P A R T III

Oa· · » D m ld · d b y Lb « * l» prpm p[: i? HF T

R. A . No . Ea a 6
Bec\\o n 84. Refarral 1.0 A rbt¢ r¢¥ ¢ lqr+.-A f t» p\befgrp
which an action la bro u« b t In P ma¢Mp pyhlrb l* Fh+¢y1 J er e¢
matter o f an arbltratltm apeeinBn¢· Ilall, lr p ¢ lJe p q Q R ¢
party ao reques ts n o t la te p tha¢ th e p r· - ¢rl* l ¢qplr¢ p«* r
or upon th e reques t o p b o th p Pr* lrB * b*rppMh IF¢ I#F ¢0 4,
partlea arbitratio n un lg p e l¢ hnd#rbp¢¢ b ]¢* rlt$ H* ljrm
to
agreement le null and vo id, In ope pp¢ lv¢ er lw ppNlh Qf
being perfo rnro d, plmphgiel* «ppplledl
It 11 clear th a t un d er th e law , th 4e lw pnt iJn l* w flu l d¢ rtjBr
a ctio n s hou ld b a ve b e e n atayed i tb e p e ¢ itinne p p n d ¢ h a rgJippMM
s h o u ld h a ve b e e n referred to arbitFation pu rls yan¢& Q ¢b arbi¢ ra
cla u s e o f th e 20 0 5 Le a s e Co n tract, The A a e tp g bo ₩₩r, 414 n n ¢ do $ e ¢

in vio latio n of th e law w h ich v fQ lation w l a i ¢ t in h#m + efnrmd}t p ¢ b¢

RTC an d Court of A ppe alrs o n ap p eal,
th e MeTe of tb e ie le a p d l. pegMw un d er &:, A.
The violation b y
Noe , 876 an d 9285 re n d e p e In valid all p l ? , fngir* g n d a r¢¢ lflk i#
th e ejectm en t cae e af iler tb e fuing by p e ti&iJ9ne p ef lt #Ww .w i¢b
Counterclaim th e p o in t w hen th e p e ¢ itlow p aM tbe p g tjp o ntle n¢
e hou ld b ave b e e n referred to ap b iMatio n . Th l#g p lie wwt , &h g p g lip * w l
be remanded to th e MTC an d b e rs u s pe nde d a ¢ s aid pglnl, In evi$#b ly,
tb e de cie ione of th e MeTC, RTC an d tlw Cou Ft ef Appeal m uret* ll b¢
va ca te d an d ra e t a rs id e ,

arbitration punuant to tbe arbiMation elau o t tlw 2000 lmw

co n tract.

Z J PLUS ASIA DEVELOPMENT CORPORATION V,

UHUTY ASSURANCE CORPORATION
e.R. No. 1*¢ o8 ol Jun * 20 , lola
FACT81
On December 24, 2907, J Plu* Alla Devrelo pmnt Coppm rau lora
reprerented by lu Chaipman, Joo Han an d Mart in E, Mabgm* y, m,
doing buliner* under th e name and* tylt* o f B« v e n Bh t* de * of mw
Tradingand Bervicei, enMredlnt oa Conatruetls n Awe¢ men\wbgpew
brml*
th e latter undertook to build
m Fom ulbminlum/
7 2· co *
th ·

pe«
hotel(Condotel Bulldlng 26). e o * tln g P42,09Q, 000,00, l*
pFOkt,
to be completed w ithin otu ye · F O F 866 d* &om thrt* nr * t
yr
 RE80LU110N
r
TTV E D IS PUTE
TH E A LTEIUA
¢

