Chapter 9 – Special Rules of Court on ADR

Alternative Dispute Resolution - Atty. David Ballesteros

TOPICS: - Verified and must be accompanied by a

A. Judicial Relief Involving the Issues of Existence, certification of non-forum shopping.
Validity, and Enforceability of the Arbitration - Authentic copy of the arbitration agreement
Agreement. should be attached UNLESS the ground relied
B. Referral to ADR upon is the non-existence of unenforceability
C. Interim Measures of Protection of the arbitration agreement.
D. Appointment of Arbitrators - Filing of the petition does not prevent the
E. Challenge to Appointment of Arbitrator commencement of arbitration, or continuation
thereof and the rendition of an award.
F. Termination of Mandate of Arbitrator
G. Assistance in Taking Evidence - Should state the ff:
ii. The facts showing that the persons named
H. Confidentiality/ Protective Orders
as petitioner or respondent have legal
I. Confirmation, Recognition, Enforcement, capacity to sue or be sued;
Correction, Vacation or Setting Aside of Arbitral iii. The nature and substance of the dispute
Awards between the parties;
Ia. Confirmation, Correction or iv. The grounds and the circumstances relied
Vacation of Domestic Arbitral upon by the petitioner to establish his
Awards position; and
Ib. Recognition, Enforcement or v. The relief/s sought.
Setting Aside of ICA Awards 2. Comment/Opposition
Ic. Recognition and Enforcement of - Within 15 days from service of the petition, the
Foreign Arbitral Awards. respondent must file his comment or
opposition.
A. Judicial Relief Involving the Issues of Existence, 3. Court Action
Validity, and Enforceability of the Arbitration - Court must exercise judicial restraint and defer
Agreement. (Rules 3.1 – 3.22, Special ADR Rules) to the competence or jurisdiction of the
• Petition for Judicial determination of the existence, arbitral tribunal to rule on its competence and
validity and/or enforceability of an arbitration agreement. jurisdiction.
• This judicial relied is applicable only to arbitration 4. Relief against court action
proceedings conducted in the Philippines. ➢ The determination by ➢ If the court finds the
• Nature: Summary Proceeding. the court upholding the arbitration agreement,
• Issues involved in these proceedings are: existence, validity or Inexistent, Invalid or
1. Existence of the arbitration agreement – Whether or enforceability of the Unenforceable, the
not there is an arbitration agreement; arbitration agreement aggrieved party may file
2. Validity of the arbitration agreement – whether or not under these proceedings a motion for
the arbitration agreement complies with all the is merely prima facie. reconsideration or a
essential requisites for a valid contract; and ➢ Such prima facie petition for certiorari.
3. Enforceability of the arbitration agreement – whether determination, however, ➢ The distinction is
or not the arbitration agreement is enforceable on shall NOT be subject to necessary in order to
accordance with Art. 1403 of the Civil Code. a motion for provide judicial remedy
reconsideration, appeal for a ruling against
A.1 Judicial Relief before commencement of arbitration. or certiorari, but shall be jurisdiction of an arbitral
(Rules 3.2 to 3.11, Special ADR Rules) without prejudice to the tribunal in line with the
• Instances: right of any party to state policy if giving
1. The arbitration proceeding has not yet commenced; raise the same issues preference to ADR.
and before the arbitral
2. There is between the parties a dispute regarding the tribunal or the court in a
existence, validity or enforceability of the arbitration petition to vacate or set
agreement. aside the arbitral award
which shall be resolved
in accordance with the
• Procedural Rules BEFORE commencement of
standards set for such
arbitration:
proceedings.
1. Petition
- To be filed with RTC where any of the parties
resides or has his place of buss.

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Chapter 7 – OTHER FORMS OF ADR
Alternative Dispute Resolution - Atty. David Ballesteros

A.2 Judicial Relief after arbitration commences. (Rules 3.12 pending, to refer the issue back to the arbitral
to 3.22, Special ADR Rules) tribunal once constituted.
• Instances: - Competence-competence principle: courts
1. After commencement of arbitration; are enjoined to exercise judicial restraint and
2. Constitution of the arbitral tribunal; and defer to the competence or jurisdiction of the
3. After the arbitral tribunal has rendered a preliminary arbitral tribunal to rule on its competence or
ruling on its jurisdiction. jurisdiction.
• Issue: Whether or not the arbitral tribunal has jurisdiction - filing and pendency of the petition for judicial
over the arbitral proceedings. relief shall NOT be a cause for the court to
• The rules on judicial relief after the commencement of enjoin the arbitration proceeding and the
arbitration apply under the ff circumstances: arbitral tribunal may proceed with the
1. The arbitration proceeding has already commenced, arbitration and render the award.
the arbitral tribunal has been constituted and has 4. Relief against court action
rendered a preliminary ruling on its jurisdiction; and • The aggrieved party • if the arbitral
2. A party desires to challenge the arbitral tribunal’s may file a motion for tribunal, instead
ruling on the issue of jurisdiction. reconsideration of the of rendering a
order of the court, preliminary
• Procedural rules AFTER arbitration commences: which shall, however, ruling on its
1. Petition not be subject to an jurisdiction,
- Within 30 days from receipt of the notice of a appeal. decides to defer
ruling from an arbitral tribunal, an aggrieved such ruling until
party may file a petition with RTC where: the rendition of
i. any the arbitration is taking place; or the arbitral
ii. where any of the petitioners or award, none of
respondents has his principal place of the parties can
business or residence, at the option of the seek judicial
petitioner. relief from the
- Should state the ff: deferment.
i. The facts showing that the petitioner or • Motions for
respondent have legal capacity to sue or be reconsideration,
sued; appeal and
ii. The nature and substance of the dispute; petitions for
iii. The grounds and the circumstances relied certiorari are
upon for the petition; and not available to
iv. The relief/s sought. challenge the
- The petitioner shall attach a copy of the decision of the
request for arbitration and the ruling of the arbitral tribunal
arbitral tribunal. to defer the
- Respondents shall be furnished with a copy of resolution for
the petition before it is filed. the preliminary
2. Comment/Opposition jurisdictional
issues.
- The respondent should file his comment or
opposition within 15 days from the date of • An order affirming • parties can
service of the petition. the jurisdiction of the await the
3. Court action arbitral tribunal shall rendition of the
- Court shall render judgment on the basis of the NOT be subject to a final arbitral
pleadings filed and evidence submitted, within petition for certiorari, award, and raise
30 days from the time the petition is submitted but an order denying the same issues
for resolution. jurisdiction may be before the court
subject of petition for in a proceeding
- When the arbitration has commenced, but the
certiorari. for setting aside
arbitral tribunal has not yet been constituted,
or vacating the
or although constituted, has not yet rendered a
award.
ruling on its jurisdiction, courts are enjoined
not to entertain any petition for judicial relief
on the issue of jurisdiction or, if already

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Chapter 7 – OTHER FORMS OF ADR
Alternative Dispute Resolution - Atty. David Ballesteros

