Please accept our deepest gratitude for institutionalizing arbitration in the country,” Supreme Court Associate Justice Jose P. Perez said during his keynote speech at the inauguration of PDRCI’s new office on June 16, 2011 at the Commerce & Industry Plaza at the McKinley Town Center in Fort Bonifacio, Taguig City. Justice Perez added that PDRCI provided the judiciary with “a reliable, responsible and respectable partner” in the administration of justice in the Philippines.
The new office, located near the spanking Bonifacio Global City, was blessed by Fr. Philip P. Lazatin, SDB. The welcome remarks of PDRCI Chair, former Chief Justice Artemio V. Panganiban, were delivered by President Emeritus Custodio O. Parlade, after which Justice Perez was introduced by trustee Jose A. Grapilon. Atty. Gapilon cites Justice Learned Hand in describing the opinions written by Justice Perez as characterized by a “tenacious grasp of fine points, honed almost to invisibility, … when we are suddenly aware of the sweep and direction of the law and its place in the lives of men.”
Justice Perez recalled how he, as a former Court Administrator, worked with two PDRCI trustees, Engr. Salvador P. Casto and Atty. Salvador Panga, Jr., in pushing for court-annexed mediation and winning over reluctant judges and lawyers who feared the loss of cases to alternative dispute resolution (ADR).
Ambassador Francis Chua, President of the Philippine Chamber of Commerce & Industries, Inc., which donated the use of the office space, gave an inspirational talk. PDRCI President Victor P. Lazatin then gave the closing remarks. Trustee Gregorio S. Navarro served as emcee.
Challenges and Procedure
In our last issue, we wrote about the commencement of and procedure in intellectual property arbitration administered by the Intellectual Property Office (IPOPHL) and Philippine Dispute Resolution Center, Inc. (PDRCI) Arbitration Center. This article will discuss challenges to arbitrators, filing of the Answer, conduct of hearings, and issuance of Award.
Challenges
Any arbitrator may be challenged by a party if circumstances exist that give rise to justifiable doubt as to the arbitrator’s impartiality or independence. A party may also challenge an arbitrator whom it has appointed or in whose appointment it concurred, only for reasons of which it becomes aware after the appointment has been made.
The challenge shall be made within 15 days after being notified of that arbitrator’s appointment or after becoming aware of the circumstances that it considers give rise to justifiable doubt as to that arbitrator’s impartiality or independence. The other party has 15 days from receipt of the notice of challenge within which to respond. The challenge shall be resolved by the Administering Body, whose decision on the matter shall be final. If the challenge is sustained, a substitute arbitrator shall be appointed. On the other hand, if the challenge is denied, the arbitrator shall continue with the arbitration.
Once the arbitral tribunal is constituted, it shall have the power to hear and determine objections to its own jurisdiction, including any objections with respect to form, existence, validity or scope of the Arbitration Agreement. Any objection to the jurisdiction of the tribunal shall be raised not later than in the Statement of Defense or, with respect to a counter-claim or a set-off, the Statement of Defense thereto, failing which any such plea shall be barred in the subsequent arbitral proceedings or before any court.
Statement of Claim and Answer
Unless the Statement of Claim accompanied the Notice of Arbitration or is embodied therein, the Claimant shall, within 30 days after receipt of notification from the Administering Body of the establishment of the tribunal, communicate its Statement of Claim to the Respondent and to the tribunal. The Respondent shall, within 30 days after receipt of the Statement of Claim or within 30 days after receipt of notification from the Administering Body of the establishment of the tribunal, whichever occurs later, communicate its Statement of Defense to the Claimant and to the tribunal. Both Statements shall by the documentary evidence in support of the parties’ respective claims or defenses.
During the proceeding, the tribunal may, at the request of a party, issue interim measures it deems necessary, including injunctions and measures for the conservation of goods which form part of the subject matter in dispute, such as an order for their deposit with a third person or for the sale of perishable goods. The tribunal may make the granting of such measures subject to appropriate security being furnished by the requesting party. The tribunal shall also have the power to subpoena witnesses and documents when the relevancy of the testimony and the materiality thereof has been demonstrated to it.
Preliminary conference and hearings
Following the submission of the Statement of Defense, the tribunal may conduct a preliminary conference during which the parties define the issues of arbitration, limit the number of witnesses, organize and schedule subsequent proceedings, and agree on other matters that are relevant to the proceedings.
Within 15 days from the preliminary conference or if there is none, after the completion of the submissions the written statements, the tribunal shall draw up a Procedural Order, defining, among others, the issues to be determined in the arbitration. The Procedural Order shall be signed by the parties and the tribunal and approved by the Administering Body. If a party refuses to sign, the tribunal and the Administering Body will sign and indicate reasons why the party refuses to sign.
After the parties are afforded sufficient opportunity to present their respective submissions and evidence, either through documents, testimonies of witnesses, or other forms of evidence, the tribunal shall declare the proceedings closed.
Award
The tribunal shall then decide the substance of the dispute in accordance with the law or rules of law chosen by the parties and proceed to render the arbitral award. Where there is more than one arbitrator, the award shall be made by a majority of the members of the tribunal. In the absence of a majority, the presiding arbitrator shall make the award, order or other decision as if acting as sole arbitrator.
The award shall be in writing and shall state the date on which it was made, as well as the place of arbitration. It shall likewise explain the reasons on which it is based, unless the parties have agreed that no reasons should be stated and the law applicable to the arbitration does not require the statement of such reasons.
The tribunal shall send the draft award for scrutiny by the Administering Body with regard to matters of form and substance but only to ensure the enforceability of the award. The tribunal shall have the sole authority and discretion to decide on whether or not to accept the suggestions of the Administering Body.
The award shall be effective and binding on the parties from the date it is communicated by the Administering Body. Within a reasonable timeframe upon receipt of the award from the Administering Body, the IPOPHL Arbitration Office shall assist in the enforcement of the award which the IPOPHL is able to do so under applicable legislation and regulations.