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By: Patricia-Ann T. ProdigalidadBy: Patricia-Ann T. ProdigalidadPartner, ACCRALAWPartner, ACCRALAW
Assistant National Secretary, IBP NationalAssistant National Secretary, IBP National
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①① Party Autono y !A"R La#, SectionParty Autono y !A"R La#, Section$%$%
&& Policy on 'ncourage ent and Acti(ePolicy on 'ncourage ent and Acti(ePro otion o) t*e +se o) A"R as aPro otion o) t*e +se o) A"R as a
eans to dis ense ustice andeans to dis ense ustice anddeclog doc ets !A"R La#, Section $%declog doc ets !A"R La#, Section $%
// Policy on 'nlisting Acti(ePolicy on 'nlisting Acti(ePartici ation o) t*e Pri(ate Sector inPartici ation o) t*e Pri(ate Sector inA"R as a ode o) dis uteA"R as a ode o) dis utesettle ent !A"R La#, Section $%settle ent !A"R La#, Section $%
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①① Party Autono y !A"R La#, Section $%Party Autono y !A"R La#, Section $%
&& Acti(e Partici ation o) t*e Pri(ate SectorActi(e Partici ation o) t*e Pri(ate Sector!A"R La#, Section $%!A"R La#, Section $%
// A"R as a eans o) ro(iding SP''"0 andA"R as a eans o) ro(iding SP''"0 andI1PARTIAL ustice !A"R La#, Section $%I1PARTIAL ustice !A"R La#, Section $%
22 Lia3ilities o) A"R Pro(iders are t*eLia3ilities o) A"R Pro(iders are t*esa e as lia3ilities o) u3lic o4cerssa e as lia3ilities o) u3lic o4cers
under Section 56 !7% o) t*eunder Section 56 !7% o) t*eAd inistrati(e Code o) 789 !A"R La#,Ad inistrati(e Code o) 789 !A"R La#,Section ;%Section ;%
+ on a clear s*o#ing o) 3ad )ait*, alice or gross negligence+ on a clear s*o#ing o) 3ad )ait*, alice or gross negligence
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Republic Act No. 876, as amendedRepublic Act No. 9285 & its ImplementingRules and RegulationsUNCI RA! "odel !a#Ne# $o% Con'ention(up%eme Cou%t (pecial A)R Rules*.+. No. --8, as amended ot/e%#ise no#nas t/e 0Const%uction Indust%1 A%bit%ation !a#and its Rules o3 4%ocedu%e"iscellaneous (pecial !a#sRele'ant u%isp%udence
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7. La3or "is utes$. Ci(il Status o) Persons
5. round )or Legal Se aration;. ?urisdiction o) Courts@. uture Legiti e
Cri inal Lia3ility9. T*ose #*ic* 3y la# cannot 3e co ro ised
!R.A. 8$9;, Section @%
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any rocess or rocedure used toany rocess or rocedure used toresol(e a dis ute or contro(ersy, ot*er t*anresol(e a dis ute or contro(ersy, ot*er t*an3y ad udication o) a residing udge o) a3y ad udication o) a residing udge o) acourt or an o4cer o) a go(ern ent agency,court or an o4cer o) a go(ern ent agency,as deDned in t*is Act,as deDned in t*is Act, in #*ic* a neutralin #*ic* a neutralt*ird arty artici ates to assist in t*et*ird arty artici ates to assist in t*eresolution o) issuesresolution o) issues , #*ic* includes, #*ic* includes
ar3itration, ediation, conciliation, earlyar3itration, ediation, conciliation, earlyneutral e(aluation, ini-trial or anyneutral e(aluation, ini-trial or anyco 3ination t*ereo)Eco 3ination t*ereo)E FA"R La#, section 5aGFA"R La#, section 5aG
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*nsu%es pa%t1 autonom1 on /o# pa%ties settlet/ei% disputes4a%ties can be c%eati'e in settling t/ei% disputes
le ibilit1 o3 p%oceedingsCon dentialit1 o3 p%oceedingsReduced cost and time in t/e %esolution o3con ict!ess st%ess because it #ill a'oid long litigation4%ese%'ation o3 %elations/ip
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"*)IA I+NC+NCI!IA I+N*AR!$ N*U RA! *:A!UA I+N"INI; RIA!
"*);AR<AR
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C+NCI!IA I+N
Process #*ere3y arties reHuest a t*irderson or ersons ! t*e conciliatorE% to
assist t*e in t*eir atte t to reac* ana ica3le settle ent o) t*eir dis utearising out o) or relating to a contractualor ot*er legal relations*i . T*econciliator does not *a(e t*e aut*orityto i ose u on t*e arties a solution tot*e dis ute .
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*AR!$ N*U RA! *:A!UA I+N
A"R rocess #*erein arties andA"R rocess #*erein arties and
t*eir la#yers are 3roug*t toget*ert*eir la#yers are 3roug*t toget*erearly in a re-trial *ase to resentearly in a re-trial *ase to resentsu aries o) t*eir cases and recei(esu aries o) t*eir cases and recei(ea non3inding assess ent 3y ana non3inding assess ent 3y an
e erienced, neutral erson, #it*e erienced, neutral erson, #it*e ertise in t*e su3 ect in t*ee ertise in t*e su3 ect in t*esu3stance o) t*e dis ute.su3stance o) t*e dis ute.
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"INI; RIA!
A structured dis ute resolutionA structured dis ute resolution
et*od in #*ic* t*e erits o) a caseet*od in #*ic* t*e erits o) a caseare argued 3e)ore a anel co risingare argued 3e)ore a anel co risingsenior decision a ers #it* orsenior decision a ers #it* or#it*out t*e resence o) a neutral#it*out t*e resence o) a neutral
t*ird erson a)ter #*ic* t*e artiest*ird erson a)ter #*ic* t*e artiessee a negotiated settle ent.see a negotiated settle ent.
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AR
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+nder t*e P*ili ine+nder t*e P*ili ineA"R La#, t*ree !5% ty esA"R La#, t*ree !5% ty eso) ar3itration areo) ar3itration are
recogniJed:recogniJed:international co ercialinternational co ercialar3itration, do esticar3itration, do esticar3itration andar3itration andconstruction ar3itrationconstruction ar3itration
3e)ore t*e CIAC.3e)ore t*e CIAC.
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WK'N IS ARBITRATI N INT'RNATI NALMWK'N IS ARBITRATI N INT'RNATI NALM
7. I) t*e arties to an ar3itration agree ent7. I) t*e arties to an ar3itration agree ent*a(e, at t*e ti e o) t*e conclusion o) t*at*a(e, at t*e ti e o) t*e conclusion o) t*atagree ent, t*eir laces o) 3usiness inagree ent, t*eir laces o) 3usiness indi erent States. !+1L, Article 7 F5G%di erent States. !+1L, Article 7 F5G%
$. I) t*e lace o) ar3itration, contract$. I) t*e lace o) ar3itration, contract
er)or ance, or t*e lace o) t*e su3 ecter)or ance, or t*e lace o) t*e su3 ectatter o) t*e dis ute is situated in a Stateatter o) t*e dis ute is situated in a Stateot*er t*an t*e lace o) 3usiness o) t*eot*er t*an t*e lace o) 3usiness o) t*e
arties.arties.5. T*e arties e ressly agree t*at su3 ect5. T*e arties e ressly agree t*at su3 ect
atter is international.atter is international.
