CHAPTER 7 - JUDICIAL REVIEW OF ARBITRAL AWARDS A. DOMESTIC AWARDS SEC. 40, RA 9285. Confirmation of Award.

- The confirmation of a domestic arbitral award shall be governed by Section 23 of R.A. 876. A domestic arbitral award when confirmed shall be enforced in the same manner as final and e ec!tory decisions of the Regional Trial "o!rt. The confirmation of a domestic award shall be made by the regional trial co!rt in accordance with the R!les of #roced!re to be $rom!lgated by the S!$reme "o!rt. A "%A" arbitral award need not be confirmed by the regional trial co!rt to be e ec!tory as $rovided !nder &.'. (o. )**8. N !"#$ A. ON DOMESTIC ARBITRAL AWARDS S"%!& ' 2(, R.A. 87) *A+,&!+-!& ' L-./ Confirmation of award. - At any time within one month after the award is made+ any $arty to the controversy which was arbitrated may a$$ly to the co!rt having ,!risdiction+ as $rovided in section twenty-eight+ for an order confirming the award- and there!$on the co!rt m!st grant s!ch order !nless the award is vacated+ modified or corrected+ as $rescribed herein. (otice of s!ch motion m!st be served !$on the adverse $arty or his attorney as $rescribed by law for the service of s!ch notice !$on an attorney in action in the same co!rt. B0 S"%. 2( 1 S"%. 28 2 !3" RA 87) -'4 !3" 5"+!&'"'! 5+ 6&#& '# 2 !3" S5"%&-7 R87"# 2 C 8+! ' ADR *R87" 99/, !3" 5"!&!& ' ! % '2&+: -' A+,&!+-7 A.-+4 *-/ *W3 / May be filed by any $arty to the domestic arbitration. *,/ *W3"'/ At any time after the la$se of thirty .3*/ days from recei$t by the $etitioner of the arbitral award. ; *V"'8"/ - The $etition for confirmation of the domestic arbitral award may be filed with the Regional Trial "o!rt having ,!risdiction over the $lace in which one of the $arties is doing b!siness+ where any of the $arties reside or where arbitration $roceedings were cond!cted. *4/ *S"%!& ' 28/. T3" 5"!&!& ' ! % '2&+: shall be accom$anied with the .i/ The s!bmission+ or contract to arbitrate- the a$$ointment of the arbitrator or arbitrators- and each written e tension of the time+ if any+ within which to ma0e the award and a .ii/ A verified co$y of the award. *"/ E'!+0 2 <84=:"'!. 1or $!r$ose of entry of ,!dgment of the confirmed arbitral award+ the doc!ments s!bmitted in the $etition to confirm shall li0ewise be filed incl!ding each notice+ affidavit+

or other $a$er !sed !$on the a$$lication to confirm s!ch award+ and a co$y of each order of the co!rt !$on s!ch a$$lication. .f/ *W+&! 2 E>"%8!& '/ The arbitral award+ once confirmed+ has the same force and effect as a ,!dgment in an action and it may be enforced as if it had been rendered in the co!rt in which it is entered. Arbitral $roceedings terminated by iss!ance of Arbitral Award -2 "onfirmation of Arbitral Award .RT"/ -2 3!dgment .Award confirmed/ -2 &ntry of ,!dgment -2 & ec!tion -2 Satisfaction of claims. 444444 B. ON CIAC ARBITRAL AWARDS .)/ Sec. 5*+ RA 6287. A "%A" arbitral award need not be confirmed by the regional trial co!rt to be e ec!tory as $rovided !nder &.'. (o. )**8. *2/ SEC. 99, EO N . 9008. FINALIT? OF AWARDS . The arbitral award shall be binding !$on the $arties. %t shall be final and ina$$ealable e ce$t on 8!estions of law which shall be a$$ealable to the S!$reme "o!rt *(/ SEC. 20, EO N . 9008. E@ECUTION 1 ENFORCEMENT OF AWARD. As soon as a decision+ order or award has become final and e ec!tory+ the Arbitral Trib!nal or the single arbitrator with the conc!rrence of the "%A" shall mot! $ro$io+ or on motion of any interested $arty+ iss!e a writ of e ec!tion re8!iring any sheriff or other $ro$er officer to e ec!te said decision+ order or award. A$ "an the sole arbitrator or the arbitral trib!nal order the e ec!tion or enforcement of the "%A" arbitral award9 SEC. 49, RA 9285. Vacation Award. - A $arty to a domestic arbitration may 8!estion the arbitral award with the a$$ro$riate regional trial co!rt in accordance with the r!les of $roced!re to be $rom!lgated by the S!$reme "o!rt only on those gro!nds en!merated in Section 25 of Republic Act No. 876. Any other gro!nd raised against a domestic arbitral award shall be disregarded by the regional trial co!rt. N !"#$ .)/ :acate;vacation of award+ meaning. .2/ <ro!nds for vacating a domestic arbitral award. The gro!nds en!merated in S"%!& ' 25, RA N . 87) shall also be the gro!nds for vacating an arbitral award+ which are =

.a/ *MISTABECERRORS/ >here there was an evident miscalc!lation of fig!res+ or an evident mista0e in the descri$tion of any $erson+ thing or $ro$erty referred to in the award- or .b/ *DRAVE ABUSE OF DISCRETION AMOUNTIND TO LACB OF JURISDICTION/ >here the arbitrators have awarded !$on a matter not s!bmitted to them+ not affecting the merits of the decision !$on the matter s!bmitted- or .c/ *INCOMPLETENESSCERRORS/ >here the award is im$erfect in a matter of form not affecting the merits of the controversy+ and if it had been a commissioner?s re$ort+ the defect co!ld have been amended or disregarded by the co!rt. .3/ The gro!nds are e cl!sive. Any other gro!nds sho!ld not be entertained by the co!rt. B. FOREIDN ARBITRAL AWARDS SEC. 42, RA 9285. Application of the New Yor Con!ention. - The (ew @or0 "onvention shall govern the recognition and enforcement of arbitral awards covered by the said "onvention. The recognition and enforcement of s!ch arbitral awards shall be filed with regional trial co!rt in accordance with the r!les of $roced!re to be $rom!lgated by the S!$reme "o!rt. Said $roced!ral r!les shall $rovide that the $arty relying on the award or a$$lying for its enforcement shall file with the co!rt the original or a!thenticated co$y of the award and the arbitration agreement. %f the award or agreement is not made in any of the official lang!ages+ the $arty shall s!$$ly a d!ly certified translation thereof into any of s!ch lang!ages. The a$$licant shall establish that the co!ntry in which foreign arbitration award was made is a $arty to the (ew @or0 "onvention. %f the a$$lication for re,ection or s!s$ension of enforcement of an award has been made+ the regional trial co!rt may+ if it considers it $ro$er+ vacate its decision and may also+ on the a$$lication of the $arty claiming recognition or enforcement of the award+ order the $arty to $rovide a$$ro$riate sec!rity. NOTES$ *9/ F +"&=' -+,&!+-7 -.-+4 E one made in a co!ntry other than the #hili$$ines. *2/ C '6"'!& ' -.-+4 *(/ A+!&%7" I*9/ 2 !3" N". ? +F C '6"'!& '. AThis "onvention shall a$$ly to the recognition and enforcement of arbitral awards made in the territory of a State other than the State where the recognition and enforcement of s!ch awards are so!ght+ and arising o!t of differences between $ersons+ whether $hysical or legal. %t shall also a$$ly to arbitral awards not considered as domestic awards in the State where their recognition and enforcement are so!ght.B *4/ Article %%%+ (ew @or0 "onvention. &ach "ontracting State shall recogniCe arbitral awards as binding and enforce them in accordance with the r!les of $roced!re of the territory

where the award is relied !$on+ !nder the conditions laid down in the following articles. There shall not be im$osed s!bstantially more onero!s conditions or higher fees or charges on the recognition or enforcement of arbitral awards to which this "onvention a$$lies than are im$osed on the recognition or enforcement of domestic arbitral awards. *5/ The $roced!re for the recognition and enforcement of a foreign arbitral award shall be in accordance with RULE 9($ RECODNITION AND ENFORCEMENT OF A FOREIDN ARBITRAL AWARD *A.M. N . 07-99-08-SCG S5"%&-7 R87"# 2 C 8+! O' ADR/ R87" 9(.9. Who may request recognition and enforcement. - Any $arty to a foreign arbitration may $etition the co!rt to recogniCe and enforce a foreign arbitral award. R87" 9(.2. When to petition. - At any time after recei$t of a foreign arbitral award+ any $arty to arbitration may $etition the $ro$er Regional Trial "o!rt to recogniCe and enforce s!ch award. R87" 9(.(. Venue. - The $etition to recogniCe and enforce a foreign arbitral award shall be filed+ at the o$tion of the $etitioner+ with the Regional Trial "o!rt .a/ where the assets to be attached or levied !$on is located+ .b/ where the act to be en,oined is being $erformed+ .c/ in the $rinci$al $lace of b!siness in the #hili$$ines of any of the $arties+ .d/ if any of the $arties is an individ!al+ where any of those individ!als resides+ or .e/ in the (ational "a$ital 3!dicial Region. SEC. 4(, RA 9285. Reco"nition and #nforcement of $orei"n Arbitral Award% Not Co!ered b& the New Yor Con!ention. - The recognition and enforcement of foreign arbitral awards not covered by the (ew @or0 "onvention shall be done in accordance with $roced!ral r!les to be $rom!lgated by the S!$reme "o!rt. The "o!rt may+ on gro!nds of comity and reci$rocity+ recogniCe and enforce a nonconvention award as a convention award.

