MODULE I

INTRODUCTION TO DISPUTE RESOLUTION

INTRODUCTION

Restorative justice is an approach to justice in which the response to a

crime is to organize a meeting between the victim and the offender, sometimes
with representatives of the wider community. The goal is for them to share their
experience of what happened, to discuss who was harmed by the crime and how,
and to create a consensus for what the offender can do to repair the harm from
the offense. This may include a payment of money given from the offender to the
victim, apologies and other amends, and other actions to compensate those
affected and to prevent the offender from causing future harm..
Restorative justice is a new movement in the fields of victimology and
criminology. Acknowledging that crime causes injury to people and communities, it
insists that justice repair those injuries and that the parties be permitted to
participate in that process.
Restorative justice programs, therefore, enable the victim, the offender and
affected members of the community to be directly involved in responding to the
crime. They become central to the criminal justice process, with State and legal
professionals becoming the facilitators of a system that aims the offender
accountability, reparation to the victim and full participation by the victim,
offender and the community.
The restorative process of involving the all parties is fundamental to
achieving the restorative outcome of reparation of peace. Restorative justice
requires that we work to restore those who have been injured. Those most directly
involved and affected by crime should have the opportunity to participate fully in
the response if they wish. Government's role is to preserve a just public order, and
the community's is to build and maintain a just peace.
Comparatively,Restorative is a valued-based approach focused on
determining harm resulting from crime, what needs to be done to repair the harm,
and who is responsible for repairing the harm while Retributive is an approach
focused on determining what law was broken, who broke it, and how they should
be punished.
Restorative view crime as an act against another person and the community
and the control lies in the community where the community facilitates the
restorative process while Retributive view crime as an act against the State and a
violation of law. The control lies in the criminal justice system and the community
becomes a sideline, represented by the State.
Restorative justice views crime as an accountability by both individual and
the society and punishment is not an effective means of changing behavior because
it disrupts community harmony and good relationship. Retributive justice views
crime as an individual act and individual responsibility and the offender should be
punished in order to deter crime and change behavior.
On the other hand, Transformative justice is a general philosophical
strategy for responding to conflicts. It takes the principles and practices of
restorative justice beyond the criminal justice system. It applies to areas such as
environmental law, corporate law, labor management relations, consumer
bankruptcy and debt, and family law. Transformative justice uses a systems
approach, seeking to see problems, as not only the beginning of the crime but also
the causes of crime, and tries to treat an offense as a transformative relational
and educational opportunity for victims, offenders and all other members of the
affected community. In theory, a transformative justice model can apply even
between peoples with no prior contact.
It can be seen as a general philosophical strategy for responding to conflicts
akin to peacemaking. Transformative justice is concerned with root causes and
comprehensive outcomes. It is akin to healing justice more than other alternatives
to imprisonment.
The analogy is that Restorative Justice are at par with the concept of
alternative dispute resolution and amicable settlement. In this premise, the
dispute resolution system under R.A. 9285 "Alternative Dispute Resolution Act"
provides the same perspective the opportunity of providing freedom of the parties
to decide at their own expense while resolving the dispute. In addition, the use of
ADR is an efficient tool and an alternative procedure for the resolution of
appropriate cases while enlisting the active private sector participation in the
settlement of disputes

OBJECTIVES

At the end of this module, the students should have:

1. Understand the concept of conflict and its different theories;

2. Discuss the different conflict resolution strategies;
3. Comprehend the concept of alternative dispute resolution;
4. Understand and define mediation and its procedure
5. Describe and comprehend the composition and arbitral proceedings.
Lesson 1

CONFLICT THEORIES AND ITS TYPES, CONFLICT

RESOLUTION STRATEGIES AND ALTERNATIVE DISPUTE
RESOLUTION SYSTEM IN THE PHILIPPINES

The Concept of Conflict

A conflict is a struggle between people. The struggle may be physical, or

between conflicting ideas. The word comes from Latin "conflingere" means to
come together for a battle. Conflicts can either be within one person, or they can
involve several people or groups.
Conflict is a natural disagreement arising between two or more people. It
exists when they have incompatible goals and one or more believe that the
behavior of the other prevents them from their own goal achievement.

Conflict Theories
Conflict theories are perspectives in sociology and social psychology that
emphasize a materialist interpretation of history, dialectical method of analysis, a
critical stance toward existing social arrangements, and political program of
revolution or, at least, reform. Conflict theories draw attention to power
differentials, such as class conflict, and generally contrast historically dominant
ideologies. It is therefore a macro-level analysis of society.
Karl Marx is the father of the social conflict theory, which is a component of
the four major paradigms of sociology. Certain conflict theories set out to highlight
the ideological aspects inherent in traditional thought. While many of these
perspectives hold parallels, conflict theory does not refer to a unified school of
thought, and should not be confused with, for instance, peace and conflict studies,
or any other specific theory of social conflict.

TYPES
Conflict theory is most commonly associated with Marxism, but as a reaction to
functionalism and the positivist method, it may also be associated with a number
of other perspectives, including:

1. Critical theory
2. Feminist theory: An approach that recognizes women's political, social, and
economic equality to men.
3. Postmodern theory: An approach that is critical of modernism, with a
mistrust of grand theories and ideologies.
4. Post-structural theory
5. Postcolonial theory
6. Queer theory – a growing body of research findings that challenges the
heterosexual bias in Western society.
7. World systems theory
 8. -Conflict Approach: A point of view that focuses on inequality and conflict
between people of different racial and ethnic categories.

MODERN APPROACH ON CONFLICT

Charles Wright Mills (1916-1962) an American sociologist, and a professor of
sociology at Columbia University from 1946 until his death in 1962. Mills was
published widely in popular and intellectual journals, and is remembered for
several books such as The Power Elite, which introduced that term and describes:
the relationships and class alliances among the US political, military, and economic
elites: White Collar: The American Middle Classes, on the American middle class;
and The Sociological Imagination, which presents a model of analysis for the
interdependence of subjective experiences within a person's biography, the
general social structure, and historical development.
Societies are defined by inequality that produces conflict, rather than which
produces order and consensus. This conflict based on inequality can only be
overcome through a fundamental transformation of the existing relations in the
society and is productive of new social relations. The disadvantaged have
structural interests that run counter to the status quo, which, once they are
assumed, will lead to social change. Thus, they are viewed as agents of change
rather than objects one should feel sympathy for.
Human potential (e.g., capacity for creativity) is suppressed by conditions of
exploitation and oppression, which are necessary in any society with an unequal
division of labor. These and other qualities do not necessarily have to be stunted
due to the requirements of the so-called "civilizing process," or "functional
necessity": creativity is actually an engine for economic development and change.

Concept of Conflict Resolution

Conflict resolution is conceptualized as the methods and processes involved
in facilitating the peaceful ending of conflict and retribution. The term conflict
resolution may also be used interchangeably with dispute resolution, where
arbitration and litigation processes are critically involved. The term conflict
resolution may also be used interchangeably with dispute resolution, where
arbitration and litigation processes are critically involved. The concept of conflict
resolution can be thought to encompass the use of nonviolent resistance measures
by conflicted parties in an attempt to promote effective resolution.
Committed group members attempt to resolve group conflicts by actively
communicating information about their conflicting motives or ideologies to the
rest of group (e.g., intentions; reasons for holding certain beliefs) and by engaging
in collective negotiation. Dimensions of resolution typically parallel the dimensions
of conflict in the way the conflict is processed. Cognitive resolution is the way
disputants understand and view the conflict, with beliefs, perspectives,
understandings and attitudes. Emotional resolution is in the way disputants feel
about a conflict, the emotional energy. Behavioral resolution is reflective of how
the disputants act, their behavior. Ultimately a wide range of methods and
procedures for addressing conflict exist, including negotiation, mediation,
mediation-arbitration, diplomacy, and creative peacebuilding.
 Kenneth Thomas and Ralph Kilmann developed five conflict resolution
strategies that people use to handle conflict, including avoiding, defeating,
compromising, accommodating, and collaborating.
This assumes that people choose how cooperative and how assertive to be in a
conflict. It suggests that everyone has preferred ways of responding to conflict,
but most of us use all methods under various circumstances.

