Case Digest Project on ADR

8/9/2019 Case Digest Project on ADR

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ALTERNATIVE DISPUTE RESOLUTIONDigested Cases

I UNIWIDE SALES REALTY AND RESOURCES CORPORATION,petitioner,vs.

TITAN-IKEDA CONSTRUCTION AND DEVELOPMENT CORPORATION,respondent.G.R. No. 126619, Deceme! 2", 2""6

II #ORGE GON$ALES %&' PANEL O( AR)ITRATORS, petitioners, vs.

CLIMA* MINING LTD., CLIMA*-ARIMCO MINING CORP., %&'

AUSTRALASIAN P+ILIPPINES MINING INC., respondents.

G.R. No. 1619, (e!%!/ 20, 2""

III CARGILL P+ILIPPINES, INC.,Petitioner,VS.SAN (ERNANDO REGALA TRADING, INC.,Respondent.G.R. No. 1", #%&%!/ 1, 2"11

IV E3UITA)LE PCI )ANKING CORPORATION., Petitioner, 45.

RC)C CAPITAL CORPORATION., Respondent.

G.R. No. 10220,Deceme! 10, 2""0

V A)S-C)N )ROADCASTING CORPORATION, petitioner,

vs.

WORLD INTERACTIVE NETWORK SYSTEMS WINS7 #APAN CO., LTD.,

respondent.

G.R. No. 1692, (e!%!/ 11, 2""0

Submitted by:

M%!8% D. Ro'!8e:(Student)Alternative Dispute Resolution


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Saturday ( 7:00 !:00 p.m.)

UNIWIDE SALES REALTY AND RESOURCES CORPORATION,petitioner,

vs.TITAN-IKEDA CONSTRUCTION AND DEVELOPMENT CORPORATION,respondent.G.R. No. 126619 Deceme! 2", 2""6

(ACTS;

"#is $ase involved "itan%&'eda #o entered into $onstru$tion agreement*

$ontra$t *pro+e$t it# niide. -ater "itan%&'eda led an a$tion /or sum o/ money

against niide it# t#e R"C be$ause niide allegedly /ailed to pay $ertain $laims

billed by "itan a/ter t#e $ompletion o/ t#e pro+e$ts. niide moved /or t#edismissal*suspension o/ t#e pro$eeding /or t#em to rst undergo arbitration. "#e

Arbitrators issued terms o/ re/eren$e #i$# as signed by t#e parties, (niide did

not attempt to modi/y t#e "R to a$$ommodate its belated $ounter$laim on

deadlines /or li1uidated damages.)"itan t#en reled t#e $ase it# C&AC.

C&AC De$ision: Pro+e$t 2: niide is absolved o/ any liability. Pro+e$t 3: niide

is absolved o/ any liability /or 4A" payment and /or t#e a$$ount o/ "itan, and "itan is

absolved /rom liability /or de/e$tive $onstru$tion. Pro+e$t : niide id #eld liable /or

unpaid balan$e (5,256,8.) plus 239 interest*annum and to pay t#e /ull 4A" /or

t#e additional or' #ere no ritten aut#oriation as presented.

C&AC li'eise re+e$ted t#e $laim on li1uidated damages.

A/ter niide;s motion /or re$onsideration as denied by C&AC, it led a

petition /or revie it# CA but same as denied, t#us, niide led a petition /or

revie under rule 85 to see' partial reversal o/ t#e de$ision o/ CA #i$# modied

t#e de$ision o/ C&AC. niide $laims t#at C&AC s#ould #ave applied pro$edural rules

su$# as se$tion 5, Rule 20 it# more liberality be$ause it as an administrative

tribubal /ree /rom all rigid te$#ni$alities o/ regular $ourts be$ause CA #eld t#at t#e

issue on li1uidated damages s#ould be le/t /or determination in /uture pro$eedings.

