court Reliefs - Speciat Ru Dis ~The Sp or regular. If the court finds through the petition or peti- tion-in-opposition thereto that there are issues of fact, it shall require the parties to submit the affidavits of all their witnesses (within a period of not more than fifteen [15] days from receipt of the order) and reply affidavits (within ten [10] days from receipt of the affidavits to be replied to), attaching thereto the documents relied upon in support of the statements of fact contained in the affi- davits.'* Up to this stage, the proceedings are summary. If the court finds that, on the basis of the petition, the op- position, and the affidavits of the parties, there is a need to conduct an oral hearing, the court shall set the case for hearing during which, the affidavits of the witnesses shall take the place of their direct testimonies and they shall be immediately subjected to cross-examination.’” Upon this stage, the proceedings become regular in character. 5. Court action.” The court may either confirm or vacate the award. It shall confirm the award unless a ground ex- ists to vacate the domestic arbitral award. The confirma- tion of an arbitral award carries with it by necessary im- plication the execution thereof.'* The arbitral award car- ries with it the presumption that is has been issued in due course of the arbitration and is subject to confirma- tion by the court. If the petition or petition-in-opposition to vacate the award contains an application for the court to refer the case back to the arbitral tribunal that rendered the award for the purpose of making a new or revised award or to di- rect a new hearing, or in an appropriate case, to order a new hearing before a new arbitral tribunal, the members of which shall be chosen in the manner provided in the “Rule 11.8, Special ADR Rules. 1 ig. “Rule 11.9, Special ADR Rules, Department of Environ snurel 1 United Planners Const nment and Natural Resources (DENR) v. 2015. tants, Inc. (UPCI), G.R. No. 212081, February 23, Scanned with CamScanner198 ALTERNATIVE Dispury, Resonurion arbitration agreement, or si ubmission, or the law, the court may grant such reliefs, In any case, the court shall not dist: the urb the arbitral tribu- nal’s determination of facts and inte, pretation of the law. 6. Relief against court action. The order of the court con- firming, vacating or correcting a domestic arbitral award may the subject of a motion for reconsideration, appeal or petition for certiorari." Section 29 of the Arbitration Lan limits the appeal to questions of law only. Ib. Recognition, Enforcement or Setting Aside of ICA Awards (Rules 12.1 to 12.14, Special ADR Rules) Rule 12 of the Special ADR Rules governs the recognition and enforcement or setting aside of a Philippine ICA award," A foreign ICA award shall be treated as a foreign arbitral award, and ite (eeognition and enforcement will be governed by Rule 13 of the Special ADR Rules. In these discussions, reference to “ICA” or International Com: mercial Arbitration” pertains to “Philippine ICA.” On the other hand, ICA whose seat is other than the Philippines are referred to 2s “foreign ICA.” - Causes of Action The following are the exclusive causes of action covered by Rule 12 of the Special ADR Rales: 1. Recognition and enforcement of an ICA award, the peti- tion for which can be filed at any time from receipt of the award. The court shall grant the petition unless any of the grounds for setting aside the arbitral award is estab- lished.“ ‘= Rules 19.1, 19.12 and 19.26, Special ADR Rules. Rule 12.1, Special ADR Rules 12.2(A) and 12.13, Special ADR Rules. Scanned with CamScannerSpecia. Rutes or Court on ALrernative 199 ResoLurion = The Specific Court Reliefs If a timely petition to set aside has first been filed, the oppositor must file therein and in opposition thereto the petition for recognition and enforcement thereof within the period for filing an opposition." Setting aside an ICA award, the petition for which should be filed within three (3) months from the time the peti- tioner receives a copy of the ICA award or the resolution of the arbitral tribunal for the correction or interpretation of the award or the rendition of an additional award if a timely request has been filed therefor."” It can also be filed in opposition to a petition for recognition and en- forcement provided it is not yet time-barred.” Be that as it may, the dismissal of a petition to set aside for being time-barred shall not automatically result in the approval of the petition filed therein or in opposition thereto for the recognition or enforcement of the same award. Judicial correction or modification is not available for an ICA award. Any other judicial recourse against an ICA award, such as an appeal, petition for review or petition for certiorari, are disal- lowed and shall be dismissed. Grounds The grounds for setting aside an ICA award or to resist its en- forcement which are the same grounds for the non-recognition of foreign arbitral awards, are as follows:'” 1 The party making the application furnishes proof that: a. A party to the arbitration agreement was under some incapacity, or the said agreement is not valid under the law to which the parties have subjected it or, fail- ing any indication thereof, under Philippine law; * Rules 12.2(A) and 12.6, Special ADR Rules. “* Rule 12.2(B), Special ADR Rules. Rule 12.6, Special ADR Rules. “Rule 12.5, Special ADR Rules. Rule 12.4, Special ADR Rules. Scanned with CamScanner200 revo; Ic BRNATIVE, Dispur Resonurion The party making the application to set asi enforcement was not given proper notice of pointment of an arbitrator or of the ings or was otherwise un: The award deals with or resi: the ap- arbitral proceed- ‘able to present his case; a dispute not contemplated by or not falling within the terms of the submission to arbitration, or contains decisions on matters beyond the scope of the submission to arbitration; provided that, if the decisions on matters submitted to arbitra- tion can be separated from those not so submitted, only that part of the award which contains decisions on matters not submitted to arbitration may be set aside or only that part of the award w! ch contains decisions on matters submitted to arbi':.tion may be enforced; or The composition of the arbitral tribunal or the arbi- tral procedure was not in accordance with the agree- ment of the parties, unless such agreement was in conflict with a provision of Philippine law from which the parties cannot derogate, or, failing such agree- ment, was not in accordance with Phi’ pine law; 2. - Or the court finds that: a. ‘The subject matter of the dispute is not capable of set- tlement by arbitration under the law of the Philip- pines; or The recognition or enforcement of the award would be contrary to public policy. The foregoing grounds are similar to the grounds for the non- nition of foreign arbitral awards" thus showing that, while ‘ proceedings in the Philippines are domestic arbitral proceed- ‘ngs, ICA awards are treated more like foreign arbitral awards; ence, firm; » the requirement for the recognition, rather than mere con- ‘ation, of ICA awards. ea “Rule 18.4, Special ADR Rules. Scanned with CamScannerSpectaL, Ruves oF Court on ALTERNATIVE 201 Disrure: Resoutrrion The Specifie Court Reliefs : ase of domestic arbitral awards, if a party to the ne a person judicially declared to be incompetent, 10 ition to oet eaide the ICA award shall be filed only on behalf wrene minor or the incompetent person, and shall allege that [i] the other party had knowingly entered into a submission or agreement with such minor or incompetent; and |ii] the submission to arbitra- tion was made by a guardian or guardian ad litem who was not authorized to do so by a competent court. The court should disregard any other ground to set aside or enforce the arbitral award, unless it amounts to a violation of pub- lic policy.” Combination of Causes of Action The same principle allowing combinations of reliefs and the dismissal of petitions or petitions-in-opposition seeking reliefs filed beyond the reglementary periods applicable to the confirmation, enforcement or setting aside of domestic arbitral awards, are appli- cable to international commercial arbitral awards. Hence, petitions for recognition and enforcement and setting aside of international commercial arbitral awards rendered in the Philippines may be filed in the first instance. They may also be filed by way of petitions-in-opposition. Considéring that the period for filing @ petition for the recognition of an ICA award is anytime after it has been received by the party seeking its recognition, and the period for filing a petition for setting it aside is anytime within three (3) months from receipt thereof by the party seeking to set it aside, the possibility of filing a petition-in-opposition is greater and the overlapping period during which the petition-in-opposition can be filed is longer, for ICA awards than those for domestic arbitral