ADR and Katarungang Pambarangay

THE KATARUNGANG PAMBARANGAY (KB) LAW AND ALTERNATIVE DISPUTE RESOLUTION (ADR) MECHANISMS

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THE KATARUNGANG PAMBARANGAY (KB) LAW AND ALTERNATIVE DISPUTE RESOLUTION (ADR) MECHANISMS

Alfredo F. Tadiar I. COMMON PURPOSES OF KB AND ADR

A. To help lighten judicial workload and decongest heavy court dockets.1

B. To empower the people to resolve their own disputes.2

C. To preserve the Filipino culture of prior conciliation to resolve their

disputes.3

II. THE KB LAW4

A. Purpose To prevent the indiscriminate filing of cases in court by barring the

filing of such cases unless the parties have undergone prior conciliation before Barangay authorities which did not result in a settlement of the dispute by a compromise agreement and a Certificate to File Action in

1 The second and third WHEREAS clauses of P.D. 1508 states:

“ WHEREAS The indiscriminate filing of cases in the courts of justice contributes heavily and unjustifiably to the congestion of court dockets, thus causing a deterioration in the quality of justice”

“WHEREAS In order to help relieve the courts of such dockets congestion and thereby enhance the quality of justice dispensed by the courts, it is deemed desirable to formally organize and institutionalize a system of amicably settling disputes at the barangay level.”

2 Republic Act No. 9285, Sec. 2: the Alternative Dispute Resolution Act of 2004 declares as a State Policy “to actively promote party autonomy in the resolution of disputes or the freedom of the parties to make their own arrangements to resolve disputes.” 3 The first WHEREAS clause of Presidential Decree No. 1508 states:

WHEREAS the perpetuation and official recognition of the time-honored tradition of amicably settling disputes among family and barangay members at the barangay level without judicial recourse would promote the speedy administration of justice and implement the constitutional mandate to preserve and develop Filipino culture and to strengthen the family as a basic social institution.

4 The Katarungang Pambarangay Law was originally promulgated on June 11, 1978 as Pres. Decree No. 1508 issued by President Ferdinand E. Marcos. It was substantially re-enacted as the Revised Katarungang Pambarangay Law under Chapter 7 of Local Government Code of 1991 (Rep. Act No. 7160).

The Katarungang Pambarangay (KB) Law and Alternative Dispute Resolution (ADR) Mechanisms

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Court has been issued that no compromise settlement has been reached despite personal confrontation of the parties.5

B. Conditions for Application of the KB Law

1. Both parties are natural persons6 2. Both parties are actual residents7 of same city/town8 3. Dispute is not among those excepted from coverage9

C. Subject Matter Jurisdiction for KB Proceedings

1. Crimes where the imposable penalty does not exceed 1 year of imprisonment or P5,000.00 fine.

2. All civil cases without limit on the amount or value of the property

involved in the dispute.10

D. Exclusions from KB Jurisdiction

1. Disputes involving the government, any subdivision, or instrumentality thereof.

5 LOCAL GOVERNMENT CODE OF 1991, Sec. 412, Conciliation, Pre-condition to filing complaint in court. The certification is that “there has been a confrontation between the parties before the upon chairman or the pangkat and that no conciliation has been reached.” The certification is made “by the lupon secretary or pangkat secretary as attested to by the lupon chairman or pangkat chairman” 6 The requirement that both disputants must be natural persons is inferred from Sec. 410 of the LOCAL GOVERNMENT CODE OF 1991, authorizing “any individual who has a cause of action against another individual” to file a complaint. The use of the terms “individual” and not the generic “persons” which include corporations, is intended to convey that narrower meaning. 7 The use of the term “actually residing” was intended to exclude “legal residence” 8 This requirement of actual residence in the larger local government unit of a city or municipality, is provided for in Sec. 408 of the LOCAL GOVERNMENT CODE OF 1991. Notwithstanding its clear provision, however, it is common error, even among lawyers, to equate this requirement with residence in the same barangay, thus unduly restricting its broader application. The confusion is understandable in light of the title that this system is only for administering justice in the Barangay. 9 LOCAL GOVERNMENT CODE OF 1991, Sec. 408, provides that the coverage is “for amicable settlement of all disputes except...” 10 Barangay conciliation is not restricted to jurisdictional amounts of first level courts, Morata et al., v. Go and Hon. Tomol, G.R. No. 62339, October 27, 1983, 125 SCRA 444. Claim for damages, regardless of the amount involved, arising from an offense outside the jurisdiction of KB, may be settled under KB law (Opinion of Minister of Justice, No. 151, series of 1979 and No. 51, series of 1980, and Opinion dated October 25, 1982.)


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2. Where a party is a public officer or employee and the “dispute relates

to the performance of official functions.”

3. Serious crimes where imposable penalty exceeds that within KB jurisdiction of 1 year imprisonment or P5,000.00 fine

4. Victimless crimes “where there is no private offended party”

5. Disputes relating to real properties located in different cities or towns unless parties agree to settle before the “appropriate lupon”

6. Where parties reside in different towns or cities unless the barangays where they reside adjoin each other and they agree to settle before the “appropriate lupon”

7. Disputes determined by the President, upon recommendation of the Secretary of Justice, to be not appropriate for barangay settlement.

E. Special Jurisdiction for KB Proceedings.

Non-criminal cases not falling within KB jurisdiction may still be referred to “the lupon concerned” by the court in which they are filed.11

F. Venue for Filing of Complaint: Before Lupon of Barangay:12

1. “Where the respondent or any of the respondents actually resides” 2. “Where the real property or the larger portion thereof (involved in the

dispute) is situated”

3. “Where the workplace in which disputants are employed is located

4. “Where the institution in which parties are enrolled for study is located”

11 The limits to the broad scope of this extended authority have not been tested. Thus, it is not settled whether corporations or non-residents of a city or town, may now avail of this remedy based on this expanded jurisdiction. 12 LOCAL GOVERNMENT CODE OF 1991, Sec. 409: Venue.


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G. Procedure for Settling Disputes under KB Law.

Barangay conciliation is a two step process:

First. Before the punong barangay as Lupon Chairman13 and principal conciliator. He has 15 days to secure a settlement.

Second. If he fails, he must constitute a 3 person

pangkatngtagapagkasundo14 which is given a similar period of “15 days from the day it convenes” extendible for another of 15 days, except in clearly meritorious cases.15

H. Arbitration

At any time during the two stages of conciliation stated above,16 the parties may execute an agreement to arbitrate wherein they agree to abide by the arbitration award made by the lupon chairman or the pangkat17.

I. Repudiation, Grounds, Procedure

There are two kinds of repudiation that are available to an aggrieved party under the KB Law. One is the repudiation of the arbitration agreement that the parties may have agreed upon. Such repudiation must be done “within five (5) days from the date thereof for the same grounds and in accordance with the procedure” for repudiating the settlement.

It is important to note that there is no remedy of repudiation of an

arbitral award. The proper remedy is “a petition to nullify the award filed before the proper city or municipal trial court”.18

The second kind is the repudiation of the compromise agreement that

may have been secured. It must be personally filed by the aggrieved party “within ten (10) days from the date of the settlement” in the form of a written

13 LOCAL GOVERNMENT CODE OF 1991, Sec. 410. 14 Id., Sec. 404. 15 Id., Sec. 410 (e). 16 Id., Sec. 413. 17 Arbitration is hardly resorted to at the Barangay level. The reason for this is that the process is not well understood and thus, is hardly suggested as an alternative to the parties. See Tadiar “Research Survey on the Conciliation of Disputes under the KB Law”, book bound mimeo, 215 pages, 1984, UP Law Center 18 LOCAL GOVERNMENT CODE OF 1991, Sec. 416 provides that a “petition to nullify the award has been filed before the proper city or municipal court.”


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statement that must be sworn to before the Lupon Chairman on the ground that his consent thereto was “vitiated by fraud, violence or intimidation”19. The grounds for repudiation of the arbitration agreement, as already noted above, are the same.

It is significant to note that while fraud may be deemed to include

deceit, the other grounds that vitiate consent under the Civil Code, namely, accident, mistake, or undue influence20, are not expressly included therein.

J. Enforcement of Settlement or Award

The KB Law provides as follows:

Sec. 417.Execution.- The amicable settlement or arbitration award may be enforced by execution by the lupon within six (6) months from the date of settlement21. After the lapse of such time, the settlement may be enforced by action in the appropriate city or municipal court.22

K. Sanctions

The original law contains a provision on sanctions23 that would

impose the penalty “as for indirect contempt of court upon proper application” therefore by the concerned KB official.

Further, if it is the complainant who refuses or willfully fails to

appear in compliance with the summons issued, the complaint shall be dismissed and this fact shall be reflected in the records and in the minutes so as to “bar the complainant from seeking judicial recourse for the same cause of action”.