R87" 9(.92. Recognition and enforcement of non-convention award. - The co!rt shall+ only !$on gro!nds $rovided by these S$ecial ADR R!les+ recogniCe and enforce a foreign arbitral award made in a co!ntry not a signatory to the (ew @or0 "onvention when s!ch co!ntry e tends comity and reci$rocity to awards made in the #hili$$ines. %f that co!ntry does not e tend comity and reci$rocity to awards made in the #hili$$ines+ the co!rt may nevertheless treat s!ch award as a foreign ,!dgment enforceable as s!ch !nder R!le 36+ Section 58+ of the R!les of "o!rt. R!le 36+ Section 58+ of the R!les of "o!rt. Sec. 58. &ffect of foreign ,!dgments or final orders.

The effect of a ,!dgment or final order of a trib!nal of a foreign co!ntry+ having ,!risdiction to render the ,!dgment or final order is as follows=

.a/ %n case of a ,!dgment or final order !$on a s$ecific thing+ the ,!dgment or final order is concl!sive !$on the title to the thing- and .b/ %n case of a ,!dgment or final order against a $erson+ the ,!dgment or final order is $res!m$tive evidence of a right as between the $arties and their s!ccessors in interest by a s!bse8!ent title. %n either case+ the ,!dgment or final order may be re$elled by evidence of a want of ,!risdiction+ want of notice to the $arty+ coll!sion+ fra!d+ or clear mista0e of law or fact. ('T&S= "AS&= 'il E nat!ral gas commission vs. "A+ et. al.+ <.R. (o. ))5232- 3!ly 23+ )668. The iss!e revolves aro!nd whether or not the ,!dgment of the foreign co!rt ."ivil "o!rt of %ndia/ is enforceable in this ,!risdiction in view of the $rivate res$ondentFs allegation that it is bereft of any statement of facts and law !$on which the award in favor of the $etitioner was based. R!ling= @es. .)/ The decision rendered by the co!rt of %ndia may not have s$ecifically disc!ssed the facts b!t it has incor$orated it by reference. %n o!r ,!risdiction+ incor$oration by reference is allowed if only to avoid the c!mbersome re$rod!ction of the decision of the lower co!rts+ or $ortions thereof+ in the decision of the higher co!rt s$ecially so if the decision so!ght to be incor$orated is a lengthy and thoro!gh disc!ssion of the facts and concl!sions arrived. .Award #a$er (o. 3;G-) consists of eighteen .)8/ single s$aced $ages./ .2/ The recognition accorded a foreign ,!dgment is not necessarily affected by the fact that the $roced!re in the co!rts of the co!ntry in which s!ch ,!dgment was rendered differs from that of the co!rts of the co!ntry in which the ,!dgment is relied on .in this case the #hili$$ines/. This "o!rt has held that matters of remedy and $roced!re are governed by the le fori or the internal law of the for!m. Th!s+ if !nder the $roced!ral r!les of the "ivil "o!rt of Dehra D!n+ %ndia+ a valid ,!dgment may be rendered by ado$ting the arbitratorFs findings+ then the same m!st be accorded res$ect. %n the same vein+ if the $roced!re in the foreign co!rt mandates that an 'rder of the "o!rt becomes final and e ec!tory !$on fail!re to $ay the necessary doc0et fees+ then the co!rts in this ,!risdiction cannot invalidate the order of the foreign co!rt sim$ly beca!se o!r r!les $rovide otherwise. .3/ AA foreign ,!dgment is $res!med to be valid and binding in the co!ntry from which it comes+ !ntil the contrary is shown. %t is also $ro$er to $res!me the reg!larity of the $roceedings and the giving of d!e notice therein. AHnder Section 7*+ R!le 36 of the R!les of "o!rt+ a ,!dgment in an action in $ersonam of a trib!nal of a foreign co!ntry having ,!risdiction to $rono!nce the same is $res!m$tive evidence of a right as between the $arties and their s!ccessors-in-interest by a s!bse8!ent title. The ,!dgment may+ however+ be assailed by evidence of want of

,!risdiction+ want of notice to the $arty+ coll!sion+ fra!d+ or clear mista0e of law or fact. Also+ !nder Section 3 of R!le )3)+ a co!rt+ whether of the #hili$$ines or elsewhere+ en,oys the $res!m$tion that it was acting in the lawf!l e ercise of ,!risdiction and has reg!larly $erformed its official d!ty.B "onse8!ently+ the $arty attac0ing a foreign ,!dgment+ the $rivate res$ondent herein+ had the b!rden of overcoming the $res!m$tion of its validity which it failed to do in the instant case. The foreign ,!dgment being valid+ there is nothing else left to be done than to order its enforcement+ des$ite the fact that the $etitioner merely $rays for the remand of the case to the RT" for f!rther $roceedings. As this "o!rt has r!led on the validity and enforceability of the said foreign ,!dgment in this ,!risdiction+ f!rther $roceedings in the RT" for the rece$tion of evidence to $rove otherwise are no longer necessary.

'he doctrine of comit& i% the le"al principle which dictates that a ,!risdiction recogniCe and give effect to ,!dicial decrees and decisions rendered in other ,!risdictions !nless to do so wo!ld offend its $!blic $olicy. Altho!gh rooted in the middle ages+ comity contin!es to be a viable doctrine+ beca!se it facilitates the achievement of a $rimary ob,ective of law Ithe orderly+ consistent and final resol!tion of dis$!tes. (octrine of reciprocit& SEC. 44, RA 9285. $orei"n Arbitral Award Not $orei"n )ud"ment. - A foreign arbitral award when confirmed by a co!rt of a foreign co!ntry+ shall be recogniCed and enforced as a foreign arbitral award and not a ,!dgment of a foreign co!rt. A foreign arbitral award+ when confirmed by the regional trial co!rt+ shall be enforced as a foreign arbitral award and not as a ,!dgment of a foreign co!rt. A foreign arbitral award+ when confirmed by the regional trial co!rt+ shall be enforced in the same manner as final and e ec!tory decisions of co!rts of law of the #hili$$ines. (otes= a/ 1oreign Arbitral Award .say+ H.S./ -2 "onfirmed by a H.S. co!rt 4 recogniCed and enforced as a foreign arbitral award. b/ 1oreign arbitral award .Singa$ore/ -2 "onfirmed by the RT" .#hils./ 4 enforced as a final and e ec!tory ,!dgment of a #hili$$ine co!rt. SEC. 45, RA 9285. Re*ection of a $orei"n Arbitral Award. - A $arty to a foreign arbitration $roceeding may o$$ose an a$$lication for recognition and enforcement of the arbitral award in

accordance with the $roced!ral r!les to be $rom!lgated by the S!$reme "o!rt only on those gro!nds en!merated !nder Article : of the (ew @or0 "onvention. Any other gro!nd raised shall be disregarded by the regional trial co!rt. R87" 9(.4. Governing law and grounds to refuse recognition and enforcement . - The recognition and enforcement of a foreign arbitral award shall be governed by the )678 (ew @or0 "onvention on the Recognition and &nforcement of 1oreign Arbitral Awards .the J(ew @or0 "onventionJ/ and this R!le. The co!rt may+ !$on gro!nds of comity and reci$rocity+ recogniCe and enforce a foreign arbitral award made in a co!ntry that is not a signatory to the (ew @or0 "onvention as if it were a "onvention Award. A #hili$$ine co!rt shall not set aside a foreign arbitral award b!t may ref!se its recognition and enforcement on any or all of the following gro!nds= .i/. *L-%F 2 %-5-%&!0/ A $arty to the arbitration agreement was !nder some inca$acityor *I77"=-7&!0/ the said agreement is not valid !nder the law to which the $arties have s!b,ected it or+ failing any indication thereof+ !nder the law of the co!ntry where the award was made- or .ii/. *L-%F 2 48" 5+ %"##/ The $arty ma0ing the a$$lication was not given $ro$er notice of the a$$ointment of an arbitrator or of the arbitral $roceedings or was otherwise !nable to $resent his case- or .iii/. *D+-6" -,8#" 2 4&#%+"!& ' -: 8'!&'= ! 7-%F 2 <8+&#4&%!& '/ The award deals with a dis$!te not contem$lated by or not falling within the terms of the s!bmission to arbitration+ or contains decisions on matters beyond the sco$e of the s!bmission to arbitration- $rovided that+ if the decisions on matters s!bmitted to arbitration can be se$arated from those not so s!bmitted+ only that $art of the award which contains decisions on matters not s!bmitted to arbitration may be set aside- or .iv/. The com$osition of the arbitral trib!nal or the arbitral $roced!re was not in accordance with the agreement of the $arties or+ failing s!ch agreement+ was not in accordance with the law of the co!ntry where arbitration too0 $lace- or .v/. *P+":-!8+" 2&7&'=/ *T3" -.-+4 &# ' ! 0"! 2&'-7 -'4 ">"%8! +0/ The award has not yet become binding on the $arties or has been set aside or s!s$ended by a co!rt of the co!ntry in which that award was made- or .vi/. The s!b,ect-matter of the dis$!te is not ca$able of settlement or resol!tion by arbitration !nder #hili$$ine law- or .vii/. The recognition or enforcement of the award wo!ld be contrary to $!blic $olicy. The co!rt shall disregard any gro!nd for o$$osing the recognition and enforcement of a foreign arbitral award other than those en!merated above.