• Parties: 3. Court Action

o In a petition for judicial relief, the arbitrator or - The court may:
the members of the arbitral tribunal shall be i. Grant the motion if its finds prima facie that
nominal parties. there is a valid and enforceable arbitration
o The real interest lies with the claimant and the agreement and that the subject matter of
respondent who stand to be benefited or injured the dispute is capable of arbitration; or
by any decision of the court. ii. Deny it if the court finds otherwise.
o As nominal parties, it is NOT mandatory for the *either way, the court should STAY the
arbitrator to file pleadings or submission for the judicial proceedings while the motion for
consideration of the court. referral is pending resolution.
*Arbitral proceedings, however, may be
B. Referral to ADR (Rules 4.1 to 4.8, Special ADR Rules) commenced or continued, and an award
• This rule pertains to the referral of a pending court action may be made thereon, while the action is
to arbitration rather than any other form of ADR. pending in court.
• Instances: - The finding of the court that a valid and
1. There is already a pending court action; enforceable arbitration agreement exists and
2. There is either a pre-action arbitration agreement or that the dispute involved is capable of
a pre-sent-action arbitration agreement; and arbitration, resulting in the grant of the motion
o Pre-action: executed prior to the filing of an for referral, is prima facie, and not conclusive
action. upon the parties.
▪ Agreement to submit to arbitration 4. Relief against court action
▪ Submission agreement - Order granting the - order denying the
o Present-action: executed after the filing of the motion for referral to request for referral,
action. arbitration shall be although not subject
▪ Submission agreement immediately to appeal, may be
If there is a pre-action arbitration agreement: executory and shall subject of a motion
NOT be subject to a for reconsideration
• the request for referral • A request made after
motion for and a petition for
to arbitration may be the pre-trial conference
reconsideration, certiorari.
made by any one of the must be with the
appeal or petition for
parties not later than agreement of both
certiorari
the pre-trial conference. parties.
If there is a present-action arbitration agreement:
Principle of preference for alternative dispute resolution.
• Parties may request the referral to arbitration at any
- Courts are prohibited from denying the request for referral
time during the proceedings.
of some or all of the parties to arbitration for any of the ff
reasons:
3. One or both parties desire to undergo arbitration.
▪ Not all of the disputes subject of the civil action
may be referred to arbitration;
• Procedural rules for referral to ADR
▪ Not all of the parties to the civil action are bound
1. Request/Motion
by the arbitration agreement and referral to
- The pleading that initiates the referral to arbitration would result in multiplicity of suits;
arbitration. ▪ Issues raised in the civil action could be speedily
- It contemplates the existence of a pending and efficiently resolved in its entirety by the court
court action already initiated. rather than in an arbitration;
- It shall contain an authentic copy of the ▪ Referral to arbitration does not appear to be the
arbitration agreement and, as in the case of most prudent action; or
litigated motions, must be served upon the ▪ The stay of action would prejudice the rights of the
respondent and be set for hearing. parties to the civil action who are not bound by the
2. Comment/Opposition arbitration agreement. The court may, however,
- Must be filed within 15 days from service of issue an order directing the inclusion in the
the request or motion and must show that: arbitration agreement but who agree to such
i. there is no agreement to refer the dispute inclusion provided that those originally bound by it
to arbitration; do not object their inclusion.
ii. the agreement is null and void; or
iii. the subject-matter of the dispute is not
capable of settlement or resolution by
arbitration.

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Chapter 7 – OTHER FORMS OF ADR
Alternative Dispute Resolution - Atty. David Ballesteros

Legal effects of the non-application of the arbitration - Court shall resolve the petition within 30 days
clause to a case (Koppel, Inc. v Makati Rotary Club from the:
Foundation, Inc.): ▪ Submission of the opposition;
i. Judicial proceedings conducted beyond the point ▪ Upon the lapse of the period to file
when the dispute should have been referred to the same; or
arbitration are rendered invalid; ▪ From termination of the hearing that
ii. The decisions, including those of the appellate court, may be set if there is need for
must be vacated and set aside; clarification or further
iii. The case must be remanded to the court a quo to be argumentation.
suspended at said point; and - In resolving the petition, court is required to
iv. The petitioner and respondent must then be referred balance the relative interest of the parties and the
to arbitration pursuant to the arbitration clause. inconveniences that may be caused.
- Gen. rule: if the basis of the petition for an
C. Interim Measures of Protection (Rules 5.1 to 5.6, Special interim measure is the non-constitution of the
ADR Rules). arbitral tribunal, the court, upon being informed
• Instances: of the subsequent constitution of the arbitral
1. Either (a) before the commencement of arbitration, tribunal, shall DEFER action on the petition.
or (b) after the commencement of the arbitration but Exception: UNLESS it is established that the
prior to the constitution of the arbitral tribunal; or arbitral tribunal has no power to act on any such
(c) after the arbitral tribunal’s constitution but it has interim measure of protection or is unable to act
no power to act or is unable to act effectively; and thereon effectively.
2. Where a party desires to secure interim measures of - The interim measure of protection issued by the
protection. court is WITHOUT prejudice to the subsequent
i. Interim; or grant, modification, amendment, revision or
ii. Temporary revocation thereof by the arbitral tribunal.
4. Relief against court action
• Types of Interim Measures: - An order of the court granting or denying an
1. Preliminary Injunction directed against a party to interim measure may be the subject of a motion
arbitration; for reconsideration, appeal, or a petition for
2. Preliminary attachment against property or certiorari.
garnishment of funds in the custody of a bank or - If the protective measure was issued in a
third person; proceeding whereat the adverse party was given
3. Appointment of a receiver; an opportunity to be heard, the order of the court
4. Detention, preservation, delivery or inspection of granting the petition shall be immediately
property; or executory. Otherwise, the order of the court shall
5. Assistance in the enforcement of an interim measure not be immediately executory, EXCEPT if it is a
of protection granted by the arbitral tribunal which temporary protective measure.
it cannot enforce effectively.

• Procedural rules for the application of interim Temporary Protective Measure (TPM) or Temporary
measures of protection with the court: Order of Protection (TOP)
1. Petition - It is an injunctive relief the office of which is to (i) preserve
- Initiated by filing petition with RTC of the place property subject matter of the arbitration, (ii) prevent the
where: disposition or concealment thereof, or (iii) prevent the
▪ Any of the parties has his principal place relief prayed for from becoming moot and academic,
of business or residence; or during the period that the court is resolving the
▪ Any of the acts sought to be enjoined are application for the interim protective measure.
being performed or threatened to be - it is applied for ex parte.
performed; or - it is immediately executory.
▪ The real property subject of the - has a lifetime of only 20 days.
arbitration is situated, at the option of - it is similar to a Temporary Restraining Order (TRO) in
the petitioner. that these measures are temporary in character, intended
2. Comment/Opposition to ensure the efficacy of the principal relief, and have, as a
- must be filed within 15 days from service of the general rule.
petition.
3. Court Action TOP or TPM TRO

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Chapter 7 – OTHER FORMS OF ADR
Alternative Dispute Resolution - Atty. David Ballesteros

- Susceptible of - Non-extendible and

extension for not more becomes functus oficio When the two designated arbitrators have failed to
than 20 days after the lapse of 20 reach an agreement on the third or presiding
days from the service arbitrator, and
thereof.
- Bond is required - Does not generally The institution fails or is unable to perform its duty
require the posting of a as appointing authority within a reasonable time from
bond. Instead, a bond is receipt of the request for appointment.
required for the
issuance of a writ of b) Where the arbitration is ad hoc and the parties failed to
preliminary injunction. provide a method for appointing or replacing an
- May be lifted through - May NOT be lifted arbitrator, or
the posting of a through the posting of a
counter-bond. counter-bond. Instead, The method agreed upon is ineffective, and
a counter-bond may lift
a writ of preliminary The National President of the IBP or his duly
injunction. authorized representative fails or refuses to act within
such period agreed upon by the parties, or in the
TOP or TPM may be issued by the court under the ff. absence thereof, within 30 days from receipt of the
conditions: request to do so.
1. There is an urgent need to (i) preserve property; (ii)
prevent the respondent from disposing of, or c) Where the parties agreed that their dispute shall be
concealing the property; (iii) prevent the relief prayed resolved by 3 arbitrators but no method of appointing
for from being illusory because of prior notice; those has been agreed upon, and the parties, and
2. The petitioner shall post a bond to answer for any subsequently, the appointing authority fails or refuses
damage that the respondent may suffer as a result to appoint the arbitrator within a reasonable time
thereof; from receipt of the request to do so.
3. It shall be valid for only 20 days from the service on
the party required to comply therewith, UNLESS 2) And any party or the appointed arbitrators request the
extended but not for more than 20 days. court to act as appointing authority and appoint the
4. During the 20-day period and any extension thereof, arbitrator or third arbitrator as the case may be.
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 Rules of Procedure for the judicial appointment of
appropriate counter-bond as determined by the court. arbitrators:

Principle of Preference for Arbitration A. Petition

- The rules on interim measures of protection recognize the
principle of preference for arbitration over judicial Where to file the petition for the appointment of an
proceedings. arbitrator:
— Regional Trial Court

i. Where the principal place of business of any

D. APPOINTMENT OF ARBITRATORS (Rules 6.1 to 6.9, of the parties is located;
Special ADR Rules) ii. Where any of the parties reside; or
When the court may act as Appointing Authority? iii. National Capital Judicial Region, at the
option of the petitioner.
The rules on the judicial appointment of arbitrators apply if—
Contents of the petition:
1) There is a failure to appoint an arbitrator under the 1) General nature of the dispute;
following circumstances: 2) Description of the procedure for the
appointment of the arbitrators and the
a) Where any of the parties in an institutional arbitration agreement containing such procedure;
failed or refused to appoint an arbitrator, or 3) The number of the arbitrators agreed upon
or the absence of such an agreement;
The parties have failed to reach an agreement on the 4) Special qualifications of the arbitrators if
sole arbitrator, or there is agreement thereon;