19 LOCAL GOVERNMENT CODE OF 1991, Sec. 418. 20 CIVIL CODE, Art. 1330 to 1346. 21 It must be noted that computation for execution by the Lupon is “6 months from date of settlement.” This is understandable since that is also the date when the parties signed the compromise agreement. However, there is no provision for computing the period in the case of an arbitral award which is certainly not signed by the parties. It is suggested that commencement of the period is from date when the award was received by the parties. 22 A problem arises in a case where monthly installments for 12 months is agreed upon and default is made only on the seventh month. If literal interpretation is made, then a new action to collect the 7th to the 12th installments must already be filed in court. However, a logical interpretation would construe the computation of the 6 month period from the date of breach which is the accrual of the cause of action. On this interpretation, the motion for execution must still be filed with the Lupon. This is in accord with the objective of decongesting court dockets. 23 Pres. Decree No. 1508, Sec. 4 (d).


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On the other hand, if it is the Respondent who is at fault, he shall be barred “from filing any counterclaim arising out of or necessarily connected therewith.”

The foregoing sanctions were not carried over to the Revised KB

Law under the Local Government Code. However, said omissions in the substantive law were sought to be filled in by the IRR in Rule VI, Section 8 which reinstates all the foregoing sanctions in Pres. Decree No. 1508.24

L. Court interventions in KB Law There are several instances when court intervention may be made.

The first is for the imposition of a sanction as for contempt of court and bar of the Complaint or the compulsory counterclaim from court proceedings. Since said sanctions are now imposed by implementing rules, their absence in the substantive law may be a good ground for challenge.25

The second instance is when a complaint is filed in court without a

certificate to file action or with a questionable certificate. This may happen when it is the Lupon Chairman that issues the Certificate to File Action. The constitution of the pangkat is mandatory26 and, therefore, it is premature for the Lupon Chairman to issue said certificate simply because Respondent did not appear for conciliation.

Under Administrative Circular No. 14-93 issued by Chief Justice

Andres Narvasa, it is the duty of the Court to carefully scrutinize cases that are filed in order to check compliance with the KB Law and its IRR. The certification must attest to the fact of personal confrontation between the parties. Plainly, this is not true in the foregoing situation since the certificate was issued immediately upon the non-appearance of the Respondent and, therefore, no such confrontation had taken place.

In the foregoing situation, the case before the court should be

dismissed upon motion of defendant “on the ground of lack of a cause of action or prematurity”27

24 This could be questioned as a procedural rule that exceeds substantive law. 25 The question of whether sanctions may be imposed on the authority of the IRR where there is no sanctions provided in the substantive law, has not been tested. 26 KB IRR, Sec. 1 c (1). 27 Royales v. Intermediate Appellate Court, G.R. No. 65072, January 31, 1984, 127 SCRA 470.


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M. Advantages of Settling under the KB Law.

Dissatisfactions28 with the judicial resolution of disputes that are costly, incomprehensible and very lengthy, are each positively addressed by the Kararungang Pambarangay Law.

1. Less costly and easily accessible.

On the matter of heavy costs entailed by judicial processing, KB

dispute processing is the least expensive mode. A minimal filing of P5.00 to P20.0029 is charged for filing a complaint. Accessibility is assured by making available dispute processing in every Barangay, thus bringing justice literally at the door step of everyone. Travel time to a centralized location where the courts are situated, becomes inconsequential. Conciliation could be agreed upon, and often takes place at a venue or time most convenient to the parties and the mediator. Thus, time taken away from work is minimized.

2. Comprehensible proceedings.

On the matter of popular incomprehensibility of judicial proceedings

arising from its being conducted in a foreign language (English) and using legal jargon, KB dispute processing are conducted in the vernacular or language understood by the parties. Parties are encouraged to tell their side of the dispute freely and unencumbered by a lawyer’s vigorous objections based on legalities.

3. Non-intervention of lawyers30 In fact, it is important to stress that no lawyer is allowed to intervene

in Barangay conciliation proceedings, much less to make obstructive objections on procedural grounds that would judicialize the dispute in the manner that lawyers are trained for.

28 Former CJ Artemio Panganiban acronymized ACID as the popular dissatisfactions with the judicial mode of resolving disputes. “A” stands for restricted ACCESS to the courts; “C” is for CORRUPTION; “I” is for INCOMPETENCE; and “D” stands for DELAY in the delivery of justice. 29 KB IRR, Rule VI, Sec. 4. 30 LOCAL GOVERNMENT CODE OF 1991, Sec. 15 provides: “Appearance of parties in person. - In all KB proceedings, the parties must appear in person without the assistance of counsel or representative, except minors and incompetents who may be assisted by their next-of-kin who are not lawyers.


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4. Brevity of proceedings On the matter of judicial delay, KB processing is restricted to a total

of 45 days.31

5. Compromise agreement is like court judgment

Finally, when the parties agree on the terms of their compromise agreement, the KB law vests it with the force and effect of a court judgment.32 Thus, in the event of non-compliance or violation of their agreement, the aggrieved party may move for enforcement without having to go to court. This is one of the most significant innovations introduced by the KB law whereby a contract is in effect converted into an enforceable judgment of a court of law.

N. Benefits to the administration of justice secured by the KB Law.

Statistics from the Bureau of Local Government Supervision (BLGS) show that in the two decades and a half that the KB system has been operating since 1980, a cumulative total of 5,142,708 cases or 79.19%33 have been settled that, it is concluded, would have been otherwise filed in the judicial system.

Based on the average amount of P 9,500.0034 that is the estimated

cost to the government for each of those cases to be resolved, the barangay justice system has saved the government the staggering sum of P 34,204,340,750.00.35 The estimated cost per case resolved is arrived at by adding the operating budget of the court for a year and dividing it by the number of cases disposed of during that year. Actually, the cost would be much more than that if the capital outlay costs (building the Halls of Justice, purchase of typewriters/computers, for instance) were added.

By lessening the workload of judges through preventing the filing of

cases that would have been resolved judicially, the KB system has undoubtedly contributed to a great degree in lessening court docket congestion.

31 Id., Sec. 410: (b) limits the conciliation before the Lupon Chairman to “15 days from the first meeting of the parties before him.” Paragraph (e) limits conciliation before the Pangkat to “15 days from he day it convenes. . .extendible for another period which shall not exceed 15 days” 32 Id., Sec. 416 provides that “The amicable settlement and arbitration award shall have the force and effect of a final judgment of a court upon expiration of ten days from date thereof... “ 33 Totality of action taken by mediation, conciliation or arbitration, DILG National Summary Report on KP Implementation from 1980 to 2009. 34 Estimated adjudication cost per case, DILG Summary Report of cases filed and action taken on Katarungang Pambarangay Implementation for CY 2009. 35 Estimated Government Savings, DILG Summary Report on KP Implementation from 1980- 2009.


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As to other objective of the KB system of broadening access to

justice, referring to an empirical study that this author conducted in San Fernando, La Union, with funding assistance from The Asia Foundation (TAF), the conclusion was reached that the respondents surveyed placed great value on the KB system for having empowered them to resolve their own disputes.

This people empowering objective has now been enshrined as a State Policy in the ADR Act of 2004 (Rep. Act No. 9285) when it explicitly expressed it as a state policy to respect party autonomy or the freedom of the parties to make their own arrangement to resolve their own disputes36.

III. COURT-ANNEXED MEDIATION (CAM) WITH MOBILE COURT-ANNEXED

MEDIATION (MCAM)

Court-Annexed Mediation (CAM) is a long belated complement to the KB Law. The latter seeks to screen out cases from being filed in court unless earnest efforts to compromise the dispute have been exerted and failed. It addresses cases that are still impending to be filed in court.

More than twenty (20) years later, CAM was introduced in 1999 to address the cases that are pending in court. Its feasibility as a useful tool to unclog the heavy court dockets37, was earlier shown by a pilot study approved by the Supreme Court for Quezon City and San Fernando, La Union. Conducted in 1991-93 by the UP Office of Legal Aid with funding from The Asia Foundation (TAF), and directed by Professor Alfredo F. Tadiar38, the experiment showed a success rate of 31.14% for the first level courts and 43.54% success rate for the RTC in San Fernando but only an 11.76% success rate for Quezon City.

Court-Annexed Mediation – Defined

“Any mediation process conducted under the auspices of the court, after such court has acquired jurisdiction of the dispute.”39

Mediation – Defined

“A voluntary process in which a mediator selected by the parties,

facilitates communication and negotiation and assists the parties in reaching a voluntary agreement regarding a dispute.”40

36 Rep. Act No. 9285, Sec. 2 37 804,076 pending cases in the courts as of the end of 1998. 38 “Court-Referred Mediation: An Experiment in Alternative Dispute Resolution” UP Office of Legal Aid, 1993, 127 pages, bookbound. 39 Rep. Act No. 9285, Sec. 2 (l). 40 Id., Sec. 2 (q).


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Court-Referred Mediation – Defined

“Mediation ordered by a court to be conducted in accordance with

the Agreement of the Parties when an action is prematurely commenced in violation of such agreement.”41

Confusion Arising from Overlapping Definitions Plainly, the definition of court-annexed mediation includes court-

referred mediation since the latter takes place “after such court has acquired jurisdiction of the dispute”. The mischief of such overlapping definitions is to produce a dilemma for the trial court judge, i.e.,

(1) to refer the case to the Philippine Mediation Center (PMC) pursuant to and as mandatorily required by SC issuance governing court-annexed mediation; or (2) to refer the case to the mediator chosen by the parties.