SEC. 4). Appeal from Court (eci%ion% on Arbitral Award%. - A decision of the regional trial co!rt confirming+ vacating+ setting aside+ modifying or correcting an arbitral award may be a$$ealed to the "o!rt of A$$eals in accordance with the r!les of $roced!re to be $rom!lgated by the S!$reme "o!rt. The losing $arty who a$$eals from the ,!dgment of the co!rt confirming an arbitral award shall be re8!ired by the a$$ellate co!rt to $ost co!nterbond e ec!ted in favor of the $revailing $arty e8!al to the amo!nt of the award in accordance with the r!les to be $rom!lgated by the S!$reme "o!rt. "ase= &8!itable #"%Gan0ing "o.+ et. al. vs. R"G" "A#%TAK "'R#'RAT%'(+ <.R. (o. )82258December )8+ 2**8 .incl!ding Lorea Technologies Kimited vs. Kerma+ MMM and Asset #rivatiCation Tr!st vs. "A+ MMMM- "AR<%KK+ #N%KS. :S. SA( 1&R(A(D' R&<AKA TRAD%(<+ 3an!ary 3)+ 2*))/ The $ro$er mode of a$$eal assailing a decision of the RT" confirming+ vacating+ setting aside+ modifying+ or correcting an arbitral award is an a$$eal before the "A $!rs!ant to Sec. 56+ of RA 6287. %n Lorea Technologies "o.+ Ktd v. Kerma+ the "o!rt stated that the remedy of an aggrieved $arty in cases where the RT" sets aside+ re,ects+ vacates+ modifies+ or corrects an arbitral award is an a$$eal to the "o!rt of A$$eals based on Sec. 56 of RA 6287 which $rovides= AA decision of the Regional Trial "o!rt confirming+ vacating+ setting aside+ modifying or correcting an arbitral award may be a$$ealed to the "o!rt of A$$eals in accordance with the r!les and $roced!re to be $rom!lgated by the S!$reme "o!rt.B The r!les being referred to here is the S$ecial R!les of "o!rt on ADR which became effective last 'ctober 3*+ 2**6. 'f co!rse+ it is re8!ired that the losing $arty who ma0es the a$$eal m!st $ost a co!nterbond in favor of the $revailing $arty. Thereafter+ the "A decision may f!rther be a$$ealed or reviewed before this "o!rt thro!gh a $etition for review !nder R!le 57 of the R!les of "o!rt. %n Lorea Technologies "o.+ Ktd v. Kerma+ the "o!rt stated that the remedy of an aggrieved $arty in cases where the RT" sets aside+ re,ects+ vacates+ modifies+ or corrects an arbitral award is an a$$eal to the "o!rt of A$$eals based on Sec. 56 of RA 6287 which $rovides= AA decision of the Regional Trial "o!rt confirming+ vacating+ setting aside+ modifying or correcting an arbitral award may be a$$ealed to the "o!rt of A$$eals in accordance with the r!les and $roced!re to be $rom!lgated by the S!$reme "o!rt.B The r!les being referred to here is the S$ecial R!les of "o!rt on ADR which became effective last 'ctober 3*+ 2**6. 'f co!rse+ it is re8!ired that the losing $arty who ma0es the a$$eal m!st $ost a co!nterbond in favor of the $revailing $arty. Thereafter+ the "A decision may f!rther be a$$ealed or reviewed before the S!$reme "o!rt thro!gh a $etition for review !nder R!le 57 of the R!les of "o!rt. 'ne of the basis for the dismissal of the $etition of &#"%G which was not disc!ssed in the case is the principle of hierarch& of court%. 'ne m!st res$ect the hierarchy of co!rts. Another is+ as stated by the "o!rt= AThe "o!rt will not overt!rn an arbitral award !nless it was made in manifest disregard of the law.B This was also disc!ssed in Asset #rivatiCation Tr!st v. "o!rt of A$$eals. %n that case+ the arbitration committee iss!ed an arbitral award which the trial co!rt+ !$on d!e $roceedings+ confirmed des$ite the o$$osition of the losing $arty. Ootions for reconsideration by the losing $arty were denied. An a$$eal inter$osed by the losing $arty to the "A was also denied.

'n a$$eal to the S!$reme "o!rt+ the "o!rt established the $arameters by which an arbitral award may be set aside+ e $lained as = +A% a rule, the award of an arbitrator cannot be %et a%ide for mere error% of *ud"ment either a% to the law or a% to the fact%. Court% are without power to amend or o!errule merel& becau%e of di%a"reement with matter% of law or fact% determined b& the arbitrator%. 'he& will not re!iew the findin"% of law and fact contained in an award, and will not underta e to %ub%titute their *ud"ment for that of the arbitrator%. 'o do %o would ma e an award the commencement, not the end, of liti"ation. #rror% of law and fact, or an erroneou% deci%ion of matter% %ubmitted to the *ud"ment of the arbitrator%, are in%ufficient to in!alidate an award fairl& and hone%tl& made. )udicial re!iew of an arbitration i%, thu%, more limited than *udicial re!iew of a trial.*E@CEPTIONS/ The "o!rt contin!ed AP(Qonetheless+ the arbitratorsF awards is not absol!te and witho!t e ce$tions. The arbitrators cannot resolve iss!es beyond the sco$e of the s!bmission agreement. The $arties to s!ch an agreement are bo!nd by the arbitratorsF award only to the e tent and in the manner $rescribed by the contract and only if the award is rendered in conformity thereto. Th!s+ Sections 25 and 27 of the Arbitration Kaw $rovide gro!nds for vacating+ rescinding or modifying an arbitration award. >here the conditions described in Articles 2*38+ 2*36 and 2*5* of the "ivil "ode a$$licable to com$romises and arbitration are attendant+ the arbitration award may also be ann!lled.B Remember that the gro!nds en!merated in Sec. 25 and 27+ of RA 6287 are e cl!sive and the co!rt will not entertain any other gro!nds. Nowever+ de%pite thi% e.clu%i!it&, if the condition% de%cribed in Art. 2/08, 2/01 and 2/2/ of the Ci!il Code on compromi%e and arbitration are pre%ent, then the arbitration award ma& be annulled on tho%e "round%. 3h&4 5ecau%e of Art. 2/22 of the Ci!il Code which pro!ide%6 An& %tipulation that the arbitrator%7 award or deci%ion %hall be final i% !alid without pre*udice to Article% 2/08, 2/01 and 2/2/. Art. 2*38= a com$romise in which there is mista0e+ fra!d+ violence+ intimidation+ !nd!e infl!ence+ or falsity of doc!ments+ is voidable !nder Art. )33* of the ("". Art. 2*36 where doc!ments are discovered+ which if it had not concealed by one of the $arties+ co!ld have res!lted in a different inter$retation of an iss!e or a 8!estion res!lting in a different com$romise agreement. Art. 2*5*. %f after a litigation has been decided by a final ,!dgment+ a com$romise sho!ld be agreed !$on+ either or both $arties being !naware of the e istence of the final ,!dgment+ the com$romise may be rescinded. A1inally+ it sho!ld be stressed that while a co!rt is $recl!ded from overt!rning an award for errors in determination of fact!al iss!es+ nevertheless+ if an e.amination of the record re!eal% no %upport whate!er for the arbitrator%7 determination% + their award m!st be vacated. %n the same manner+ an award mu%t be !acated if it wa% made in +manife%t di%re"ard of the law.-8italic% mine for empha%i%9 SEC. 47. RA 9285, Venue and )uri%diction. - #roceedings for recognition and enforcement of an arbitration agreement or for vacation+ setting aside+ correction or modification of an arbitral award+ and any a$$lication with a co!rt for arbitration assistance and s!$ervision shall be deemed as s$ecial $roceedings and shall be filed with the regional trial co!rt .i/ where arbitration $roceedings are cond!cted- .ii/ where the asset to be attached or levied !$on+ or the act to be en,oined is located- .iii/

where any of the $arties to the dis$!te resides or has his $lace of b!siness- or .iv/ in the (ational 3!dicial "a$ital Region+ at the o$tion of the a$$licant. SEC. 48. Notice of :roceedin" to :artie%. - %n a s$ecial $roceeding for recognition and enforcement of an arbitral award+ the "o!rt shall send notice to the $arties at their address of record in the arbitration+ or if any $arty cannot be served notice at s!ch address+ at s!ch $arty?s last 0nown address. The notice shall be sent at least fifteen .)7/ days before the date set for the initial hearing of the a$$lication. ('T&S= %. D'O&ST%" Arbitration A>ARD )/ Arbitration $roceedings terminated by the iss!ance of the Domestic Arbitral Award 2/ #arty file a Re8!est or #etition to confirm Arbitral Award3/ "o!rt sets the $etition for hearing- (otifies the $arties of the date of hearing. 5/ Nearing .S!mmary $roceedings/ a. (o $roblem+ no o$$osition b. >ith motion to correct+ amend i. "orrected+ amended+ no $roblem c. >ith o$$osition+ motion to vacate award 7/ %ss!es ,!dgment confirming the arbitral award. 6/ &nforcement by writ of & ec!tion 7/ Satisfaction of "laims 5/ Nearing. >ith o$$osition or motion to vacate award gro!nded on the en!merations in Sec. 27+ RA 8767/ "o!rt denies the motion to :acate- $roceeds to confirm the award or <rants the motion to vacate- denies the motion to confirm the award 6/ Aggrieved $arty files a Ootion for Reconsideration Ootion granted- (o $roblem 7/ Ootion denied+ aggrieved $arty a$$eals to the "o!rt of A$$eals !nder R!le 56+ RA 6287 cf S$ecial R!les of "o!rt on ADR/ 8/ "A r!ling+ aggrieved $arty files a $etition for review on "ertiorari with the S!$reme "o!rt. .Reg!lar R!les/

%%.