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WKAT IS C 11'RCIAL ARBITRATI NMWKAT IS C 11'RCIAL ARBITRATI NM
An ar3itration isAn ar3itration is
co ercialco ercial
EE
i) iti) it
co(ers atters arising )ro allco(ers atters arising )ro allrelations*i s o) a co ercial nature,relations*i s o) a co ercial nature,#*et*er contractual or not.#*et*er contractual or not.Relations*i s o) a co ercial natureRelations*i s o) a co ercial natureinclude, 3ut are not li ited to, t*einclude, 3ut are not li ited to, t*e)ollo#ing transactions:)ollo#ing transactions:
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any trade transaction )or t*e su lyany trade transaction )or t*e su lyor e c*ange o) goods or ser(icesOor e c*ange o) goods or ser(icesOdistri3ution agree entsOdistri3ution agree entsOconstruction o) #or sO co ercialconstruction o) #or sO co ercialre resentation or agencyO )actoring,re resentation or agencyO )actoring,leasingO consultingO engineeringOleasingO consultingO engineeringOlicensingO in(est entO DnancingOlicensingO in(est entO DnancingO
3an ingO insuranceO oint (enture3an ingO insuranceO oint (entureand ot*er )or s o) industrial orand ot*er )or s o) industrial or3usiness coo erationO carriage o)3usiness coo erationO carriage o)goods or assengers 3y air, sea, railgoods or assengers 3y air, sea, railor road. !A"R La#, Section $7%or road. !A"R La#, Section $7%
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"o estic Ar3itration eans an"o estic Ar3itration eans anar3itration t*at is notar3itration t*at is notinternational, as deDned in Articleinternational, as deDned in Article7!5% o) t*e +1L !A"R La#, Sec. 5$%7!5% o) t*e +1L !A"R La#, Sec. 5$%
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CIAC *asCIAC *as original and e clusi(eoriginal and e clusi(e urisdiction o(er dis utes arising )ro , or urisdiction o(er dis utes arising )ro , orconnected #it*, contracts entered intoconnected #it*, contracts entered into3y arties in(ol(ed in construction in t*e3y arties in(ol(ed in construction in t*eP*ili ines.P*ili ines. EE !'. . No. 7669, Sec. =%!'. . No. 7669, Sec. =%
A lies to 3ot* go(ern ent and ri(ateA lies to 3ot* go(ern ent and ri(atecontracts !!'. . No. 7669, Sec. 5%contracts !!'. . No. 7669, Sec. 5%
Includes dis utes 3et#een or a ongIncludes dis utes 3et#een or a ongarties to, or #*o are ot*er#ise 3ound 3y,arties to, or #*o are ot*er#ise 3ound 3y,
an ar3itration agree ent, directly or 3yan ar3itration agree ent, directly or 3yre)erence #*et*er suc* arties are ro ectre)erence #*et*er suc* arties are ro ecto#ner, contractor, su3contractor, )a3ricator,o#ner, contractor, su3contractor, )a3ricator,
ro ect anager, design ro)essional,ro ect anager, design ro)essional,consultant, Huantity sur(eyor, 3onds an orconsultant, Huantity sur(eyor, 3onds an orissuer o) an insurance olicy in aissuer o) an insurance olicy in aconstruction ro ect.construction ro ect. EE !A"R La#, Sec. 5;%!A"R La#, Sec. 5;%
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0=++) + IC*(
+>ces t/at essentiall1 p%o'ide logisticalsuppo%t to pa%ties to come up #it/consultation. It is me%el1 t/e p%o'ision o3'enue onl1 and not t/e consultation itsel3. Itis plainl1 administ%ati'e suppo%t.
?+A)R @ebsite, A sB
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A) +C 4a%ties ag%ee to %esol'e
disputes b1 A)R but
#it/out an1 speci cadministe%ing institution =ene%all1, I
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4RI:A *
4/ilippine )isputeResolution Cente%, Inc.
4)RCIECo%e =%oup
=+:*RN"*N
4/ilippine "ediationCente%
Const%uction Indust%1A%bit%ation CommissionCIACEIntellectual 4%ope%t1
+>ce)epa%tment +3 !abo%
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Koppel, Inc. vs. Makati Rotary Club Foundation, Inc.Ko ppel, Inc. vs. Makati Rotary Club Foundation, Inc.(September 20 !"(Se ptember 20 !"
T*e ?"R )ra e#or is 3ased on t*e rocesses o)ediation, conciliation or early neutral e(aluation #*ic*
entails t*e su3 ission o) a dis ute 3e)ore a ?"R udge#*o s*all erely )acilitate settle ent H 3et#een t*e
arties in conQict or a e a non-3inding e(aluation orassess ent o) t*e c*ances o) eac* arty s case. /us in
)R, t/e )R Gudge lac s t/e aut/o%it1 to %ende% a %esolution o3t/e dispute t/at is binding upon t/e pa%ties in con ict. Ina%bit%ation, on t/e ot/e% /and, t/e dispute is submitted to ana%bit%ato% s J a neut%al t/i%d pe%son o% a g%oup o3 t/e%eo3 J#/o s/all /a'e t/e aut/o%it1 to %ende% a %esolution binding upont/e pa%ties.
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=ene%all1, an inte%c/ange bet#een t#o o%mo%e pa%ties in an attempt to %eac/ acomp%omise.Communication is directly bet#een t/epa%ties #it/ o% #it/out t/ei% %especti'ecounselE and does not in'ol'e a neut%alt/i%d pa%t1
ec/nicall1, not #it/in t/e de nition o3 A)Runde% RA 9285 as t/e%e is no neut%alin'ol'edE
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In 2- , Intellectual 4%ope%t1 +>ce o3 t/e 4/ilippinesI4+4 !E establis/ed its A)R 4%og%am in consultation
#it/ UNKs @o%ld Intellectual 4%ope%t1 Association3 ecti(e o) Progra L 4%o'iding (4**)$, UA!I $
AN) * *C I:* legal %emedies AN) to
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/e%e is t/e %epo%ted %ecent success o3 t/e online /e%e is t/e %epo%ted %ecent success o3 t/e onlinemediation conducted b1 t/e 4/ilippinemediation conducted b1 t/e 4/ilippine)epa%tment o3 !abo% and *mplo1ment )o!*E in a)epa%tment o3 !abo% and *mplo1ment )o!*E in adispute in'ol'ing t/i%teen OE disg%untleddispute in'ol'ing t/i%teen OE disg%untled#o% e%s claiming sepa%ation bene ts.#o% e%s claiming sepa%ation bene ts.
Using 0( 1pe , a 3amilia% online telecon3e%encingUsing 0( 1pe , a 3amilia% online telecon3e%encingapplication t/e )o!* ac/ie'ed an onlineapplication t/e )o!* ac/ie'ed an onlinemediated settlement 0t/at %an s as t/e /ig/est o3mediated settlement 0t/at %an s as t/e /ig/est o3its t1pe e'e% ac/ie'ed in t/e local a%ea #/e%eits t1pe e'e% ac/ie'ed in t/e local a%ea #/e%et/e1 li'ed #it/out %ePui%ing t/e pa%ties to /a'et/e1 li'ed #it/out %ePui%ing t/e pa%ties to /a'et/ei% %especti'e da1s in cou%t.t/ei% %especti'e da1s in cou%t.