Distinctions between Mediation and Adjudication

While both methods involve processes for resolving disputes, they

may be distinguished from each other in the following significant respects:

41 Id., Sec. 2 (l).

Standards Mediation Adjudication 1. Product Compromise Agreement Judgment 2. Maker of Product Parties themselves Judge 3. Focus Person Act 4. Outlook Forward Backward 5. Process Flexible Rigid 6. Result Win-Win Win-Lose

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Each one of those distinctions shall be discussed separately, as follows:

The product of mediation is a compromise agreement while the

product of adjudication is a judgment. As defined by the Civil Code, “a compromise is a contract whereby the parties, by making reciprocal concessions, avoid a litigation or put an end to one already commenced.”42

Although the judicial resolution of a dispute is often called a

decision, there is a distinction that may be drawn between the two terms - decision and judgment. While a decision, such as to get married, may often be based on emotions like love, hatred, and anger, judgment is based on a rational evaluation of evidence bearing upon an issue that relates to a relevant standard. Such standard distinguishes right from wrong, legal from illegal, moral from immoral, or ethical from unethical. Judgment is a product of the mind and emotion should not be allowed to becloud rendition of a cold judgment.

A compromise that settles a dispute is the product of both parties

agreeing on the terms thereof. A judgment is the intellectual product of a judge or an arbitrator for deciding which of the contending parties was right or wrong in doing what is charged.

The focus of litigation is the act or omission that is complained of.

It is thus rightly called an “act-oriented process”. It is to prevent justice from being swayed erroneously when one considers the kind of person who committed the act charged, that the lady symbol of justice is blindfolded not to see. Thus, evidence of character43, such as the social rank, wealth or poverty, good or bad reputation, and the like, cannot be initially introduced as they are considered prejudicial evidence. That means evidence that may sway emotions and produce bias. After a judgment of conviction for the crime charged, the sentencing stage now becomes a “person-oriented process” so that the penalty maybe tailor- suited to the particular person to be sentenced.

This is the case with the bifurcated trial of criminal cases that is

followed under the American system. It is only after a verdict of guilty that the blindfold is literally removed to allow the imposition of a penalty suitable to the person of a convicted accused after a thorough study is made of the character of the person convicted. It is at this stage of sentencing that the blindfold from the lady symbol of justice is removed.

42 CIVIL CODE, Art. 2028. 43 RULES OF COURT, Rule 130, Sec. 51.

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Unfortunately, in Philippine criminal trials, a mix-up takes place whereby evidence of mitigating and aggravating circumstances are considered together with evidence of guilt or innocence. It is like an accused saying “I am innocent but if you find me guilty, please be lenient in imposing my punishment”. This kind of trial has been criticized as more prone to a miscarriage of justice than a bifurcated one.

In contrast, mediation is focused on the individual disputants and is

therefore aptly called a “person-oriented process”. Effort must be exerted to determine what values each party holds, what are their interests, their needs, their apprehensions and concerns. A good mediator, armed with this knowledge, would then be able to effect a “trade-off of values” in order to convince the parties to agree on a settlement. Such trade-off is formally termed by the Civil Code as “making reciprocal concessions” to secure a compromise that will avoid litigation or put an end to one already commenced.

Since the focus of litigation is on the act, it must necessarily be

“backward looking”. This is because the ultimate purpose of litigation is to punish for a wrong that was committed. While that purpose of punishment is plain enough in criminal prosecutions, it is less obvious in civil cases. Nevertheless, when one prays for “punitive damages” or “exemplary or corrective damages”44 which are prayed for in the interest of the public good to deter others from doing what was charged, the punitive orientation of even civil litigation becomes obvious.

Once an act has been committed, it becomes a past event. In

criminal law, one can only be punished for an “overt act” that constitutes part of a criminal attempt to commit a crime. This is the earliest stage at which a crime may be punished. No one may be charged, much less be punished for what he is merely intending to commit, is a sound principle in the administration of criminal law in democratic countries.

On the other hand, mediation is “forward looking” in the sense that

its efforts are directed to reconciliation of the parties. The act charged is merely the starting point to mend the relationship that was broken or impaired because of it.

By reason of the foregoing distinctions, the mediation process must

necessarily be informal, even friendly, casual and flexible. In contrast, the adjudicative process is formal, follows a rigid sequence, is distant and aloof. This must be so in order to show the seriousness of the process that may result in a deprivation of property, liberty or even life itself.

44 CIVIL CODE, Arts. 2229 to 2235.

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The result of mediation may be a win-win agreement; that of litigation must always be a win-lose decision. The judgment is a clear condemnation of a wrong or the exoneration of innocence. It has been insightfully observed that we need the black and white judgment of litigation to keep alive our sense of right and wrong. Otherwise, the gray area of a compromise may serve to dull it.

Expansion of PMC Units in the Philippines

As of December 2009, there are already 11045 Philippine Mediation Center (PMC) units in the whole country with approximately 79846 accredited mediators.

The 98 CAM sites were not simultaneously, but cumulatively

established over a period of several years. Cumulatively, from 2001 to 2009, or a period of eight (8) years, for 33 sites (including Rizal and some parts of Bulacan for MCAM), a total of 238,672 cases were referred to CAM and 143,527 cases underwent mediation proceedings or an acceptance rate of 60%. 96,158 cases resulted to successful mediation or a success rate of 67%. Thus, 96,158 cases were out of the dockets of 2,026 courts in 33 sites for a period of eight (8) years or an average of 47 cases taken out of the docket per court for the said period.

Significantly, statistics gathered by the PMCO, reveal that during

the regular period for 2009, in 33 sites (including Rizal and Bulacan through the Mobile Court-Annexed Mediation [MCAM]) covering 2,026 courts, there were 53,066 cases referred to CAM and MCAM of which 33,430 were mediated. Parties in 33,430 cases agreed to undergo mediation proceedings (63% acceptance rate). 21,429 cases out of the 33,430 cases mediated resulted in successful mediation or a success rate of 64% for the 2009 regular period. Thus, 21,429 cases were taken out of the 2,026 courts’ dockets in 33 sites. Effectively, an average of 10 cases were out of the case docket of each court in 2009 through CAM.

Concept of Court Diversion of Pending Cases

The diversion of pending court cases both to Court-Annexed Mediation (CAM) and to Judicial Dispute Resolution (JDR) is plainly intended to put an end to pending litigation through a compromise agreement of the parties and thereby help solve the ever-pressing problem of court dockets congestion. It is also intended to empower the

45 104 Court-Annexed Mediation Units, 2 Appeals Court Mediation units and 4 Mobile Court-Annexed Mediation Units. 46 719 CAM Mediators and 79 ACM Mediators.

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parties to resolve their own disputes and give practical effect to the State Policy expressly stated in the ADR Act of 2004 (Rep. Act No. 9285, to wit:

“to actively promote party autonomy in the resolution

of disputes or the freedom of the parties to make their own arrangement to resolve disputes. Towards this end, the State shall encourage and actively promote the use of Alternative Dispute Resolution (ADR) as an important means to achieve speedy and impartial justice and de-clog court dockets”

The Three Stages of Diversion

Simply stated, court diversion is a 3-stage process. The first

stage is the Court-Annexed Mediation (CAM) where the judge refers the parties to the Philippine Mediation Center (PMC) for the mediation of their dispute by trained and accredited mediators.

Upon failing to secure a settlement of the dispute during the

first stage, a second stage (the JDR stage) sets in for another attempt to be made for a settlement. At this stage, the JDR judge sequentially becomes a mediator-conciliator-early neutral evaluator in a continuing effort to secure a settlement. Still failing that second attempt, the mediator-judge must turn over the case to another judge (a new one chosen by raffle or nearest/pair judge) who will try the unsettled case. The trial judge shall continue with the pre-trial proper and, thereafter, proceed to try and decide the case.

The third stage is during the appeal where covered cases

are referred to the PMC-ACM unit for mediation.

The ultimate common end of both the Katarungang Pambarangay Law and Court-Annexed Mediation is to restore the role of the judiciary as the forum of last recourse to be resorted to only after all prior earnest efforts to arrive at private accommodation and resolution of disputes have failed.