1'R&%<( ARG%TRAK "'(:&(T%'( A>ARD .)/ Arbitration $roceedings terminated by iss!ance of award .2/ "onfirmation of 1oreign Arbitral Award by a foreign co!rt a. Recognition and enforcement as a foreign arbitral award by RT" .#hils/ .3/ "onfirmation of foreign Arbitral Award with RT" .#hils/ a. &nforcement as a foreign arbitral award by RT" .#hils/ .5/ #etitions;motion 8!estioning the decision of the RT" will be by

ADD%T%'(AK ('T&S= .)/ "ase= "AR<%KK+ #N%KS. :S. SA( 1&R(A(D' R&<AKA TRAD%(<+ 3an!ary 3)+ 2*))

%n this case+ the iss!e bro!ght for resol!tion revolved aro!nd the arbitration cla!se which $rovides that= AAny dis$!te which the G!yer and Seller may not be able to settle by m!t!al agreement shall be settled by arbitration in the "ity of (ew @or0 before the American Arbitration Association. The Arbitration Award shall be final and binding on both $artiesB. San 1ernando Regala trading entered into a $!rchase contract with "argills+ #hil. "laiming violations of the $rovisions of the contract+ Regala filed with the RT" a com$lainant for the rescission of the contract and $ayment of damages against "AR<%KK. "AR<%KK+ claiming that that the contract contained an arbitration cla!se+ filed a Ootion to Dismiss;S!s$end #roceedings and To Refer "ontroversy to :ol!ntary Arbitration and that res$ondent m!st first com$ly with the arbitration cla!se before resorting to co!rt+ th!s+ the RT" m!st either dismiss the case or s!s$end the $roceedings and direct the $arties to $roceed with arbitration+ $!rs!ant to Sections 6P6Q and 7P7Q of Re$!blic Act .R.A./ (o. 876+ or the Arbitration Kaw. After an e change of $leadings+ the RT" rendered an 'rder denying the motion and ordered "AR<%KK to file its answer. A motion for reconsideration was li0ewise denied. "AR<%KK a$$eal by $etition on certiorari to the "o!rt of A$$eals li0ewise res!lted in an !nfavorable decision as the "A said that AArbitration is not $ro$er when one of the $arties re$!diated the e istence or validity of the contract.B %t s!stained the RT"Fs decision. 'n a$$eal to the S!$reme "o!rt+ the following $rinci$les were disc!ssed= .)/ Re a$$lication of Section 26 of R.A. (o. 876 which $rovides= An a$$eal may be ta0en from an order made in a $roceeding !nder this Act+ or from a ,!dgment entered !$on an award thro!gh certiorari $roceedings+ b!t s!ch a$$eals shall be limited to 8!estion of law. . "AR<%KK is 8!estioning before the "A its contention that the RT" .res$ondent 3!dge/ acted in e cess of ,!risdiction or with grave ab!se of discretion in ref!sing to dismiss+ or at least s!s$end+ the

$roceedings a 8!o+ des$ite the fact that the $artyFs agreement to arbitrate had not been com$lied with. Des$ite the RT"Fs finding of the e istence of the arbitration agreement+ it denied "AR<%KKFs motion and directed it to file an answer. The "o!rt said= A%n iss!ing the 'rder which denied $etitioner?s Ootion to Dismiss;S!s$end #roceedings and to Refer "ontroversy to :ol!ntary Arbitration+ the R'C went be&ond it% authorit& of determinin" onl& the i%%ue of whether or not there i% an a"reement in writin" pro!idin" for arbitration b& directin" petitioner to file an an%wer, in%tead of orderin" the partie% to proceed to arbitration. ;n %o doin", it acted in e.ce%% of it% *uri%diction and %ince there i% no plain, %peed&, and ade<uate remed& in the ordinar& cour%e of law, petitioner7% re%ort to a petition for certiorari i% the proper remed&%n the said case+ the "o!rt cited Ka (aval Dr!g "or$oration v. "o!rt of A$$eals+P <.R. (o. )*32**+ A!g!st 3)+ )665+ 236 S"RA 78+ 6)Q where it was held that R.A. (o. 876 e $licitly confine% the court7% authorit& onl& to the determination of whether or not there i% an a"reement in writin" pro!idin" for arbitration. ;n the affirmati!e, the %tatute ordain% that the court %hall i%%ue an order %ummaril& directin" the partie% to proceed with the arbitration in accordance with the term% thereof. ;f the court, upon the other hand, find% that no %uch a"reement e.i%t%, the proceedin"% %hall be di%mi%%ed.- =italic% mine for empha%i%> .2/ %n resolving the iss!e that even if there is an arbitration cla!se in the contract+ the same sho!ld not be resorted to considering that the main contract is invalid and has not been cons!mmated nor com$lied with+ the "o!rt relied on the Doctrine of Se$arability. The "o!rt held that Athe validity of the contract containing the agreement to s!bmit to arbitration does not affect the a$$licability of the arbitration cla!se itself. A contrary r!ling wo!ld s!ggest that a $arty?s mere re$!diation of the main contract is s!fficient to avoid arbitration. That is e actly the sit!ation that the se$arability doctrine+ as well as ,!ris$r!dence a$$lying it+ see0s to avoid.B .3/ The doctrine of se$arability+ or severability en!nciates that an arbitration agreement is inde$endent of the main contract. The arbitration agreement is to be treated as a se$arate agreement and the arbitration agreement does not a!tomatically terminate when the contract of which it is a $art comes to an end. The doctrine denotes that the invalidity of the main contract+ also referred to as the JcontainerJ contract+ does not affect the validity of the arbitration agreement. %rres$ective of the fact that the main contract is invalid+ the arbitration cla!se;agreement still remains valid and enforceable. II. BENDUET CORPORATION 6#. DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES-MINES ADJUDICATION BOARD -'4 J.D. REALT? AND MININD C .G F",+8-+0 9(, 2008 D.R. N . 9)(909 The case relates to the cancellation of the Royalty Agreement with '$tion to #!rchase .RA>'#/ between Geng!et and 3.<. Realty+ and e cl!ded Geng!et from the ,oint Oineral #rod!ction Sharing Agreement .O#SA/ a$$lication over fo!r mining claims. 3.<. Realty filed for cancellation with the #'A which canceled the RA>'#. Therefrom+ Geng!et filed a (otice of A$$eal with the OAG which s!stained the decision of the #'A. Geng!etFs motion for reconsideration was denied hence+ Geng!et filed a $etition for certiorari !nder R!les 67 of the R!les of "o!rt.

Gefore we $roceed to the iss!e related to o!r s!b,ect matter+ % wo!ld li0e to call yo!r attention to the following facts why the $etition was dismissed+ which is on ,!risdiction. The $etition of Geng!et was dismissed beca!se it failed to follow $roced!re+ basically+ the giving of d!e res$ect to the hierarchy of co!rts. %n the said case+ the "o!rt disc!ssed that= .a/ Section 76 of Re$!blic Act (o. .RA/ 7652 or the A#hili$$ine Oining Act of )667B which states that AA $etition for review by certiorari and 8!estion of law may be filed by the aggrieved $arty with the S!$reme "o!rt within thirty .3*/ days from recei$t of the order or decision of the POAGQ was already declared invalid in "ar$io v. S!l! Reso!rces Develo$ment "or$. r!ling that a decision of the OAG m!st first be a$$ealed to the "o!rt of A$$eals ."A/ !nder R!le 53 of the R!les of "o!rt+ before reco!rse to this "o!rt may be had. The invalidity is gro!nded on the following= .i/ Section 3* of Article :% of the )687 "onstit!tion+ mandates that APnQo law shall be $assed increasing the a$$ellate ,!risdiction of the S!$reme "o!rt as $rovided in this "onstit!tion witho!t its advice and consent.B Section 76 of RA (o. 7652 which $rovides that decisions of the OAG may be reviewed by the S!$reme "o!rt on a A$etition for review by certiorariB is obvio!sly an e $ansion of the "o!rtFs a$$ellate ,!risdiction+ an e $ansion to which this "o!rt has not consented. .ii/ Second+ the S!$reme "o!rt has already transferred to the "A $ending cases involving a review of a 8!asi-,!dicial bodyFs decisions. S!ch transfer relates only to $roced!re and will not im$air the s!bstantive and vested rights of the $arties. The aggrieved $artyFs right to a$$eal is $reserved. The $arties still have a remedy and a com$etent trib!nal to grant this remedy. .iii/ The Revised R!les of "ivil #roced!re incl!ded R!le 53 to $rovide a !niform r!le on a$$eals from 8!asi-,!dicial agencies. Hnder the r!le+ a$$eals from their ,!dgments and final orders are now re8!ired to be bro!ght to the "A on a verified $etition for review. A 8!asi-,!dicial agency or body has been defined as an organ of government+ other than a co!rt or legislat!re+ which affects the rights of $rivate $arties thro!gh either ad,!dication or r!le-ma0ing to which OAG belongs. .iv/ Hnder Gatas #ambansa .G#/ Glg. )26 as amended by RA (o. 76*2+ fact!al controversies are !s!ally involved in decisions of 8!asi-,!dicial bodies and an a$$eal from 8!asi-,!dicial agencies to the "A incl!des iss!es involving 8!estions of fact+ of law or mi ed 8!estions of fact and law as $rovided in Section 3+ of R!le 53 of the r!les of "o!rt. R!le 53+ APaQn a$$eal !nder this R!le may be ta0en to the "o!rt of A$$eals within the $eriod and in the manner herein $rovided whether the a$$eal involves 8!estions of fact+ of law+ or mi ed 8!estions of fact and law.B Nence+ a$$eals from 8!asi,!dicial agencies even only on 8!estions of law may be bro!ght to the "A. .v/ The ,!dicial $olicy of observing the hierarchy of co!rts dictates that direct resort from administrative agencies to this "o!rt will not be entertained+ !nless the redress desired cannot be obtained from the a$$ro$riate lower trib!nals+ or !nless e ce$tional and com$elling circ!mstances ,!stify availment of a remedy falling within and calling for the e ercise of o!r $rimary ,!risdiction.