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A ong t*e rotections granted to )oreign in(estors is t*e+NILAT'RAL a3ility to co ence an ar3itration A>AINST aK ST STAT' in t*e anner rescri3ed in t*e rele(antIn(est ent TreatyT*roug* t*e In(est ent Treaty, t*e K ST STAT' gi(esad(ance consent to t*e su3 ission o) in(est entdis utesE !#it* in(estors )ro anot*er STAT'% tointernational ar3itration
nce a co(ered in(estor ro(ides its o#n consent toar3itration !3y co encing t*e ar3itration rocess%, t*eK ST STAT' 3eco es legally 3ound to roceed #it* t*ear3itration !#it*out any additional a ro(al rocess%In(est ent Treaties can 3e in t*e )or o) !i% BilateralIn(est ent Treaties !BITs%O !ii% ree Trade Agree entsOand ot*er ultilateral agree ents suc* as !iii% AS'ANCo re*ensi(e In(est ent Agree ent.
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C 11'RCIAL ARBITRATI N IN
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C 11'RCIALARBITRATI N
INR''1'NTSI>N'" B0 PARTI'S
BASIS
IN
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IC(I) is an autonomous inte%national institutionestablis/ed unde% t/e Con'ention on t/e(ettlement o3 In'estment )isputes bet#een(tates and Nationals o3 +t/e% (tates t/e IC(I) o%t/e @as/ington Con'entionE #it/ o'e% one/und%ed and 3o%t1 membe% (tates. /eCon'ention sets 3o%t/ IC(I)Qs mandate,o%ganiMation and co%e 3unctions.T*e ri ary ur ose o) ICSI" is to ro(ide)acilities )or conciliation and ar3itration o)international in(est ent dis utes.
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/e IC(I) Con'ention is a multilate%al t%eat1 3o%mulatedb1 t/e * ecuti'e )i%ecto%s o3 t/e Inte%national
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As e'idenced b1 its la%ge membe%s/ip,conside%able caseload, and b1 t/e nume%ous%e3e%ences to its a%bit%ation 3acilities inin'estment t%eaties and la#s, IC(I) pla1s an
impo%tant %ole in t/e eld o3 inte%nationalin'estment and economic de'elopment.
Today, ICSI" is considered to 3e t*e leadinginternational ar3itration institution de(otedto in(estor-State dis ute settle ent.
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IC(I) does not conciliate o% a%bit%ate disputesD itp%o'ides t/e institutional and p%ocedu%al3%ame#o% 3o% independent conciliationcommissions and a%bit%al t%ibunals constituted in
eac/ case to %esol'e t/e dispute.
IC(I) /as t#o sets o3 p%ocedu%al %ules t/at ma1go'e%n t/e initiation and conduct o3 p%oceedingsunde% its auspices. /ese a%eL iE t/e IC(I)Con'ention, Regulations and RulesD and iiE t/eIC(I) Additional acilit1 Rules.
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Additional acti'ities o3 IC(I) in t/e eld o3 t/e settlemento3 disputes /a'e included t*e Secretary->eneral o)ICSI" acce ting to act as t*e a ointing aut*orityo) ar3itrators in ad hoc !i.e., non-institutional%ar3itration roceedings . /is is most commonl1 done
in t/e conte t o3 a%%angements 3o% a%bit%ation unde% t/eA%bit%ation Rules o3 t/e United Nations Commission onInte%national %ade !a# UNCI RA!E, #/ic/ a%e speciall1designed 3o% ad /oc p%oceedings.At t/e %ePuest o3 t/e pa%ties and t/e t%ibunal conce%ned,
ICSI" ay also agree to ro(ide ad inistrati(eser(ices 3o% p%oceedings /andled unde% t/e UNCI RA!A%bit%ation Rules.
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Conciliation and a%bit%ation p%oceedings 3o% t/esettlement o3 disputes a%ising di%ectl1 out o3 anin'estment #/e%e eit/e% t/e (tate pa%t1 o% t/e/ome (tate o3 t/e 3o%eign national is not anICSI" Contracting State.
Conciliation and a%bit%ation p%oceedings bet#eenpa%ties at least one o3 #/ic/ is a Cont%acting(tate o% a national o3 a Cont%acting (tate 3o% t/esettlement o3 dis utes t*at do not directly
arise out o) an in(est ent.act-Dnding roceedings.
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4/ilippines /as
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National In3%ast%uctu%e)e'elopmentCount%1#ide A)R 4%omotionNational A)R )a1
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An attac*ed agency to t*e"e art ent o) ?ustice !A"R La#, Sec.=8%
Wit* a Secretariat to 3e *eaded 3y an' ecuti(e "irector !A"R La#, Sec. =8%
' ecuti(e "irector s*all 3e a ointed3y t*e President !A"R La#, Sec. =8%
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To ro ote, de(elo and e andt*e use o) A"R in t*e ri(ate and
u3lic sectorsO
To assist in t*e onitoring,studying and e(aluating t*e use3y t*e u3lic and t*e ri(atesector o) A"ROTo reco end to Congress need)ulstatutory c*anges to de(elo ,strengt*en, and i ro(e A"R
ractices in accordance #it* #orldstandards
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To act as APP INTIN> A+TK RIT0 o) ediators andar3itrators #*en t*e arties agree in #riting t*at it s*all3e e o#ered to do soO
To conduct se inars, sy osia, con)erences and ot*eru3lic )ora and u3lis* roceedings o) said acti(ities and
rele(ant aterialsVin)or ation t*at #ould PR 1 T'"' PR >RA1S R A"R PR
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To C'RTI 0 t*ose #*o *a(e success)ullyco leted t*e regular ro)essional training
rogra s ro(ided 3y t*e A"R or ot*er A"Rro(ider organiJations as a ro(ed 3y t*eA"RO
To c*arge )ees )or ser(ices rendered suc* as,a ong ot*ers, )or training and certiDcationso) A"R ro(idersO
To acce t donations, grants and ot*erassistance )ro local and )oreign sourcesOand
To e ercise suc* ot*er o#ers as ay 3enecessary and ro er to carry into e ect t*e
ro(isions o) t*e A"R Act o) $66= !R.A. No.8$9;%.
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IBP AS "' A+LT APP INTIN>A+TK RIT0 R A" K C A"R
>R WTK A"R S'R ACCR'"ITATI N
S+PP RT ACILITI'S
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'X'C+TI
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'. . 9 S'RI'S $67$'. . 9 S'RI'S $67$R'C >NITI N A"R AN" PART0 A+T N 10 R'C >NITI N A"R AN" PART0 A+T N 10
S'CTI N 7. +se o) A"R ec*anis s.S'CTI N 7. +se o) A"R ec*anis s. All cont%actsAll cont%actsin'ol'ing 4ublic;4%i'ate 4a%tne%s/ip 444E p%oGectsin'ol'ing 4ublic;4%i'ate 4a%tne%s/ip 444E p%oGectsand o% t/ose ente%ed into unde% ?t/e
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"ulti; ie%ed )isputeResolution Clauses)ispute A'oidance"ec/anisms
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(e%'es as a %eminde% t/at 0A)R s/ould al#a1s be on t/eagenda #/en t/e%e is a dispute
Add%esses t/e imp%ession o3 0#ea ness t/at a suggestion
o3 A)R ma1 c%eate
elp3ul in p%ese%'ing long;te%m %elations/ips t/at ma1/a'e to continue a3te% t/e dispute
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"a1 be e ploited b1 one pa%t1 to p%e'ent t/e inGu%edpa%t1 3%om see ing %elie3 and t/e%eb1 0coe%ce asettlementE
Augments t/e time needed be3o%e pa%ties can %eso%t tocoe%ci'e po#e%s o3 cou%ts o% a%bit%al t%ibunals
especiall1 #/e%e one pa%t1 is %igid and %ecalcit%antE
I3 poo%l1 d%a3ted, ma1 unnecessa%il1 add cost #it/out
t/e co%%esponding 'alue
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Multi#$ier %uideline & ' $ e clause s ouldspeci)y a period o) time )or ne*otiation ormediation, tri**ered by a de+ned andundisputable event (ie, a ritten re-uest",a)ter ic eit er party can resort toarbitration.