CONFLICT RESOLUTION STRATEGIES

Conflict Resolution Strategy #1: Avoiding

Avoiding is when people just ignore or withdraw from the conflict. They
choose this method when the discomfort of confrontation exceeds the potential
reward of resolution of the conflict. While this might seem easy to accommodate
for the facilitator, people aren't really contributing anything of value to the
conversation and may be withholding worthwhile ideas. When conflict is avoided,
nothing is resolved.

Conflict Resolution Strategy #2: Competing

Competing is used by people who go into a conflict planning to win. They're
assertive and not cooperative.This method is characterized by the assumption that
one side wins and everyone else loses. It doesn't allow room for diverse
perspectives into a well-informed total picture. Competing might work in sports or
war, but it's rarely a good strategy for group problem solving.

Conflict Resolution Strategy #3: Accommodating

Accommodating is a strategy where one party gives in to the wishes or
demands of another. They're being cooperative but not assertive. This may appear
to be a gracious way to give in when one figures out s/he has been wrong about an
argument. It's less helpful when one party accommodates another merely to
preserve harmony or to avoid disruption. Like avoidance, it can result in
unresolved issues. Too much accommodation can result in groups where the most
assertive parties commandeer the process and take control of most conversations.

Conflict Resolution Strategy #4: Collaborating

Collaborating is the method used when people are both assertive and
cooperative. A group may learn to allow each participant to make a contribution
with the possibility of co-creating a shared solution that everyone can support. A
great way to collaborate and overcome conflict is to reach out and touch them.

Conflict Resolution Strategy #5: Compromising

Another strategy is compromising, where participants are partially assertive
and cooperative. The concept is that everyone gives up a little bit of what they
want, and no one gets everything they want. The perception of the best outcome
when working by compromise is that which "splits the difference. Compromise is
perceived as being fair, even if no one is particularly happy with the final
outcome.

ALTERNATIVE DISPUTE RESOLUTION SYSTEM IN THE PHILIPPINES (Republic Act

No. 9285)
Policy of the State
The following statements provides the Policy of the State as reference for the
sustenance of social justice and promotion of peace while making it at the early
stage of resolution.

1. To promote party autonomy in the resolution of disputes or the freedom of

the parties to make their own arrangements to resolve their disputes;
2. To encourage and actively promote the use of Alternative Dispute
Resolution ("ADR") as an important means to achieve speedy and impartial
justice and to declog court dockets;

3. To provide means for the use of ADR as an efficient tool and an alternative
procedure for the resolution of appropriate cases; an

4. To enlist active private sector participation in the settlement of disputes

through ADR.

Terms to Ponder

1. Alternative Dispute Resolution a means to achieve speedy and impartial

justice to declog court dockets.
2. ADR Provider means the institutions or persons accredited as mediators,
conciliators, arbitrators, neutral evaluators or any person exercising similar
functions in any Alternative Dispute Resolution system. This is without
prejudice to the rights of the parties to choose non-accredited individuals to
act as mediator, conciliator, arbitrator or neutral evaluator of their dispute.
3. Alternative Dispute Resolution System means any process or procedure
used to resolve a dispute or controversy, other than by adjudication of a
presiding judge of a court or an officer of a government agency, as defined
in the ADR Act, in which a neutral third person participates to assist in the
resolution of issues, including arbitration, mediation, conciliation, early
neutral evaluation, mini-trial or any combination thereof.
4. Arbitration means a voluntary dispute resolution process in which one or
more arbitrators, appointed in accordance with the agreement of the parties
or these Rules, resolve a dispute by rendering an award.
5. Arbitration Agreement means an agreement by the parties to submit to
arbitration all or certain disputes which have arisen, or which may arise
between them in respect of a defined legal relationship, whether contractual
or not. An arbitration agreement may be in the form of an arbitration clause
in a contract or in the form of a separate agreement.
6. Authenticate means to sign, execute, adopt a symbol or encrypt a record in
whole or in part, intended to identify the authenticating party and to adopt,
accept or establish the authenticity of a record or term.
7. Award means any partial or final decision by arbitrator in resolving the issue
or controversy.
8. Confidential Information means any information, relative to the subject of
mediation or arbitration, expressly intended by the source not to be
disclosed, or obtained under circumstances that would create a reasonable
 expectation on behalf of the source that the information shall not be
disclosed. It shall include:

(a) communication, oral or written, made in a dispute resolution proceeding,

including any memoranda, notes or work product of the neutral party or non-party
participant;
(b) an oral or written statement made or which occurs during mediation or for
purposes of considering, conducting, participating, initiating, continuing or
reconvening mediation or retaining a mediator; and
(c) pleadings, motions, manifestations, witness statements, reports filed submitted
in or arbitration or for expert evaluation.

9. Counsel means a lawyer duly admitted to the practice of law in the

Philippines and in good standing who represents a party in any ADR process.
10.Court means Regional Trial Court except insofar as otherwise defined under
the Model Law.
11.Government Agency means any governmental entity, office or officer, other
than a court, that is vested by law with quasi-judicial power or the power to
resolve or adjudicate disputes involving the government, its agencies and
instrumentalities or private persons.
12.Model Law means the Model Law on International Commercial Arbitration
adopted by the United Nations Commission on International Trade Law on 21
June 1985..
13. Proceedings means a judicial, administrative or other adjudicative process,
including related pre hearing or post hearing motions, conferences and
discovery.
14.Record means information written on a tangible medium or stored in an
electronic or other similar medium, retrievable in a perceivable form.
15.Roster means a list of persons qualified to provide ADR services as neutrals
or to serve as arbitrators.
16. Special ADR Rules means the Special Rules of Court on Alternative Dispute
Resolution issued by the Supreme Court on September 1, 2009.

EXCEPTION IN THE APPLICATION OF THE ADR ACT

The provisions of the ADR Act shall not apply to the resolution or settlement of
the following:

A. labor disputes covered by Presidential Decree No. 442, otherwise known as

the "Labor Code of the Philippines, as amended", and its Implementing Rules
and Regulations;
B. the civil status of persons;
C. the validity of marriage;
D. any ground for legal separation;
E. the jurisdiction of courts;
F. future legitime;
G. criminal liability;
H. those disputes which by law cannot be
 I. compromised; and
J. disputes referred to court-annexed mediation.

Liability of ADR Providers/Practitioners

The ADR providers/practitioners shall have the same civil liability for acts
done in the performance of their official duties as that of public officers, upon a
clear showing of bad faith, malice or gross negligence.
 LEARNING ACTIVITIES

I. Define the following terms:

1. Restorative Justice

2. Retributive Justice

3. Transformative Justice

4. Conflict

5. Arbitration

II.
1. What are the Conflict resolution strategies?
Lesson 2

INTERNATIONAL COMMERCIAL AND DOMESTIC ARBITRATION, THE OFFICE OF ALTE

What is International Commercial Arbitration?

Arbitration is any arbitration whether or not administered by a permanent
arbitration institution.
International Arbitration is an arbitration where the parties to an
arbitration agreement have, at the time of the conclusion of that agreement, their
places of business in different states or one of the following places is situated
outside the Philippines in which the parties have their places of business wherein -

a. the place of arbitration if determined in, or pursuant to the arbitration

agreement;
b. any place where a substantial part of the obligations of the commercial
relationship is to be performed or the place with which the subject matter of the
dispute is most closely connected or the parties have expressly agreed that the
subject matter of the arbitration agreement relates to more than one country.

