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Alternative Disputes Resolution Cases-1-5-Digest
Alternative Disputes Resolution Cases-1-5-Digest
INDUSTRY ARBITRATION COMMISSION (CIAC) month of February to present its evidence and to pay all
G.R. No. 132848-49 June 26, 2001 PHILROCK, INC., fees assessed by it, otherwise Philrock would be
petitioner, vs. CONSTRUCTION INDUSTRY deemed to have waived its right to present evidence
ARBITRATION COMMISSION and Spouses
VICENTE and NELIA CID, respondents. Judgment is rendered in favor of the Claimant, directing
Respondent to pay.
FACTS : Private respondents, filed a Complaint for Before the CA, petitioner filed a Petition for Review,
damages against Philrock and seven of its officers and docketed as CA-GR SP No. 42443, contesting the
engineers with the Regional Trial Court of Quezon City, jurisdiction of the CIAC and assailing the propriety of the
Branch 82. The trial court issued an Order dismissing monetary awards in favor of respondent spouses. This
the case and referring the same to the CIAC because Petition was consolidated by the CA with CA-GR SP No.
the Cid spouses and Philrock had filed an Agreement to 39781, a Petition for Certiorari earlier elevated by
Arbitrate with the CIAC. Preliminary conferences were petitioner questioning the jurisdiction of the CIAC.
held among the parties and their appointed arbitrators.
At these conferences, disagreements arose as to: ISSUE : Whether or not the CIAC could take jurisdiction
1) whether moral and exemplary damages and tort over the case of Respondent Cid spouses against
should be included as an issue along with breach of Petitioner Philrock after the case had been dismissed
contract, and by both the RTC and the CIAC.
2) whether the seven officers and engineers of Philrock
who are not parties to the Agreement to Arbitrate should HELD : Section 4 of Executive Order 1008 expressly
be included in the arbitration proceedings. vests in the CIAC original and exclusive jurisdiction over
No common ground could be reached by the parties, disputes arising from or connected with construction
hence, on April 2, 1994, both the Cid spouses and contracts entered into by parties that have agreed to
Philrock requested that the case be remanded to the submit their dispute to voluntary arbitration. It is
trial court. undisputed that the parties submitted themselves to the
jurisdiction of the Commission by virtue of their
On June 13, 1995, The trial court declared that it no Agreement to Arbitrate dated November 24, 1993.
longer had jurisdiction over the case and ordered the Signatories to the Agreement were Atty. Ismael J.
records of the case to be remanded anew to the CIAC Andres and Perry Y. Uy (president of Philippine Rock
for arbitral proceedings. the CIAC resumed conducting Products, Inc.) for petitioner, and Nelia G. Cid and Atty.
preliminary conferences. On August 21, 1995, herein Esteban A. Bautista for respondent spouses
[P]etitioner Philrock requested to suspend the
proceedings until the court clarified its ruling in the
Order dated June 13, 1995 Petitioner claims, on the other hand, that this
Agreement was withdrawn by respondents on April 8,
Petioner : Philrock argued that said Order was based on 1994, because of the exclusion of the seven engineers
a mistaken premise that 'the proceedings in the CIAC of petitioners in the arbitration case. This contention is
fell through because of the refusal of Philrock to include untenable. First, private respondents removed the
the issue of damages therein,' whereas the true reason obstacle to the continuation of the arbitration, precisely
for the withdrawal of the case from the CIAC was due to by withdrawing their objection to the exclusion of the
Philrock's opposition to the inclusion of its seven officers seven engineers. Second, petitioner continued
and engineers, who did not give their consent to participating in the arbitration even after the CIAC Order
arbitration, as party defendants had been issued. Finally, as pointed out by the solicitor
general, petitioner maneuvered to avoid the RTC’s final
Respondent : manifested that she was willing to exclude resolution of the dispute by arguing that the regular
the seven officers and engineers of Philrock as parties court also lost jurisdiction after the arbitral tribunal’s
to the case so as to facilitate or expedite the April 13, 1994 Order referring the case back to the RTC.
proceedings. After submitting itself to arbitration proceedings and
actively participating therein, petitioner is estopped from
the Arbitral Tribunal denied Philrock's request for the assailing the jurisdiction of the CIAC, merely because
suspension of the proceedings. The parties then the latter rendered an adverse decision.
proceeded to finalize, approve and sign the Terms of
Reference. Philrock's counsel and representative, Atty.
Pericles C. Consunji affixed his signature to said Terms
of Reference which stated that 'the parties agree that
their differences be settled by an Arbitral Tribunal
Facts:
METROPOLITAN CEBU WATER DISTRICT V.
MACTAN ROCK INDUSTRIES (G.R. NO. 172438)
Facts:
Petitioner Metropolitan Cebu Water District (MCWD), a
government-owned and controlled corporation, entered
into a Water Supply Contract with herein respondent,
Mactan Rock Industries, Inc. (MRII), wherein the latter
would supply MCWD with potable water with a minimum
guaranteed annual volume. Respondent filed a
complaint against MCWD with the CIAC citing the
arbitration clause of the contract and seeking the
reformation of Clause 17 of the Contract or the Price
Escalation/De-Escalation Clause in order to include
Capital Cost Recovery in the price escalation formula.