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Multi#$ier %uideline &2' $ e clause s ouldavoid t e trap o) renderin* arbitration
permissive, not mandatory.
Multi#$ier %uideline !' $ e clause s ouldde+ne t e disputes to be submitted tone*otiation or mediation and to arbitrationin identical terms.
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/e 3ollo#ing clause p%o'ides 3o% mandato%1negotiation as a %st stepL
0 /e pa%ties s/all endea'o% to %esol'e amicabl1 b1negotiation all disputes a%ising out o3 o% in connection #it/
t/is ag%eement, including an1 Puestion %ega%ding itse istence, 'alidit1 o% te%mination. An1 suc/ dispute #/ic/%emains un%esol'ed ?O-B da1s a3te% eit/e% pa%t1 %ePuests in#%iting negotiation unde% t/is clause o% #it/in suc/ ot/e%pe%iod as t/e pa%ties ma1 ag%ee in #%iting, s/all be nall1settled unde% t/e ?designated set o3 a%bit%ation %ulesB b1?one o% t/%eeB a%bit%ato%?sB appointed in acco%dance #it/t/e said Rules. /e place o3 a%bit%ation s/all be ?cit1,count%1B. /e language o3 a%bit%ation s/all be ?TB.
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/e 3ollo#ing clause p%o'ides 3o% mandato%1 mediation as a%st stepL
0 /e pa%ties s/all endea'o% to %esol'e amicabl1 b1 mediation unde% t/e?designated set o3 mediation %ulesB all disputes a%ising out o3 o% inconnection #it/ t/is ag%eement, including an1 Puestion %ega%ding itse istence, 'alidit1 o% te%mination. An1 suc/ dispute not settledpu%suant to t/e said Rules #it/in ? 5B da1s a3te% appointment o3 t/emediato% o% #it/in suc/ ot/e% pe%iod as t/e pa%ties ma1 ag%ee in#%iting, s/all be nall1 settled unde% t/e ?designated set o3 a%bit%ation%ulesB b1 ?one o% t/%eeB a%bit%ato%?sB appointed in acco%dance #it/ t/esaid Rules. /e place o3 a%bit%ation s/all be ?cit1, count%1B. /elanguage o3 a%bit%ation s/all be ?TB.
?All communications du%ing t/e mediation a%e con dential and s/allbe t%eated as made in t/e cou%se o3 comp%omise and settlementnegotiations 3o% pu%poses o3 applicable %ules o3 e'idence and an1additional con dentialit1 and p%o3essional sec%ec1 p%otectionsp%o'ided b1 applicable la#.B
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/e 3ollo#ing clause p%o'ides 3o% bot/ mandato%1negotiation and mediation be3o%e a%bit%ationL
0All disputes a%ising out o3 o% in connection #it/ t/is
ag%eement, including an1 Puestion %ega%ding its e istence,'alidit1 o% te%mination )isputeKE, s/all be %esol'ed inacco%dance #it/ t/e p%ocedu%es speci ed belo#, #/ic/s/all be t/e sole and e clusi'e p%ocedu%es 3o% t/e%esolution o3 an1 suc/ )ispute.
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AE Negotiation
/e pa%ties s/all endea'o% to %esol'e an1 )ispute amicabl1 b1 negotiationbet#een e ecuti'es #/o /a'e aut/o%it1 to settle t/e )ispute and #/o a%eat a /ig/e% le'el o3 management t/an t/e pe%sons #it/ di%ect %esponsibilit13o% administ%ation o% pe%3o%mance o3 t/is ag%eement.
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CE A%bit%ation
An1 )ispute not %esol'ed b1 mediation in acco%dance #it/ pa%ag%ap/
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5 C s R+L': CLA+S' 1+ST B' CL'AR, C'RTAIN AN" C 1PL'T'◦ (4*CI $ * 4R+C*((*( INC!U)IN= RU!*(, I AN$◦ IN)ICA * RI==*R( AN) 4*RI+)(◦ I)*N I $ 4*R(+NA!I I*( )*CI(I+N "AW*R(◦ A:* A IX*) I"* RA"* @I A )* INI * R*CW+NIN= )A *E◦ I ( *4( AR* @AI:A
1+LTI-TI'R'" CLA+S'S AR' B'SP Y' E AN" N T B IL'R-PLAT'1 "'L CLA+S'S AR' ESTARTIN> P INTSE NL0
o ie%ed clauses a%e not boile%plate S t/e1 s/ould al#a1s be d%a3ted b1%e3e%ence to t/e pa%ticula% ci%cumstances o3 t/e t%ansaction.
o /e specimen is use3ul 3o% t/e pu%pose o3 illust%ating /o# a tie%edclause loo s and ope%ates and as a sta%ting point 3o% t/e d%a3ting o3 atailo%ed tie%ed clause.
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68
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69
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)e nitionL A Condition 4%ecedent is ane'ent #/ic/ must occu%, unless its non;occu%%ence is e cused, be3o%e pe%3o%mance
unde% a cont%act becomes due, i.e., be3o%ean1 cont%actual dut1 a%ises.
See Restatement 2dE Cont%acts Z 22
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/e clause c%eates a condition p%ecedentmediation ta ing placeE be3o%e pe%3o%mance
unde% t/e a%bit%ation clause becomes due
A %ecalcit%ant pa%t1 simpl1 %e3uses topa%ticipate in mediation, %ende%ing t/ea%bit%ation clause unen3o%ceable until
mediation ta es place.ResultL no %esolution is possible
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IM /ortland, C v. 1e ito 3uilders, Inc. , O 7 .Od st Ci%. 2--OE.
Cont%act 3o% motel %eno'ation
"ulti;tie% A)R clause #as d%a3ted to c%eate acondition p%ecedent mediation be3o%ea%bit%ationE
4a%t1 soug/t to compel a%bit%ation /e cou%t declined to compel a%bit%ation, as
t/e condition p%ecedent mediationE /ad notta en place
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(imple time e pi%ation 3o% mediationL 0I3settlement is not %eac/ed #it/in 6- da1s a3te%se%'ice o3 a #%itten demand 3o% mediationT
"o%e elabo%ate ca%'e outL 0In t/e e'ent
mediation 3ails to %esol'e all o3 t/e issuesbet#een o% among t/e 4a%ties, t/e 4a%ties3o%go t/ei% option to mediate, o% i3 mediationis not /eld #it/in 6- da1s o3 t/e e'ent gi'ing%ise to t/e dispute, t/en t/e matte% o% an1%emaining matte%s s/all be submitted to nal,non;appealable a%bit%ation. /e a%bit%ations/all beT
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4%oblemL Ag%eement to Negotiate o% "ediate ma1not be *n3o%ceable in t/e (eat o3 t/e A)R Clause.