Mandatory Coverage for CAM and JDR

The following cases shall be: 1) referred to Court-Annexed

Mediation (CAM) and 2) be the subject of JDR proceedings:

(1) All civil cases and the civil liability of criminal cases covered by the Rule on Summary Procedure, including the civil liability of crimes charging violation of B.P. 22, except those which by law may not be compromised;

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(2) Special proceedings for the settlement of estates; (3) All civil and criminal cases filed with a certificate to file action issued by the Punong Barangay or the PangkatngTagapagkasundo under the Revised Katarungang Pambarangay Law;47 (4) The civil aspect of Quasi Offenses under Title 14 of the Revised Penal Code; (5) The civil aspect of less grave felonies punishable by correctional penalties not exceeding 6 years of imprisonment where the offended party is a private person; (6) The civil aspect of estafa, theft, and libel;

The following cases shall not be referred to CAM and JDR:

(1) Civil cases which by law cannot be compromised (Article 2035, New Civil Code); (2) Other criminal cases than those under paragraphs 3 to 6 above; (3) Habeas Corpus petitions; (4) All cases under Rep. Act No. 9262 (Violence against Women and Children); and (5) Cases with pending application for Restraining Orders/Preliminary Injunctions.

However, in cases covered under 1, 4 and 5 where the parties inform the court that they have agreed to undergo mediation on some aspects thereof, e.g., custody of minor children, separation of property, or support pendente lite, the court shall refer them to mediation.

47 LOCAL GOVERNMENT CODE OF 1991, Chapter 7 essentially re-enacts the Katarungang Pambarangay Law with some revisions and, therefore, is referred to as the Revised KB Law.

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Procedure in CAM 1. After the last pleading has been filed, the judge shall issue an order requiring the parties to forthwith appear before the concerned Philippine Mediation Center (PMC) Unit staff to start the process for the settlement of their dispute through mediation. On the same date, the court shall give copies of the order for mediation and other pertinent pleadings filed to the PMC. 2. Individual parties are required to personally appear for mediation. In the event they cannot do so, their representatives must be fully authorized to appear, negotiate and enter into a compromise by Special Power of Attorney.

3. Corporate parties, partnership or other juridical entities, shall be represented by a ranking corporate officer fully authorized by Board Resolution to offer, negotiate, accept, decide and enter into a compromise agreement without need of further approval by or notification to the authorizing party.

4. The order issued shall include a clear warning that sanctions may be imposed upon a party for failure to comply therewith in accordance with the Section below on sanctions.

5. On the date set in the order, the parties shall proceed to select a mutually acceptable mediator from among the list of accredited mediators. If no agreement is reached, the Mediation Staff Officer in the PMC Unit shall recommend three (3) mediators from whom said officer shall choose by lot the one who will mediate the dispute.

6. The Mediator shall be considered an officer of the court while performing his duties as such or in connection therewith.

7. The concerned Mediator shall forthwith start the mediation process unless the parties and mediator agree to reset the initial mediation conference which shall not be later than five (5) days from the original date.

8. At the initial conference, the Mediator shall explain to both parties the mediation process, stressing the benefits of an early settlement of their dispute based on serving their mutual interests rather than the legal positions taken by them.

9. With the consent of both parties, the Mediator may hold separate caucuses with each party to determine their respective real interests in the dispute. Thereafter, another joint conference may be held to consider

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various options that may resolve the dispute through reciprocal concession and on terms that are mutually beneficial

10. The Mediator shall not record in any manner the proceedings of the joint conferences or of the separate caucuses. No transcript or minutes of mediation proceedings shall be taken. If personal notes are taken for guidance, the notes shall be shredded and destroyed. Should such record exists, they shall not be admissible as evidence in any other proceeding.

11. If no settlement has been reached at the end of the period given, the case must be returned to the referring judge (or in appropriate cases the JDR judge) for further proceedings.

Sanctions The court, upon recommendation of the Mediator, may impose

sanctions upon a party who fails to appear before the Philippine Mediation Center (PMC) Unit as directed by the referring judge (or in appropriate cases the JDR judge), or upon any person who engages in abusive conduct during mediation proceedings, may impose the appropriate sanctions provided for in the Rules of Court as part of the Pre-Trial and other issuances of the Supreme Court, including, but not limited to censure, reprimand, contempt requiring the absent party to reimburse the appearing party his costs, including attorney’s fees for that day, up to treble such costs, payable on or before the date of the re-scheduled setting. Sanctions may also be imposed by the referring judge upon his own initiative or upon motion of the interested party.

Upon justifiable cause duly proved in the hearing called on the

motion to reconsider filed by the absent party, concurred in by the concerned mediator, the sanctions imposed may be lifted or set aside in the sound discretion of the referring judge.

Duration of Mediation in the PMC

The Mediator shall have a period of not exceeding thirty (30) days to complete the mediation process. Such period shall be computed from the date when the parties first appeared for the initial conference as stated in the order to appear. An extended period of another thirty (30) days may be granted by the court upon motion filed by the Mediator with the conformity of the parties.

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Suspension of periods

The period during which the case is undergoing mediation shall be excluded from the regular and mandatory periods for trial and rendition of judgment in ordinary cases and in cases under summary proceedings.

Settlement

If full settlement is reached of the dispute, the parties, assisted by their respective counsel, shall draft the compromise agreement which shall be submitted to the court for judgment upon compromise or other appropriate action. Where compliance is forthwith made, the parties shall instead submit a satisfaction of claims or a mutual withdrawal of the case. In this situation, the court shall enter an order dismissing the case.

If partial settlement is reached, the parties shall, with the assistance

of counsel, submit the terms thereof for the appropriate action of the court without waiting for resolution of the unsettled part.

In relation to the unsettled part of the dispute, the court shall

proceed to conduct JDR proceedings in accordance with PART THREE hereof where JDR is available.

IV. JUDICIAL DISPUTE RESOLUTION (JDR)

JDR is conducted by a judge48 after parties fail to settle during Court-

Annexed Mediation (CAM). JDR proceedings are conducted in thirty (30) days for first level courts (Municipal Trial Court, Municipal Circuit Trial Courts, Municipal Trial Courts in Cities, Metropolitan Trial Courts) and sixty (60) days for second level courts (Regional Trial Courts)49 subject to extension at the discretion of the JDR judge if settlement appears highly feasible.

The JDR judge becomes a mediator, early neutral evaluator and conciliator. In fact, the JDR judge could be one or a combination of some or all of said roles when conducting JDR. As a conciliator, the JDR judge persuades parties to reconsider their reluctance to compromise. As an early neutral evaluator, the JDR judge gives a confidential, reasoned oral evaluation but non-binding opinion on the strengths and weaknesses of each party’s case and their chances of success. Based on practice, early neutral evaluation is conducted

48 In the following areas: City of San Fernando, Angeles City, and Pampanga; Bacolod City and Negros Occidental; Baguio City and Benguet; Cagayan De Oro City and Misamis Oriental; San Fernando City and La Union; and Makati City per Court En Banc Resolution, dated November 13, 2007, in Administrative Matter No. 04-1-12-SC-PHILJA.

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during private caucus. As a mediator, the JDR judge actively facilitates and assists negotiations among the parties.

The JDR judge shifts from rights-based approach to problem-solving approach in resolving cases. The JDR judge focuses on interests and motivation of parties and not their demands and positions. Thus, the JDR judge is not bound by legal remedies but helps parties develop their own creative options for their mutual gain.

As conciliator, early neutral evaluator, and/or mediator, the JDR judge

receives information in absolute confidence that could affect neutrality. Bias may be created that could affect the impartiality of the judge in the trial of the case. Moreover, parties will be more spontaneous once they are assured that the JDR judge will not be the trial judge. Thus, in sites where JDR is in place, there is a two-judge system – the JDR judge and the trial judge.50

Procedure Judicial proceedings shall be divided into two stages - (1) from the

filing of a complaint, to the conduct of CAM and JDR during the pre-trial stage, and (2) pre-trial proper to trial and judgment. The judge to whom the case has been originally raffled, who shall be called the JDR Judge, shall preside over the first stage. The judge, who shall be called the trial judge, shall preside over the second stage.51

At the initial stage of the pre-trial conference, the JDR judge briefs

the parties and counsels of the CAM and JDR processes. Thereafter, he issues an Order of Referral of the case to CAM and directs parties and their counsels to proceed to the PMCU bringing with them copies of the Order of Referral and major pleadings (complaint, answer etc.). The JDR judge shall include in said Order or in another Order the pre-setting of the case for JDR not earlier than forty-five (45) days from the time the parties first personally appear at the PMCU so that JDR will be conducted immediately if the parties do not settle at CAM.

All incidents or motions filed during the first stage shall be dealt with

by the JDR judge. If JDR is not conducted because of the failure of parties to appear, the JDR judge may impose the appropriate sanctions and shall continue with the proceedings of the case.52

If the parties do not settle their dispute at CAM, the parties and their

counsels shall appear at the preset date before the JDR judge who will 50 A.M. No. 04-1-12-SC-PhilJA, as amended, November 13, 2007, Part IV, No. 5, modified. 51 A.M. No. 04-1-12-SC-PhilJA, as amended, November 13, 2007, Part IV, modified. 52 A.M. No. 04-1-12-SC-PhilJA, as amended, November 13, 2007, Part IV, modified.

