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Arbitration more closely resembles traditional litigation in that An early neutral evaluation (ENE) is used when one or both part
a neutral third party hears the disputants' arguments andimposes a final an ies to a dispute seek the advice of an experienced individual,usually an att
d binding decision that is enforceable by the courts. The difference is that i orney, concerning the strength of their cases. An objective evaluation by a
n arbitration, the disputantsgenerally agreed to the procedure before the di knowledgeable outsider cansometimes move parties away from unrealistic
spute arose; the disputants mutually decide who will hear their case; and t positions, or at least provide them with more insight into their cases' stren
heproceedings are typically less formal than in a court of law. One extrem gthsand weaknesses. Of course, the success of this technique depends upo
ely important difference is that, unlike courtdecisions, arbitration offers al n the parties' faith in the fairness and objectivity ofthe neutral third-
most no effective appeal process. Thus, when an arbitration decision is iss party, and their willingness to compromise.
ued, the case is ended.
SUMMARY JURY TRIAL
Final and binding arbitration has long been used in labor
management disputes. For decades, unions and employers havefound it m Summary jury trials have been used prima-
utually advantageous to have a knowledgeable arbitrator rily in the federal courts, where they provide parties with the opportunity t
whom they have chosen o "try"their cases in an abbreviated fashion before a group of jurors, who t
resolve their disputes in thischeaper and faster fashion. One primary advan hen deliberate and render an Advisory Opinion.
tage for both sides has been that taking disputes to arbitration has keptever Like an early neutral evaluation, an advisory opinion from a su
yone working by providing an alternative to strikes and lockouts and has k mmary jury trial can help the parties assess the strengths andweaknesses o
ept everyone out of the courts. Given this verysuccessful track record, the f their cases and sometimes can facilitate the settlement of the dispute. An
commercial world has become enthusiastic about arbitration for other type other advantage of the summaryjury trial, which it has in common with th
s of disputes as well. e minitrial, is that it can be scheduled much sooner than a trial. When earl
Now a new form of arbitration, known as court- yevaluations help the parties settle their cases, the parties typically avoid
annexed arbitration, has emerged. Many variations of court- much of the delay, expense, and anxiety thatoccurs in litigation.
annexed arbitration
have developed throughout the United States. One can be found in Minn The Law on Alternative Dispute Resolution: Private Justice in the
esota, where, in the mid1990s, the Hennepin CountyDistrict Court adopted Philippines
a program making civil cases involving less than $50,000 subject to mand Caveat: This is merely a summary of the book. You should read the book
atory nonbinding arbitration.The results of that experimental program wer at least once. This reviewer does not contain some essential definitions
e so encouraging that legislation was later enacted expanding the arbitratio because such are already defined in the law, RA 9285. No copyright
nprogram statewide. As of 2003, most cases were channeled through an A infringement is intended.
DR process before they could be heard in thecourts. A growing number of
other federal and state courts were adopting this or similar approaches. CHAPTER 1
The Laws delay: An introduction
MEDIATION-ARBITRATION History of ADR
As its name suggests, mediation-arbitration, or med
arb, combines mediation and arbitration. First, a mediator tries to bring Pre-Hispanic era-Jose Rizal noted the custom of the inhabitants
the partiescloser together and helps them reach their own agreement. If the of the Philippines before the Spaniards reached its shores. They submitted
parties cannot compromise, they precede to arbitration the decision of their elders, which they respected and carried out.
before that same third party or before a different arbitrator According to Jose Rizal, it was better that the ..Judges were persons of
for a final and binding decision. the locality, forming a jury, elected by both parties who knew the case, the
customs and usages better than the gowned judge from the outside to
MINI-TRIAL make his fortune, to judge the case he does not know and who does not
know the usage customs and language of the locality. It is easy to
The minitrial, a development in ADR, is finding its greatest use in resolvin surmise that our ancestors practiced ADR.
g largescale disputes involving complex questionsof mixed law and fact, s
uch as Product
Hispanic Era-Discontented parties had to resort to going to the -some parties get afflicted with AVOIDANCE SYNDROME
SC of Spain which was a 36-day trip. Procedure for civil action, although (disregarding the existence of the problem because of relative
similar to the criminal cases, was definitely more costly and drawn-out. powerlessness high risks and costs involved)
The high cost and unwarranted delays ensured that only the Europeans 3) Parties choose their conflict resolution methods and select their
and the rich merchants in the city and the wealthy landowners in the rural strategies to settle their disagreements.
areas could afford the prosecution of the civil suit. 4) Evaluation of outcomes and the analysis of all ramifications of
Our primitive ancestors were ahead of their times! full implementation of the chosen methods of conflict management.