"a1 be 3ound to be an illuso%1 ag%eement o% anunen3o%ceable 0ag%eement to ag%ee unde% t/ela# o3 t/e seat o3 t/e A)R clause
(/ould cou%t inte%'ention be %ePui%ed, a localcou%t #ill %e3use to en3o%ce t/e clause
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Almost all U.(. u%isdictions=e%man1 =e%man ede%al (up%eme Cou%tE
%ance %enc/ Cou% de CassationE*ngland *nglis/ Comme%cial Cou%tE %ecentc/ange in t/e la# on t/is issueENe# (out/ @ales, Aust%alia (up%eme Cou%t o3Ne# (out/ @alesEI%eland I%is/ ig/ Cou%tE
Wlaus 4ete%
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(eat 1ou% "ulti; ie% A)R Clause in a Gu%isdiction #/ic/ #ill en3o%ce t/e p%elimina%1tie%s
I3 1ou a%e conside%ing placing t/e seat in anun3amilia% Gu%isdiction, Consult LocalCounsel
Include p%o'isions gi'ing t/e a%bit%ato% t/epo#e% to %ePui%e speci c pe%3o%mance o3p%elimina%1 tie%s o3 t/e A)R clause
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8-
[ R'L'
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8
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82
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"ISP+T' B AR"S IS N' TK'"ISP+T' B AR"S IS N' TK'PR
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00(tanding(tanding ;; appointed at t/e sta%t o% e'en p%io%appointed at t/e sta%t o% e'en p%io%to t/e commencement dateE o3 t/e 4%oGectto t/e commencement dateE o3 t/e 4%oGect
00Ad /ocAd /oc ;; Appointed as and #/en a dispute isAppointed as and #/en a dispute is%e3e%%ed%e3e%%ed
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a.a. 'arly '(aluation 3y a Neutral !and Well-'arly '(aluation 3y a Neutral !and Well-In)or ed% ' ertIn)or ed% ' ert
3.3. eed3ac ' ecteed3ac ' ect
c.c. Role in "is ute A(oidance !or "is uteRole in "is ute A(oidance !or "is utePre(ention%Pre(ention%
"B #it* aut*ority to gi(e in)or al"B #it* aut*ority to gi(e in)or al
ad(ice orad(ice or o inionsE !u on reHuest o)o inionsE !u on reHuest o)3ot* Parties%3ot* Parties%
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"B #it* aut*ority to *a(e in)or al"B #it* aut*ority to *a(e in)or alconsultationsE !#it* consent o) 3ot*consultationsE !#it* consent o) 3ot*Parties and notParties and not ex parteex parte %%
Clause $6.$ ! ar. % FA oint ent o)Clause $6.$ ! ar. % FA oint ent o)t*et*e "is ute BoardG"is ute BoardG
I) at any ti e t*e Parties agree, t*eyI) at any ti e t*e Parties agree, t*eyay ointly re)er a atter to t*e "B )oray ointly re)er a atter to t*e "B )or
it to gi(e its o inion. Neit*er artyit to gi(e its o inion. Neit*er artys*all consult t*e "B on any atters*all consult t*e "B on any atter#it*out t*e agree ent o) t*e ot*er#it*out t*e agree ent o) t*e ot*erParty.EParty.E
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>eneral Conditions o) "is ute Board>eneral Conditions o) "is ute BoardAgree ent !A endi to >eneralAgree ent !A endi to >eneralConditions o) Contract%Conditions o) Contract%
Clause =! % F>eneral 3ligations o) t*eClause =! % F>eneral 3ligations o) t*e
1e 3erG1e 3erG
! % 3e a(aila3le to gi(e ad(ice and! % 3e a(aila3le to gi(e ad(ice ando inions, on any atter rele(ant to t*eo inions, on any atter rele(ant to t*e
Contract #*en reHuested 3y 3ot* t*eContract #*en reHuested 3y 3ot* t*e' loyer and t*e Contractor, su3 ect to t*e' loyer and t*e Contractor, su3 ect to t*eAgree ent o) t*e t*er 1e 3ers.Agree ent o) t*e t*er 1e 3ers. EE
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d. 'n*anced ca acity o) t*e ' loyer inter s o) contract anage ent and o) t*eContractor in ter s o) ro ectad inistration
e. 'arly and Huic resolution o) dis utes t*atcould not 3e a(oided
). '(entual cost sa(ings !arising )rosuccess)ul dis ute a(oidance andVor earlyresolution o) dis utes%
9-
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/e 4a%ties /e%eb1 ag%ee to establis/ a )isputeRe'ie#
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All disputes a%ising out o3 o% in connection #it/t/e p%esent Cont%act s/all be submitted, in t/e
%st instance, to t/e )R< in acco%dance #it/ t/e
Rules. o% an1 gi'en dispute, t/e )R< s/all issuea Recommendation in acco%dance #it/ t/e Rules.
I3 an1 4a%t1 3ails to compl1 #it/ a
Recommendation #/en %ePui%ed to do sopu%suant to t/e Rules, t/e ot/e% 4a%t1 ma1 %e3e%t/e 3ailu%e itsel3 to A%bit%ation unde% t/e Rules o3A%bit%ation o3 t/e Inte%national C/ambe% o3Comme%ce b1 one o% mo%e a%bit%ato%s appointedin acco%dance #it/ t/e said Rules o3 A%bit%ation.
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I3 an1 4a%t1 sends a #%itten notice to t/e ot/e%4a%t1 and t/e )R< e p%essing its dissatis3action
#it/ a Recommendation, as p%o'ided in t/e Rules,o% i3 t/e )R< does not issue t/e Recommendation#it/in t/e time limit p%o'ided in t/e Rules, o% i3t/e )R< is disbanded pu%suant to t/e Rules, t/edispute s/all be nall1 settled unde% t/e Rules o3A%bit%ation o3 t/e Inte%national C/ambe% o3Comme%ce b1 one o% mo%e a%bit%ato%s appointedin acco%dance #it/ t/e said Rules o3 A%bit%ation.
FI) t*e arties do not #ant t*e ' ergency Ar3itratorPro(isions to a ly in t*e ar3itration roceedings,t*ey ust e ressly o t out.G
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/e 4a%ties /e%eb1 ag%ee to establis/ a )isputeAdGudication
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%ePui%ed to do so pu%suant to t/e Rules, t/e ot/e%4a%t1 ma1 %e3e% t/e 3ailu%e itsel3 to A%bit%ation unde%t/e Rules o3 A%bit%ation o3 t/e Inte%national C/ambe%
o3 Comme%ce b1 one o% mo%e a%bit%ato%s appointed inacco%dance #it/ t/e said Rules o3 A%bit%ation.
I3 an1 4a%t1 sends a #%itten notice to t/e ot/e% 4a%t1and t/e )A< e p%essing its dissatis3action #it/ a)ecision, as p%o'ided in t/e Rules, o% i3 t/e )A< doesnot issue t/e )ecision #it/in t/e time limit p%o'ided3o% in t/e Rules, o% i3 t/e )A< is disbanded pu%suantto t/e Rules, t/e dispute s/all be nall1 settled unde%
t/e Rules o3 A%bit%ation o3 t/e Inte%national C/ambe%o3 Comme%ce b1 one o% mo%e a%bit%ato%s appointed inacco%dance #it/ t/e said Rules o3 A%bit%ation.
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FI) t*e arties do not #ant t*e ' ergency Ar3itratorPro(isions to a ly in t*e ar3itration roceedings,t*ey ust e ressly o t out.G
56 /arties may, i) t ey is , provide )or revie by ICC o) a1738s 1ecisions by insertin* t e )ollo in* te9t in place o)t e asterisk above' $ e 173 s all submit eac 1ecision toICC )or revie in accordance it 7rticle 2 o) t e Rules.:
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/e 4a%ties /e%eb1 ag%ee to establis/ a Combined)ispute
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I3 an1 4a%t1 3ails to compl1 #it/ a Recommendation o% a)ecision #/en %ePui%ed to do so pu%suant to t/e Rules,t/e ot/e% 4a%t1 ma1 %e3e% t/e 3ailu%e itsel3 to A%bit%ation
unde% t/e Rules o3 A%bit%ation o3 t/e Inte%nationalC/ambe% o3 Comme%ce b1 one o% mo%e a%bit%ato%sappointed in acco%dance #it/ t/e said Rules o3A%bit%ation.