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then conduct the JDR process as mediator, neutral evaluator and/or conciliator in order to actively assist and facilitate negotiations among the parties for them to settle their dispute. As mediator and conciliator, the judge facilitates the settlement discussions between parties and tries to reconcile their differences. As a neutral evaluator, the judge assesses the relative strengths and weaknesses of each party's case and makes a non-binding and impartial evaluation of the chances of each party's success in the case. On the basis of such neutral evaluation, the judge persuades the parties to a fair and mutually acceptable settlement of their dispute.53

The JDR Judge shall not preside over the trial of the case54 when

parties did not settle their dispute at JDR.55 Courts 1. Multiple Sala Court - If the case is not resolved during JDR, it shall

be raffled to another branch for the pre trial proper56 up to judgment.57

For cases with pending applications for restraining

orders/preliminary injunctions, the judge to whom the case was raffled shall rule on the said applications. During the pre-trial stage, the judge refers the case to CAM but if the parties do not settle at CAM, the case will be raffled to another branch for JDR. If the parties do not settle at JDR, the case will be returned to the branch that ruled on the applications for the pre-trial proper and up to judgment.58

2. Single Sala Court. –Unless otherwise agreed upon as provided

below, the JDR proceedings will be conducted by the judge of the pair court, if any, otherwise, by the judge of the nearest court as determined by the concerned Executive Judge. The JDR proceedings shall be conducted at the station where the case was originally filed. The result of the JDR proceedings shall be referred to the court of origin for appropriate action e.g. approval of the compromise agreement, trial, etc.

53 A.M. No. 04-1-12-SC-PhilJA, as amended, November 13, 2007, Part III, last paragraph, modified. 54 Parties will be more spontaneous once they are assured that the JDR judge will not be the one to try the case. This is so because, the JDR judge may have elicited confidential information that may create bias and partiality that could affect the judgment. 55 A.M. No. 04-1-12-SC-PhilJA, as amended, November 13, 2007, Part IV, second paragraph. 56 Rule 18, Sec. 2, paragraphs b, c, d, e, f, g, and i. 57 A.M. No. 04-1-12-SC-PhilJA, as amended, November 13, 2007, Part IV, No. 1. 58 Includes post-judgment proceedings e.g. motion for reconsideration, execution, etc.

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Notwithstanding the foregoing, the parties may file, by joint written motion, a request before commencement of the JDR proceedings that the court of origin shall conduct the JDR proceedings and trial.59

3. Family Courts – Unless otherwise agreed upon as provided below,

the JDR proceedings in areas where only one court is designated as a family court, shall be conducted by a judge of another branch through raffle. However, if there is another family court in the same area, the family court to whom the case was originally raffled shall conduct JDR proceedings and if no settlement is reached, the other family court shall conduct the pre-trial proper and trial.

Notwithstanding the foregoing, the parties may file, by joint

written motion, a request before commencement of the JDR proceedings that the family court to whom the case was originally raffled, shall conduct the JDR proceedings and trial.

Despite the non-mediatable nature of the principal like annulment of marriage, other issues such as custody of children, support, visitation, property relations and guardianship may be referred to CAM and JDR to limit the issues for trial.60

4. Commercial, Intellectual Property and Environmental Courts - Unless otherwise agreed upon as provided below, the JDR proceedings in areas where only one court is designated commercial/intellectual property/environmental, hereafter the special courts, shall be conducted by another judge through raffle and not the judge of the special courts. Where settlement is not reached, the judge of the special courts shall be the trial judge. Any incident or motion filed before the pre-trial stage shall be dealt with by the special courts that shall refer the case to CAM.61

Notwithstanding the foregoing, the parties may file, by joint written motion, a request before commencement of the JDR proceedings that the special courts to whom the case was originally raffled, shall conduct the JDR proceedings and trial.

59 A.M. No. 04-1-12-SC-PhilJA, as amended, November 13, 2007, Part IV, No. 2, modified. 60 A.M. No. 04-1-12-SC-PhilJA, as amended, November 13, 2007, Part IV, No. 3, modified. 61 A.M. No. 04-1-12-SC-PhilJA, as amended, November 13, 2007, Part IV, No. 4, modified.

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JDR During Trial Cases may be referred to JDR even during the trial stage upon

written motion of one or both parties indicating willingness to discuss a possible compromise. If the motion is granted the trial shall be suspended62 and the case referred to JDR which shall be conducted by another judge through raffle in multiple sala courts.

If settlement is reached during JDR, the JDR court shall take

appropriate action thereto i.e. approval/disapproval of the compromise agreement. If settlement is not reached at JDR, the case is returned to the referring court for continuation of trial.

In single sala courts, the JDR shall be conducted by the nearest

court (or pair court, if any) regardless of the level of the latter court. The result of the JDR proceedings shall be referred to the court of origin for appropriate action e.g. approval of the compromise agreement, trial, etc.

The parties may, by joint written motion, despite confidential

information that may be divulged during JDR proceedings, file a request that their case be not transferred to other courts for JDR and that they agree to have the trial judge continue the trial should the case not be settled through JDR

Settlement Period

Any Settlement Period declared by the Supreme Court is understood to include JDR and, therefore, half of all cases referred to mediation shall be for JDR settlement. The procedure shall be as stated in Roman Numeral IV above, except that no written motion is required from the parties for their case to be referred to JDR.63 Party Participation

1. Individual Party Litigants

The party litigants shall attend all mediation conferences in person or through duly authorized representatives. The authority of the representative shall be in writing and shall state that he or she is fully empowered to offer, negotiate, accept, decide and enter into a compromise agreement without need of further approval by or notification to the authorizing party.

62 CIVIL CODE, Art. 2030, par. 1. 63 A.M. No. 04-1-12-SC-PhilJA, as amended, November 13, 2007, Part IV, No. 9, modified.

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2. Corporate Party Litigants

In case of corporations, the representative must be a senior management official with written authority from the Board of Directors to offer, negotiate, accept, decide and enter into compromise agreement without need of further approval by or notification to the authorizing party.64

Judgments/Decisions in JDR – Decisions/ Judgments approving

the compromise of parties through the efforts of the judge as a mediator, conciliator or neutral evaluator shall contain a statement to the effect that the Judgments/Decisions were achieved through JDR. This is to distinguish Judgments/Decisions approving compromise agreements secured through CAM. Copies of said Judgments/Decisions shall be submitted to the Philippine Mediation Center Unit for documentation purposes.65

Sanctions

A party who fails to appear on the date set for JDR conference, may forthwith be imposed the appropriate sanctions as provided in Rule 18 of the Revised Rules of Court and relevant issuances of the Supreme Court including, but not limited to censure, reprimand, contempt, requiring the absent party to reimburse the appearing party his costs, including attorney’s fees for that day, up to treble such costs, payable on or before the4 date of the re-scheduled setting. Sanctions may be imposed by the JDR Judge upon motion of the appearing party or motu proprio.

Upon justifiable cause duly proved in the hearing of the motion to

reconsider filed by the absent party, the sanctions imposed may be lifted, set aside or modified in the sound discretion of the JDR judge.

A representative who appears on behalf of an individual or

corporate party without the required authorization by special power of attorney or board resolution, respectively, may similarly be imposed appropriate sanctions.

64 A.M. No. 0-3-15-SC, 23 March 2004 and A.M. No. 04-1-12-SC-PhilJA, as amended, November 13, 2007, Part IV, No. 11, modified. 65 A.M. No. 04-1-12-SC-PhilJA, as amended, November 13, 2007, Part IV, No. 12.

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Duration of JDR proceedings

To complete the judicial dispute resolution process, judges of First Level Courts shall have a period of not exceeding thirty (30) days while judges of Second Level Courts shall have a period of not exceeding sixty (60) days. A longer period, however, may be granted upon discretion of the JDR judge if there is a high probability of settlement and upon joint written motion of the parties. Both periods shall be computed from the date when the parties first appeared for JDR proceedings as directed in the respective orders issued by the judge. As far as practicable, JDR conferences shall be set not more than two (2) weeks apart so as to afford parties ample time to negotiate meaningfully for settlement.66

In criminal cases covered by CAM & JDR, where settlement on the

civil aspect has been reached but the period of payment in accordance with the terms of settlement exceeds one (1) year, the case may be archived upon motion of the prosecution with notice to the private complainant and approval by the judge.67

Suspension of periods The period during which the case is undergoing JDR proceedings

shall be excluded from the regular and mandatory periods for trial and rendition of judgment in ordinary cases and in cases under summary proceedings.

Settlement

A. Civil Cases

If full settlement is reached of the dispute, the parties, assisted by their respective counsel, shall draft the compromise agreement which shall be submitted to the court for a judgment upon compromise, enforceable by execution.

Where full compliance with the terms of the compromise is

forthwith made, the parties, instead of submitting a compromise agreement, shall submit a satisfaction of claims or a mutual withdrawal of the parties’ respective claims and counterclaims. In this case, the court shall enter an order dismissing the case.

66 A.M. No. 04-1-12-SC-PhilJA, as amended, November 13, 2007, Part IV, Nos. 6 and 10, modified. 67 A.M. No. 04-1-12-SC-PhilJA, as amended, November 13, 2007, Part IV, No. 7 on archiving – N.B. – held for further study, modified.