Problems of judicial delay according to Marcos (1967): ADR aims to solve the conflict not win the lawsuit which is the
1) The misuse of the due process and the abuse of legal aim of litigation. Conflict is a contest and a problem to solve (Bill
technicalities; Withers)
2) The intervention of the political pressure in the court cases; Modes of Resolving Conflict (Blake and Moulton)
3) Sheer weight of the court litigations arising from development 1) Withdrawal-Avoidance behavior on one or both parties
and growth; 2) Smoothing-emphasis of common interest and yielding by one or
4) Dilatory tactics of lawyers; both parties.
5) Neglect and laxity on the part of the judges. 3) Compromising-each side obtains a part of what it wants.
The Laws delay according to Florentino P. Feliciano: 4) Forcing-forcing the other to acquiesce.
1) An efficient and mismanaged court system that fails to act 5) Problem solving-involves an agreement in which both sides
promptly on legal issues ; meet their objective and affective needs.
2) The disorganized state of the court-connected agencies; When a person wins through a lawsuit can compare it as a Pyrrhic
3) The lack of preparation on the part of the litigants and lawyers; victory (pronounced /prk/) which is a victory with devastating cost to
4) The trigger-happy mind frame of lawyers to engage in long- the victor; it carries the implication that another such will ultimately cause
winded examinations of witnesses; and defeat.
5) The lawyers propensity to elevate their cases to the appellate Importance of Litigation (Peter Lovenheim)
courts and needlessly filing petitions for mandamus, prohibition 1) When you need to establish a legal precedent, such as the
and certiorari for the purpose of reviewing the interlocutory validity of the patent which your company holds;
orders of the lower courts. 2) When you need to publicly prove the truth, such as when a
But a more serious factor behind the laws delay in the Philippines customers complaint about the product quality or safety has
involves the billing practice of lawyers. (Billable hours, number of court received wide attention in the media products good name;
appearances) Delaying tactics to consume time. 3) When your companys legal rights have been infringed and you
The choice between a litigation and settlement is clear. He would stand a good chance of collecting substantial damages in court;
rather cut through the chase and solve his disputes swiftly and move on 4) When your opponent is unable and unwilling to participate in
with his life. ADR; and
AGAN v. PIATCO (GR> NO. 15501)-SC ordered all affected parties to 5) When serious crimes are involved in the dispute.
comment made by one of the parties that PIATCO commences arbitration CHAPTER 3
proceedings by filing a request for arbitration with the secretariat of the The Grand Misnomer: Alternative Dispute Resolution
International chamber of commerce, International Court of arbitration. Legal Basis of ADR:
Private Justice-the concept is fairly recent development in the
administration of justice. ART. VIII, Sec. 5 (5) 1987 Constitution
-Private Courts are managed by private organizations, called -Mandating the SC to promulgate rules that shall provide a simplified
ADR providers to serve those who need to resolve most types of and inexpensive procedure for the speedy disposition of cases.
consumer, civil, corporate and commercial disputes. Rule 18, Sec 2(a) 1997 Rules of Civil Procedure
-Parties generally agree to enter the private court system for one -Requiring the courts to consider the possibility of an amicable settle or
main reason: the public court system is too chaotic and unwieldy. of a submission to alternative modes of resolution.
-vigilante justice Alternative comes from the word alternate which means substitute,
-Judges, selected by the parties and are paid on an hourly or a spare tire, a second stringer, a fallback position.
per session basis, are for rent not for sale. They are paid for their time and Which is wrong because litigation should be the LAST option not
their expertise, not their expected favors. ADR.