I3 an1 4a%t1 sends a #%itten notice to t/e ot/e% 4a%t1 andt/e C)< e p%essing its dissatis3action #it/ aRecommendation o% a )ecision as p%o'ided 3o% in t/eRules, o% i3 t/e C)< does not issue t/e Recommendationo% )ecision #it/in t/e time limit p%o'ided 3o% in t/e
Rules, o% i3 t/e C)< is disbanded pu%suant to t/e Rules,t/e dispute s/all be nall1 settled unde% t/e Rules o3A%bit%ation o3 t/e Inte%national C/ambe% o3 Comme%ce b1one o% mo%e a%bit%ato%s appointed in acco%dance #it/t/e said Rules o3 A%bit%ation.
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FI) t*e arties do not #ant t*e ' ergency Ar3itratorPro(isions to a ly in t*e ar3itration roceedings,t*ey ust e ressly o t out.G
56 /arties may, i) t ey is , provide )or revie by ICC o) aC138s 1ecisions by insertin* t e )ollo in* te9t in place o)t e asterisk above' $ e C13 s all submit eac 1ecision toICC )or revie in accordance it 7rticle 2 o) t e Rules.:
10
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7% TK' INCL+SI N A "AB ! R AN0R1 "ISP+T' B AR"% IN
C NSTR+CTI N C NTRACTS IS N T TK'
N R1
$% >
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* ecuti'e +%de% No. 78 se%ies o3 2- 2 * ecuti'e +%de% No. 78 se%ies o3 2- 2 0*+0*+78 E %ePui%es all cont%acts iE in'ol'ing 4ublic;78 E %ePui%es all cont%acts iE in'ol'ing 4ublic;4%i'ate 4a%tne%s/ip 444E 4%oGects and o% iiE4%i'ate 4a%tne%s/ip 444E 4%oGects and o% iiEt/ose ente%ed into unde% t/e
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At p%esent and despite t/e autonom1 p%o'ided inAt p%esent and despite t/e autonom1 p%o'ided in*+ 78 to de ne t/e A)R mec/anismsE, t/e*+ 78 to de ne t/e A)R mec/anismsE, t/estanda%d bidding documents o3 t/e 4/ilippinestanda%d bidding documents o3 t/e 4/ilippine=o'e%nment inco%po%ates t/e t%aditional t#o;=o'e%nment inco%po%ates t/e t%aditional t#o;tie%ed app%oac/ to dispute %esolutionLtie%ed app%oac/ to dispute %esolutionL
stst tie% ; Amicable (ettlement Negotiationstie% ; Amicable (ettlement Negotiations22 ndnd tie% ; A%bit%ation unde% 4/ilippine A)R Act o3tie% ; A%bit%ation unde% 4/ilippine A)R Act o32-- s/ould amicable settlement not2-- s/ould amicable settlement not
mate%ialiMeEmate%ialiMeE
-O
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As suc/, t/e standa%d bidding documents /a'eAs suc/, t/e standa%d bidding documents /a'enot put in place anot put in place a 0dispute a'oidance0dispute a'oidancemec/anismmec/anism
!atest d%a3t anua%1 2- OE o3 t/e 4/ilippine!atest d%a3t anua%1 2- OE o3 t/e 4/ilippine=o'e%nment 444 Cente%=o'e%nment 444 Cente% Ks 4olic1
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/e 444 4olic1
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5% PR ?'CT PARTICIPANTS T'N " N TC NSTIT+T' TK' "AB AS R'Z+IR'"!WK'TK'R STAN"IN> R A" K C% R
A 10RIA" R'AS NS=% $668 HUTAMA CAS' "I1INISK'S TK'
"AB 1'CKANIS1, WKICK 1A0 B' A"ISINC'NTI
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ACTS:ACTS:C"" C is t/e gene%al cont%acto% 3o% t/e 4/ilippineC"" C is t/e gene%al cont%acto% 3o% t/e 4/ilippine
go'e%nmentgo'e%nment Ks ( 1#a1 4%oGect a toll%oad p%oGectE.Ks ( 1#a1 4%oGect a toll%oad p%oGectE.U A"AU A"A #as C"" CKs subcont%acto%.#as C"" CKs subcont%acto%.
C"" C and U A"A ente%ed into an *nginee%ingC"" C and U A"A ente%ed into an *nginee%ing4%ocu%ement Const%uction Cont%act *4CCE in4%ocu%ement Const%uction Cont%act *4CCE in 788@788@ ,,#/ic/ p%o'ided 3o% a standing )ispute AdGudication#/ic/ p%o'ided 3o% a standing )ispute AdGudication
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K+TA1A e(entually co leted t*e #or s andK+TA1A e(entually co leted t*e #or s andt*e S y#ay Pro ect #as o ened in "ece 3ert*e S y#ay Pro ect #as o ened in "ece 3er7888 )or u3lic use7888 )or u3lic use ..
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I((U* as de ned in t/e e%ms o3 Re3e%ence inI((U* as de ned in t/e e%ms o3 Re3e%ence inA%bit%ationEL Is p%io% %eso%t to t/e )A< aA%bit%ationEL Is p%io% %eso%t to t/e )A< ap%econdition to t/e submission o3 t/e disputep%econdition to t/e submission o3 t/e disputeto a%bit%ation conside%ing t/at t/e )A< #asto a%bit%ation conside%ing t/at t/e )A< #asnot constituted\not constituted\)*CI(I+NL (U4R*"* C+UR A IR"*) *)*CI(I+NL (U4R*"* C+UR A IR"*) *CIACK( URI()IC I+N AN) *R* +R* *CIACK( URI()IC I+N AN) *R* +R* *
4R+4RI* $ + * AR
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Alt/oug/ t/e *4CC states t/at a dispute bet#een t/eAlt/oug/ t/e *4CC states t/at a dispute bet#een t/epa%ties as %ega%ds t/e *4CC s/all be initiall1 %e3e%%ed topa%ties as %ega%ds t/e *4CC s/all be initiall1 %e3e%%ed tot/e )A< 3o% decision, and onl1 #/en t/e pa%ties a%et/e )A< 3o% decision, and onl1 #/en t/e pa%ties a%edissatis ed #it/ t/e decision o3 t/e )A< s/ould a%bit%ationdissatis ed #it/ t/e decision o3 t/e )A< s/ould a%bit%ationcommence, t/is does not, and cannot, mean t/at t/ecommence, t/is does not, and cannot, mean t/at t/eCIAC is ba%%ed 3%om assuming Gu%isdiction o'e% t/e disputeCIAC is ba%%ed 3%om assuming Gu%isdiction o'e% t/e disputei3 suc/ clause #as not complied #it/.i3 suc/ clause #as not complied #it/.
Unde% 4/ilippine la# and Gu%isp%udence, t/e ba%e 3act t/atUnde% 4/ilippine la# and Gu%isp%udence, t/e ba%e 3act t/att/e pa%ties inco%po%ated an a%bit%ation clause in t/e *4CCt/e pa%ties inco%po%ated an a%bit%ation clause in t/e *4CCis su>cient to 'est t/e CIAC #it/ Gu%isdiction o'e% an1is su>cient to 'est t/e CIAC #it/ Gu%isdiction o'e% an1const%uction cont%o'e%s1 o% claim bet#een t/e pa%ties.const%uction cont%o'e%s1 o% claim bet#een t/e pa%ties.