On the issue of whether there was serio!s and $al$able error when the Nonorable Goard failed
to r!le that the contract!al obligation of the $arties to arbitrate !nder the Royalty Agreement is mandatory=

The 8!estioned arbitration cla!se of the RA>'# are Sec. 11. 1 !r"itration. !ny disputes# differences or disagreements "etween $%&G'%( and the )W&%R with reference to anything whatsoever pertaining to this !greement that cannot "e amica"ly settled "y them shall not "e cause of any action of any *ind whatsoever in any court or administrative agency "ut shall# upon notice of one party to the other# "e referred to a $oard of !r"itrators consisting of three +,- mem"ers# one to "e selected "y $%&G'%(# another to "e selected "y the )W&%R and the third to "e selected "y the aforementioned two ar"itrators so appointed. 11. . Court !ction. &o action shall "e instituted in court as to any matter in dispute as hereina"ove stated# e/cept to enforce the decision of the ma0ority of the !r"itrators. To bac0trac0+ #'A held that the arbitration cla!se is invalid as it is tying the hands of the $arties+ i.e.+ $reventing them from availing of co!rt action if they did not !ndergo arbitration. The OAG denied arbitration on gro!nd of esto$$el. The "o!rt r!led that the $arties sho!ld have s!bmitted their dis$!te to vol!ntary arbitration gro!nded on S"%. 2 2 RA 87) .3&%3 "78%&4-!"# !3" #% 5" 2 -+,&!+-!& ' -# 2 77 .# = A#ersons and matters s!b,ect to arbitration.IITwo or more $ersons or $arties may s!bmit to the arbitration of one or more arbitrators any controversy e isting between them at the time of the s!bmission and which may be the s!b,ect of an action+ or the $arties to any contract may in s!ch contract agree to settle by arbitration a controversy thereafter arising between them. S!ch s!bmission or contract shall be valid+ enforceable and irrevocable+ save !$on s!ch gro!nds as e ist at law for the revocation of any contract.B The iss!es to be s!bmitted for resol!tion may incl!de 8!estionPsQ arising o!t of val!ations+ a$$raisals or other controversies which may be collateral+ incidental+ $recedent or s!bse8!ent to any iss!e between the $arties. The co!rt held that in RA 6287 recogniCes the efficacy of arbitration as an alternative mode of dis$!te resol!tion by stating in Sec. 32 thereof that domestic arbitration shall still be governed by RA 876. "learly+ a contract!al sti$!lation that re8!ires $rior resort to vol!ntary arbitration before the $arties can go directly to co!rt is not illegal and is in fact $romoted by the State. So that if a case which is $ro$erly the s!b,ect of vol!ntary arbitration is erroneo!sly filed with the co!rts or 8!asi-,!dicial agencies+ on motion of the defendant+ the co!rt or 8!asi-,!dicial agency shall determine whether s!ch contract!al $rovision for arbitration is s!fficient and effective. %f in affirmative+ the co!rt or 8!asi-,!dicial agency shall then order the enforcement of said $rovision. %n this sit!ation+ the lower co!rt has not lost its ,!risdiction over the case+ since Section 7 of Re$!blic Act (o. 876 $rovides that the co!rt $roceedings have only been stayed. After the s$ecial $roceeding of arbitration has been $!rs!ed and com$leted+ then the lower co!rt may confirm the award made by the arbitrator. %n the same case+ the "o!rt had the occasion to disc!ss the difference between a com$!lsory arbitration from a vol!ntary arbitration. "om$!lsory arbitration refers to the Athe $rocess of settlement of labor dis$!tes by a government agency which has the a!thority to investigate and to ma0e an award which is

binding on all the $arties+ and as a mode of arbitration where the $arties are com$elled to acce$t the resol!tion of their dis$!te thro!gh arbitration by a third $arty.B >hereas+ a vol!ntary arbitrator is not $art of the governmental !nit or labor de$artmentFs $ersonnel+ said arbitrator renders arbitration services $rovided for !nder labor laws. The co!rt contin!ed that A. T/here is a clear distinction between com$!lsory and vol!ntary arbitration. The arbitration $rovided by the #'A is com$!lsory+ while the nat!re of the arbitration $rovision in the RA>'# is vol!ntary+ not involving any government agency. The arbitration !nder the #'A which is a 8!asi-,!dicial body + being $art of the D&(R+ is mandatory in nat!re and having freely entered into by the $arties+ m!st be held binding against them. Nowever+ on the iss!e of whether #'A sho!ld have referred the case to vol!ntary arbitration+ #'A has no ,!risdiction over the dis$!te which is governed by RA 876+ the arbitration law. The dis$!te between Geng!et and 3.<. Realty sho!ld have been referred to vol!ntary arbitration !nder the Arbitration Kaw and in accordance with the agreement of the $arties. Nowever+ Geng!et+ having $artici$ated in all the $roceedings !nderta0en that led to the filing of a $etition before the S!$reme "o!rt+ is already esto$$ed from 8!estioning the #'AFs ,!risdiction. The 8!estion on the ,!risdiction of the #'A sho!ld have been bro!ght at the first o$$ort!nity and not as late as the S!$reme "o!rt $etition. ATo redo the $roceedings f!lly $artici$ated in by the $arties after the la$se of seven years from date of instit!tion of the original action with the #'A wo!ld be anathema to the s$eedy and efficient administration of ,!sticeB+ the S!$reme "o!rt held.

III.

BOREA TECHNOLODIES CO., LTD. V#. 94(589, J-'. 7, 2008

H '. A7,"+! L"+:-,"!. -7., D.R. N .

"aseFs $refatory statement= %n o!r ,!risdiction+ the $olicy is to favor alternative methods of resolving dis$!tes+ $artic!larly in civil and commercial dis$!tes. Arbitration along with mediation+ conciliation+ and negotiation+ being ine $ensive+ s$eedy and less hostile methods have long been favored by this "o!rt. The $etition before !s $!ts at iss!e an arbitration cla!se in a contract m!t!ally agreed !$on by the $arties sti$!lating that they wo!ld s!bmit themselves to arbitration in a foreign co!ntry. Regrettably+ instead of hastening the resol!tion of their dis$!te+ the $arties wittingly or !nwittingly $rolonged the controversy. % en,oin yo! to read this case at so!rce as it disc!ssed basic $rinci$les of civil $roced!res and almost one half of RA 6287. GR%&1 STAT&O&(T '1 1A"TS= #etitioner Lorea Technologies "o.+ Ktd. .L'<%&S/ is a Lorean cor$oration which is engaged in the s!$$ly and installation of Ki8!efied #etrole!m <as .K#</ "ylinder man!fact!ring $lants+ while $rivate res$ondent #acific <eneral Steel Oan!fact!ring "or$. .#<SO"/ is a domestic cor$oration. L'<%&S and #<SO" e ec!ted a "ontract whereby L'<%&S wo!ld set !$ an K#< "ylinder Oan!fact!ring #lant in "armona+ "avite. The contract was e ec!ted in the #hili$$ines. Kater+ the $arties e ec!ted+ in Lorea+ an amendment to the contract regarding the terms of $ayment. The contract and its amendment sti$!lated that L'<%&S will shi$ the machinery and facilities necessary for man!fact!ring K#< cylinders for which #<SO" wo!ld $ay HSD )+225+***. L'<%&S wo!ld install and initiate the o$eration of the $lant for which #<SO" bo!nd

itself to $ay HSD 3*6+*** !$on the $lantFs $rod!ction of the ))-0g. K#< cylinder sam$les. Th!s+ the total contract $rice amo!nted to HSD )+73*+***. #<SO" then $roceeded to $rovide for the real estate where L'<%&S wo!ld install the K#< "ylinder man!fact!ring of #<SO" in "armona+ "avite. #<SO" $aid L'<%&S HSD )+225+***. Hnfort!nately+ #<SO" enco!ntered financial diffic!lties affecting the s!$$ly of materials. The chec0s !sed to $ay for its balances bo!nced. 'n the other hand+ #<SO" com$lained that not only did L'<%&S deliver a different brand of hydra!lic $ress from that agreed !$on b!t it had not delivered several e8!i$ment $arts already $aid for. #<SO" then informed L'<%&S that #<SO" was canceling their "ontract dated Oarch 7+ )667 on the gro!nd that L'<%&S had altered the 8!antity and lowered the 8!ality of the machineries and e8!i$ment it delivered to #<SO"+ and that #<SO" wo!ld dismantle and transfer the machineries+ e8!i$ment+ and facilities installed in the "armona $lant. #<SO" later filed before the 'ffice of the #!blic #rosec!tor an Affidavit-"om$laint for &stafa doc0eted as %.S. (o. 68-*38)3 against Or. Dae Ny!n Lang+ #resident of L'<%&S. 'n 3!ne )7+ )668+ L'<%&S wrote #<SO" informing the latter that #<SO" co!ld not !nilaterally rescind their contract nor dismantle and transfer the machineries and e8!i$ment on mere imagined violations by L'<%&S. %t also insisted that their dis$!tes sho!ld be settled by arbitration as agreed !$on in Article )7+ the arbitration cla!se of their contract. 'n 3!ly )+ )668+ L'<%&S instit!ted an A$$lication for Arbitration before the Lorean "ommercial Arbitration Goard .L"AG/ in Seo!l+ Lorea $!rs!ant to Art. )7 of the "ontract as amended. Gasically+ this was what ha$$ened. There are other e changes between the $arties as can be seen from the disc!ssion of the iss!es+ inter alia= .)/ Reason for re8!iring the filing of a Ootion for reconsideration $rior to filing an a$$eal= The reason behind the r!le is Ato enable the lower co!rt+ in the first instance+ to $ass !$on and correct its mista0es witho!t the intervention of the higher co!rt.B .2/ The "ore %ss!e= :alidity of Article )7 of the "ontract which $rovides= Article )7. Arbitration.RAll dis$!tes+ controversies+ or differences which may arise between the $arties+ o!t of or in relation to or in connection with this "ontract or for the breach thereof+ shall finally be settled by arbitration in Seo!l+ Lorea in accordance with the "ommercial Arbitration R!les of the Lorean "ommercial Arbitration Goard. The award rendered by the arbitration.s/ shall be final and binding !$on both $arties concerned. The "o!rt r!led that Art. )7 is :AK%D gro!nded on=. .)/ The $rinci$le of 1e/ loci contractus. &stablished in this ,!risdiction is the r!le that the law of the $lace where the contract is made governs. Since the contract case was $erfected in the #hili$$ines+ o!r laws o!ght to govern. And in o!r ,!risdiction+ the law $rovides in Art. 2*55 of the "ivil "ode that AAny sti$!lation that the arbitratorsF award or decision shall be final+ is valid+ witho!t $re,!dice to Articles 2*38+ 2*36 and 2*5*B. These $rovisions sanction the validity of m!t!ally agreed arbitral cla!se or the finality and binding effect of an arbitral award. Arts. 2*38+ 2*36+ and