ISSUE;


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Rule o/ Pro$edure =overning Constru$tion Arbitration promulgated by t#e C&AC

$ontains no provision on t#e appli$ation o/ t#e Rules o/ Court to arbitration

pro$eedings, even in a suppletory $apa$ity. Su$# importation o/ t#e Rules o/ Court

provision on amendment to $on/orm to eviden$e ould $ontravene t#e spirit, i/ not

t#e letter o/ t#e C&AC rules. "#is is /or t#e reason t#at t#e /ormulation o/ t#e "erms

o/ Re/eren$e is done it# t#e a$tive parti$ipation o/ t#e parties and t#eir $ounsel

t#emselves. "#e "R is /urt#er re1uired to be signed by all t#e parties, t#eir

respe$tive $ounsel and all t#e members o/ t#e Arbitral "ribunal. nless t#e issues

t#us $are/ully /ormulated in t#e "erms o/ Re/eren$e ere e>pressly s#oed to be

amended, issues outside t#ereo/ may not be resolved. As already noted in t#e

De$ision, ?no attempt as ever made by t#e @niide to modi/y t#e "R in order to

a$$ommodate t#e issues related to its belated $ounter$laim? on t#is issue.

Arbitration #as been dened as ?an arrangement /or ta'ing and abiding by t#e

+udgment o/ sele$ted persons in some disputed matter, instead o/ $arrying it to

establis#ed tribunals o/ +usti$e, and is intended to avoid t#e /ormalities, t#e delay,t#e e>pense and ve>ation o/ ordinary litigation.

#ORGE GON$ALES %&' PANEL O( AR)ITRATORS, petitioners,

vs.

CLIMA* MINING LTD., CLIMA*-ARIMCO MINING CORP., %&' AUSTRALASIAN

P+ILIPPINES MINING INC., respondents.

G.R. No. 1619. (e!%!/ 20, 2""

(ACTS:

Petitioner Borge =onales, as $laimoner o/ mineral deposits lo$ated it#in t#e

Addendum Area o/ &nuen$e in Didipio, in t#e provin$es o/ uirino and Eueva

4i$aya, entered into a $o%produ$tion, +oint venture and*or produ$tion%s#aring letter%

agreement designated as t#e Fay 28, 2!67 -etter o/ &ntent it# =eop#ilippines, &n$,

and &nme> -td. nder t#e agreement, petitioner, as $laimoner, granted to

=eop#ilippines, &n$. and &nme> -td. $olle$tively, t#e e>$lusive rig#t to e>plore and

survey t#e mining $laims /or a period o/ t#irty%si> () mont#s it#in #i$# t#e

latter $ould de$ide to ta'e an operating agreement on t#e mining $laims and*or


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develop, operate, mine and ot#erise e>ploit t#e mining $laims and mar'et any and

all minerals t#at may be derived t#ere/rom.

n 36 Gebruary 2!6!, t#e parties to t#e Fay 28, 2!67 -etter o/

&ntent renegotiated t#e same into t#e Gebruary 36, 2!6! Agreement #ereby t#e

e>ploration o/ t#e mining $laims as e>tended /or anot#er period o/ t#ree years. n

! Far$# 2!!2, petitioner =onales, Arim$o Fining Corporation, =eop#ilippines &n$.,

&nme> -td., and Aume> P#ilippines, &n$. signed a do$ument designated as

t#eAddendum to t#e Fay 28, 2!67 -etter o/ &ntent and Gebruary 36, 2!6!

Agreement it# H>press Ad#esion "#ereto (#erea/ter, t#e Addendum Contra$t).

nder t#e Addendum Contra$t, Arim$o Fining Corporation ould apply to t#e

=overnment o/ t#e P#ilippines /or permission to mine t#e $laims as t#e

=overnment;s $ontra$tor under a Ginan$ial and "e$#ni$al Assistan$e

Agreement (G"AA). n 30 Bune 2!!8, Arim$o Fining Corporation obtained t#e G"AA

and $arried out or' under t#e G"AA.

n 6 Eovember 2!!!, petitioner =onales led be/ore t#e Panel o/ Arbitrators,

Region &&, Fines and =eos$ien$es Iureau o/ t#e Department o/ Hnvironment and

Eatural Resour$es, against respondents Clima>%Arim$o Fining Corporation, Clima>,

and APF&, a Complaint See'ing t#e de$laration o/ nullity or termination o/ t#e

Addendum Contra$t, t#e G"AA, t#e perating and Ginan$ial A$$ommodation

Contra$t, t#e Assignment, A$$ession Agreement, and t#e Femorandum o/

Agreement. Petitioner =onales prayed /or an unspe$ied amount o/ a$tual and

e>emplary damages plus attorney;s /ees and /or t#e issuan$e o/ a temporary

restraining order and*or rit o/ preliminary in+un$tion to restrain or en+oin

respondents /rom /urt#er implementing t#e 1uestioned agreements.

&SSH:

2.


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R-&E=:

2. n t#e ot#er #and, a mining dispute is a dispute involving (a) rig#ts to mining

areas, (b) mineral agreements, G"AAs, or permits, and ($) sur/a$e oners,

o$$upants and $laim#olders*$on$essionaires. nder Republi$ A$t Eo. 7!83

(ot#erise 'non as t#e P#ilippine Fining A$t o/ 2!!5), t#e Panel o/Arbitrators #as e>$lusive and original +urisdi$tion to #ear and de$ide t#ese

mining disputes."#e Court o/ Appeals, in its 1uestioned de$ision, $orre$tly

stated t#at t#e Panel;s +urisdi$tion is limited only to t#ose mining disputes

#i$# raise 1uestions o/ /a$t or matters re1uiring t#e appli$ation o/

te$#nologi$al 'noledge and e>perien$e. &t is apparent t#at t#e Panel o/

Arbitrators is bere/t o/ +urisdi$tion over t#e Complaintled by petitioner. "#e

basi$ issue in petitioner;s Complaintis t#e presen$e o/ /raud or

misrepresentation allegedly attendant to t#e e>e$ution o/ t#eAddendum

Contract and t#e ot#er $ontra$ts emanating /rom it, su$# t#at t#e $ontra$ts

are rendered invalid and not binding upon t#e parties. &t avers t#at petitioner

as misled by respondents into agreeing to t#eAddendum Contract. "#is

$onstitutes /raud #i$# vitiated petitioner;s $onsent, and under Arti$le 2!0 o/

t#e Civil Code, is one o/ t#e grounds /or t#e annulment o/ a voidable $ontra$t.

4oidable or annullable $ontra$ts, be/ore t#ey are set aside, are e>istent, valid,

and binding, and are eJe$tive and obligatory beteen t#e parties. "#ey $an

be ratied.

3. Arbitration be/ore t#e Panel o/ Arbitrators is proper only #en t#ere is a

disagreement beteen t#e parties as to some provisions o/ t#e $ontra$t

beteen t#em, #i$# needs t#e interpretation and t#e appli$ation o/ t#at

parti$ular 'noledge and e>pertise possessed by members o/ t#at Panel. &t is

not proper #en one o/ t#e parties repudiates t#e e>isten$e or validity o/ su$#

$ontra$t or agreement on t#e ground o/ /raud or oppression as in t#is $ase.

"#e validity o/ t#e $ontra$t $annot be sub+e$t o/ arbitration pro$eedings.

Allegations o/ /raud and duress in t#e e>e$ution o/ a $ontra$t are matters

it#in t#e +urisdi$tion o/ t#e ordinary $ourts o/ la. "#ese 1uestions are legal

in nature and re1uire t#e appli$ation and interpretation o/ las and

+urispruden$e #i$# is ne$essarily a +udi$ial /un$tion. Petitioner also disagrees


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it# t#e Court o/ Appeals; ruling t#at t#e $ase s#ould be broug#t /or

arbitration under Rep. A$t 67, pursuant to t#e arbitration $lause in

t#eAddendum Contract#i$# states t#at K@all disputes arising out o/ or in

$onne$tion it# t#e Contra$t, #i$# $annot be settled ami$ably among t#e

Parties, s#all nally be settled under R.A. 67.L Me points out t#at respondentsClima> and APF& are not parties to t#eAddendum Contractand are t#us not

bound by t#e arbitration $lause in said $ontra$t.

"#e $ourt agreed t#at t#e $ase s#ould not be broug#t under t#e ambit o/ t#e

Arbitration -a, but /or a diJerent reason. "#e 1uestion o/ validity o/ t#e

$ontra$t $ontaining t#e agreement to submit to arbitration ill aJe$t t#e

appli$ability o/ t#e arbitration $lause itsel/. A party $annot rely on t#e

$ontra$t and $laim rig#ts or obligations under it and at t#e same time impugn

its e>isten$e or validity. &ndeed, litigants are en+oined /rom ta'ing in$onsistent

positions. As previously dis$ussed, t#e $omplaint s#ould #ave been led

be/ore t#e regular $ourts as it involved issues #i$# are +udi$ial in nature.

CARGILL P+ILIPPINES, INC.,Petitioner,VS.SAN (ERNANDO REGALA TRADING, INC.,Respondent.G.R. No. 1", #%&%!/ 1, 2"11

(ACTS;

Cargill P#ilippines, &n$. and Regala "rading, &n$. entered into a $ontra$t and

agreed upon t#at San Gernando Regala "rading, &n$. ould pur$#ase /rom Cargill a

"#ailand origin $ane bla$'strap molasses and t#e delivery as to be made in

Banuary or Gebruary #oever, t#e delivery as moved to April or Fay and t#e

payment ould be by an &rrevo$able -etter o/ Credit Payable at Sig#t.Cargill /ailed

to $omply it# t#e obligation and Regala "rading led a $omplaint it# t#e R"C /or


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t#e Res$ission o/ t#e Contra$t it# Damages against Cargill.Cargill led a Fotion to

Dismiss * Suspend Pro$eedings and re/er $ontroversy to 4oluntary Arbitration, it

argued t#at t#e $ontra$t beteen t#e parties as never $onsummated be$ause

Regala "rading did not return t#e proposed agreement bearing its ritten

a$$eptan$e.

ISSUE;

istent +ust be$ause t#e

main $ontra$t is invalid or did not $ome into e>isten$e, sin$e t#e arbitration

agreement s#all be treated as a separate agreement independent o/ t#e main

$ontra$t. A $ontrary ruling ould suggest t#at a partyNs mere repudiation o/ t#e

main $ontra$t is suO$ient to avoid arbitration and t#at is e>a$tly t#e situation t#at

t#e separability do$trine soug#t to avoid. "#us, e nd t#at even t#e party #o #as

repudiated t#e main $ontra$t is not prevented /rom en/or$ing its arbitration $lause.

"#e separability o/ t#e arbitration agreement is espe$ially signi$ant to t#e

determination o/ #et#er t#e invalidity o/ t#e main $ontra$t also nullies t#e

arbitration $lause. &ndeed, t#e do$trine denotes t#at t#e invalidity o/ t#e main

$ontra$t, also re/erred to as t#e ?$ontainer? $ontra$t, does not aJe$t t#e validity o/t#e arbitration agreement. &rrespe$tive o/ t#e /a$t t#at t#e main $ontra$t is invalid,

t#e arbitration $lause*agreement still remains valid and en/or$eable.