awards. The proscription against forum shopping is also Strictly ob- served in the filing of these combined petitions. Once a petition for recognition has been filed in court, Separate petition for s filing a petition-in. i » the adverse party cannot file a etting aside, but must seek that relief by “opposition for setting aside the arbitral award Rule 19.10, Special ADR Rules Scanned with CamScanner02 ALTERNATE 8 Dispure: Resowurion in the same proceeding, Similarly, once a petition for setting aside has been filed in court, the adverse party cannot file a separate petition for recognition, but must seek that relief by filing a peti. tion-in-opposition for recognition in the same proceeding. Procedural Rules 1. Petition. The petition shall be filed with the Regional Trial Court [i] where the arbitration Proceedings were conducted; [ii] where any of the assets to be attached or levied upon is located; [iii] where the act to be enjoined will be or is being performed; [iv] where any of the parties to the arbitration resides or has his place of business; or \v] in the National Capital Judicial Region, at the option of the petitioner.'® The petitions to set aside, for recognition and enforcement, to set aside in opposition to a petition for recognition or en. forcement, and for recognition and enforce tion to a petition to set aside, shall be verified" and shall state [i] the addresses of record of the parties; [ii] that the arbitration agreement or submission exists; [iii] the names of the arbitrators and proof of their appointment; [iv] that an arbitral award was issued and the date when the peti- tioner received it; and [v] the relief sought. The petitioner shall attach to the petition [i] an authentic copy of the arbi. tration agreement; [ii] an authentic copy of the arbitral award; [iii] the verification and certification against forum shopping; and [iv] an authentic copy of the appointment of the arbitrator or the arbitral tribunal." In addition, the Petition to set aside and petition to set aside in opposition ‘0 a petition for recognition and enforcement should state the grounds relied upon therefor.” ment in opposi- Notice, opposition and reply. If the petition is sufficient - in form and substance, the cou rt shall cause a notice and ve Rule 12.3, Special ADR Rules. xu Rule 12.6, Special ADR Rules ve Rule 12.714), Special ADR Rules © 12.1(B), Special ADR Rules. Scanned with CamScannerSpeciaL Rutes or Court ON ALTERNATIVE 203 Dispute RESOLUTION ~The Specific Court Reliefs — a copy of the petition to be delivered to the respondent di- recting him to file an opposition thereto, including a peti- tion for recognition or to set aside in opposition thereto, if not yet time-barred, within fifteen (15) days from receipt of the petition. The petitioner may file a reply within fif- teen (15) days from receipt of the opposition or petition in opposition. Hearing. The court may conduct the hearing through [i] the submission of briefs of legal arguments if the issue is mainly one of law; or [ii] the submission of affidavits of witnesses, reply affidavits and documents in support thereof if there are issues of fact relating to the grounds relied upon for the petition. Up to this point, the proceed- ings are summary in nature. Tf, on the basis of the petition, the opposition, the affida- vits and reply affidavits, the court finds a need to conduct an oral hearing, it shall set the case for hearing during which the affidavits of witnesses shall take the place of their direct examination.” Upon this stage, the proceed- ings become non-summary in character. 4. Suspension of the proceedings. In a petition to set aside, the court, upon motion of party, may suspend the proceed. ings in order to give the arbitral tribunal an opportunity to resume the arbitral proceedings or take such other ac- tion as will eliminate the grounds for setting aside. The court, however, cannot direct the arbitral tribunal to re- vise the arbitral award one way or the other, revise its findings of fact or conclusions of law, or otherwise en- croach upon the independence of the arbitral tribunal in making the final award. Also, when the preliminary ruling of an arbitral tribunal affirming its jurisdiction has been appealed to the court, the proceedings for setting aside may be suspended to await the ruling of the court on such pending appeal, or may be consolidated with the earlier appeal,"” ‘Rules 12.9 and 12.10, Special ADR Rules. “° Rule 12.11, Special ADR Rules. Scanned with CamScanner