CON: Creates a dual court system-one rich and one poor. No
means a perfect system, it offers enormous savings in time, effort, anxiety, Limitations of ADR Cases that involve:
money in the long haul. 1) Constitutional law issues
CHAPTER 2 2) Anti-trust suits
The litigation of conflict: A Confucian Confusion 3) Probate
Two fundamental reasons for failure of trial courts according to Ralph 4) Adoption
Warner and Stephen Elias: 5) Precedent-setting cases that involve punitive damages
1) Court Rules and Procedures are so complicated and inefficient 6) Actions of equitable relief, and
that lawyer fees and other costs end up being a bigger problem 7) Nuisance are beyond the scope of arbitration.
than the dispute itself. ART. 2035 of the Civil Code
2) Winner take-all system defies logic, encourages lying and If related issues of the following are matters in controversy may not be
generally brings out the worst in all participants. capable of being referred to arbitration:
The Nature of Conflict 1) Civil Status of persons;
Conflict- clash of divergence of opinions, values and interests and 2) Validity of Marriage;
emotions. 3) And legal separation;
Several phases of the conflict process by Peter Condiffe (1995) 4) Futures support;
1) Conflict starts when parties perceive their differences-they go 5) Future legitime;
though feelings of anxiety and frustration. 6) Jurisdiction of the courts;
2) Realization or expression of grievances and the assessment of 7) Future jurisdiction of the courts.
all angles in the conflict.
CHAPTER IV
The Settlement of dispute in the Philippines: Tesco v. Vera-While it is true that the CIAC shall have original and
A culture of PAKIKISAMA exclusive jurisdiction over disputes connected with contracts entered
into by parties involved in the construction industry in the Philippines,
Many Filipinos readily overcome conflict through pragmatic means. Gini the parties must first agree to do so before the CIAC can acquire
Grahams techniques in Resolving Conflict: jurisdiction to arbitrate the matter.
1) Identify the source of the problem 3) Consumer Arbitration
2) Applying the appropriate problem solving techniques: Consumer Act of the Philippines (RA no. 7394) provides for the
a. Creative visualization-examine the reasons for the problem creation of a consumer arbitration program to handle consumer
b. Brain-storming-come up with alternatives complaints. They have original and exclusive jurisdiction to mediate,
c. Automatic writing-ask inner self for reactions of those possibilities conciliate hear and adjudicate all consumer complaints xxx.
d. Mental Imaging-ask inner expert for advice in making choices. 4) Matrimonial Mediation
Litigation is what many Filipino Lawyers do best. Students of law Disputes between couples that are civil in nature may be the subject of
are trained to think like lawyers, but they are not prepared to deal with court-referred mediation, subject to the limitations of Art. 2035 of the
they should do best: solve their client problems and resolve their disputes Civil Code.
with the least amount of time and expense. The key to decongest the The ff. disputes may not be compromised:
courts is that students should be trained to be sensitive to their clients a) civil status of persons
wishes to settle their conflict or dispute swiftly and without expense to b) validity of marriage or legal separation
court trials. c) any ground for legal separation
Filipino Conflict Management System d) future support
Filipino Values e) future legitime
1) Pakikiusap-request and f) jurisdiction of the courts.
2) Pakikisama-Companionship
Keep communication lines open. 5) Corporate Arbitration
1) Amor Proprio (self-respect) Corporation Code provides for the mechanism to resolve
2) Pasikaban (one-upmanship) corporate disputes. The SEC can exercise its power to arbitrate the
3) Bahala na (fatalism) dispute upon written petition by any stockholder. (read more about
4) Gantihan (retaliation) powers of the SEC)
Impede settlement and plays key roles in clogging the courts with 6) Partnership Arbitration
frivolous suits that are brought just to Save face or to give a lesson to The CC states that is beyond the authority of one or more but less than
the opposing party. all the partners to enter into a compromise or submit to arbitration a
But, positive aspects of Filipino culture that may tend to mitigate the partnership claim or liability. When it comes to ADR, unanimous
Filipino propensity to litigate disputes: consent of partners is needed to carry out the plant to resolve
1) Kamag-anak network (close family ties) partnership disputes without a court trial.
2) Tulungan (mutual aid) 7) Administrative Arbitration
3) Bigayan (give and take) Doctrine of Non-exhaustion of administrative remedies
4) Palabra de Honor (Word of Honor) 8) Environmental Mediation
5) Bayanihan (cooperative endeavor) 9) Executive Arbitration
6) Hiya (shame of doing something wrong) 10) Foreign Arbitration
7) Utang na loob (recognition of a debt or obligation) 11) Banking Arbitration
8) Paggalang (respect or honor) 12) Mining Arbitration
9) Kompadre (godfather system) 13) Maritime Arbitration
10) Delikadesa (Being proper) 14) Insurance Arbitration
15) IP Arbitration
The Katarungan Pambarangay was seen by legislators as a means to 16) Securities Arbitration
decongest the courts dockets, by encouraging the settlement of minor Six-Step Structure of a face-to-face mediation meeting
cases at the barangay level, which will in turn allow the courts to speed up (I-H-I-M-I-S)
the adjudication of already pending cases. This again relates to the access- 1) Introduction and agreeing of ground rules
to-justice problem in the country. 2) Hearing what has happened or summarizing the facts
To ensure that the goal is met, the Local Government Code makes 3) Identifying the issues
KP mediation and conciliation a condition precedent to the filing of cases 4) Mutual understanding and communicating feelings
in court. 7 Though non-compliance does not result in jurisdictional defect 5) Ideal storming of a win/win solution
thereby rendering the court proceedings void ab initio, such failure, if 6) Signing of voluntary agreement.
seasonably raised, makes the case vulnerable to a motion to dismiss on the Causes of Court Delays (Justice Myrna Dimaranan Vidal)
ground of prematurity (Garces v. CA, 162 SCRA 504). (TAKEN FROM 1) the misuse of the due process and the abuse of legal
AN ONLINE PRIMER OF THE KATARUNGAN PAMBARANGAY technicalities;
Published by the UP-College of Law) 2) the intervention of political pressure in court cases;
Types of Arbitration in the Philippines: 3) the sheer weight of court litigations arising from development
1) Labor Arbitration and growth;
The Labor Code of the Philippines makes arbitration mandatory in 4) the dilatory tactics of lawyers;
cases involving the interpretation and implementation of collective 5) neglect and laxity on the part of judges; and
bargaining agreements (CBA) and the interpretation or enforcement of 6) Court vacancies.
company personnel policies. The original and exclusive jurisdiction of
which falls with the Voluntary Arbitrators. (Sanyo v. Canizares) Definition of Terms:
2) Construction Arbitration
The creation of the Construction Industry Arbitration Commission Alternative Dispute Resolution
(CIAC) ushered the birth of arbitration in the construction industry.(EO. It is defined as any process or procedure used to resolve a
1008) dispute or controversy, other than by adjudication of a presiding judge of a
Private or Government-entered construction contracts can be submitted. court or an officer of a government agency, in which a neutral third party
participates to assist in the resolution of issues. It includes arbitration,
mediation or conciliation, mini-trial, early neutral evaluation, or any Process Consultation
combination thereof. This is used if there is a long-standing relationship between the
Arbitration parties and they encounter problems in resolving the disputes. Process
A voluntary dispute resolution process in which one or more consultants act as counselors who focus on the process of negotiation,
arbitrators, appointed in accordance with the agreement of the parties assisting the parties in enhancing or restoring communication lines.
resolve a dispute by rendering an award. It is the reference by mutual
agreement or consent of the parties of a controversy or dispute to selected Court-Annexed Mediation
persons for an informal hearing and extra-judicial determination and Means any mediation process conducted under the auspices of
resolution. The hearing is usually held in private and the decision of the the court, after such court has acquired jurisdiction of the dispute
persons selected will be a substitute for a court judgment. This avoids the
formalities, delay and expenses of ordinary litigation. Court-Referred Mediation
Mediation Means mediation ordered by a court to be conducted in
A dispute resolution procedure in which an impartial third party, accordance with the Agreement of the Parties when as action is
mutually chosen by the parties, acts as the referee to help the contending prematurely commenced in violation of such agreement.
parties settle their dispute. The mediator, unlike the arbitrator, has no
authority to make the parties reach an agreement. He serves as a clarifier Chapter V
and facilitator without dictating settlement. The term mediation used The Mitigation of Litigation:
under ADR Law includes conciliation. A Cornucopia of Non-litigative Processes
Mini-trial
A dispute resolution method in which the merits of a case are Motivating Factors that contribute to the rise in demand ADR
argued before a panel created by agreement of the parties comprising processes:
senior decision makers with or without the presence of a neutral third 1) Avoidance of high expense of litigation
person after which the parties seek a negotiated settlement. 2) Fear of lawsuit will result in an outcome far more adverse than
Early neutral evaluation reasonably anticipated
An alternative dispute resolution process whereby parties and 3) Need to return workers involved in the law suit to more
their lawyers are brought together early in a pre-trial phase to present productive activities
summaries of their cases and receive a non-binding assessment by an 4) Wish to preserve and re-establish the business or inter-personal
experienced, neutral person with expertise in the subject of the dispute. relationship that was temporarily disturbed by the conflict.
Med/Arb (Already defined in this reviewer) The parties go through a
Combination of Alternative Dispute Resolution phase where parties in crafting a compromise agreement only if this goes
A particular alternative dispute resolution may be combined down in flames, the mediator will change colors-may not render a binding
with the other types of alternative dispute resolutions. The most common award as an arbitrator pursuant to the agreement. However, Sec. 20 of RA
is the mediation-arbitration (Med-Arb). In this kind of combination, 876 states, No Arbitrator shall act as a mediator in any proceedings in
parties first proceed to mediation to define the dispute and settle as many which he is acting as an arbitrator;xxx is subject to strict interpretation.
issues as possible, and then they engage in arbitration to settle issues that
remain unresolved by the mediator. Facilitation is a less active form of mediation. The neutral third party or
Class Action Administration facilitator acts as a moderator in large meetings, acting as traffic police
Method of resolving the claims of a huge class of claimants officer directing the flow of traffic in the meeting and seeing to it that
with the least possible litigation expenditures and court cost through an everyone says his piece during the forum.
administrative agency in charge of maintaining and tracking statistical
days as well as overseeing restitution payments, appointed by the court or Mini-trials are not a trial but a rational and voluntary manner in
chosen by the parties design a set of claims procedures. structuring a settlement of disputes between two big companies that are at
Voluntary Settlement Conference loggerheads over sticky business issues. This is otherwise known as rent-
Just like mediation it is a non binding hearing; the neutral party a-judge.
is allowed to express his opinions and views about the case and will be
obligated to formulate an advisory opinion to be submitted to the parties Besides, mini-trial is a voluntary, confidential and non-binding procedure
for review and approval. that affects a speedy, cost-effective resolution of corporate conflict.
Lawyers present summaries of their cases to chief executives or other key
Mass Tort ADR Projects (Manville Personal Injury Settlement decision-makers representing both clients. (Linda Singer)
Trust and A.H Robbins bankruptcy for claims of asbestos sufferers and for
claims related to the Dalkon shield, respectively) Mini-trial contract This is signed by the parties that contain provisions
governing the conduct of discovery, how hearing will be handled and a
Referee or Rent a Judge few more important stipulations.
A practicing attorney or a retired judge usually acts as a referee
who conducts a trial that incorporates the formalities of a regular court Class action administration is a sensible approach at dispute resolution
trial, complete with a court reporter and the observance of the strict rules is to have an administrative agency that is in charge of maintaining and
of evidence. tracking statistical data as well as overseeing restitution payments,
appointed by the court or chosen by the parties design a set of claims
Mock-Jury trial. procedures and forms that will be sent out to all the claimants.
A mock jury contract sets forth all the provisions government
the dispute resolution process chosen by them, including how the mock Voluntary settlement conference is where the neutral party, unlike
jury proceedings will be conducted. mediation, is allowed to express his opinions and views about the case and
Ombudsman will be obligated to formulate an advisory opinion to be submitted to the
He is a fact finder or referee hired by businesses to deal with parties for review and approval.
disputes inside the organization. The objective is to solve problems and
disputes quickly and informally by hearing and investigating disputes
between workers.