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If partial settlement is reached, the parties shall, with the

assistance of counsel, submit the terms thereof for the court’s approval and rendition of a judgment upon partial compromise which may be enforced by execution without waiting for resolution of the unsettled part.

In relation to the unsettled part of the dispute, the court shall

proceed to conduct trial on the merits of the case should the parties file a joint motion for him to do so, despite confidential information that may have been divulged during the conciliation/mediation stage of the proceedings. Otherwise, the JDR Judge shall turn over the case to a new judge by re-raffle in multiple sala courts or to the originating court in single sala courts, for the conduct of pre-trial proper and trial.

B. Criminal Cases

If settlement is reached on the civil aspect of the criminal case, the parties, assisted by their respective counsel, shall draft the compromise agreement which shall be submitted to the court for appropriate action.

Action on the criminal aspect of the case will be determined

by the Public Prosecutor subject to the appropriate action of the court.

If settlement is not reached by the parties on the civil aspect

of the criminal case, the JDR judge shall proceed to conduct the trial on the merits of the case should the parties file a joint written motion for him to do so, despite confidential information that may have been divulged during the JDR proceedings. Otherwise, the JDR Judge shall turn over the case to a new judge by re-raffle in multiple sala courts or to the originating court in single sala courts, for the conduct of pre-trial proper and trial.

Pre-trial Proper

Where no settlement or only a partial settlement was reached, and there being no joint written motion submitted by the parties as stated in the last preceding paragraphs, the JDR judge shall turn over the case to the trial judge, determined by re-raffle in multiple sala courts or to the originating court in single sala courts, as the case may be, to conduct pre-trial proper as mandated by Rules 18 and 118 of the Rules of Court.

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Trial and Judgment

The trial judge to whom the case was turned over, shall

expeditiously proceed to trial following pre-trial and thereafter render judgment in accordance with the established facts determined by the judge and the applicable laws.

V. JDR FOR RTC AS APPELLATE COURT FROM FIRST LEVEL COURTS

To date, trial courts in JDR sites do not only conduct JDR proceedings in cases initially filed with them since the Supreme Court has already issued Administrative Order No. 28-2009 dated March 2, 2009 directing all regional trial courts in JDR sites acting as appellate courts in appeals from first level courts to conduct JDR on appeal. VI. APPELLATE COURT MEDIATION (ACM)

The Supreme Court expanded CAM to the Court of Appeals in 200268

Court of Appeals mediators were, however, limited to retired justices and judges, senior members of the Bar and senior law professors who are trained and accredited by the Supreme Court.

VII. NEED FOR CONSOLIDATION OF RULES

Some unexpected confusion in the implementation of court diversion of pending cases to court-annexed mediation has arisen over the years. This is due to the facts that 1) separate issuances/guidelines from the Supreme Court govern the operations of Court-Annexed Mediation (CAM) and Judicial Dispute Resolution (JDR); 3) such separate issuances/guidelines are separately addressed to two distinct groups, eg., one to CAM in areas where the PMCO has established operational units; and the others in five (5) provinces (Negros Occidental, Misamis Oriental, Pampanga, Benguet, and La Union and in Makati City; 4) such issuances/guidelines were made at different times spread out over a period of several years; and 5) such issuances/guidelines contain different coverage of cases for the mediation of cases under CAM and JDR.

The result of this confusion is that there is no authority to collect mediation

fees for theft despite its having been included as a mediatable case. The question has been raised as to whether the amendment of Rule 141, which was intended principally to provide authority to collect mediation fees, also expanded

68 Administrative Matter No. 02-2-17-SC, April 16, 2002.

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the coverage of mediatable cases which were vested by separate issuances of the Supreme Court. Further, there is no statement of a rationale why estafa, libel and theft have been included as mediatable cases for their civil as aspects, irrespective of the gravity of the offenses that they carry. For all the foregoing reasons, the PMCO Executive Committee has endorsed to the PHILJA Board of Trustees such consolidated guidelines.69 Thereafter, the Supreme Court approved the Consolidated and Revised Guidelines to Implement the Expanded Coverage of Court-Annexed Mediation and Judicial Dispute Resolution. 70

VIII. NEED TO EXPAND COVERAGE OF MEDIATION

Although an impressive settlement rate has been achieved for cases diverted to mediation, a still greater impact can be achieved by continuing the expansion of the criminal coverage of CAM and JDR. This can be done without necessarily affecting societal security.

Deterrence, which is achieved from a consistent and swift imposition of

the appropriate penalties imposed by law for the crime committed, is the principle upon which societal security rests. It is for this reason that Article 2034 of the Civil Code provides that:

“There may be a compromise upon the civil liability

arising from the offense, but such compromise shall not extinguish the public action for the imposition of the legal penalty”.

It is significantly important to note that the above-quoted statutory

provision does not restrict “the offense” for which a compromise may be reached on the civil liability arising therefrom, to a category that is merely a light felony or a misdemeanor. The gravity of the offense, as may be gauged from the imposable penalty, is not mentioned in the Civil Code as a condition to allow compromises on the civil aspects thereof. Inferably, therefore, the allowed compromise of the civil liability applies to all crimes subject only to the policy considerations of deterrence variables arising from the celerity, certainty and severity of punishments actually imposed.71

69 65th Meeting of PHILJA Board of Trustees, November 4, 2009. 70 Court en banc Resolution dated January 11, 2011 in A.M. No. 11-1-6-SC-PHILJA 71 Jeremy Bentham, the noted English Utilitarian, posits that of the three variables, severity is the least important of them.

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As a result of the foregoing reasoning, and considering that generally, the caseloads of courts are about 75% criminal,72 it was proposed73 to expand the criminal case coverage for mediation to include the civil aspect of all crimes falling within the exclusive jurisdiction of the first level courts.

The rationale for such proposal is that the accused who are charged of

offenses which are punishable by a penalty not exceeding 6 years of imprisonment or prision correccional, if convicted, is not intended to be punished but to be corrected and rehabilitated. Even the nomenclature of the penalty, correccional, infers such a purpose of teaching a lesson to effect a rehabilitation. Such a rationale is further clearly inferred from the fact that such offenses are subject to probation.

The convicted offender who is qualified, is granted a conditional freedom

and released to society. It is further relevant to and significant to note that that the Department of Justice has initiated and is running a program of training prosecutors to be mediators for criminal cases where the imposable penalty does not exceed six years. 74

In contrast, the penalties classified under the Revised Penal Code as

afflictive and capital,75 are explicit that their purpose is outright punishment due to enforced isolation or even permanent removal from society of the convict to ensure public safety. Thus, the imposition of afflictive penalties for grave offenses is surely the underlying basis for achieving the principle of deterrence, not only for the person punished but also for the benefit of general society through the principle of exemplarity.

IX. SPECIAL ADR RULES OF COURT76

PART I – GENERAL PROVISIONS AND POLICIES RULE 1: GENERAL PROVISIONS Rule 1.1 Subject matter and governing rules Rule 1.2 Nature of the proceedings

Rule 1.3 Summary proceedings in certain cases

72 Summary Report of Cases for 2006 shows that only 108,855 civil cases were pending at that period, while 524,685 criminal cases were similarly pending. 73 The proposal was made by the author to the PMCO Executive Committee, based on a study conducted and funded by The Asia Foundation. 74 DOJ Mediation Program. 75 Article 25, RPC, categorizes these penalties as those punishable with prision mayor, reclusion temporal, reclusion perpetua and death (6 years and 1 day, 20 years and life imprisonment to death). 76 For complete text of the Rules, see enclosed CD.

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Rule 1.4 Verification and submissions Rule 1.5 Certification against forum shopping Rule 1.6 Prohibited submissions Rule 1.7 Computation of time Rule 1.8 Service and filing of pleadings, motions and other papers in non-summary proceedings Rule 1.9 No summons Rule 1.10 Contents of petition/motion Rule 1.11 Definitions Rule 1.12 Applicability of Part II on Specific Court Relief Rule 1.13 Spirit and intent of the Special ADR Rules RULE 2: STATEMENT OF POLICIES

Rule 2.1 General policies Rule 2.2 Policy on arbitration Rule 2.3 Rules governing arbitral proceedings Rule 2.4 Policy implementing competence-competence principle Rule 2.5 Policy on mediation Rule 2.6 Policy o Arbitration-Mediation or Mediation-Arbitration Rule 2.7 Conversion of a settlement agreement to an arbitral award.