2*5* refer to instances where a com$romise or an arbitral award+ may be voided+ rescinded+ or ann!lled. The arbitration cla!se which was m!t!ally and vol!ntarily agreed !$on by the $arties has not been shown to be contrary to any law+ or against morals+ good c!stoms+ $!blic order+ or $!blic $olicy. (either is there any showing that the $arties have not dealt with each other on e8!al footing hence+ there is no reason why the arbitration cla!se sho!ld not be res$ected and com$lied with by both $arties. %n a n!mber of cases+ the S!$reme "o!rt has s!stained the r!ling that As!bmission to arbitration is a contract and that a cla!se in a contract $roviding that all matters in dis$!te between the $arties shall be referred to arbitration is a contractB. %n short+ the arbitration cla!se is a contract within the main contract. .2/ T3" A+,&!+-!& ' %7-8#" &# ' ! % '!+-+0 ! 58,7&% 5 7&%0. The arbitration cla!se sti$!lating that arbitration m!st be done in Seo!l+ Lorea in accordance with the "ommercial Arbitration R!les of the L"AG+ and that the arbitral award is final and binding+ is not contrary to $!blic $olicy. %n a n!mber of cases since )673 when the Arbitration law was enacted+ the S!$reme "o!rt has been consistent in r!ling that arbitration cla!ses are valid and constit!tional- that dis$!tes can be settled by arbitration. %n this case+ the S!$reme "o!rt reiterated that= AGeing an ine $ensive+ s$eedy and amicable method of settling dis$!tes+ arbitrationIIalong with mediation+ conciliation and negotiationIIis enco!raged by the S!$reme "o!rt. Aside from !nclogging ,!dicial doc0ets+ arbitration also hastens the resol!tion of dis$!tes+ es$ecially of the commercial 0ind. %t is th!s regarded as the Awave of the f!t!reB in international civil and commercial dis$!tes. Gr!shing aside a contract!al agreement calling for arbitration between the $arties wo!ld be a ste$ bac0ward.B And consistent with the stateFs A$olicy of enco!raging alternative dis$!te resol!tion methods+ co!rts sho!ld liberally constr!e arbitration cla!ses. #rovided s!ch cla!se is s!sce$tible of an inter$retation that covers the asserted dis$!te+ an order to arbitrate sho!ld be granted. Any do!bt sho!ld be resolved in favor of arbitrationB. .3/ 'n the 8!estion of what governs an arbitration cla!se s$ecifying that in case of any dis$!te arising from the contract+ an arbitral $anel will be constit!ted in a foreign co!ntry and the arbitration r!les of the foreign co!ntry wo!ld govern and its award shall be final and binding. Gefore we $roceed+ the 8!estion why RA 6287 which was enacted in 2**5 was made a$$licable to this case when L'<%&S filed for arbitration in )668 .b!t still $ending in 2**5/+ sho!ld first be answered. >ell-settled is the r!le that $roced!ral laws are constr!ed to be a$$licable to actions $ending and !ndetermined at the time of their $assage+ and are deemed retroactive in that sense and to that e tent. As a general r!le+ the retroactive a$$lication of $roced!ral laws does not violate any $ersonal rights beca!se no vested right has yet attached nor arisen from them. (ow+ ta0e note that RA 6287 incor$orated the H("%TRAK Oodel law to which the #hili$$ines is a signatory. As signatory to the Arbitration R!les of the H("%TRAK Oodel Kaw on %nternational "ommercial Arbitration of the Hnited (ations "ommission on %nternational Trade Kaw .H("%TRAK/ in the (ew @or0 "onvention on 3!ne 2)+ )687+ the #hili$$ines committed itself to be bo!nd by the Oodel Kaw. .Geing a signatory+ even witho!t RA 6287+ the #hili$$ines is bo!nd by the Oodel law/. >here a foreign arbitral body is chosen by the arbitration $arties+ the arbitration r!les of o!r domestic arbitration bodies wo!ld not be a$$lied. .the arbitration is international and not domestic/. >hat wo!ld govern wo!ld be the $ertinent $rovisions of RA 6287 %("'R#'RAT%(<

TN&R&%( the $rovisions of the Oodel Kaw $artic!larly Secs. )6 and 2* of "ha$ter 5 of RA 6287 $roviding that= "NA#T&R 5 - %(T&R(AT%'(AK "'OO&R"%AK ARG%TRAT%'( S&". )6. Ado$tion of the Oodel Kaw on %nternational "ommercial Arbitration.II%nternational commercial arbitration shall be governed by the Oodel Kaw on %nternational "ommercial Arbitration .the AOodel KawB/ ado$ted by the Hnited (ations "ommission on %nternational Trade Kaw on 3!ne 2)+ )687 .Hnited (ations Doc!ment A;5*;)7/ and recommended for enactment by the <eneral Assembly in Resol!tion (o. 5*;72 a$$roved on December ))+ )687+ co$y of which is hereto attached as A$$endi AAB. S&". 2*. %nter$retation of Oodel Kaw.II%n inter$reting the Oodel Kaw+ regard shall be had to its international origin and to the need for !niformity in its inter$retation and resort may be made to the trava! $re$aratories and the re$ort of the Secretary <eneral of the Hnited (ations "ommission on %nternational Trade Kaw dated Oarch 27+ )687 entitled+ A%nternational "ommercial Arbitration= Analytical "ommentary on Draft Trade identified by reference n!mber A;"(. 6;265.B *4/ A44&!& '-7 2"-!8+"# 2 RA 9285 -5570&'= -'4 &'% +5 +-!&'= !3" UNCITRAL M 4"7 L-. -+" !3" 2 77 .&'=$ .)/ 'he R'C mu%t refer to arbitration in proper ca%e%. Hnder Sec. 25+ the RT" does not have ,!risdiction over dis$!tes that are $ro$erly the s!b,ect of arbitration $!rs!ant to an arbitration cla!se+ and mandates the referral to arbitration in s!ch cases+ th!s= S&". 25. Referral to Arbitration.IIA co!rt before which an action is bro!ght in a matter which is the s!b,ect matter of an arbitration agreement shall+ if at least one $arty so re8!ests not later than the $re-trial conference+ or !$on the re8!est of both $arties thereafter+ refer the $arties to arbitration !nless it finds that the arbitration agreement is n!ll and void+ ino$erative or inca$able of being $erformed. .29 $orei"n arbitral award% mu%t be confirmed b& the R'C. 1oreign arbitral awards tho!gh agreed !$on by the $arties to be final and binding cannot be immediately be enforced or im$lemented. %n Sec. 37 and 36 of the Oodel Kaw+ the foreign arbitral award m!st first be recogniCed by a com$etent co!rt for enforcement and which co!rt may ref!se recognition or enforcement on gro!nds $rovided . Sec. 37 and 36 of the H("%TRAK Oodel Kaw are incor$orated as Sec. 52+ 53+ E 55 cf Sec. 57 E 58 of RA 6287. S&". 52. A$$lication of the (ew @or0 "onvention.IIThe (ew @or0 "onvention shall govern the recognition and enforcement of arbitral awards covered by said "onvention. The recognition and enforcement of s!ch arbitral awards shall be filed with the Regional Trial "o!rt in accordance with the r!les of $roced!re to be $rom!lgated by the S!$reme "o!rt. Said $roced!ral r!les shall $rovide that the $arty relying on the award or a$$lying for its enforcement shall file with the co!rt the original or a!thenticated co$y of the award and the

arbitration agreement. %f the award or agreement is not made in any of the official lang!ages+ the $arty shall s!$$ly a d!ly certified translation thereof into any of s!ch lang!ages. The a$$licant shall establish that the co!ntry in which foreign arbitration award was made in $arty to the (ew @or0 "onvention. S S&". 53. Recognition and &nforcement of 1oreign Arbitral Awards (ot "overed by the (ew @or0 "onvention.IIThe recognition and enforcement of foreign arbitral awards not covered by the (ew @or0 "onvention shall be done in accordance with $roced!ral r!les to be $rom!lgated by the S!$reme "o!rt. The "o!rt may+ on gro!nds of comity and reci$rocity+ recogniCe and enforce a non-convention award as a convention award. S&". 55. 1oreign Arbitral Award (ot 1oreign 3!dgment.IIA foreign arbitral award when confirmed by a co!rt of a foreign co!ntry+ shall be recogniCed and enforced as a foreign arbitral award and not as a ,!dgment of a foreign co!rt. A foreign arbitral award+ when confirmed by the Regional Trial "o!rt+ shall be enforced in the same manner as final and e ec!tory decisions of co!rts of law of the #hili$$ines

