ALTERNATIVE DISPUTE RESOLUTION

ALTERNATIVE DISPUTE RESOLUTION - It is the means and method of settling controversy outside the court system with the
assistance of a neutral third party. It is a court diversion strategy, i.e. a way to avoid court litigation although still part of the court
system.

FOUR ASPECTS OF DIFFERENTIATION BETWEEN DOMESTIC AND INTERNATIONAL ADR

Domestic and international ADR differ on the following aspects:

1) place of business of parties
2) place of arbitration
3) place of performance of obligation
4) subject matter which relates to more than one country

DIFFERENTIATE LITIGATION FROM ADR

1) Litigation involves a judge while ADR involves a neutral third party.
2) Litigation is public while ADR is private.
3) Litigation is time-consuming and prolonged while ADR is less time-consuming.
4) Litigation is a formal process while ADR is an informal process/
5) Litigation is strict and rigid while ADR is uncomplicated and flexible.
6) Litigation is expensive while ADR is less costly.
7) Litigation is evidentiary while ADR is nor evidentiary.
8) In litigation, the decision-makes is the judge while in ADR, the decision-maker is the parties among themselves.
9) In litigation, the product is a judgment while in ADR, the product is a comprise agreement.
10) In litigation, only one party wins as a result while in ADR, both parties wins as a result.

PRIMORDIAL PRINCIPLE OF ADR: The primordial principle of ADR is party autonomy, i.e. the freedom of the parties to
determine rules and to make own arrangements in settling dispute.

THE FIVE PRINCIPLES OR OBJECTIVES OF ADR

1) to declog court dockets
2) to conserve judicial climate
3) to dispense with expeditious and impartial justice
4) to promote party autonomy
5) to enlist the private sector’s participation in resolving cases

SOURCES OF ADR RULES

1) domestic laws
2) rules or acts from the executive branch
3) SC decisions
4) International laws and treaties
5) general principles of law

COMMON FORMS OF ADR IN THE PHILLIPINES

1) Arbitration, i.e. a voluntary dispute resolution process in which one or more arbitrators resolve a dispute by rendering an
award.
2) Mediation, i.e. a voluntary process in which a mediator, selected by the disputing parties, facilitates communication and
negotiation, and assists the parties in reaching a voluntary agreement regarding a dispute.
3) Conciliation, i.e. the adjustment and settlement of a dispute in a friendly, unantagonistic manner.

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DEFINE THE FOLLOWING:
1. ARBITRAL AWARD - It is the partial or final decision by an arbitrator in resolving the issue in a controversy.
2. COURT-ANNAXED MEDIATION – It is the mediation process conducted under the auspices of the court.
3. COURT-REFERRED MEDIATION – It is mediation ordered by a court to be conducted in accordance with the
Agreement of the Parties when as action is prematurely commenced in violation of such agreement

CONCLUDING AGREEMENTS IN ADR

1. Mediation
a. Compromise Agreement – it is a contract whereby the parties, by making reciprocal concessions, avoid litigation
or put an end to one already commenced.
b. Mediated Settlement Agreement – it is a contract executed by the mediating parties, with the assistance of their
respective counsel, certified by the mediator, evidencing a successful mediation.
2. Court-annexed mediation
a. Judgement Based on Compromise – it is a compromise agreement submitted to the court or tribunal for approval,
if the controversy subject matter of te compromise agreement is also the subject of litigation.
3. Conciliation
a. Waiver or Quitclaim – it is a statement renouncing any right or claim involved in a controversy by one party in
favour of the other.
4. Arbitration
a. Arbitral Award – it is the partial or final decision by an arbitrator in resolving the issue in a controversy

EXCEPTIONS TO THE APPLICATION OF RA 9285

1. labor disputes covered by the Labor Code of the Philippines (PD 442), as amended, and its Implementing Rules and
Regulations
2. cases affecting the civil status of persons
3. cases affecting the validity of a marriage
4. any ground for legal separation
5. the jurisdiction of courts
6. future legitimes
7. criminal liability
8. those which by law cannot be compromised

HISTORY OF ADR
 1950 – The NCC was enacted, providing chapters on compromises and on arbitrations, ie. Book V, Title IV.
 1953 – RA 876 or the Arbitration Law was enacted.
 1965 – The Philippines adhered to the UN Convention on Recognition and Enforcement of Foreign Arbitrary Awards of
1958.
 1985 – The Philippines became a signatory to the UN Commission on International Trade Law (UNCITRAL).
 2004 – RA 9285 was enacted.

THE AGREEMENTS INITIATING ARBITRATION PROCEEDINGS

1. PRE-CAUSAL CONSENT OR AGREEMENT TO SUBMIT TO ARBITRATION – it is where parties agree in a contract
to settle by arbitration a controversy that will arise between them.
2. PRESENT CAUSAL CONSENT OR SUBMISSION AGREEMENT – it is where the controversy already exists between
the parties at the time of the submission to arbitration.

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BASIS OF ADR AS A COURT DIVERSION STRATEGY : ADR, as a court diversion strategy, is based on the fact that ADR
essentially avoids litigation. It is geared towards the conservation of judicial climate. i.e. to allow the judge to focus on non-
backyard cases.

COMROMISE UNDER THE NCC: A compromise is a contract whereby the parties, by making reciprocal concessions, avoid
litigation or put an end to one already commenced.

MAY A CRIMINAL OFFENSE BE THE SUBJECT OF COMPROMISE?

- Yes, but only as to the civil aspect of the criminal offense. RA 9285 expressly provides cases affecting criminal liability
as an exception to this applicability.

CONTRIBUTIONS OF THE THREE BRANCHES OF THE GOVERNMENT IN PROMOTING ADR

 LEGISLATIVE
1. Enactment of PD 442 in relation to NLRC arbitration
2. Enactment of RA 7160 in relation to ADR in the barangay level
 EXECUTIVE
1. Issuance of EO 1008 or the Construction Industry Arbitration Law
2. Issuance of Rules on ADR for Disputes Between National Government Agencies
 JUDICIARY
1. Requirement of conducting pre-trial conference
2. Utilization of modes of discovery
3. Proscription against forum-shopping
4. Encouraging ADR through the Philippine Mediation Center or through Judicial Dispute Resolution

FORMAL REQUIREMENTS OF ARBITRATION AGREEMENTS

- An arbitration agreement must be in writing and subscribed by the party sought to be charged, or by his lawful agent.
(Section 4, Arbitration Law)

REQUIREMENTS FOR RECOGNITION OF DOMESTIC ARBITRAL AWARDS

- Section 23 of RA 876 provides that at any time within one month after the award is made, any party to the arbitrated
controversy may apply to the court for an order of confirmation. Notice of such motion must be served upon the
adverse party or his attorney.

DOCTRINE OF SEPARABILITY
- It refers to pre-causal arbitration agreements.
- It means that just in case the principal contract is declared void, the arbitration clause shall remain valid.
- Each doctrine is to avoid letting a party escape his obligation claiming that the contract is void.

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