PART II – SPECIFIC COURT RELIEF

RULE 3: JUDICIAL RELIEF INVOLVING THE ISSUE OF EXISTENCE, VALIDITY AND ENFORCEABILITY OF THE ARBITRATION AGREEMENT

Rule 3.1 When judicial relief is available A. Judicial Relief before Commencement of Arbitration

Rule 3.2 Who may file petition Rule 3.3 When the petition may be filed Rule 3.4 Venue Rule 3.5 Grounds Rule 3.6 Contents of petition Rule 3.7 Comment/Opposition Rule 3.8 Court action Rule 3.9 No forum shopping Rule 3.10 Application for interim relief Rule 3.11 Relief against court action

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B. Judicial Relief after Arbitration Commences

Rule 3.12 Who may file petition Rule 3.13 When petition may be filed Rule 3.14 Venue Rule 3.15 Grounds Rule 3.16 Contents of petition Rule 3.17 Comment/opposition Rule 3.18 Court action

A. Period for resolving the petition B. No injunction of arbitration proceedings C. When dismissal of petition is appropriate

Rule 3.19 Relief against court action Rule 3.20 Where no petition is allowed Rule 3.21 Rendition of arbitral award before court decision on petition from arbitral tribunal’s preliminary ruling on jurisdiction Rule 3.22 Arbitral tribunal a nominal party

RULE 4: REFERRAL TO ADR

Rule 4.1Who makes the request Rule 4.2 When to make request Rule 4.3 Contents of request Rule 4.4 Comment/opposition Rule 4.5 Court action Rule 4.6 No reconsideration, appeal or certiorari Rule 4.7 Multiple actions and parties Rule 4.8 Arbitration to proceed RULE 5: INTERIM MEASURES OF PROTECTION

Rule 5.1 Who may ask for interim measures of protection Rule 5.2 When to petition Rule 5.3 Venue Rule 5.4 Grounds Rule 5.5 Contents of petition Rule 5.6 Types of interim measures of protection Rule 5.7 Dispensing with prior notice in certain cases Rule 5.8 Comment/opposition Rule 5.9 Court action Rule 5.10 Relief against court action Rule 5.11 Duty of the court to refer back Rule 5.12 Security

Rule 5.13 Modification, amendment, revision or revocation

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Rule 5.14 Conflict or inconsistency between interim measure by court and by arbitral tribunal Rule 5.15 Court to defer action on interim measures upon constitution of tribunal Rule 5.16 Court assistance should tribunal be unable to enforce

RULE 6: APPOINTMENT OF ARBITRATORS

Rule 6.1 When court may act as appointing authority Rule 6.2 Who may request for appointment Rule 6.3 Venue Rule 6.4 Contents of petition Rule 6.5 Comment/Opposition Rule 6.6 (skipped rule) Rule 6.7 Court action Rule 6.8 Forum shopping prohibited Rule 6.9 Relief against court action

RULE 7: CHALLENGE TO APPOINTMENT OF ARBITRATORS

Rule 7.1 Who may challenge Rule 7.2 When challenge may be raised in court Rule 7.3 Venue Rule 7.4 Grounds Rule 7.5 Contents of petition Rule 7.6 Comment/Opposition Rule 7.7 Court action Rule 7.8 No motion for reconsideration Rule 7.9 Reimbursement of expenses and reasonable compensation

RULE 8: TERMINATION OF MANDATE OF ARBITRATOR

Rule 8.1 Who may request for termination and on what grounds Rule 8.2 When to request Rule 8.3 Venue Rule 8.4 Contents of petition Rule 8.5 Comment/Opposition Rule 8.6 Court action Rule 8.7 No motion for reconsideration or appeal Rule 8.8 Appointment of substitute arbitrator

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RULE 9: ASSISTANCE IN TAKING EVIDENCE

Rule 9.1 Who may request assistance Rule 9.2 When assistance may be sought Rule 9.3 Venue Rule 9.4 Ground Rule 9.5 Type of assistance Rule 9.6 Contents of petition Rule 9.7 Comment/Opposition Rule 9.8 Court action Rule 9.9 Relief against court action Rule 9.10 Perpetuation of testimony before arbitral tribunal constituted Rule 9.11 Consequence of disobedience.

RULE 10. CONFIDENTIALIY/PROTECTIVE ORDERS

Rule 10.1 Who may request confidentiality Rule 10.2 When request made Rule 10.3 Venue Rule 10.4 Grounds Rule 10.5 Contents of petition Rule 10.6 Notice Rule 10.7 Comment/Opposition Rule 10.8 Court action Rule 10.9 Relief against court action Rule 10.10 Consequence of disobedience

RULE 11: CONFIRMATION, CORRECTION OR VACATION OF AWARD IN DOMESTIC ARBITRATION

Rule 11.1 Who may request confirmation, correction or vacation Rule 11.2 When to request confirmation, correction or vacation

A. Confirmation B. Correction/Modification C. Vacation

Rule 11.3 Venue Rule 11.4 Grounds Rule 11.5 Form of petition Rule 11.6 Contents of petition Rule 11.7 Notice Rule 11.8 Hearing Rule 11.9 Court action

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RULE 12: RECOGNITION AND ENFORCEMENT OR SETTING ASIDE OF INTERNATIONAL COMMERCIAL ARBITRATION AWARD

Rule 12.1 Who may request recognition and enforcement Rule 12.2 When to file petition

(A) Petition to recognize and enforce (B) Petition to set aside

Rule 12.3 Venue Rule 12.4 Grounds to set aside or resist enforcement Rule 12.5 Exclusive recourse against arbitral award Rule 12.6 Form Rule 12.7 Contents of petition Rule 12.8 Notice Rule 12.9 Submission of documents Rule 12.10 Hearing Rule 12.11.Suspension of proceedings to set aside Rule 12.12 Presumption in favor of confirmation Rule 12.13 Judgment of the court Rule 12.14 Costs RULE 13: RECOGNITION AND ENFORCEMENT OF FOREIGN ARBITRAL AWARD

Rule 13.1 Who may request recognition and enforcement Rule 13.2 When to request petition Rule 13.3 Venue Rule 13.4 Governing law and grounds to refuse recognition and enforcement Rule 13.5 Contents of petition Rule 13.6 Notice and opposition Rule 13.7 Opposition Rule 13.8 Submissions Rule 13.9 Hearing Rule 13.10 Adjournment/deferment of decision to enforce award Rule 13.11 Court action Rule 13.12 Recognition and enforcement of non-convention award

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PART III – PROVISIONS SPECIFIC TO MEDIATION

RULE 14: GENERAL PROVISIONS Rule 14.1 Application of the rules on arbitration

RULE 15: DEPOSIT AND ENFORCEMENT OF MEDIATED SETTLEMENT AGREEMENTS

Rule 15.1 Who makes a deposit Rule 15.2 When deposit is made Rule 15.3 Venue Rule 15.4 Registry Book Rule 15.5 Enforcement of mediated settlement agreement Rule 15.6 Contents of petition Rule 15.7 Opposition Rule 15.8 Court action

PART IV – PROVISIONS SPECIFIC TO CONSTRUCTION ARBITRATION RULE

RULE 16: GENERAL PROVISIONS

Rules 16.1 Application of the rules on arbitration

RULE 17: REFERRAL TO CIAC

Rule 17.1 Dismissal of action

Rule 17.2 Form and contents of motion Rule 17.3 Opposition Rule 17.4 Hearing Rule 17.5 Court Action Rule 17.6 Referral immediately executory Rule 17.7 Multiple actions and parties Rule 17.8 Referral

PART V – PROVISIONS SPECIFIC TO OTHER FORMS OF ADR

RULE 18: GENERAL PROVISIONS

Rule 18.1 Applicability of rules to other forms of ADR Rule 18.2 Applicability of rules on mediation

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Rule 18.3 Applicability of rules on arbitration Rule 18.4 Referral Rule 18.5 Submission of settlement agreement

PART VI – MOTION FOR RECONSIDERATION, APPEAL AND CERTIORARI

RULE 19: MOTION FOR RECONSIDERATION, APPEAL AND CERTIORARI

A. MOTION FOR RECONSIDERATION Rule 19.1 Motion for reconsideration Rule 19.2 When to more for reconsideration Rule 19.3 Contents and notice Rule 19.4 Opposition or comment Rule 19.5 Resolution of motion Rule 19.6 No second motion for reconsideration

B. GENERAL PROVISIONS ON APPEAL AND CERTIORARI

Rule 19. 7 No appeal or certiorari on merits of arbitral award Rule 19. 8 Subject matter and governing rules Rule 19. 9 Prohibited alternative remedies Rule 19.10 Rule on judicial review of arbitration in Philippines Rule 19.11 Rule on judicial review of foreign arbitral award. C. APPEALS TO THE COURT OF APPEALS

Rule 19.12 Appeal to the Court of Appeals Rule 19.13 Where to appeal Rule 19.14 When to appeal Rule 19.15 How appeal taken Rule 19.16 Contents of the petition Rule 19.17 Effect of failure to comply with requirements Rule 19.18 Action on the petition Rule 19.19 Contents of Comment Rule 19. 20 Due course Rule 19.21 Transmittal of Records Rule 19. 22 Effect of appeal Rule 19. 23 Submission for decision Rule 19. 24 Subject of appeal restricted in certain instance Rule 19. 25 Party appealing decision of court confirming award required to post bond

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D. SPECIAL CIVIL ACTION FOR CERTIORARI