S&". 57. :en!e and 3!risdiction.II#roceedings for recognition and enforcement of an arbitration agreement or for vacations+ setting aside+ correction or modification of an arbitral award+ and any a$$lication with a co!rt for arbitration assistance and s!$ervision shall be deemed as s$ecial $roceedings and shall be filed with the Regional Trial "o!rt .i/ where arbitration $roceedings are cond!cted- .ii/ where the asset to be attached or levied !$on+ or the act to be en,oined is located- .iii/ where any of the $arties to the dis$!te resides or has his $lace of b!siness- or .iv/ in the (ational 3!dicial "a$ital Region+ at the o$tion of the a$$licant. S&". 58. (otice of #roceeding to #arties.II%n a s$ecial $roceeding for recognition and enforcement of an arbitral award+ the "o!rt shall send notice to the $arties at their address of record in the arbitration+ or if any $art cannot be served notice at s!ch address+ at s!ch $artyFs last 0nown address. The notice shall be sent al least fifteen .)7/ days before the date set for the initial hearing of the a$$lication. Therefore+ foreign arbitral awards even if final and binding can not yet be e ec!ted !ntil it $asses confirmation by the RT". Thereafter+ it can now be enforced as final and e ec!tory decisions of o!r co!rts of law. *(/ T3" RTC 3-# <8+&#4&%!& ' ! +"6&". 2 +"&=' -+,&!+-7 -.-+4#

Sec. 52 in relation to Sec. 57 of RA 6287 designated and vested the RT" with s$ecific a!thority and ,!risdiction to set aside+ re,ect+ or vacate a foreign arbitral award on gro!nds $rovided !nder Art. 35.2/ of the H("%TRAK Oodel Kaw.

S&". 52. A$$lication of the (ew @or0 "onvention.IIThe (ew @or0 "onvention shall govern the recognition and enforcement of arbitral awards covered by said "onvention. The recognition and enforcement of s!ch arbitral awards shall be filed with the Regional Trial "o!rt in accordance with the r!les of $roced!re to be $rom!lgated by the S!$reme "o!rt. Said $roced!ral r!les shall $rovide that the $arty relying on the award or a$$lying for its enforcement shall file with the co!rt the original or a!thenticated co$y of the award and the arbitration agreement. %f the award or agreement is not made in any of the official lang!ages+ the $arty shall s!$$ly a d!ly certified translation thereof into any of s!ch lang!ages. The a$$licant shall establish that the co!ntry in which foreign arbitration award was made is $arty to the (ew @or0 "onvention. %f the a$$lication for re,ection or s!s$ension of enforcement of an award has been made+ the Regional Trial "o!rt may+ if it considers it $ro$er+ vacate its decision and may also+ on the a$$lication of the $arty claiming recognition or enforcement of the award+ order the $arty to $rovide a$$ro$riate sec!rity. S&". 57. Re,ection of a 1oreign Arbitral Award.IIA $arty to a foreign arbitration $roceeding may o$$ose an a$$lication for recognition and enforcement of the arbitral award in accordance with the $roced!res and r!les to be $rom!lgated by the S!$reme "o!rt only on those gro!nds en!merated !nder Article : of the (ew @or0 "onvention. Any other gro!nd raised shall be disregarded by the Regional Trial "o!rt. Th!s+ while the RT" does not have ,!risdiction over dis$!tes governed by arbitration m!t!ally agreed !$on by the $arties+ still the foreign arbitral award is s!b,ect to ,!dicial review by the RT" which can set aside+ re,ect+ or vacate it. %n this sense+ what this "o!rt held in "h!ng 1! %nd!stries .#hils./+ %nc. relied !$on by L'<%&S is a$$licable insofar as the foreign arbitral awards+ while final and binding+ do not o!st co!rts of ,!risdiction since these arbitral awards are not absol!te and witho!t e ce$tions as they are still ,!dicially reviewable. "ha$ter 7 of RA 6287 has made it clear that all arbitral awards+ whether domestic or foreign+ are s!b,ect to ,!dicial review on s$ecific gro!nds $rovided for. 829 ?round% for *udicial re!iew different in dome%tic and forei"n arbitral award%

The differences between a final arbitral award from an international or foreign arbitral trib!nal and an award given by a local arbitral trib!nal are the s$ecific gro!nds or conditions that vest ,!risdiction over o!r co!rts to review the awards. 1or foreign or international arbitral awards which m!st first be confirmed by the RT"+ the gro!nds for setting aside+ re,ecting or vacating the award by the RT" are $rovided !nder Art. 35.2/ of the H("%TRAK Oodel Kaw. 1or final domestic arbitral awards+ which also need confirmation by the RT" $!rs!ant to Sec. 23 of RA 876 and shall be recogniCed as final and e ec!tory decisions of the RT"+ they may only be assailed before the RT" and vacated on the gro!nds $rovided !nder Sec. 27 of RA 876.

859 'he R'C deci%ion %ettin" a%ide, re*ectin", !acatin", modif&in" or correctin" an arbitral award ma& be appealed b& the a""rie!ed part& to the Court of Appeal% a% pro!ided in Sec. 26 of RA 1285. S&". 56. A$$eal from "o!rt Decision or Arbitral Awards.RA decision of the Regional Trial "o!rt confirming+ vacating+ setting aside+ modifying or correcting an arbitral award may be a$$ealed to the "o!rt of A$$eals in accordance with the r!les and $roced!re to be $rom!lgated by the S!$reme "o!rt. The losing $arty who a$$eals from the ,!dgment of the co!rt confirming an arbitral award shall be re8!ired by the a$$ellate co!rt to $ost a co!nterbond e ec!ted in favor of the $revailing $arty e8!al to the amo!nt of the award in accordance with the r!les to be $rom!lgated by the S!$reme "o!rt. Thereafter+ the "A decision may f!rther be a$$ealed or reviewed before this "o!rt thro!gh a $etition for review !nder R!le 57 of the R!les of "o!rt. The sti$!lation between the $arties that the arbitral award is final and binding+ does not o!st o!r co!rts of ,!risdiction as the international arbitral award is still ,!dicially reviewable !nder certain conditions $rovided for by the H("%TRAK Oodel Kaw on %"A as a$$lied and incor$orated in RA 6287. >here there is a valid and binding arbitration contract+ the $arties are bo!nd by it and a $arty may not !nilaterally rescind or terminate the contract for whatever ca!se witho!t first resorting to arbitration.. >here an arbitration cla!se in a contract is availing+ neither of the $arties can !nilaterally treat the contract as rescinded since whatever infractions or breaches by a $arty or differences arising from the contract m!st be bro!ght first and resolved by arbitration+ and not thro!gh an e tra,!dicial rescission or ,!dicial action. *)/ $rom Sec. 28, RA 1285, the R'C can li ewi%e pro!ide for interim mea%ure% of protection. Art. )7.2/ of the H("%TRAK Oodel Kaw on %"A defines an Ainterim meas!reB of $rotection as= 2/ An interim meas!re is any tem$orary meas!re+ whether in the form of an award or in another form+ by which+ at any time $rior to the iss!ance of the award by which the dis$!te is finally decided+ the arbitral trib!nal orders a $arty to= .a/ Oaintain or restore the stat!s 8!o $ending determination of the dis$!te.b/ Ta0e action that wo!ld $revent+ or refrain from ta0ing action that is li0ely to ca!se+ c!rrent or imminent harm or $re,!dice to the arbitral $rocess itself.c/ #rovide a means of $reserving assets o!t of which a s!bse8!ent award may be satisfied- or .d/ #reserve evidence that may be relevant and material to the resol!tion of the dis$!te. Art. )7 3 of H("%TRAK Oodel Kaw on %"A also grants co!rts $ower and ,!risdiction to iss!e interim meas!res= Article )7 3. "o!rt-ordered interim meas!res

A co!rt shall have the same $ower of iss!ing an interim meas!re in relation to arbitration $roceedings+ irres$ective of whether their $lace is in the territory of this State+ as it has in relation to $roceedings in co!rts. The co!rt shall e ercise s!ch $ower in accordance with its own $roced!res in consideration of the s$ecific feat!res of international arbitration. As a f!ndamental $oint+ the $endency of arbitral $roceedings does not foreclose resort to the co!rts for $rovisional reliefs. The R!les of the %""+ which governs the $artiesF arbitral dis$!te+ allows the a$$lication of a $arty to a ,!dicial a!thority for interim or conservatory meas!res. Ki0ewise+ Section )5 of Re$!blic Act .R.A./ (o. 876 .The Arbitration Kaw/ recogniCes the rights of any $arty to $etition the co!rt to ta0e meas!res to safeg!ard and;or conserve any matter which is the s!b,ect of the dis$!te in arbitration. %n addition+ R.A. 6287+ otherwise 0nown as the AAlternative Dis$!te Resol!tion Act of 2**5+B allows the filing of $rovisional or interim meas!res with the reg!lar co!rts whenever the arbitral trib!nal has no $ower to act or to act effectively.