218

th e b alanc e
14,20 0 8 . Payment of
on Janu ary
p aym en t w as f ully paid b illin g s, P e r th e ag re e d
8
o f th e m o n tld y prog re s
d a ya fb o m re ce ip t
Perbrmance Bo n d
tb e required
be r 20 0 & Mabu nay als o
s u bm itte d Co rpo ratio n(UTASSCO)in
is s u e d by re s ponde nt
Utility A e s u ra irce
o r P8.4
millio n.
Io 20% d o w n p aym en t
th e a m o u n t e q u iv ale nt on Janu ary 7,
s ite
w o rk a t th e p ro je ct
Mab un ay com m e nce d billing s e nt by
to th e 7th m o n th ly prog re s e
20 0 8 . Pe titio n e r paid up h ad paid th e to tal
16 ,20 0 8 , pe titione r
Mab un ay. A s of Se pte m be r payment. H o w -
P15,979,472.03 inclu s iv e o f th e 20% dow n
am ou nt of
h a d accom plis he d
o n ly 27.5% o t th e
e v e r, ae o f s a id d ate , Mab un ay
proje ct
19,20 0 8 , pe titione r terminated th e c o ntrac t
On Nov e m be r s urety. A s its
Mabunay a n d re s ponde nt
a n d s e nt d em an d le tte rs to
f o r Arb itratio n
d em an d s w e n t unheed pe titione r s le d a R e q u e s t
In d ustry Mbitration Co mmissio n (CIA
b e fo re th e Cons tru ction
a n d re s ponde nt b e o rd ered
m pay
P e titione r p rayed th atMab un ay
P8,980,676.89 as liquid ated d a m a g e s
an d P 2,379,441.6 3
th e sum s of
o r o v e rp ay]o ne nt
to th e u nre cou pe d d o w n p aym en t
m rresp o n d in g
Mabunay.
p etitio n er m ad e to
Re s p o n d e n t, on th e o th e r hand,
s led a m o tio n to dis mis s on th e
s tate s
th a t p etitio n er h a s no ca u s e o f a ctio n a n d th e complaint
g rou nd d ism iss.
it. Th e CIAC d e n ie d th e m o tio n to
no ca u s e o f a ctio n ag ain st
Re s p o n d e n t' 8 nao tio n for re cons ide ration w as li]£ ew ise
deni
w h icb
On Feb ruary 2,2010, th e CIAC ren d ered its D ecisio n
to jo in tly an d eeverauy p ay claim an t
o rd e rs Mabunay a n d UTASSCO
]jjq uid ate d dam ag e sa n d u nre cou pe d dow n pwment p lus in w rest
tb e re o n , It likew is e o rd e rs Mabunay to p ay to claimant th e
am o ust
inte re s &
of arb itratio n co s t w h ich th e claimant a d va n ce d w ith leg al
an d to indemm UTASSCO o f th e am o un t w h ich th e latw r will h a ve
p aid Io claim an t.
D iseatieEed , re s ponde nt s led In th e CA a p etitio n f o r re v ie w
am en d ed .
un d er R u le 43 o f tb e 1997 R u le e of Civil Pro ced ure, as
In m a s s a ile d de cis ion,
and e e t a s id e th e
CA g ran ted th e p eatio n
th je
D ecisio n ren d ered by th e CIAC.
ana

re w e ne e d
 PA RT
va s e s D e cid e d
M 411
b y th e Sup re m e C o u rt

Petitioner m o ved f o r
reco n sid eratio n of th e CA d e cis io n w h ile
re s ponde nt filed a m o tio n f o r partial
re cons ide ration. Bo th m o tio n s
w e re d en ied .

rssuES:
l* W et her or n o t tfte Coun
in n o t holding th at th e o f Ap lp eala aerio uBf y erred
tion A ct and tb e Alternatiue Dis pute Resolw
Special Rules on Altematiue Dh
pute Reso lutio n b ad e s tripped tb e Co urt
ofi urisdict ion to reulew arbiml aw ards. o f A ppeals
2. Whet her or riot th e Co urt o f
A ppeals serio usly ep red
in rrguerslw th e arbitral award on an is s ue th at U) 08
n o t raised in th e answ er n o t
identilied in th e terms
o f reference, n o t as s igned a8 an erro fl and n o t argited
in any of th e pleadlngs Ried b ef o re th e coun
SUPREME COURTS RULING:
The Co urt f in d s no merit in p e titio n e r' s co n te n tio n th a t w irth th e
instituo nalizatio n of alternative d isp ute reso lutio n un d er RA No.
9285, o therw ise]mo w n a s th e A lternative D isp ute R e s olu tion A ct of
2004, th e CA w as d ivested of jurisd ictio n review th e d e cis io n s or
to

aw ard s of th e CIAC. Petitioner erro n eo usly relied on th e p ro visio n

in s a id law allo w ing any PW
to a d o m estic arbitration to 6 1e in th e

Reg io n al Tyia1 Com (RTC) a p etitio n eith er to conErm, co rrect ar

va ca te a domes tic arbitral aw ard.