Conciliation uses a neutral third party to clarify issues in dispute so that 7) Low-balling
the parties concerned may themselves arrive at a mutually acceptable Agreeing to the offer made by the other part and then start chipping
agreement. away at the terms of the original offer until the offer has been severely
altered
Mass tort ADR projects 8) The Bait and switch
9) Advertising one product to bring people inside the store and finding
Rent-A-Judge incorporates the formalities of a regular court trial, excuses to explain the unavailability of the advertised product then
complete with a court reporter and the observance of the strict rule of quickly suggest that a different product be bought instead.
evidence but the parties may agree to modify or disregard most formal 10) Outrageous behavior
rules of procedure, evidence and pleading with some limitations. Exhibiting socially unacceptable demeanor to rattle the other party
11) Written work
Mock Jury Trial Presenting adhesion contracts to discourage question about the deal
Ombudsman 12) The vise
Applying verbal pressure to force the other party To do better than
Process consultation the process consultants (PC) differs from the what is being offered and to gain concessions.
mediator in that there is no discussion of the specific issues or any attempt 13) Trade off
to solve them. Thus, process consultants are often more like counselors Splitting the difference and seeking the midpoint
who help parties to get along better so that they can engage in better 14) Nibble
negotiation and problem-solving. Waiting for the major terms of the deal to be settled then asking for
the minor concessions to be included in the deal
ADR processes in US Government Agencies 15) Funny Money
International Commercial Arbitration Making mathematical calculations and dividing the payments over a
Small claims courts period of time to convey the impression that the other party is getting a
Neighborhood dispute centers good deal.
Regulatory negotiation Two major types of unassisted negotiations:
1) Combative Negotiator- who will emphasize only his own gains at
Chapter VI the expense of the other and employ hard line tactics, such as
The sport of Non-adversarial lawyers exaggerating claims or even threatening to abandon the discussion if
he does not get his way.
Leigh Steinberg, Effective negotiation is about exhaustive 2) Conciliatory negotiator-who will assume the role of a problem
preparation, utter clarity, heartfelt communication, and a sincere, solver rather than an intimidator.
demonstrated desire to fully understand not just your own needs but the
needs of other party.xxx Jesus and Socrates were two of the best Class of negotiations
negotiators of history. One is a form of syllogism, the other in the form of
parables. Rock and a Hard Place- The rock is litigation, which as a means 1) Position-based negotiations often involve hard-ball methods because
of resolving a dispute is frustrating, time consuming, expensive and full of it is premised on the presumed superiority of ones position.
friction. The hard place is negotiation, which can often prove unavailing 2) Interest-based negotiation is much more candid and amiable
as a means of reaching accord between two disputants; each of whom has technique that involves the willing disclosure of all germane
strong feelings about the matter. (Freund, Smart Negotiating, 1992) information to the other party so as to explore all avenues of
satisfying the needs and interests of the other side of the least
LITI-GATION (Marc Deiner) Litigation is often used for leveraging. A possible cost and at the shortest possible time.
lawsuit is filed and pushed to the limit to force a favorable settlement Leonard Koren and Peter Goodmans dead-lock breaking techniques
agreement. (1991)
Negotiation is a problem solving operation. (Romance Languages means
to do business) 1) Be positive and dont be put off by the good word no
Lawyers have a role to play in at least two crucial negotiation 2) Agree on easier terms first and skip over the points that are bogging
schemes: you down and come back to them late
1) Dispute or litigation settlement 3) Emphasize shared goals, get back to common ground and start
2) Transaction-planning to preventive law negotiations building up again
Basic Negotiation Tactics 4) Reduce complexity, break down complicated negotiations into pieces
1) The wince and solve each piece one at a time
Well-timed flinch at the exact moment when the other party 5) Brainstorm with your opponent to generate various alternatives
announces his terms. 6) Fine tune your agreement so that there is something that both of you
2) Silence can find acceptable
Staying absolutely quiet after making your offer or when the other 7) Passing written proposals back and forth for comment
party says something that you find disagreeable 8) Calling a time out when things get rough and not going your way.
3) Good guy/bad-guy
Working with an actual partner to make it appear to the other party EXHAUST ADR PROCESSES BEFORE LITIGATION.
that accepting the offer of the good guy is a much better alternative than
giving in the harsher terms bad guy
4) Limited authority
Buying time to obtain more authority from an imaginary principal or
a real person with greater discretion
5) Red Herring
Creating distraction to muddle the real issues
6) Trial Balloon
Raising questions designed to peek into the other partys position
without revealing your true objectives