For the purpose of International Arbitration, the New York Convention is

the United Nations Convention on the Recognition and Enforcement of Foreign
Arbitral Awards approved in 1958 and ratified by the Philippine Senate under
Senate Resolution NO.71. The following are important terms to consider:

A. Non-Convention Award means a foreign arbitral award made in a state, which

is not a Convention State.
B. Non-Convention State means a state that is not a member of the New York
Convention.
C. Appointing Authority as used in the Model Law shall mean the person or
institution named in the arbitration agreement as the appointing authority; or the
regular arbitration institution under whose rules the arbitration is agreed to be
conducted. Where the parties have agreed to submit their dispute to institutional
arbitration rules, and unless they have agreed to a different procedure, they shall
be deemed to have agreed to the procedure under such arbitration rules for the
selection and appointment of arbitrators. In ad hoc arbitration, the default
appointment of an arbitrator shall be made by the National President of the
Integrated Bar of the Philippines (IBP) or his/her duly authorized representative.
D. Arbitral Tribunal (under the Model Law) means a sole arbitrator or a panel of
arbitrators.
E. Commercial Arbitration means an arbitration that covers matters arising from
all relationships of a commercial nature, whether contractual or not. Relationships
of a commercial nature include, but are not limited to any trade transaction for
the supply or exchange of goods or services; distribution agreements; construction
of works; commercial representation or agency; factoring; leasing; consulting;
engineering; licensing: investment; financing; banking: insurance; joint venture
and other forms of industrial or business cooperation; carriage of goods or
passengers by air, sea, rail or road.
F. Convention Award means a foreign arbitral award made in a Convention State.
G. Court (under the Model Law) means a body or organ of the judicial system of
the Philippines (i.e., the Regional Trial Court, Court of Appeals and Supreme
Court).

What is Domestic Arbitration?

Domestic Arbitration is an arbitration that is not international. The
following are important terms to consider:
Ad hoc Arbitration means an arbitration administered by an arbitrator
and/or the parties themselves. An arbitration administered by an institution shall
be regarded as an ad hoc arbitration if such institution is not a permanent or
regular arbitration institution in the Philippines.
Appointing Authority in Ad Hoc Arbitration means, in the absence of an
agreement, the National President of the IBP or his/her duly authorized
representative.
Appointing Authority Guidelines means the set of rules approved or
adopted by an appointing authority for the making of a Request for Appointment,
Challenge, Termination of the Mandate of Arbitrator/s and for taking action
thereon.
Arbitration means a voluntary dispute resolution process in which one or
more arbitrators, appointed in accordance with the agreement of the parties or
these Rules, resolve a dispute by rendering an award.
Arbitral Tribunal means a sole arbitrator or a panel, board or committee of
arbitrators.
Claimant means a person/s with a claim against another and who
commence/s arbitration against the latter.
Court means, unless otherwise specified in these Rules, a Regional Trial
Court.
Day means calendar day.
Institutional arbitration means arbitration administered by an entity,
which is registered as a domestic corporation with the Securities and Exchange
Commission (SEC)' and engaged in, among others, arbitration of disputes in the
Philippines on a regular and permanent basis.
Request for Appointment means the letter request to the appointing
authority of either or both parties for the appointment of arbitrator/s or of the
two arbitrators first appointed by the parties for the appointment of the third
member of an arbitral tribunal.
Representative is a person duly authorized in writing by a party to a
dispute, who could be a counsel, a person in his/her employ or any other person of
his/her choice, duly authorized to represent said party in the arbitration
proceedings.
Respondent means the person/s against whom the claimant commence/s
arbitration.
 Written communication means the pleading, motion, manifestation, notice,
order, award and any other document or paper submitted or filed with the arbitral
tribunal or delivered to a party.

What are the other forms of Alternative Dispute Resolution?

1. Early Neutral Evaluation is an ADR process wherein parties and their

lawyers are brought together early in the pre-trial phase to present
summaries of their cases and to receive a non binding assessment by an
experienced neutral person, with expertise in the subject matter or
substance of the dispute.
2. Mediation-Arbitration or Med-Arb is a two-step dispute resolution process
involving mediation and then followed by arbitration.
3. Mini-trial is a structured dispute resolution method in which the merits of a
case are argued before a panel comprising of senior decision makers, with
or without the presence of a neutral third person, before which the parties
seek a negotiated settlement.

THE OFFICE FOR ALTERNATIVE DISPUTE RESOLUTION

The Office of Alternative Dispute Resolution is an agency attached to the
Department of Justice which shall have a Secretariat and shall be headed by an
Executive Director, who shall be appointed by the President of the Philippines,
taking into consideration the recommendation of the Secretary of Justice.

Powers of the OADR

1. To act as appointing authority of mediators and arbitrators when the parties

agree in writing that it shall be empowered to do so.
2. To conduct seminars, symposia, conferences and other public fora and
publish proceedings of said activities and relevant materials/information
that would promote, develop and expand the use of ADR.
3. To establish an ADR library or resource center where ADR laws, rules and
regulations, jurisprudence, books, articles and other information about ADR
in the Philippines and elsewhere may be stored and accessed.
4. To establish a training programs for ADR providers/practitioners, both in
the public and private sectors; and to undertake periodic and continuing
training programs for arbitration and mediation and charge fees on
participants. It may do so in conjunction with or in cooperation with the
IBP, private ADR organizations, and local and foreign government offices
and agencies and international organizations.
5. To certify those who have successfully completed the regular professional
training programs provided by the OADR.

6. To charge fees for services rendered such as, among others, for training and
certifications of ADR providers.

7. Το accept donations, grants and other assistance from local and foreign
sources.
 8. To exercise such other powers as may be necessary and proper to carry into
effect the provisions of the ADR Act.

Functions of the OADR

1. To promote, develop and expand the use of ADR in the private and public
sectors through information, education and communication.
2. To monitor, study and evaluate the use of ADR by the private and public
sectors for purposes of, among others, policy formulation.
3. To recommend to Congress needful statutory changes to develop,
strengthen and improve ADR practices in accordance with international
professional standards.
4. To make studies on and provide linkages for the development,
implementation, monitoring and evaluation of government and private ADR
programs and secure information about their respective administrative
rules/procedures, problems encountered and how they were resolved.

5. To compile and publish a list or roster of ADR providers/practitioners, who

have undergone training by the OADR, or by such training
providers/institutions recognized or certified by the OADR as performing
functions in any ADR system. The list or roster shall include the addresses,
contact numbers, e-mail addresses, ADR service/s rendered (e.g.
arbitration, mediation) and experience in ADR of the ADR
providers/practitioners.

6. To compile a list or roster of foreign or international ADR

providers/practitioners. The list or roster shall include the addresses,
contact numbers, e-mail addresses, ADR service/s rendered (e.g.
arbitration, mediation) and experience in ADR of the ADR
providers/practitioners.

Divisions of the OADR

The OADR has following staff and service divisions:

Secretariat which shall provide necessary support and discharge such other
functions and duties as may be directed by the Executive Director.

Public Information and Promotion Division - which shall be charged with the
dissemination of information, the promotion of the importance and public
acceptance of mediation, conciliation, arbitration or any combination thereof and
other ADR forms as a means of achieving speedy and efficient means of resolving
all disputes and to help in the promotion, development and expansion of

Training Division which shall be charged with the formulation of effective

standards for the training of ADR practitioners; conduct of trainings in accordance
with such standards; issuance of certifications of training to ADR practitioners and
ADR service providers who have undergone the professional training provided by
the OADR; and the coordination of the development, implementation, monitoring
and evaluation of government and private sector ADR programs.
Records and Library Division - which shall be charged with the
establishment and maintenance of a central repository of ADR laws, rules and
regulations, jurisprudence, books, articles, and other information about ADR in the
Philippines and elsewhere.

THE ADVISORY COUNCIL

Composition of the Advisory Council

✓ Mediation profession
✓ Arbitration profession
✓ ADR organizations
✓ IBP
✓ Academe

Role of the Advisory Council

The Advisory Council is responsible to advise the Executive Director on
policy, operational and other relevant matters. The Council shall meet regularly,
at least once every two (2) months, or upon call by the Executive Director.
 LEARNING ACTIVITIES

I.
1. What is Domestic Arbitration?

2. What are the forms of Alternative Dispute Resolution?

3. What is the composition of the Advisory Council?

Lesson 3

THE MEDIATION AND ITS PROCEDURE, ROLE OF PARTIES AND THEIR COUNSEL, CON

The MEDIATION Process

Mediation is a voluntary process in which a mediator, selected by the disputing
parties, facilitates communication and negotiation, and assists the parties in
reaching a voluntary agreement regarding a dispute. The following are important
terms to consider:

A. Ad hoc Mediation means any mediation other than institutional or court-

annexed.
B. Institutional Mediation means any mediation administered by, and
conducted under the rules of, a mediation institution.
C. Court-Annexed Mediation means any mediation process conducted under
the auspices of the court and in accordance with Supreme Court approved
guidelines, after such court has acquired jurisdiction of the dispute.
D. Court-Referred Mediation means mediation ordered by a court to be
conducted in accordance with the agreement of the parties when an action
is prematurely commenced in violation of such agreement.
E. Certified Mediator means a mediator certified by the Office for ADR as
having successfully completed its regular professional training program.
F. Mediation Party means a person who participates a mediation and whose
consent is necessary to resolve the dispute.
G. Mediator means person who conducts a mediation.
H. Non-Party Participant means a person, other than a party or mediator,
who participates in a mediation proceeding as a witness, resource person or
expert.

For the purpose of mediation, it shall be applied voluntarily whether ad hoc or

institutional, other than court-annexed mediation and only in default of an
agreement of the parties on the applicable rules. It shall also apply to all cases
pending before an administrative or quasi-judicial agency that are subsequently
agreed upon by the parties to be referred to mediation.
In applying and construing the rule on mediation, consideration must be given
on the need to promote candor of parties and mediators through confidentiality of
the mediation process, the policy of fostering prompt, economical and amicable
resolution of disputes in accordance with principles of integrity of determination
by the parties and the policy that the decision-making authority in the mediation
process rests with the parties.
A party may petition a court before which an action is prematurely brought in a
matter which is the subject of a mediation agreement, if at least one party so
requests, not later than the pre-trial conference or upon the request of both
parties thereafter, to refer the parties to mediation in accordance with the
agreement of the parties,

Selection of a Mediator
The parties have the freedom to select their mediator. The parties may
request the OADR to provide them with a list or roster or the resumes of its
certified mediators. The OADR may be requested to inform the mediator of his/her
selection.

Replacement of Mediator
If the mediator selected is unable to act as such for any reason, the parties
may, upon being informed of such fact, select another mediator..

Refusal or Withdrawal of Mediator

A mediator may refuse from acting as such, withdraw or may be compelled to
withdraw, from the mediation proceedings under the following circumstances:

1. If any of the parties so requests the mediator to withdraw.

2. The mediator does not have the qualifications, training and experience to
enable him/her to meet the reasonable expectations of the parties.
3. Where the mediator's impartiality is in question. ✓ If continuation of the
process would violate any ethical standards.
4. If the safety of any of the parties would be If the mediator is unable to
provide effective jeopardized.
5. In case of conflict of interest.
6. In any of the following instances, if the mediator is satisfied that:
a. one or more of the parties is/are not acting in good faith;
b. the parties' agreement would be illegal or involve the commission of a
crime;
c. continuing the dispute resolution would give rise to an appearance of
impropriety;
d. continuing with the process would cause significant harm to a
nonparticipating person or to the public, or;
e. continuing discussions would not be in the best interest of the parties,
their minor children or the dispute resolution process.

THE ETHICAL CONDUCT OF MEDIATOR

Competence
It is not required that a mediator shall have special qualifications by
background or profession unless the special qualifications of a mediator are
required in the mediation agreement or by the mediation parties.

However, the certified mediator shall:

A. maintain and continually upgrade his/her professional competence in

mediation skills;
 B. ensure that his/her qualifications, training and experience are known to
and accepted by the parties; and
C. serve only when his/her qualifications, training and experience enable
him/her to meet the reasonable expectations of the parties and shall not
hold himself/herself out or give the impression that he/she has
qualifications, training and experience that he/she does not have.

Upon the request of a mediation party, an individual who is requested to serve

as mediator shall disclose his/her qualifications to mediate a dispute.

■ Impartiality
A mediator shall maintain impartiality.

a. Before accepting a mediation, an individual who is requested to serve as a

mediator shall:

✓ make an inquiry that is reasonable under the circumstances to determine

whether there are any known facts that a reasonable individual would consider
likely to affect the impartiality of the mediator, including a financial or personal
interest in the outcome of the mediation and any existing or past relationship with
a party or foreseeable participant in the mediation; and
✓ disclose to the mediation parties any such fact known or learned as soon as is
practical before accepting a mediation.

Confidentiality
A mediator shall keep in utmost confidence all confidential information
obtained in the course of the mediation process.
A mediator shall discuss issues of confidentiality with the mediation parties
before beginning the mediation process including limitations on the scope of
confidentiality and the extent of confidentiality provided in any private sessions or
caucuses that the mediator holds with a party.

Consent and Self-Determination

a. A mediator shall make reasonable efforts to ensure that each party
understands the nature and character of the mediation proceedings including
private caucuses, the issues, the available options, the alternatives to non-
settlement, and that each party is free and able to make whatever choices he/she
desires regarding participation in mediation generally and regarding specific
settlement options.
If a mediator believes that a party, who is not represented by counsel, is
unable to understand, or fully participate in, the mediation proceedings for any
reason, a mediator may either:

✓ limit the scope of the mediation proceedings in a manner consistent with

the party's ability to participate, and/or recommend that the party obtain
appropriate assistance in order to continue with the process; or
 terminate the mediation proceedings.
 b. A mediator shall recognize and put in mind that the primary responsibility of
resolving a dispute and the shaping of a voluntary and uncoerced settlement rests
with the parties.

Separation of Mediation from Counseling and Legal Advice

a. Except in evaluative mediation or when the parties so request, a mediator shall:

 refrain from giving legal or technical advice and otherwise engaging in

counseling or advocacy; and
 abstain from expressing his/her personal opinion on the rights and duties of
the parties and the merits of any proposal made.
b. Where appropriate and where either or both parties are not represented by
counsel, a mediator shall:

 recommend that the parties seek outside professional advice to help them
make informed decision and to understand the implications of any proposal;
and
 suggest that the parties seek independent legal and/or technical advice
before a settlement agreement is signed.
c. Without the consent of all parties, and for a reasonable time under the
particular circumstance, a mediator who also practices another profession shall
not establish a professional relationship in that other profession with one of the
parties, or any person or entity, in a substantially and factually related matter.

Charging of Fees
a. A mediator shall fully disclose and explain to the parties the basis of cost,
fees and charges.
b. The mediator who withdraws from the mediation shall return to the
parties any unearned fee and unused deposit.
c. A mediator shall not enter into a fee agreement which is contingent upon
the results of the mediation or the amount of the settlement.

Promotion of Respect and Control of Abuse of Process

The mediator shall encourage mutual respect between the parties, and shall
take reasonable steps, subject to the principle of self-determination, to limit
abuses of the mediation process.

Solicitation or Acceptance of any Gift

No mediator or any member of a mediator's immediate family or his/her
agent shall request, solicit, receive or accept any gift or any type of compensation
other than the agreed fee and expenses in connection with any matter coming
before the mediator..

ROLE OF PARTIES AND THEIR COUNSELS

Designation of Counselor any Person to Assist Mediation

 A party may designate a lawyer or any other person to provide assistance in
the mediation. A waiver of this right shall be made in writing by the party waiving
it. A waiver of participation or legal representation may be rescinded at any time.

The Role of the Counsel

 The lawyer shall view his/her role in mediation as a collaborator with the
other lawyer in working together toward the common goal of helping their
clients resolve their differences to their mutual advantage.
 The lawyer shall encourage and assist his/her client to actively participate
in positive discussions and cooperate in crafting an agreement to resolve
their dispute.
 The lawyer must assist his/her client to comprehend and appreciate the
mediation process and its benefits, as well as the client's greater personal
responsibility for the success of mediation in resolving the dispute.

In preparing for participation in mediation, the lawyer shall confer and discuss
with his/her client the following:
The mediation process as essentially a negotiation between the parties assisted
by their respective lawyers, and facilitated by a mediator, stressing its difference
from litigation, its advantages and benefits, the client's heightened role in
mediation and responsibility for its success and explaining the role of the lawyer in
mediation proceedings.

The substance of the upcoming mediation, such as:

✓ The substantive issues involved in the dispute and their prioritization in terms of
importance to his/her client's real interests and needs.
✓ The study of the other party's position in relation underlying interests, fears,
concerns and needs.
✓ The information or facts to be gathered or sought from the other side or to be
exchanged that are necessary for informed decision-making.
✓ The possible options for settlement but stressing the need to be open-minded
about other possibilities.
✓ The best, worst and most likely alternatives to a non-negotiated settlement.

Other Matters which the Counsel shall do to Assist Mediation

The lawyer:

✓ shall give support to the mediator so that his/ her client will fully understand
the rules and processes of mediation;
✓shall impress upon his/her client the importance of speaking for himself/herself
and taking responsibility for making decisions during the negotiations within the
mediation process;
✓ may ask for a recess in order to give advice Or suggestions to his/her client in
private, if he/she perceives that his/her client is unable to bargain effectively:
✓ shall assist his/her client and the mediator put in writing the terms of the
settlement agreement that the parties have entered into. The lawyers shall see to
it that the terms of the settlement. agreement are not contrary to law, morals,
good customs, public order or public policy,

CONDUCT OF MEDIATION
The following articles shall be considered in the Conduct of Mediation

A. The mediator shall not make untruthful or exaggerated claims about the dispute
resolution process, its costs and benefits, its outcome or the mediator's
qualifications and abilities during the entire mediation process.
B. The mediator shall help the parties reach a satisfactory resolution of their
dispute but has no authority to impose a settlement on the parties.
C. The parties shall personally appear for mediation and may be assisted by a
lawyer. A party may be represented by an agent who must have full authority to
negotiate and settle the dispute.
D. The mediation process shall, in general, consist of the following stages:

1. opening statement of the mediator;

2. individual narration by the parties;
3. exchange by the parties;
4. summary of issues;
5. generation and evaluation of options; and
6. closure

E. The mediation proceeding shall be held in private. Persons, other than the
parties, their
representatives and the mediator, may attend only with the consent of all the
parties..

F. The mediation shall be closed:

1. by the execution of a settlement agreement

2. by the parties;
3. by the withdrawal of any party from mediation; and
4. by the written declaration of the mediator that any further effort at
mediation would not be helpful.

PLACE OF MEDIATION

Agreement of Parties on the Place of Mediation

The parties are free to agree on the place of mediation. Failing such
agreement, the place of mediation shall be any place convenient and appropriate
to all parties.

Agreement to Submit a Dispute to Mediation by an Institution

An agreement to submit a dispute to mediation by an institution shall
include an agreement to be bound by the internal mediation and administrative
policies of such institution. Further, an agreement to submit a dispute to
mediation under institutional mediation rules shall be deemed to include an
agreement to have such rules govern the mediation of the dispute and for the
mediator, the parties, their respective counsels and non-party participants to
abide by such rules.

Operative Principles to Guide Mediation

The mediation shall be guided by the following operative principles:

A. A settlement agreement following successful mediation shall be prepared by the

parties with the assistance of their respective counsels, if any, and by the
mediator. The parties and their respective counsels shall endeavor to make the
terms and condition of the settlement agreement complete and to make adequate
provisions for the contingency of breach to avoid conflicting interpretations of the
agreement.
B. The parties and their respective counsels, if any, shall sign the settlement
agreement. The mediator shall certify that he/she explained the contents of the
settlement agreement to the parties in a language known to them.
C. If the parties agree, the settlement agreement may be jointly deposited by the
parties or deposited by one party with prior notice to the other party/ ies with the
Clerk of Court of the Regional Trial Court (a) where the principal place of business
in the Philippines of any of the parties is located; (b) if any of the parties is an
individual, where any of those individuals resides; or (c) in the National Capital
Judicial Region. Where there is a need to enforce the settlement agreement, a
petition may be filed by any of the parties with the same court, in which case, the
court shall proceed summarily to hear the petition, in accordance with the Special
ADR Rules.
D. The parties may agree in the settlement agreement that the mediator shall
become a sole arbitrator for the dispute and shall treat the settlement agreement
as an arbitral award which shall be subject to enforcement under Republic Act No.
876, otherwise known as "The Arbitration Law", notwithstanding the provisions
Executive Order No. 1008, s. 1985, otherwise known as the "Construction Industry
Arbitration Law for mediated disputes outside of the Construction Industry
Arbitration Commission.

Confidentiality of Information
Information obtained through mediation proceedings shall be subject to the
following principles and guidelines:
1. Information obtained through mediation shall be privileged and confidential.
2. Confidential information shall not be subject to discovery and shall be
inadmissible in any adversarial proceeding, whether judicial or quasi judicial.
However, evidence or information that is otherwise admissible or subject to
discovery does not become inadmissible or protected from discovery solely by
reason of its use in a mediation.
3 In such an adversarial proceeding, the following persons involved or previously
involved in a mediation may not be compelled to disclose confidential information
obtained during the mediation:

A. the parties to the dispute;

B. the mediator or mediators;
C. the counsel for the parties;
D. the non-party participants;
 E. any person hired or engaged in connection with the mediation as
secretary, stenographer, clerk or assistant; and
F. any other person who obtains or possesses confidential information by
reason of his/ her profession..

4. The protections of the ADR Act shall continue to apply even if a mediator is
found to have failed to act impartially.
5 A mediator may not be called to testify to provide
confidential information gathered in mediation. A mediator who is wrongfully
subpoenaed shall be reimbursed the full cost of his/her attorney's fees and
related expenses.

Waiver of Confidentiality
A. A privilege arising from the confidentiality of information may be waived in a
record or orally during a proceeding by the mediator and the mediation parties.
B. With the consent of the mediation parties, a privilege arising from the
confidentiality of information may likewise be waived by a non party participant if
the information is provided by such non-party participant.
C. A person who discloses confidential information shall be precluded from
asserting the privilege under Confidentiality of Information to bar disclosure of the
rest of the information necessary to a complete understanding of the previously
disclosed information. If a person suffers loss or damage as a result of the
disclosure of the confidential information, he/she shall be entitled to damages in a
judicial proceeding against the person who made the disclosure.
D. A person who discloses or makes a representation about a mediation is
precluded from asserting the privilege mentioned in Confidentiality of Information
to the extent that the communication prejudices another person in the proceeding
and it is necessary for the person prejudiced to respond to the representation or
disclosure.

Exceptions to the Privilege of Confidentiality of Information

1. There is no privilege against disclosure in the following instances:

1. in an agreement evidenced by a record authenticated by all parties to

the agreement;
2. available to the public or made during a session of a mediation which is
open, or is required by law to be open, to the public
3. a threat or statement of a plan to inflict bodily injury or commit a crime
of violence;
4. intentionally used to plan a crime, attempt to commit, or commit a
crime, conceal an ongoing crime or criminal activity:
5. sought or offered to prove or disprove abuse, neglect, abandonment or
exploitation in a proceeding in which a public agency is protecting the
interest of an individual protected by law; but this exception does not
apply where a child protection matter is referred to mediation by a court
or where a public agency participates in the child protection mediation;
6. sought or offered to prove or disprove a claim or complaint of
professional misconduct or malpractice filed against a mediator in a
proceeding; or
 7. sought or offered to prove or disprove a claim or complaint of
professional misconduct or malpractice filed against a party, nonparty
participant, or representative of a party based on conduct occurring
during a mediation.

2. If a court or administrative agency finds, after a hearing in camera, that the

party seeking discovery of the proponent of the evidence has shown that the
evidence is not otherwise available, that there is a need for the evidence that
substantially outweighs the interest in protecting confidentiality, and the
mediation communication is sought or offered in:

a. a court proceeding involving a crime or felony; or

b. a proceeding to prove a claim or defense that under the law is sufficient to
reform or avoid a liability on a contract arising out of the mediation.
c. A mediator may not be compelled to provide evidence of a mediation
communication or testify in such proceeding.
d. If a mediation communication is not privileged under an exception in paragraph
(a) or (b), only the portion of the communication necessary for the application of
the exception for non disclosure may be admitted. The admission of a particular
evidence for the limited purpose of an exception does not render that evidence, or
any other mediation communication, admissible for any other purpose.

Non-Reporting or Communication by Mediator

A mediator may not make a report, assessment, evaluation,
recommendation,finding or other communication regarding a mediation to a court
or agency or other authority that may make a ruling on a dispute that is the
subject of a mediation, except:

A. to state that the mediation occurred or has terminated, or where a

settlement was reached; or
B. as permitted to be disclosed under the provisions on the Exceptions to
the Privilege of Confidentiality of Information.

The parties may, by an agreement in writing, stipulate that the settlement

agreement shall be sealed and not disclosed to any third party including the
court. Such stipulation, however, shall not apply to a proceeding to enforce
or set aside the settlement agreement.

FEES AND COST OF MEDIATION

Fees and Cost of Ad hoc Mediation

In ad hoc mediation, the parties are free to make their own arrangement as to
mediation cost and fees. In default thereof, the schedule of cost and fees to be
approved by the OADR shall be followed.

Fees and Cost of Institutional Mediation

A. In institutional mediation, mediation cost shall include the administrative
charges of the mediation institution under which the parties have agreed to be
bound, mediator's fees and associated expenses, if any. In default agreement of
the parties as to the amount and manner of payment of mediation's cost and fees,
the same shall be determined in accordance with the applicable internal rules of
the mediation service providers under whose rules the mediation is conducted.
B. A mediation service provider may determine such mediation fee as is
reasonable taking into consideration the following factors, among others:

A. the complexity of the case;

B. the number of hours spent in mediation; and
C. the training, experience and stature mediators.

INTERNATIONAL COMMERCIAL ARBITRATION

Scope of Application
The rule applies to international commercial arbitration, subject to any
agreement in force between the Philippines and other state or states and only if
the place or seat of arbitration is the Philippines and in default of any agreement
of the parties on the applicable rules and shall not affect any other law of the
Philippines by virtue of which certain disputes may not be submitted to arbitration
or may be submitted to arbitration only according to provisions other than those of
the ADR Act.

Rules of Interpretation
A. International commercial arbitration shall be governed by the Model Law
on International Commercial Arbitration.
B. In interpreting the rule, regard shall be had to the international origin of
the Model Law and to the need for uniformity in its interpretation. Resort may be
made to the travaux preparatories and the Report of the Secretary-General of the
United Nations Commission on International Trade Law dated March 1985 entitled,
"International Commercial Arbitration: Analytical Commentary on Draft Text
identified by reference number A/ CN. 9/264".
C. Moreover, in interpreting the rule, the court shall have due regard to the
policy of the law in favor of arbitration and the policy of the Philippines to actively
promote party autonomy in the resolution of disputes or the freedom of the parties
to make their own arrangement to resolve their dispute.
D. Where a provision of the rule, except the those applicable to the
substance of the dispute, leaves. the parties free to determine a certain issue,
such freedom includes the right of the parties to authorize a third party, including
an institution, to make that determination.
E. Where a provision of these rule refers to the fact that the parties have agreed
or that they may agree or in any other way refers to an agreement of the parties,
such agreement includes any arbitration rules referred to in that agreement.

Receipt of Written Communications

A. Unless otherwise agreed by the parties:

 any written communication is deemed to have been received if it is

delivered to the addressee personally or at his/her place of business,
habitual residence or mailing address; if none of these can be found
after making a reasonable inquiry, a written communication is deemed
 to have been received if it is sent to the addressee's last known place of
business, habitual residence or mailing address by registered letter or
any other means which provides a record of the attempt deliver it;

 the communication is deemed to have been received on the day it is so

delivered.

B. The provisions of the Rule do not apply communications in court proceedings,

which shall be governed by the Rules of Court.

Waiver of Right to Object

A party who knows that any provision of the rule from which the parties may
derogate or any requirement under the arbitration agreement has not been
complied with and yet proceeds with the arbitration without stating the objections
for such non-compliance without undue delay or if a time limit is provided
therefor, within such period of time, shall be deemed to have waived the right to
object.

Extent of Court Intervention

In matters governed by the rule, no court shall intervene except where so
provided in the ADR Act. Resort to Philippine courts for matters within the scope
of the ADR Act shall be governed by the Special ADR Rules.
 LEARNING ACTIVITIES

I. Define the following terms:

1. Mediation

2. Mediator

III. Discuss briefly.

1. How are mediators selected?

 Lesson 4

ARBITRATION AGREEMENT, CONDUCT OF ARBITRAL TRIBUNAL PRO

ARBITRATION AGREEMENT

Definition and Form of Arbitration Agreement

The arbitration agreement shall be in writing. Ant agreement is in writing if
it is contained in a document signed by the parties or in an exchange of letters,
telex, telegrams or other means of telecommunication which provide a record of
the agreement, or in an exchange of statements of claim and defense in which the
existence of an agreement is alleged by one party and not denied by another. The
reference in a contract to a document containing an arbitration clause constitutes
an arbitration agreement provided that the contract is in writing and the reference
is such as to make that clause part of the contract.

Arbitration Agreement and Substantive Claim Before Court

A. A court before which an action is brought in a matter which is the subject
of an arbitration agreement shall, if at least one party so requests not later than
the pre-trial conference, or upon the request of both parties thereafter, refer the
parties to arbitration unless it finds that the arbitration agreement is null and
void, inoperative or incapable of being performed.
B. Where an action referred to in the previous paragraph has been brought,
arbitral proceedings may nevertheless be commenced or continued, and an award
may be made, while the issue is pending before the court.
C. Where the action is commenced by or against multiple parties, one or
more of whom are parties to an arbitration agreement, the court shall refer to
arbitration those parties who are bound by the arbitration agreement although the
civil action may continue as to those who are not bound by such arbitration
agreement.

Composition of Arbitral Tribunal

Number of Arbitrators
The parties are free to determine the number of arbitrators. Failing such
determination, the number of arbitrators shall be three (3).

Appointment of Arbitrators
A. No person shall be precluded by reason of his/her nationality from acting
as an arbitrator, unless otherwise agreed by the parties.
B. The parties are free to agree on a procedure of appointing the arbitrator or
arbitrators.

C. Failing such agreement:

 in an arbitration with three (3) arbitrators, each party shall appoint one
arbitrator, and the two (2) arbitrators thus appointed shall appoint the third
arbitrator; if a party fails to appoint the arbitrator within thirty (30) days of
receipt of a request to do so from the other party, or if the two (2)
arbitrators fail to agree on the third arbitrator within thirty (30) days of
their appointment, the appointment shall be made, upon request of a party,
by the appointing authority;

 in an arbitration with a sole arbitrator, if the parties are unable to agree on

the arbitrator, he/she shall be appointed, upon request of a party, by the
appointing authority.

D. Where, under an appointment procedure agreed upon by the parties,

 a party fails to act as required under such procedure, or

 the parties, or two arbitrators, are unable to reach an agreement expected

of them under such procedure, or

 a third party, including an institution, fails to perform any function

entrusted to it under such procedure, any party may request the appointing
authority to take the necessary measure to appoint an arbitrator, unless the
agreement on the appointment procedure provides other means for securing
the appointment.

E. A decision on a matter entrusted shall be immediately executory and not be

subject to a motion for reconsideration or appeal. The appointing authority shall
have in appointing an arbitrator, due regard to any qualifications required of the
arbitrator by the agreement of the parties and to such considerations as are likely
to secure the appointment of an independent and impartial arbitrator and, in the
case of a sole or third arbitrator,

Grounds for Challenge

A. When a person is approached in connection with his/her possible appointment

as an arbitrator, he/she shall disclose any circumstance likely to give rise to
justifiable doubts as to his/her impartiality or independence. An arbitrator, from
the time of his/her appointment and throughout the arbitral proceedings shall,
without delay. disclose any such circumstance to the parties unless they have
already been informed of them by him/her.

B. An arbitrator may be challenged only if circumstances exist that give rise to

justifiable doubts as to his/her impartiality or independence, or if he/she does not
possess qualifications agreed to by the parties. A party may challenge an arbitrator
appointed by him/her, or in whose appointment he/ she has participated, only for
reasons of which he/she becomes aware after the appointment has been made.

Challenge Procedure

A. The parties are free to agree on a procedure for challenging an arbitrator,

subject to the provisions of the rule.

B. Failing such agreement, a party who intends to challenge an arbitrator shall,

within fifteen (15) days after becoming aware of the constitution of the arbitral
tribunal or after becoming aware of any circumstance, send a written statement of
the reasons for the challenge to the arbitral tribunal. Unless the challenged
arbitrator withdraws from his/her office or the other party agrees to the
challenge, the arbitral tribunal shall decide on the challenge.

C. If a challenge under any procedure agreed upon by the parties is not successful,
the challenging party may request the appointing authority, within thirty (30) days
after having received notice of the decision rejecting the challenge, to decide on
the challenge, which decision shall be immediately executory and not subject to
motion for reconsideration or appeal. While such a request is pending, the arbitral
tribunal, including the challenged arbitrator, may continue the arbitral
proceedings and make an award.

Failure or Impossibility to Act

A. If an arbitrator becomes dejure or de facto unable to perform his/her functions

or for other reasons fails to act without undue delay, his/ her mandate terminates
if he/she withdraws from his/her office or if the parties agree on the termination.
Otherwise, if a controversy remains concerning any of these grounds, any party
may request the appointing authority to decide on the termination of the
mandate, which decision shall be immediately executory and not subject to motion
for reconsideration or appeal.

B. If an arbitrator withdraws from his/her office or a party agrees. the termination

of the mandate of an arbitrator, this does not imply acceptance of the validity of
any ground.

Appointment of Substitute Arbitrator

Where the mandate of an arbitrator terminates under the provisions on
Challenge Procedure and Failure or Impossibility to Act or because of his/her
withdrawal from office for any other reason or because of the revocation of
his/her mandate by agreement of the parties or in any other case of termination of
his/ her mandate, a substitute arbitrator shall be appointed according to the rules
that were applicable to the appointment of the arbitrator being replaced.

Jurisdiction of Arbitral Tribunal

Competence of Arbitral Tribunal to Rule on its Jurisdiction

A. The arbitral tribunal may rule on its own jurisdiction, including any objections
with respect to the existence or validity of the arbitration agreement or any
condition precedent to the filing of a request for arbitration. For that purpose, an
arbitration clause, which forms part of a contract shall be treated as an agreement
independent of the other terms of the contract. A decision by the arbitral tribunal
that the contract is null and void shall not entail ipso jure the invalidity of the
arbitration clause.

B. A plea that the arbitral tribunal does not have jurisdiction shall be raised not
later than the submission of the statement of defense (i.e., in an Answer or Motion
to Dismiss). A party is not precluded from raising such plea by the fact that he/she
has appointed, or participated in the appointment of, an arbitrator. A plea that
the arbitral tribunal is exceeding the scope of its authority shall be raised as soon
as the matter alleged to be beyond the scope of its authority is raised during the
arbitral proceedings. The arbitral tribunal may, in either case, admit a later plea if
it considers the delay justified.

C. The arbitral tribunal may rule on a plea either as a preliminary question or in an

award on the merits. If the arbitral tribunal rules as preliminary question that it
has jurisdiction, any party may request, within thirty (30) days after having
received notice of that ruling, the Regional Trial Court to decide the matter, which
decision shall be immediately executory and not subject to motion for
reconsideration or appeal. While such a request is pending, the arbitral tribunal
may continue the arbitral proceedings and make an award.

Power of Arbitral Tribunal to Order Interim Measures

A. Unless otherwise agreed by the parties, the arbitral tribunal may, at the request
of a party. order any party to take such interim measures of protection as the
arbitral tribunal may consider necessary in respect of the subject matter of the
dispute. Such interim measures may include, but shall not be limited to,
preliminary injunction directed against a party, appointment of receivers, or
detention, preservation, inspection of property that is the subject of the dispute in
arbitration.

B. After constitution of the arbitral tribunal, and during arbitral proceedings, a

request for interim measures of protection, or modification thereof shall be made
with the arbitral tribunal. The arbitral tribunal is deemed constituted when the
sole arbitrator or the third arbitrator, who has been nominated, has accepted the
nomination and written communication of said nomination and acceptance has
been received by the party making the request.

C. The following rules on interim or provisional relief shall be observed:

 Any party may request that interim or provisional relief be granted against
the adverse party.
Such relief may be granted:
  To prevent irreparable loss or injury. To provide security for the
performance of an obligation.
 To produce or preserve evidence. To compel any other appropriate acts
omissions.
 The order granting provisional relief may be conditioned upon the provision
of security or any act or omission specified in the order.
 Interim or provisional relief is. requested by written application
transmitted by reasonable means to the arbitral tribunal and the party
against whom relief is sought, describing in appropriate details of the
precise relief, the party against whom the relief is requested, the ground
for the relief, and the evidence supporting the request.
 The order either granting or denying an application for interim relief shall
be binding upon the parties.
 Either party may apply with the court for assistance in implementing or
enforcing an interim measure ordered by an arbitral tribunal.
 A party who does not comply with the order shall be liable for all damages,
resulting from noncompliance, including all expenses. and reasonable
attorney's fees, paid in obtaining the order's judicial enforcement.

Conduct of Arbitral Proceedings

Equal Treatment of Parties

The parties shall be treated with equality and each party shall be given a
full opportunity of presenting his/ her case.

Determination of Rules of Procedure

A. The parties are free to agree on the procedure to be followed by the
arbitral tribunal in conducting the proceedings.

B. Failing such agreement, the arbitral tribunal may, conduct the arbitration
in such manner as it considers appropriate. Unless the arbitral tribunal considers it
inappropriate, the UNCITRAL Arbitration Rules adopted by the UNCITRAL on 28
April 1976 and the UN General Assembly on 15 December 1976 shall apply subject
to the following clarification: All references to the "Secretary General of the
Permanent Court of Arbitration at the Hague" shall be deemed to refer to the
appointing authority.

C. The power conferred upon the arbitral tribunal includes the power to
determine the admissibility, relevance, materiality and weight of any evidence.

Place of Arbitration
A. The parties are free to agree on the place of arbitration. Failing such
agreement, the place of arbitration shall be in Metro Manila unless the arbitral
tribunal, having regard to the circumstances of the case, including the
convenience of the parties, shall decide on different place of arbitration.
B. Notwithstanding the rule stated in paragraph (a), the arbitral tribunal
may, unless otherwise agreed by the parties, meet at any place it considers
appropriate for consultation among its members, for hearing witnesses, experts or
the parties, or for inspection of goods, other property or documents.
Commencement of Arbitral Proceedings
Unless otherwise agreed by the parties, the arbitral proceedings in respect
of a particular dispute commence on the date on which a request for that dispute
to be referred to arbitration is received by the respondent.

Language
A. The parties are free to agree on the language or languages to be used in
the arbitral proceedings. Failing such agreement, the language to be used shall be
English. This agreement, unless otherwise specified therein, shall apply to any
written statement by a party, any hearing and any award, decision or other
communication by the arbitral tribunal.
B. The arbitral tribunal may order that any documentary evidence shall be
accompanied by a translation into the language or languages agreed upon by the
parties or determined by the arbitral tribunal in accordance with paragraph (a).