The Co urt h o ld s th at R.A

No . 9286 d id n o t co n f er on Reg io n al
T* ial Courts juris diction to review aw ards or d ecisio n s o f th e CIAC in
40 th ereo f expres s u
co n structio n dis putes . On tb e contrary, S e ctio n
de clare s th at co nErmatio n by th e RTC is n o t required,
th us:

SEC. 40. Cbnjlrmat ion ofA u}aM The co nEmaatio n

of a
tio n
d o ]Jaestlc
23 of m arbitral aw ard shall
8 76 .
conErmed shall b e
b e go verned by Se»

A domest ic arbltral award when and deci- executo ry

enforced in the same manner a e Boat
eiona ofthe Regional Trial CouN.
award shall b e made
The confirmation o ta do mestic
In accordance wit h the Rules
by the Regional Trial Court
of procedure to be promulgat ed by
the Supreme com
 DISP UTE R ESO LUTIO N
218 TH E A LTERNA TIVIBITRATION
E LA W
A TQ D TH E

n eed n o t be confirmed by th e
A CIAC arbltral aw ard a8 pro vided under
Trial Co urt to b e executory
Regional supplied.)
E.O. No. 1008. (Emphasis th e CIAC
10 0 8 ve s ts u p o n
o riBin al
No .
Exe cu tiv e Order (EO) aris ing from, o r c o nne c te d
o ve r dis pu te s
a n d e xclu s ive jurisd ictio n involved in cons tru ction in th e
w ith , c o ntrac ts e nte re d into b y p arties
o r af ter th e com ple tion
a ris e s b e fo re
Ph ilip p in es, w h e th e r th e dis pu te o r b reach th ereo f . By e x-
th e ab an d o n m en t
o f th e co n tra ct, o r a fte r aw ard of th e CIA C
of S e ctio n 19 the re of, th e arbitral
p re s s p ro visio n of law , w h ich a re
is G nal and unapw alable, e xce pt on q u e s tions introdu ce d
Co urt. W ith th e amendments
ap p ealab le to th e S up rem e Civil P ro -
R.A. No .7902 a n d p ro m ulg atio n o f th e 1997 Rules of
by
in clud ed in th e en um eratio n of
ce du re , as am en d ed , th e CIAC w as
quasi. Ju dicial ag e ncie s w h o s e de cis ions o r aw ards may
b e appe ale d

Rule 43. S uch review o f th e

to th e CA in p etitio n for review un d er
a
of law , o r o f fa ct
CIAC aw ard may inv olv e eith er q u e s tions of fact,
an d law .
Petitio n er mis read th e p ro visio n s of
A.M. No. 07- 11- 08- S C
th is Co urt an d w hich to o k e f[e c t
(S p ecial ADR Rules)p ro m ulg ated b y
exclud ed CIA C
on Ocb o b e r 30,2009. S in ce R.A. No . 928 5 explicitly
co n Erm ed
aw ards fFom d o m e s tic arb itratio n aw ard s th a t n e e d to b e
to b e e xe cu tory, s a id aw ard s
are th eref o re n o t cov e re d b y R u le 11 o f
to b e g o vern ed b y E.O. No .
th e S p ecial ADR R u le s , a s the y co n tin u e
of th e CIAC. The CIAC
1008, a s am en d ed a n d th e ru le s o f p ro ced ure
A rbitration
Revised Rules of P roce du re G o vern in g Co n s tru Lctio n
provide f o r th e manner an d m o d e of ap p eal fro m CIAC
d e cis io n s o r

aw ards in S e ctio n 18 the re of, w h ich reads :

SECTION 18 .2 P e tition lo r reuieul.-A p etitio n f o r review
&om a G nal aw ard may b e taken by any of th e parties w ithin
Meen (16) d ays fro m receip t th ereo f in ac c o .Rd a n ce w itb th e

provisim of R u le 43 of th e Rules of Court.

A s to th e alleg ed error co n u n itte d b y th e CA in d ecid in g th e ca s e

u pon an is s u e n o t rais ed o r litigated b ef o re th e C1AC, this as s e rtion
h as n o bas is . Wnether o r n o t Mabunay h ad incurred d elay in tb e
wrformance of h is o b lig atio n s under th e Cons truction Ag reem eo t
w as th e very rst is s u e stip ulated in th e Tenns of Reference(TOR),
w hich is d istin ct fro n a th e is s u e of th e exten t of re s ponde nt' 8 liabuity
under th e Perf o rm an ce Bo n d .