TUNA PROCESSIND, INC.,-6"+#8#-PHILIPPINE BINDFORD, INC., F",+8-+0 29, 2092

D.R. N . 985582G

>hen the dis$!te between the $arties was s!bmitted for arbitration+ the %nternational "entre for Dis$!te Resol!tion in the State of "alifornia+ Hnited States r!led in favor of T#%+ granting the $ayment by Lingford of com$!ted monetary award and damages to T#%. To enforce the award+ $etitioner T#% filed on )* 'ctober 2**7 a #etition for "onfirmation+ Recognition+ and &nforcement of 1oreign Arbitral Award before the RT" of Oa0ati "ity. At Granch )7*+ res$ondent Lingford filed a Ootion to Dismiss. After the co!rt denied the motion for lac0 of merit+ res$ondent so!ght for the inhibition of 3!dge Alameda and moved for the reconsideration of the order denying the motion. 3!dge Alameda inhibited himself and the case was re-raffled to 3!dge "edric0 '. R!iC of Granch 6)+ who granted res$ondentFs Ootion for Reconsideration and dismissed the $etition on the gro!nd that the $etitioner lac0ed legal ca$acity to s!e in the #hili$$ines. #etitioner T#% now see0s to n!llify+ in this instant #etition for Review on "ertiorari !nder R!le 57 .R;"/+ the order of the trial co!rt dismissing its #etition for "onfirmation+ Recognition+ and &nforcement of 1oreign Arbitral Award. %ss!e. "an a foreign cor$oration .T!na #rocessing/ not licensed to do b!siness in the #hili$$ines+ b!t which collects royalties from entities in the #hili$$ines+ s!e here to enforce a foreign arbitral award9 R!ling= @&S .)/ #rovisions of law that were disc!ssed in this case= .a/ Sec. )33+ The "or$oration "ode of the #hili$$ines which $rovides= Doing b!siness witho!t a license. - (o foreign cor$oration transacting b!siness in the #hili$$ines witho!t a license+ or its s!ccessors or assigns+ shall be $ermitted to maintain or intervene in any action+ s!it or $roceeding in any co!rt or administrative agency of the #hili$$ines- b!t s!ch cor$oration may be s!ed or $roceeded against before #hili$$ine co!rts or administrative trib!nals on any valid ca!se of action recogniCed !nder #hili$$ine laws.

This was the basis for the dismissal of the com$laint by the RT". A$$arently+ there is a conflict between the $rovisions of the "or$oration "ode and that of Ra 6287+ the (ew @or0 "onvention and the Oodel Kaw. To this 8!estion+ the "o!rt held that the "or$oration "ode is a general law a$$lying to all ty$es of cor$orations. %t is the general law $roviding for the formation+ organiCation and reg!lation of $rivate cor$orations. 'n the other hand+ the Alternative Dis$!te Resol!tion Act of 2**5+ An Act to %nstit!tionaliCe the Hse of an Alternative Dis$!te Resol!tion System in the #hili$$ines and to &stablish the 'ffice for Alternative Dis$!te Resol!tion+ and for 'ther #!r$oses is a law es$ecially enacted Ato actively $romote $arty a!tonomy in the resol!tion of dis$!tes or the freedom of the $arty to ma0e their own arrangements to resolve their dis$!tes.B %t s$ecifically $rovides e cl!sive gro!nds available to the $arty o$$osing an a$$lication for recognition and enforcement of the arbitral award. As between a general and s$ecial law+ the latter shall $revailRgeneralia speciali"us non derogant. The co!rt contin!ed= A%nasm!ch as the Alternative Dis$!te Resol!tion Act of 2**5+ a m!nici$al law+ a$$lies in the instant $etition+ we do not see the need to disc!ss com$liance with international obligations !nder the (ew @or0 "onvention and the Oodel Kaw. After all+ both already form $art of the law. %n $artic!lar+ the Alternative Dis$!te Resol!tion Act of 2**5 incor$orated the (ew @or0 "onvention in the Act by s$ecifically $roviding= S&". 52.A$$lication of the (ew @or0 "onvention. - The (ew @or0 "onvention shall govern the recognition and enforcement of arbitral awards covered by the said "onvention. S&". 57.Re,ection of a 1oreign Arbitral Award. - A $arty to a foreign arbitration $roceeding may o$$ose an a$$lication for recognition and enforcement of the arbitral award in accordance with the $roced!ral r!les to be $rom!lgated by the S!$reme "o!rt only on those gro!nds en!merated !nder Article : of the (ew @or0 "onvention. Any other gro!nd raised shall be disregarded by the regional trial co!rt. %t also e $ressly ado$ted the Oodel Kaw+ to wit= Sec. )6.Ado$tion of the Oodel Kaw on %nternational "ommercial Arbitration. %nternational commercial arbitration shall be governed by the Oodel Kaw on %nternational "ommercial Arbitration .the AOodel KawB/ ado$ted by the Hnited (ations "ommission on %nternational Trade Kaw on 3!ne 2)+ )687 .B Sec. 57 of the Alternative Dis$!te Resol!tion Act of 2**5 $rovides that the o$$osing $arty in an a$$lication for recognition and enforcement of the arbitral award may raise only those gro!nds that were en!merated !nder Article : of the (ew @or0 "onvention+ to wit= Article : ). Recognition and enforcement of the award may be ref!sed+ at the re8!est of the $arty against whom it is invo0ed+ only if that $arty f!rnishes to the com$etent a!thority where the recognition and enforcement is so!ght+ $roof that= .a/ The $arties to the agreement referred to in article %% were+ !nder the law a$$licable to them+ !nder some inca$acity+ or the said agreement is not valid !nder the law to which the $arties have s!b,ected it or+ failing any indication thereon+ !nder the law of the co!ntry where the award was madeor

.b/ The $arty against whom the award is invo0ed was not given $ro$er notice of the a$$ointment of the arbitrator or of the arbitration $roceedings or was otherwise !nable to $resent his case- or .c/ The award deals with a difference not contem$lated by or not falling within the terms of the s!bmission to arbitration+ or it contains decisions on matters beyond the sco$e of the s!bmission to arbitration+ $rovided that+ if the decisions on matters s!bmitted to arbitration can be se$arated from those not so s!bmitted+ that $art of the award which contains decisions on matters s!bmitted to arbitration may be recogniCed and enforced- or .d/ The com$osition of the arbitral a!thority or the arbitral $roced!re was not in accordance with the agreement of the $arties+ or+ failing s!ch agreement+ was not in accordance with the law of the co!ntry where the arbitration too0 $lace- or .e/ The award has not yet become binding on the $arties+ or has been set aside or s!s$ended by a com$etent a!thority of the co!ntry in which+ or !nder the law of which+ that award was made. 2. Recognition and enforcement of an arbitral award may also be ref!sed if the com$etent a!thority in the co!ntry where recognition and enforcement is so!ght finds that= .a/ The s!b,ect matter of the difference is not ca$able of settlement by arbitration !nder the law of that co!ntry- or .b/ The recognition or enforcement of the award wo!ld be contrary to the $!blic $olicy of that co!ntry. The above-given gro!nds did not incl!de lac0 of ca$acity to s!e of the $arty see0ing the recognition and enforcement of the award. #ertinent $rovisions of the S$ecial R!les of "o!rt on Alternative Dis$!te Resol!tion+ which was $rom!lgated by the S!$reme "o!rt+ li0ewise s!$$ort this $osition. R!le )3.) of the S$ecial R!les $rovides that APaQny $arty to a foreign arbitration may $etition the co!rt to recogniCe and enforce a foreign arbitral award.B The contents of s!ch $etition are en!merated in R!le )3.7. "a$acity to s!e is not incl!ded. '$$ositely+ in the R!le on local arbitral awards or arbitrations in instances where Athe $lace of arbitration is in the #hili$$ines+B it is s$ecifically re8!ired that a $etition Ato determine any 8!estion concerning the e istence+ validity and enforceability of s!ch arbitration agreementBP35Q available to the $arties before the commencement of arbitration and;or a $etition for A,!dicial relief from the r!ling of the arbitral trib!nal on a $reliminary 8!estion !$holding or declining its ,!risdictionBP37Q after arbitration has already commenced sho!ld state APtQhe facts showing that the $ersons named as $etitioner or res$ondent have legal ca$acity to s!e or be s!ed.B %ndeed+ it is in the best interest of ,!stice that in the enforecement of a foreign arbitral award+ we deny availment by the losing $arty of the r!le that bars foreign cor$orations not licensed to do b!siness in the #hili$$ines from maintaining a s!it in o!r co!rts. >hen a $arty enters into a contract containing a foreign arbitration cla!se and+ as in this case+ in fact s!bmits itself to arbitration+ it becomes bo!nd by the contract+ by the arbitration and by the res!lt of arbitration+ conceding thereby the ca$acity of the other $arty to enter into the contract+ $artici$ate in the arbitration and ca!se the im$lementation of the res!lt. Altho!gh not on all fo!rs with the instant case+ also worthy to consider is the wisdom of then Associate 3!stice 1lerida R!th #. Romero in her Dissenting '$inion in Asset #rivatiCation Tr!st v. "o!rt of A$$eals+ to wit=

Arbitration+ as an alternative mode of settlement+ is gaining adherents in legal and ,!dicial circles here and abroad. %f its tested mechanism can sim$ly be ignored by an aggrieved $arty+ one who+ it m!st be stressed+ vol!ntarily and actively $artici$ated in the arbitration $roceedings from the very beginning+ it will destroy the very essence of m!t!ality inherent in consens!al contracts. "learly+ on the matter of ca$acity to s!e+ a foreign arbitral award sho!ld be res$ected not beca!se it is favored over domestic laws and $roced!res+ b!t beca!se Re$!blic Act (o. 6287 has certainly erased any conflict of law 8!estion.