/e a%bit%ation clause in t/e *4CC ipso 3acto 'ested t/e /e a%bit%ation clause in t/e *4CC ipso 3acto 'ested t/eCIAC #it/ Gu%isdiction. /is %ule applies, %ega%dless o3CIAC #it/ Gu%isdiction. /is %ule applies, %ega%dless o3#/et/e% t/e pa%ties speci call1 c/oose anot/e% 3o%um o%#/et/e% t/e pa%ties speci call1 c/oose anot/e% 3o%um o%ma e %e3e%ence to anot/e% a%bit%al bod1.ma e %e3e%ence to anot/e% a%bit%al bod1.
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Alt/oug/ Clause 2-. is not a case #/e%ein t/ea%bit%ation clause in t/e *4CC named anot/e% 3o%um, nott/e CIAC, nonet/eless, t/e ig/ Cou%t /eld t/at t/iscondition p%ecedent o3 p%io% %e3e%%al to t/e )A%m a condition p%ecedent in t/e const%uctioncont%act t/at eFecti'el1 suspends t/e Gu%isdiction o3 t/eCIAC until compliance t/e%e#it/, #ould be in con ict#it/ t/e %ecogniMed intention o3 t/e la# and %ules to
automaticall1 'est CIAC #it/ Gu%isdiction o'e% a disputes/ould t/e const%uction cont%act contain an a%bit%ationclause.
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A ruling reHuiring t*e arties to stillA ruling reHuiring t*e arties to stilla oint a "AB, to #*ic* t*ey s*ould Drsta oint a "AB, to #*ic* t*ey s*ould Drstre)er t*eir dis ute 3e)ore t*e sa e couldre)er t*eir dis ute 3e)ore t*e sa e could3e su3 itted to t*e CIAC, #ould erely3e su3 itted to t*e CIAC, #ould erely3e circuitous and dilatory at t*is oint. It3e circuitous and dilatory at t*is oint. It#ould entail unnecessary delays and#ould entail unnecessary delays ande enses on 3ot* arties, #*ic*e enses on 3ot* arties, #*ic*' ecuti(e rder No. 7669 recisely see s' ecuti(e rder No. 7669 recisely see sto re(ent. It #ould, indeed, de)eat t*eto re(ent. It #ould, indeed, de)eat t*e
ur ose )or #*ic* t*e CIAC #as created.ur ose )or #*ic* t*e CIAC #as created.It #ould entail unnecessary delays andIt #ould entail unnecessary delays ande enses on 3ot* arties, #*ic*e enses on 3ot* arties, #*ic*' ecuti(e rder No. 7669 recisely see s' ecuti(e rder No. 7669 recisely see sto re(ent. It #ould, indeed, de)eat t*eto re(ent. It #ould, indeed, de)eat t*e
ur ose )or #*ic* t*e CIAC #as created.Eur ose )or #*ic* t*e CIAC #as created.E
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TK' Z+'STI N, TK'R' R', IS WK'TK'R ASI1ILAR "'CISI N W +L" B' R'ACK'" INCAS'S WK'R' A "AB KA" B''N C NSTIT+T'"AS P'R C NTRACT B+T "'LIB'RAT'L0 I>N R'"
B0 N' TK' PARTI'S B0 R' 'RRIN> TK'"ISP+T' "IR'CTL0 T ARBITRATI N !CIAC% '
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TK' R'
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I) a dis ute arises 3et#een t*e Parties inI) a dis ute arises 3et#een t*e Parties inconnection #it*, or arising out o), t*e Contractconnection #it*, or arising out o), t*e Contractor t*e e ecution o) t*e Wor s and t*ere is noor t*e e ecution o) t*e Wor s and t*ere is no"B in lace, #*et*er 3y reason o) t*e e iry"B in lace, #*et*er 3y reason o) t*e e iry
o) t*e "Bo) t*e "B s a oint ent or ot*er#ise:s a oint ent or ot*er#ise:a%a% Su3-Clause $6.= F 3taining "is ute BoardSu3-Clause $6.= F 3taining "is ute Board ss"ecisionG and Su3-Clause $6.; FA ica3le"ecisionG and Su3-Clause $6.; FA ica3leSettle entG s*all not a lyO andSettle entG s*all not a lyO and3%3% T*e dis ute ay 3e re)erred directly toT*e dis ute ay 3e re)erred directly toar3itration under Su3-Clause $6.@ar3itration under Su3-Clause [email protected]. EE
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B+T TK' R'1AININ> Z+'STI N IS \ WILL TK'S+PR'1' C +RT CKAN>' HUTAMA?
I N T, " 'S TKIS "'CISI N I1PL0 TKAT:◦ TK' S+PR'1' C +RT WILL N T 'N RC' 1+LTI-
TI'R'" "ISP+T' R'S L+TI N CLA+S'SM◦ WILL N T C NSI"'R TK' A"R ST'PS AS
C N"ITI NSPR'C'"'NT R TK' ARBITRAL TRIB+NALT ACZ+IR' ?+RIS"ICTI NM
◦ I S , WKAT W +L" B' TK'
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7% W RL" BANY(tanda%d
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$%$% ASIAN "'
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5%5% ?APAN'S' INT'RNATI NAL C P'RATI N ?APAN'S' INT'RNATI NAL C P'RATI NA>'NC0 !?ICA%A>'NC0 !?ICA%
in3o%mation dissemination and t%ainingin3o%mation dissemination and t%ainingsemina%s 3o% potential adGudicato%sDsemina%s 3o% potential adGudicato%sD
ICA adopted t/e I)IC ")< a%monised ICA adopted t/e I)IC ")< a%monised*dition 2--6E in 2--9 as t/e Conditions o3*dition 2--6E in 2--9 as t/e Conditions o3Cont%act to be included in its (ample
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2-
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7% >ILAT SAT'LLIT' N'TW RYS LT". (s.+CPB >'N'RAL INS+RANC' !$67=%
K'L": /e e istence o3 a su%et1s/ip
ag%eement does not gi'e t/e su%et1 t/e%ig/t to inte%'ene in t/e p%incipal cont%act,no% can an a%bit%ation clause bet#een t/ebu1e% and t/e selle% be in'o ed b1 a non;
pa%t1 suc/ as t/e su%et1.
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/e su%et1 cannot in'o e in its 3a'o% t/ea%bit%ation clause in t/e 4u%c/aseAg%eement, because it is not a pa%t1 to t/atcont%act. An a%bit%ation ag%eement being
cont%actual in natu%e, it is binding onl1 ont/e pa%ties t/e%eto, as #ell as t/ei% assignsand /ei%s.
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$% Y PP'L (s. 1AYATI R TAR0 CL+B !$675%
K'L":a. /e a%bit%ation clause o3 t/e 2--5 !ease
Cont%act sti ulates t*at any disagree ent
as to t*e inter retation, a lication ore ecution o) t*e $66; Lease Contractoug*t to 3e su3 itted to ar3itration. Tot*e ind o) t*is Court, suc* sti ulation isclear and is co re*ensi(e enoug* so as
to include (irtually any ind o) conQict ordis ute t*at ay arise )ro t*e $66; LeaseContract including t*e one t*at resently3esets Yo el and 1a ati Rotary Clu3.
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c. /e ope%ation o3 t/e a%bit%ation clause in t/iscase is not at all de3eated b1 t/e 3ailu%e o3 t/epetitione% to le a 3o%mal H%ePuestH o%application t/e%e3o% #it/ t/e "e C. We Dndt*at t*e Dling o) a reHuest ursuant toSection $= o) R.A. No. 8$9; is not t*esole eans 3y #*ic* an ar3itrationclause ay 3e (alidly in(o ed in a
ending suit. Attention ust 3e aid,
*o#e(er, to t*e salient #ordings o) Rule=.7 !#*ic* i le ents Section $= o) RA8$9;%.
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It reads: FaG arty to a ending action Dled in(iolation o) t*e ar3itration agree ent . . . ayreHuest t*e court to re)er t*e arties toar3itration in accordance #it* suc* agree ent.
In using t*e #ord ay to Huali)y t*e act o)Dling a reHuest under Section $= o) R.A. No.8$9;, t*e S ecial A"R Rules clearly did notintend to li it t*e in(ocation o) an ar3itrationagree ent in a ending suit solely (ia suc*
reHuest. A)ter all, non-co liance #it* anar3itration agree ent is a (alid de)ense to anyo ending suit and, as suc*, ay e(en 3e raisedin an ans#er as ro(ided in our ordinary rules o)
rocedure .
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In t*is case, it is conceded t*at etitioner#as not a3le to Dle a se arate reHuest o)ar3itration 3e)ore t*e 1eTC. Ko#e(er, it iseHually conceded t*at t*e etitioner, asearly as in its Ans#er #it* Counterclai ,*ad already a rised t*e 1eTC o) t*ee istence o) t*e ar3itration clause in t*e$66; Lease Contract and, oresigniDcantly, o) its desire to *a(e t*e sa e
en)orced in t*is case. T*is act o) etitioneris enoug* (alid in(ocation o) *is rig*t toar3itrate.
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d. It is clear t*at under t*e la#, t*e instantunla#)ul detainer action s*ould *a(e 3eenstayedO t*e petitione% and t*e res ondent s*ould*a(e 3een re)erred to ar3itration ursuant tot*e ar3itration clause o) t*e $66; LeaseContract. T*e 1eTC, *o#e(er, did not do so in(iolation o) t*e la# ] #*ic* (iolation #as, inturn, a4r ed 3y t*e RTC and Court o) A ealson a eal. T*e (iolation 3y t*e 1eTC o) t*eclear directi(es under R.A. Nos. 9 @ and 8$9;renders in(alid all roceedings it undertoo int*e e ect ent case a)ter t*e Dling 3y etitionero) its Ans#er #it* Counterclai ] t*e oint#*en t*e etitioner and t*e res ondent s*ould*a(e 3een re)erred to ar3itration.
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T*is case ust, t*ere)ore, 3ere anded to t*e 1eTC and 3esus ended at said oint. Ine(ita3ly,
t*e decisions o) t*e 1eTC, RTC and t*eCourt o) A eals ust all 3e (acatedand set aside.
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5% ?. PL+S ASIA "'
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*!)LR.A. No. 9285 did not con3e% on %egional t%ial cou%ts
Gu%isdiction to %e'ie# a#a%ds o% decisions o3 t/e CIAC inconst%uction disputes. +n t/e cont%a%1, (ection - t/e%eo3e p%essl1 decla%es t/at con %mation b1 t/e R C is not%ePui%ed. (ince R.A. No. 9285 e plicitl1 e cluded CIACa#a%ds 3%om domestic a%bit%ation a#a%ds t/at need to becon %med to be e ecuto%1, said a#a%ds a%e t/e%e3o%e notco'e%ed b1 Rule o3 t/e (pecial A)R Rules, 2 as t/e1continue to be go'e%ned b1 *+ No. --8, as amended andt/e %ules o3 p%ocedu%e o3 t/e CIAC. /e CIAC Re'ised Ruleso3 4%ocedu%e =o'e%ning Const%uction A%bit%ation p%o'ide 3o%
t/e manne% and mode o3 appeal 3%om CIAC decisions o%a#a%ds in (ection 8 t/e%eo3 Sand t/e mode is a Rule O4etition 3o% Re'ie# to t/e Cou%t o3 Appeals.
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=%RCBC CAPITAL C RP RATI N (s. BANC"' R +NIBANY INC. !$67$%
*!)L /e Cou%t adopts t/e reasona3le i ression o)
artiality standard, #*ic* reHuires a s*o#ing t*ata reasona3le erson #ould *a(e to conclude t*atan ar3itrator #as artial to t*e ot*er arty to t*ear3itration. Suc* interest or 3ias, oreo(er, ust3e direct, deDnite and ca a3le o) de onstrationrat*er t*an re ote, uncertain, or s eculati(e.
W*en a clai o) ar3itrator s e(ident artiality isade, t*e court ust ascertain )ro suc* recordas is a(aila3le #*et*er t*e ar3itrators conduct#as so 3iased and re udiced as to destroy)unda ental )airness.
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Appl1ing t/e 3o%egoing standa%d, #e ag%ee#it/ t/e CA in nding t/at C/ai%man
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;% T+NA PR C'SSIN> INC. (s. YIN> R",
INC. !$67$%K'L": As t/e A)R !a# is a special la#, it p%e'ails o'e% t/ep%o'isions o3 t/e Co%po%ation Code, #/ic/ is a gene%al la#.
ence, a 3o%eign co%po%ation not licensed to do business in
t/e 4/ilippines /as legal capacit1 to sue unde% t/ep%o'isions o3 t/e A)R !a# including to le a petition toen3o%ce and %ecogniMe a 3o%eign a%bit%al a#a%dE because,unde% t/e A)R !a#, t/e lac o3 pe%sonalit1 to sue is not ag%ound to 'acate set aside %e3use %ecognition to an a%bit%ala#a%d. In addition, unde% t/e (up%eme Cou%t A)R Rules,allegation and p%oo3 o3 t/e petitione%Ks pe%sonalit1 sue a%enot %ePui%ed 3o% t/e en3o%cement %ecognition o3 3o%eigna%bit%al a#a%ds, me%el1 domestic a#a%ds.
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@% CKINA NATI NAL 1ACKIN'R0 'Z+IP1'NTC RP. (s. K N. SANTA1ARIA, 'T AL. !$67$%K'L": An ag%eement to submit an1 dispute to a%bit%ationma1 be const%ued as an implicit #ai'e% o3 immunit13%om suit. In t/e United (tates, t/e o%eign (o'e%eignImmunities Act o3 976 p%o'ides 3o% a #ai'e% b1implication o3 state immunit1. In t/e said la#, t/eag%eement to submit disputes to a%bit%ation in a3o%eign count%1 is const%ued as an implicit #ai'e% o3immunit1 3%om suit. Alt/oug/ t/e%e is no simila% la# int/e 4/ilippines, t/e%e is %eason to appl1 t/e legal%easoning be/ind t/e #ai'e% in t/is case.
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% 'Z+ITABL' PCI BANYIN>C RP RATI N, 'T AL. (s. RCBC CAPITALC RP RATI N !$669%
K'L":
o Gusti31 t/e 'acation o3 an a%bit%al a#a%d onaccount o3 Hmani3est dis%ega%d o3 t/e la#H,
t/e a%bite%Qs ndings must clea%l1 andunePui'ocall1 'iolate an establis/ed legalp%ecedent. An1t/ing less #ould not su>ce.
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By: Patricia-Ann T. ProdigalidadBy: Patricia-Ann T. ProdigalidadPartner, ACCRALAWPartner, ACCRALAW
Assistant National Secretary, IBP NationalAssistant National Secretary, IBP National
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