Rule 19.26 Certiorari to the Court of Appeals Rule 19.27 Form Rule 19.28 When to file petition. Rule 19.29 Arbitral tribunal a nominal party in the petition Rule 19.30 Court to dismiss petition. Rule 19.31 Order to comment. Rule 19.32 Arbitration may continue despite petition for certiorari. Rule 19.33 Prohibition against injunctions. Rule 19.34 Proceedings after comment is filed. Rule 19.35 Service and enforcement of order or judgment E. APPEAL TO THE SUPREME COURT

Rule 19.36 Review discretionary Rule 19.37 Filing of petition with Supreme Court Rule 19.38 Time for filing; extension Rule 19.39 Docket and other lawful fees; proof of service of petition Rule 19.40 Contents of petition Rule 19.41 Dismissal or denial of petition Rule 19.42 Due course; elevation of records

PART VII – FINAL PROVISIONS RULE 20: FILING AND DEPOSIT FEES

Rule 20.1 Filing fee in petitions Rule 20.2 Filing fee for action to enforce as a counter-petition Rule 20.3 Deposit fee for mediated settlement agreements Rule 20.4 Filing fee for other proceedings

RULE 21: COSTS

Rule 21.1 Costs Rule 21.2 On dismissal of petition against ruling of arbitral tribunal on preliminary question upholding jurisdiction Rule 21.3 On recognition and enforcement of a foreign arbitral tribunal award Rule 21.4 Costs Rule 21.5 Bill of costs Rule 21.6 Government exemption for payment of fees

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RULE 22: APPLICABILITY OF THE RULES OF COURT Rule 22.1 Applicability of Rules of Court

RULE 23: SEPARABILITY Rule 23.1 Separability Clause

RULE 24: TRANSITORY PROVISIONS Rule 24.1 Transitory provision

RULE 25: ONLINE DISPUTE RESOLUTION

Rule 25.1 Applicability of Special ADR Rules to Online Dispute Resolution

Rule 25.2 Scope of online dispute resolution

RULE 26: EFFECTIVITY

Rule 26.1 Effectivity

Necessity for Promulgation

This is a positive response of the Supreme Court to the several provisions of the Alternative Dispute Resolution Act of 2004 (Rep. Act No. 9285)77 relating to remedies that may be filed “in accordance with such rules of procedure as may be promulgated by the Supreme Court”78

Purpose

The discernible intent is to establish a parallel track for ADR dispute resolution alongside the judicial track and prohibit court intervention with ADR processes unless “allowed under ADR Laws or the

77 Passed April 2, 2004. 78 Section 17 (c), relating to enforcement of a settlement deposited in court; Effectivity. - By an En Banc Resolution (A.M. No. 07-11-08-SC) issued on September 1, 2009, the Special Rules of Court on ADR took “effect on October 30, 2009 following its publication in three (3) newspapers of general circulation.” Rep. Act No. 9285, Sec. 40, paragraph 4, relating to judicial confirmation of a domestic award.

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Special ADR Rules”79 Thus, the courts are enjoined to extend their “greatest cooperation and (to exercise) the least intervention.”80

The Special ADR Rules of Court is intended to govern the procedure to be followed by the courts whenever judicial intervention is sought in ADR proceedings in the specific cases where it is allowed.

Exclusions 1) The Special ADR Rules of Court “do not apply to Court-Annexed

Mediation which shall be governed by issuances of the Supreme Court.”81

2) The law does not apply to the resolution or settlement of labor disputes

under the Labor Code.82

X. Conditions for Arbitration to Proceed

1) A valid and enforceable arbitration agreement in the contract for future disputes.83

2) A submission agreement for arbitration of present dispute.84

XI. Features

1) Intrinsic value.- People empowerment is promoted by both the ADR

Law and the Special ADR Rules of Court by declaring as a policy of the State “to respect party autonomy or the freedom of the parties to make their own arrangements in the resolution of disputes”85

2) Instrumental value.- It recognizes that “ADR, particularly arbitration and

mediations (are) important means to achieve speedy and efficient resolution of disputes, impartial justice, curb a litigious culture and to de-clog court dockets.”86

79 SPECIAL ADR RULES OF COURT, Rule 2.2 Policy on arbitration (B). 80 Id., Rule 2.1: General policies. 81 Id., Rule 2.5: Policy on mediation. 82 Rep. Act No. 9285, Sec. 6: Exceptions to the application of this Act. 83 Rep. Act No. 876, Sec. 2: “parties to a contract may in such contract agree to settle by arbitration a controversy thereafter arising between them.” 84 Id., “parties may submit to arbitration any controversy existing between them” 85 SPECIAL ADR RULES, Rule 2.1: General policies. 86 Id.

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3) Need for judicial confirmation of award to make it enforceable. All awards made by an arbitrator or arbitral tribunal requires confirmation by a court of law in order to be enforceable.87

Exception: “A CIAC Arbitral award need not be confirmed by the Regional Trial Court to be executory as provided under Executive Order No. 1008”88

4) The Special ADR Rules of Court do not govern the arbitration

proceedings itself. In ad hoc arbitration, “the parties are free to agree on the procedure to be followed in the conduct of arbitral proceedings.”89 However, they may agree “to submit their dispute to institutional arbitration rules.”90

5) The law and the Special Rules recognize that construction disputes

shall be governed by Exec. Order No. 1008 and its arbitration rules.91

6) Construction disputes filed in court shall be dismissed and referred to CIAC arbitration. 92

7) The Revised Rules of Court may not be resorted to even in a

suppletory capacity.93

8) The Special ADR Rules of Court now resolves conflicting procedural remedies of appeal with confirmation/vacation of the award.94

Section 1, Rule 43 of the Rules of Court allows appeals to the Court

of Appeals from an award made “by any quasi-judicial agency in the exercise of its quasi-judicial functions”. Included in the list of such agencies are “Construction Industry Arbitration Commission, and voluntary arbitrators authorized by law”.

87 Rep. Act No. 9285, Sec. 40: Confirmation of Award. 88 Id., Sec. 40, paragraph 4. 89 Rule 2.3 Rules governing arbitral proceedings. 90 Rep. Act No. 9285, Sec. 26: Meaning of “appointing authority.” 91 Id., Sec. 34. Arbitration of construction disputes: Governing Law, “The arbitration of construction disputes shall be governed by Executive Order No. 1008, otherwise known as the Construction Industry Arbitration Law. 92 Id., Sec. 39. Court to dismiss case involving construction disputes. 93 The suppletory application of the Rules of Court was proposed but was objected to by the technical working group. Instead, Rule 22.1 was approved in effect stating that those relevant provisions of the Rules of Court “have either been included and incorporated in these Special ADR Rules, or specifically referred to herein”. Therefore, there is no need for providing for its suppletory application. 94 Rule now mandates the joinder of the two remedies if filed separately.

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On the other hand, Section 23 of the general “Arbitration Law”95 require that an award must first be confirmed by a Regional Trial Court where the parties reside and an appeal therefrom is allowed under Section 29 thereof.

Based on experience arising from an actual case where the

foregoing conflicting jurisdictions arose, the Special ADR Rules of Court resolves the conflict by providing as follows:

Rule 19.7 No appeal or certiorari on the merits of an arbitral

award. An agreement to refer a dispute to arbitration shall mean that the arbitral award shall be final and binding.

Consequently, a party to an arbitration is precluded from filing

an appeal or a petition for certiorari questioning the merits of an arbitral award.

Where the losing party files an action to vacate or modify the award

and the prevailing party files a separate petition to confirm the award in its favor, “upon motionof either party, the court may order the consolidation of the two cases before either court.”96

9) All actions under the Special ADR Rules of Court are classified as

special proceedings97. This means that an initiatory pleading is a petition.

10) A large number of judicial interventions are by summary

proceedings.98 This requires personal service and filing of petition or by courier service,99 “a hearing conducted in one (1) day and only for purposes of clarifying facts” and requires the court to “resolve the matter within a period of thirty (30) days from the day of hearing.”100

11) Arbitration rule on competence-competence now enforced.

Under this principle,101 the first opportunity to rule on the issue of

whether a Tribunal has jurisdiction over a dispute must be given to the Tribunal itself. Accordingly, the rule requires a court to exercise judicial restraint and defer to the Tribunal on this issue.

95 Rep. Act No. 876. 96 SPECIAL ADR RULES OF COURT, Rule 11.5, paragraph 5. 97 Id., Rule 1.2: All proceedings under the Special ADR Rules are special proceedings. 98 Id., Rule 1.3 lists nine (9) interventions that are required to follow summary procedure. 99 Id., No provision is made for service by postal service. 100 Id. 101 Id., Rule 2.3 Policy implementing competence-competence principle.

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12) Appeal to the Supreme Court now discretionary.

The reason for this restriction is to shorten the period of judicial

review of arbitration awards. Disputants resort to arbitration knowing that it is an expeditious remedy to resolve disputes. A contrary rule would be a disincentive to resort to arbitration and would contravene the State policy of least intervention from the courts. This new policy is clearly stated in the following provision:

Rule 19.36 Review discretionary. A review by the Supreme Court is not a matter of right but of sound judicial discretion which will be granted only for serious and compelling reasons resulting in grave prejudice to the aggrieved party.

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ADR and Katarungang Pambarangay