Statements of Claim and Defense

A. Within the period of time agreed by the parties or determined by the
arbitral tribunal, the claimant shall state the facts supporting his/her/its claim,
the points at issue and the relief or remedy sought, and the respondent shall state
his/her/its defense in respect of these particulars, unless the parties have
otherwise agreed as to the required elements of such statements. The parties may
submit with their statements, all documents they consider to be relevant or may
add a reference to the documents or other evidence they will submit.
B. Unless otherwise agreed by the parties, either party may amend or
supplement his/her claim or defense during the course of the arbitral proceedings,
unless the arbitral tribunal considers it inappropriate to allow such amendment
having regard to the delay in making it.

Hearing and Written Proceedings

A. Subject to any contrary agreement by the parties, the arbitral tribunal
shall decide whether to hold oral hearings for the presentation of evidence or for
oral argument, or whether the proceedings shall be conducted on the basis of
documents and other materials. However, unless the parties have agreed that no
hearings shall be held, the arbitral tribunal shall hold such hearings at an
appropriate stage of the proceedings, if so requested by a party.
B. The parties shall be given sufficient advance notice of any hearing and of
any meeting of the arbitral tribunal for the purposes of inspection goods, other
property or documents.
C. All statements, documents or other information supplied to the arbitral
tribunal by one party shall be communicated to the other party. Also, an expert
report or evidentiary document on which the arbitral tribunal may rely in making
its decision shall be communicated to the parties.

Default of a Party
Unless otherwise agreed by the parties, if, without showing sufficient cause,
the claimant fails to communicate his statement of claim in accordance with the
provisions of Statement of Claim and Defense, the arbitral tribunal shall terminate
the proceedings;
  the respondent fails to communicate his/her/ its statement of
defense in accordance with the provisions of Statement of Claim and
Defense, the arbitral tribunal shall continue the proceedings without
treating such failure in itself as an admission of the claimant's
allegations;

 any party fails to appear at a hearing or to produce documentary

evidence, the arbitral tribunal may continue the proceedings and
make the award on the evidence before it.

Expert Appointed by the Arbitral Tribunal

Unless otherwise agreed by the parties, the arbitral tribunal,

 may appoint one or more experts to report to it on specific issues to be

determined by the arbitral, tribunal; or
 may require a party to give the expert any relevant information or to
produce, or to provide access to, any relevant documents, goods or other
property for his/her inspection.

Unless otherwise agreed by the parties, if a party so requests or if the arbitral

tribunal considers it necessary, the expert shall, after delivery of his/her written
or oral report, participate in a hearing where the parties have the opportunity to
put questions to him and to present expert witnesses in order to testify on the
points at issue.

Court Assistance in Taking Evidence

The arbitral tribunal or a party with the approval of the arbitral tribunal
may request from a court of the Philippines assistance in taking evidence. The
court may execute the request within its competence and according to its rules on
taking evidence.
The arbitral tribunal shall have the power to require any person to attend a
hearing as a witness. The arbitral tribunal shall have the power to subpoena
witnesses and documents when the relevancy of the testimony and the materiality
thereof has been demonstrated to it. The arbitral tribunal may also require the
retirement of any witness during the testimony of any other witness.
A party may bring a petition under this Section before the court in
accordance with the Rules of Court or the Special ADR Rules.

Rules Applicable to the Substance of Dispute

A. The arbitral tribunal shall decide the dispute in accordance with such
rules of law as are chosen by the parties as applicable to the substance of the
dispute. Any designation of the law or legal system of a given state shall be
construed, unless otherwise expressed, as directly referring to the substantive law
of that state and not to its conflict of laws rules.
B. Failing any designation by the parties, the arbitral tribunal shall apply the
law determined by the conflict of laws rules, which it considers applicable.
C. The arbitral tribunal shall decide ex aequo et bono or as amiable
compositeur only if the parties have expressly authorized it to do so.
 D. In all cases, the arbitral tribunal shall decide in accordance with the
terms of the contract and shall take into account the usages of the trade
applicable to the transaction.

Decision Making by Panel of Arbitrators

In arbitral proceedings with more than one arbitrator, any decision of the
arbitral tribunal shall be made, unless otherwise agreed by the parties, by a
majority of all its members. However, questions of procedure may be decided by a
presiding arbitrator, if so authorized by the parties or all members of the arbitral
tribunal.

Settlement
If, during arbitral proceedings, the parties settle the dispute, the arbitral
tribunal shall terminate the proceedings and, if requested by the parties and not
objected to by the arbitral tribunal, record the settlement in the form of an
arbitral award on agreed terms.
An award on agreed terms shall be made in accordance with the provisions
of Form and Contents of Award and shall state that it is an award. Such an award
has the same status and effect as any other award on the merits of the case.

Form and Contents of Award

The award shall be made in writing and shall be signed by the arbitrator or
arbitrators. In arbitral proceedings with more than one arbitrator, the signatures
of the majority of all members of the arbitral tribunal shall suffice, provided that
the reason for any omitted signature is stated.
The award shall state the reasons upon which it is based, unless the parties
have agreed that no reasons are to be given or the award is an award on agreed
terms under the provisions of Place of Arbitration.

✓ The award shall state its date and the place of arbitration. The award shall be
deemed to have been made at that place.
✓ After the award is made, a copy signed by the arbitrators shall be delivered to
each party.

Termination of Proceedings
The arbitral proceedings are terminated by the final award or by an order of
the arbitral tribunal. The arbitral tribunal shall issue an order for the termination
of the arbitral proceedings when:

✓ The claimant withdraws his/her/its claim, unless the respondent objects thereto
and the arbitral tribunal recognized a legitimate interest on his/ her/its part in
obtaining a final settlement of the dispute:
✓ The parties agree on the termination of the proceedings;
✓ The arbitral tribunal finds that the continuation of the proceedings has for any
other reason become unnecessary or impossible.

Correction and Interpretation of Award, Additional Award

A. Within thirty (30) days from receipt of the award, unless another period
of time has been agreed upon by the parties:
  A party may, with notice to the other party, request the arbitral tribunal to
correct in the award any errors in computation, any clerical or
typographical errors or any errors of similar nature:
 A party may, if so agreed by the parties and with notice to the other party,
request the arbitral tribunal to give an interpretation of a specific point or
part of the award.
B. If the arbitral tribunal considers the request to be justified, it shall make the
correction or give the interpretation within thirty (30) days from receipt of the
request. The interpretation shall form part of the award.
C. The arbitral tribunal may correct any error of the type on its own initiative
within thirty (30) days from the date of the award.
D. Unless otherwise agreed by the parties, a party may, with notice to the
other party, request, within thirty (30) days of receipt of the award, the arbitral
tribunal to make an additional award as to claims presented in the arbitral
proceedings but omitted from the award. If the arbitral tribunal considers the
request to be justified, it shall make the additional award within sixty (60) days.
E. The arbitral tribunal may extend, if necessary, the period of time within
which it shall make a correction, interpretation or an additional award. F. The
provisions of Form and Contents of Award shall apply to a correction or
interpretation of the award or to an additional award.
 LEARNING ACTIVITIES

I Fill in the blanks.

1. The numbers of arbitrators shall be _________.

2. The arbitrator agreement shall be in ________.
3. The parties shall be treated with __________ and each party shall be given a
full opportunity of presenting his/her case.
4. The parties are _____ to agree on the place of arbitration.
5. The arbitral tribunal may order that any documentary evidence shall be
accompanied by a ___________ into the language or languages agreed upon by the
parties.
6. If, during arbitral proceedings, the parties settle the dispute, the arbitral
tribunal shall _________ the proceedings, and if requested by the parties and not
objected to by the arbitral tribunal, record the settlement in the form an (7)
______________ on an agreed terms.
8. The arbitral proceedings are ___________ by the (9) _____________ or by an
order of the arbitral tribunal.
10. The arbitral tribunal may correct error of the type on its own initiative within
______ days from the date of the award.