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Chapter 7 – OTHER FORMS OF ADR
Alternative Dispute Resolution - Atty. David Ballesteros

5) The fact that the appointing authority, A. Petition

without justifiable cause, has failed or
refused to act as such within a reasonable Where to file petition for the judicial challenge:
time, from the date a request was made; and — Regional Trial Court
6) The petitioner is not the cause of the delay
or in the failure of the appointment of the i. Where the principal place of business of any of the
arbitrator. parties is located;
ii. Where any of the parties reside; or
Contents of a petition: iii. National Capital Judicial Region, at the option of the
1) authentic copy of the arbitration agreement; petitioner.
2) proof of notice to the appointing authority of the
filing of the petition with the court Contents of the petition:
1) Name of the arbitrator challenged and his address;
❖ The petition shall be served upon the respondent before it is filed in 2) Grounds for the challenge;
court. 3) Facts showing that the ground for the challenge has
been expressly or impliedly rejected by the challenged
B. Comment/opposition arbitrator; and
— must be filed within 15 days from the service of the petition. 4) Facts showing that the appointing authority failed or
refused to act on the challenge.
C. Court action
— The court may require each party to submit a list of not less ❖ A copy of the petition shall be served upon the respondent before it is
that 3 proposed arbitrators together with the curriculum vitae filed in court.
from whom the court may appoint the arbitrator.
B. Comment/opposition
— Prior to the appointment, if the court is informed that the — The challenged arbitrator or other parties may file a
appointing authority has already made an appointment, it shall comment of opposition within 15 days from service of the
dismiss the petition. petition.

D. Relief against court action C. Court action

a) Order of the court appointing an arbitrator—
immediately executory and shall not be the subject of a Options of the court in resolving the petition:
motion for reconsideration, appeal or certiorari.
b) Order of the court denying the petition for a) Grant the petition by removing the challenged
appointment of an arbitrator— may be the subject arbitrator if it finds merit in the petition;
of a motion for reconsideration, appeal or certiorari. b) Dismiss the petition if there is no merit;
c) Allow the challenged arbitrator to withdraw as
E. CHALLENGE TO APPOINTMENT OF arbitrator;
ARBITRATOR (Rules 7.1 to 7.9, Special ADR Rules) d) Accept the challenge and remove the arbitrator if:
Who may challenge the appointment of arbitrator?
— any of the parties in an arbitration i. The party or parties who appointed the
challenged arbitrator agree to the challenge
The rules of procedure on the judicial challenge to the and withdraw the appointment;
appointment of arbitrators apply if: ii. The other arbitrators in the arbitral tribunal
1) The challenge to the appointment of an arbitrator is agree to the removal of the challenged
not successful, and arbitrator; or
iii. The challenged arbitrator fails or refuses to
The appointing authority fails or refuses to act on the submit his comment on the petition or the
challenge within the period allowed under the rule or, brief, or he fails to object his removal.
in the absence thereof, within 30 days from receipt of
the request; and D. No relief against court action

2) The aggrieved party wants to secure judicial action on Order of the court resolving the petition— immediately
the challenge. executory and shall not be subject to a motion for
reconsideration, appeal or certiorari.
Rules of procedure for the challenge to the appointment of an F. Termination of Mandate of Arbitrato (Rules 8.1 to 8.8,
arbitrator: Special ADR Rules)
This rules will apply when:

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Chapter 7 – OTHER FORMS OF ADR
Alternative Dispute Resolution - Atty. David Ballesteros

1. An arbitrator becomes de jure or de facto 3. COURT ACTION

• Unable to perform his functions - Court may GRANT or DISMISS the petition.
• Fails to act without undue delay
2. The arbitrator, upon request of the party IF GRANTED, a substitute arbitrator shall be
• Fails or refuse to withdraw from his office appointed subject to rules of replacement
3. The appointing authority fails or refuse to decide on the appointment
termination of the mandate of the arbitrator within
• a specific period of time provided 4. NO RELIEF AGAINTS COURT ACTION
• in the absence thereof, within 30 days from the time the - The order of the court is final and executory
request was brought before him - Not subject for reconsideration, appeal or petition for
4. Any party seeks judicial action in terminating the mandate certiorari.
of the arbitrator
G. ASSISTANCE IN TAKING EVIDENCE
Note: The relief for the TERMINATION OF THE (Rules 9.1 to 9.11, Special ADR Rules)
MANDATE OF AN ARBITRATOR is different from a Any party to an arbitration, whether domestic or foreign,
CHALLENGE TO AN ARBITRATOR. may request the court to provide assistance in taking
evidence.
JUDICIAL CHALLENGE TO AN ARBITRATOR
- the arbitrator is sought to be removed on the ground of Judicial assistance in taking evidence apply when;
partiality or non-compliance with the qualifications 1. There is a pending arbitration, whether
required of him. domestic or foreign
2. A party desires to present evidence or
JUDICIAL TERMINATION OF THE MANDATE OF the tribunal ordered
THE AN ARBITRATOR 3. The evidence is sought other than a
- there is an arbitrator who is validly appointed has become party to the arbitration
incapable of performing his functions or has become
unable to do so. NOTE: When, however, arbitration has not yet
commence , any person who desires to perpetuate his
testimony may val of the remedy under RULE 24 of the
PROCEDURE FOR JUDICIAL TERMINATION OF 1997 Rules of Civil Procedure.
THE MANDATE OF AN ARBITRATOR

1. PETITION Listed are examples of court assistance in taking evidence

- Petition shall be filed with the RTC enumerated under Rule 9.5 of the Special ADR Rules.
- Principal place of business of any parties a. To comply with a subpoena ad testificandum and/o
- Place where any of the parties resides subpoena duces tecum;
- In the National Capital Judicial region b. To appear as a witness before an officer for the taking of hi
deposition upon oral examination or by written
Contents: interrogatories;
▪ Name of the arbitrator sought to be terminated c. To allow the physical examination of the condition o
▪ Grounds for termination persons, or the inspection of things or premises and, when
▪ Fact that parties requested the withdrawal of appropriate, to allow the recording and/or documentation o
arbitrator but failed or refused to accede condition of persons, things or premises (i.e., photographs
▪ Fact that the parties requested the appointing video and other means of recording/documentation);
authority to act on the request but failed to do so d. To allow the examination and copying of documents; and
within 30 days from the request or within such e. To perform any similar acts.
period of time agreed upon.
▪ A copy of the petition shall be served upon the NOTE: The foregoing enumeration is not exclusive.
respondent before it is filed in court.
The arbitral tribunal is not clothed with authority to cite
persons or parties in contempt, they can only impose
sanctions.
2. COMMENT / OPPOSITION
- Must be filed within 15 days from service of the PROCEDURE FOR JUDICIAL ASSISTANCE IN
petition TAKING EVIDENCE

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Chapter 7 – OTHER FORMS OF ADR
Alternative Dispute Resolution - Atty. David Ballesteros

I.
1. PETITION xx
• Filed with the RTC
• Where the arbitration proceedings are taking
place
• Where the witness resides or found
• Where evidence is found
• Option of petitioner

Contents:

a. The fact that there is an ongoing

arbitration proceeding even if such
proceeding could not continue due to
some legal impediments;

b. The arbitral tribunal ordered the taking

of evidence or the party desires to present
evidence to the arbitral tribunal;

c. Materiality or relevance of the evidence

to be taken; and

d. The names and addresses of the

intended witnesses place wher the
evidence may be found, the place where
the premises to be inspected are located
or the place where the acts required are to
be done.
→

2. COMMENT / OPPOSITION
- Must be filed within fifteen (15) days from
service of the petition.

3. COURT ACTION
- If the evidence sought is not privileged, and
is material and relevant, the court shall
grant the assistance in taking evidence
requested and shall order petitioner to pay
costs attendant to such assistance.

4. RELIEF AGAINTS COURT ACTION

- The order granting assistance in taking
evidence shall be immediately executory
and not subject to reconsideration or
appeal. If the court declines to grant
assistance in taking evidence, the petitioner
may file a motion for reconsideration or
appeal.

H.
xx

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