MCWD filed its Answer, including a motion to dismiss
the complaint on the ground that CIAC had no
jurisdiction over the case, as the contract was not one
for construction or infrastructure. Petitioner then filed
two petitions before the CA which were both denied,
hence this petition.
Issues:
(1) Whether or not CIAC may exercise jurisdiction over
disputes arising from a water supply contract; and if so,
(2) Whether or not CIAC have a jurisdiction over a
complaint praying for a reformation of a water supply
contract.
Ruling:
(1) The Court finds in the affirmative. The motion for
reconsideration was denied by CA and MCWD never
appealed the case. Thus, the decision of the CA
became final and executory. The Court has held time
and again that a final and executory judgment, no
matter how erroneous, cannot be changed even by this
Court. The CA affirming the CIAC’s jurisdiction and it
becoming final, is now beyond the jurisdiction of the
Court to review or modify, even supposing for the sake
of argument, that it is indeed erroneous.
(2) Where the law does not delineate, neither should
we. Neither the provisions of the Civil Code on
reformation of contracts nor the law creating CIAC
exclude reformation in its jurisdiction. Therefore,
because the CIAC has been held to have jurisdiction
over the contract, it follows that it has jurisdiction to
order the reformation of the contract as well.
Advertisements
BF Corporation v. CA, 288 SCRA 267 (1998) "certiorari will not be issued to cure errors in
proceedings or correct erroneous conclusions of law or
Facts: fact. As long as a court acts within its jurisdiction, any
Petitioner and respondent Shangri-la alleged errors committed in the exercise of its
Properties, Inc. entered into an agreement whereby the jurisdiction will amount to nothing more than errors of
latter engaged the former to construct the main judgment which are reviewable by timely appeal and not
structure of the "EDSA Plaza Project," a shopping mall by a special civil action of certiorari."
complex in Mandaluyong. Petitioner incurred delay in
the construction work that SPI considered as "serious The question of jurisdiction, which is a question
and substantial." On the other hand, according to of law depends on the determination of the existence of
petitioner, the construction works "progressed in faithful the arbitration clause, which is a question of fact. In the
compliance with the First Agreement until a fire broke instant case, the lower court found that there exists an
out damaging Phase I" of the Project. Hence, SPI arbitration clause. However, it ruled that in
proposed the re-negotiation of the agreement between contemplation of law, said arbitration clause does not
them. exist. It is that mode of appeal taken by private
Petitioner and SPI entered into a written agreement respondents before the CA that is being questioned by
denominated as "Agreement for the Execution of the petitioners before this Court. But at the heart of said
Builder's Work for the EDSA Plaza Project." Said issue is the question of whether there exists an
agreement would cover the construction work on said Arbitration Clause because if an Arbitration Clause does
project as of May 1, 1991 until its eventual completion. not exist, then private respondents took the wrong mode
According to SPI, petitioner "failed to complete the of appeal before the CA.
construction works and abandoned the project." This
resulted in disagreements between the parties as For this Court to be able to resolve the question
regards their respective liabilities under the contract. of whether private respondents took the proper mode of
appeal, which, incidentally, is a question of law, then it
Petitioner filed with the RTC of Pasig a has to answer the core issue of whether there exists an
complaint for collection of the balance due under the Arbitration Clause which, admittedly, is a question of
construction agreement. SPI and its co-defendants filed fact.
a motion to suspend proceedings instead of filing an
answer. The motion was anchored on defendants' Moreover, where a rigid application of the rule
allegation that the formal trade contract for the that certiorari cannot be a substitute for appeal will
construction of the project provided for a clause result in a manifest failure or miscarriage of justice, the
requiring prior resort to arbitration before judicial provisions of the Rules of Court which are technical
intervention could be invoked in any dispute arising from rules may be relaxed. As we shall show hereunder, had
the contract. Petitioner opposed said motion claiming the CA dismissed the petition for certiorari, the issue of
that there was no formal contract between the parties whether or not an arbitration clause exists in the
although they entered into an agreement defining their contract would not have been resolved in accordance
rights and obligations in undertaking the project. with evidence extant in the record of the case.
Consequently, this would have resulted in a judicial
Thereafter, upon a finding that an arbitration rejection of a contractual provision agreed by the parties
clause indeed exists, the lower court denied the motion to the contract.
to suspend proceedings as the Conditions of Contract
was not duly executed or signed by the parties, and the In the same vein, this Court holds that the
failure of the defendants to submit any signed copy of question of the existence of the arbitration clause in the
the said document,. contract between petitioner and private respondents is
a legal issue that must be determined in this petition for
The lower court then ruled that, assuming that review on certiorari.
the arbitration clause was valid and binding, still, it was
"too late in the day for defendants to invoke arbitration.
Considering the fact that under the supposed Arbitration
Clause invoked by defendants, it is required that "Notice
of the demand for arbitration of a dispute shall be filed
in writing with the other party . . . . in no case . . . . later
than the time of final payment . . . "which apparently,
had elapsed because defendants have failed to file any
written notice of any demand for arbitration during the
said long period of one year and eight months. The CA
annulled the orders of the RTC.
Held: