History of Adr

HISTORY OF ADR
CHUNG FU INDUSTRIES V CA
96283
!!!
Because conflict is inherent in human society, much effort has been expended by
men and institutions in devising ways of resolving the same.
Since there was a growing need for a law regulating arbitration in general was
acknowledged, Republic Act No. 876 (1953), otherwise known as the Arbitration
Law, was passed. "Said Act was obviously adopted to
supplement — not to supplant — the New Civil Code on arbitration.
FACTS:
 Chung Fu entered into a construction agreement with Roblecor for their

industrial factory.
 Under the agreement, disputes arising from the performance of the contract is
subject to resolution by a single arbitrator chosen by the parties.
 Roblecor failed to complete the work and Chung Fu took over its completion.
 Roblecor claims for unsatisfied amount and filed for a compulsory arbitration and
TRO.
 Chung Fu prayed for its dismissal.
 Subsequent negotiations between the parties eventually led to the formulation
of an arbitration agreement.
 RTC approved the arbitration agreement.
 Arbitrator Asuncion ordered petitioners to immediately pay respondent
contractor.
 Chung Fu moved to remand the case for further hearing however it was denied.
 Chung Fu elevated the case to the CA however it was also denied.
ISSUE:
Whether or not the subject arbitration award is indeed beyond the ambit of the
court's power of judicial review.
HELD:
NO. It is stated explicitly under Art. 2044 of the Civil Code that the finality of the
arbitrators' award is not absolute and without exceptions. Where the conditions
described in Articles 2038, 2039 and 2040 applicable to both compromises and
arbitrations are obtaining, the arbitrators' award may be annulled or rescinded.
Thus, if and when the factual circumstances referred to in the above-cited

provisions are present, judicial review of the award is properly warranted.
The case was remanded for further hearing.

DEL MONTE CORPORATION - USA V CA
136154
!!!
There is no doubt that arbitration is valid and constitutional in our jurisdiction.

Even before the enactment of RA 876, this Court has countenanced the
settlement of disputes through arbitration. Unless the agreement is such as
absolutely to close the doors of the courts against the parties, which agreement
would be void, the courts will look with favor upon such amicable arrangement
and will only interfere with great reluctance to anticipate or nullify the action of
the arbitrator.
FACTS:
 DMC-USA entered into distribution agreement with MMI. MMI, with approval of
DMC-USA, appointed SFI as their marketing arm.
 MMI filed a complaint against DMC-USA for violation of Articles 20,21
and 23 for continuing to ship their products through parallel importers despite
the appointment of MMI as the sole and exclusive distributor.
 DMC-USA filed for a motion to suspend proceeding and invoked the arbitration
clause in their agreement, however it was denied.
 CA affirmed.
ISSUE:
Whether or not the arbitration clause would be enough to settle the dispute
HELD:
NO. The object of arbitration is to allow the expeditious determination of a

dispute. However, this issue calls for a full blown trial as the arbitration cannot
resolve its entirety.
RTC ordered to proceed with the hearing of civil case.

The salient features of the ADR Law of 2004 are, among others, the following:
1. Mediation, as a significant ADR mode, was given a concrete legal framework, and more importantly, solid legal support and
encouragement. In addition, the ADR law of 2004 established the principle of "Confidentiality of Information" in mediation such
that information obtained or generated through mediation proceedings is deemed "privileged and confidential".
2. The UNCITRAL Model Law on International Commercial Arbitration was adopted to govern international commercial
arbitration in the Philippines. With this, the ADR law of 2004 has brought Philippine law on international commercial arbitration
up to par with the world’s best and it superseded the outmoded 1952 RA 876, the Philippine Arbitration Law.
3. The National President of the Integrated Bar of the Philippines (IBP) or his duly authorized representative was designated the
default "Appointing Authority." Under the old law, in the absence of an agreement among the parties, it was the Regional Trial
Court (RTC) which will appoint the sole arbitrator or the third arbitrator of a panel if and when the parties do not or cannot
agree. As the "Appointing Authority", the National President of the IBP or his duly authorized representative will decide
challenges to the arbitrator as well as the termination of his mandate.
4. The grant of interim or provisional relief by the courts and the arbitrator/s has been expanded and clarified. Any party may
request either the court or arbitral tribunal that an interim or provisional relief be granted against the adverse party on the
following grounds: (i) to prevent irreparable loss or injury; (ii) to provide security for the performance of any obligations; (iii) to
produce or preserve any evidence; or (iv) to compel any other appropriate act or omission.
Such interim measures may include but are not limited to a preliminary injunction directed against a party, appointment of a
receiver or the detention, preservation, and inspection of property subject of the arbitration.
5. Although RA 876, the old Arbitration Law, continues to govern domestic arbitration, the ADR law of 2004 adopted several
provisions of the UNCITRAL Model Law as well as RA 9285 for domestic arbitration. Thus, to a large extent, even the rules on
domestic arbitration were updated by RA 9285 – specifically on the appointment and number of arbitrators,
grounds/procedure to challenge arbitrators, termination of the mandate of arbitrators, equality and full opportunity of each
party to present their case, decision-making by a panel of arbitrators, form and contents of the award, confidentiality of
arbitration proceedings, and interim measures of protection.
6. With respect to the Construction Industry Arbitration Commission (CIAC) under E.O. 1008, the ADR law of 2004 now allows (i)
for the appointment of a foreign arbitrator as co-arbitrator or chairman of a tribunal who has not been previously accredited by
the CIAC, and (ii) upon written agreement of the parties, for an arbitrator to act as mediator and vice versa.
The ADR Law of 2004 also codified into law the CIAC Rule that a Regional Trial Court before which a construction dispute is filed
and is aware that the parties involved have entered into an arbitration agreement must dismiss the case and refer the parties
to arbitration to be conducted by the CIAC.
7. The ADR Law of 2004 likewise clarified the judicial review and enforcement of arbitral awards. For Foreign Arbitral Awards,
RA 9285 refers to the provisions of the New York Convention of 1958.
8. The Office for Alternative Dispute Resolution (OADR) created by the law will be established an attached agency of the
Department of Justice (DOJ). The objectives of the OADR are to promote, develop and expand the use of ADR in the private and
public sectors; to assist the government to monitor, study and evaluate the use by the public and the private sector of ADR; and
to recommend to Congress needful statutory changes to develop, strengthen and improve ADR practice in accordance with
world standards.
ROLE OF THE 3 BRANCHES OF THE GOVERNMENT IN ADR
EXECUTIVE
THE OFFICE OF THE ALTERNATE DISPUTE RESOLUTION, UNDER THE DOJ, SHALL PROMOTE,
DEVELOP, AND EXPAND THE USE OF ADR IN THE PRIVATE AND PUBLIC SECTORS; ASSIST THE
GOVERNMENT TO MONITOR, STUDY, AND EVALUATE THE USE BY THE PUBLIC AND PRIVATE
SECTOR OF ADR; TO RECOMMEND TO CONGRESS NEEDFUL STATUTORY CHANGES TO DEVELOP,
STRENGTHEN, AND IMPROVE ADR PRACTICE IN ACCORDANCE WITH THE WORLD STANDARDS.
LEGISLATIVE
TO ENACT LAWS PERTAINING TO THE DEVELOPMENT OF ADR FOR IT TO BE ON PAR WITH THE
WORLD STANDARDS.
JUDICIARY
IN CASE THE PARTIES FAILED TO REACH AN AMICABLE SETTLEMENT, THE TRIAL COURTS MAY
TAKE COGNIZANCE OF THE CASE AND RESOLVE ITS ENTIRETY TO REACH THE ENDS OF JUSTICE.

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HISTORY OF ADR

 Chung Fu entered into a construction agreement with Roblecor for their

Thus, if and when the factual circumstances referred to in the above-cited

The case was remanded for further hearing.

There is no doubt that arbitration is valid and constitutional in our jurisdiction.

NO. The object of arbitration is to allow the expeditious determination of a

RTC ordered to proceed with the hearing of civil case.

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