E3UITA)LE PCI )ANKING CORPORATION., Petitioner,45.RC)C CAPITAL CORPORATION., Respondent.G.R. No. 10220.Deceme! 10, 2""0

GAC"S:


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n Fay 38, 3000, petitioners H1uitable PC& Ian', &n$. (HPC&I) and t#e

individual s#are#olders o/ Ian'ard, &n$., as sellers, and respondent RCIC Capital

Corporation (RCIC), as buyer, e>e$uted a Share Purchase Agreement@5(SPA) /or t#e

pur$#ase o/ petitioners; interests in Ian'ard, representing 33,80,000 s#ares, /or

t#e pri$e o/ P#P 2,76,7!,800. "o e>pedite t#e pur$#ase, RCIC agreed to dispenseit# t#e $ondu$t o/ a due diligen$e audit on t#e nan$ial status o/ Ian'ard.

nder t#e SPA, RCIC underta'es, on t#e date o/ $ontra$t e>e$ution, to

deposit, as donpayment, 309 o/ t#e pur$#ase pri$e, or P#P 57,5,660, in an

es$ro a$$ount. "#e es$roed amount, t#e SPA stated, s#ould be released to

petitioners on an agreed%upon release date and t#e balan$e o/ t#e pur$#ase pri$e

s#all be delivered to t#e s#are buyers upon t#e /ulllment o/ $ertain $onditions

agreed upon, in t#e /orm o/ a manager;s $#e$'.

Sometime in September 3000, RCIC #ad Ian'ard;s a$$ounts audited, $reating

/or t#e purpose an audit team led by a $ertain Rubio, t#e 4i$e%President /or Ginan$e

o/ RCIC at t#e time. Rubio;s $on$lusion as t#at t#e arranty, as $ontained in

Se$tion 5(#) o/ t#e SPA (simply Se$. 5@# #ereina/ter), as $orre$t. n De$ember 36,

3000, RCIC paid t#e balan$e o/ t#e $ontra$t pri$e. "#e $orresponding deeds o/ sale

/or t#e s#ares in 1uestion ere e>e$uted in Banuary 3002. "#erea/ter, in a letter o/

Fay 5, 300, RCIC in/ormed petitioners o/ its #aving overpaid t#e pur$#ase pri$e o/

t#e sub+e$t s#ares, $laiming t#at t#ere as an overstatement o/ valuation o/

a$$ounts amounting to P#P 876 million, resulting in t#e overpayment o/ over P#P

2 million. "#us, RCIC $laimed t#at petitioners violated t#eir arranty, as sellers,

embodied in Se$. 5(g) o/ t#e SPA (Se$. 5@g #ereina/ter).

Golloing unsu$$ess/ul attempts at settlement, RCIC, in a$$ordan$e it# Se$.

20 o/ t#e SPA, led a Request for Arbitrationdated Fay 23, 3008@6it# t#e &CC%

&CA. &n t#e re1uest, RCIC $#arged Ian'ard it# deviating /rom, $ontravening and

not /olloing generally a$$epted a$$ounting prin$iples and pra$ti$es in maintaining

t#eir boo's. Due to t#ese improper a$$ounting pra$ti$es, RCIC alleged t#at bot#

t#e audited and unaudited nan$ial statements o/ Ian'ard prior to t#e sto$'

pur$#ase ere /ar /rom /air and a$$urate and, #en$e, violated t#e representations

and arranties o/ petitioners in t#e SPA. Per RCIC, its overpayment amounted to
http://sc.judiciary.gov.ph/jurisprudence/2008/december2008/182248.htm#_ftn5http://sc.judiciary.gov.ph/jurisprudence/2008/december2008/182248.htm#_ftn8http://sc.judiciary.gov.ph/jurisprudence/2008/december2008/182248.htm#_ftn8http://sc.judiciary.gov.ph/jurisprudence/2008/december2008/182248.htm#_ftn5


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P#P 55 million. &t t#us prayed /or t#e res$ission o/ t#e SPA, restitution o/ t#e

pur$#ase pri$e, payment o/ a$tual damages in t#e amount o/ P#P 57,23,220,

legal interest on t#e pur$#ase pri$e until a$tual restitution, moral damages, and

litigation and attorney;s /ees. As alternative to res$ission and restitution, RCIC

prayed /or damages in t#e amount o/ at least P#P 60!,7!,0!3 plus legal interest.&SSH:

amine RCIC;s itnesses, t#eir $laim is also bere/t o/ merit.

Se$. 25 o/ RA 67 or t#eArbitration Lawprovides t#at:

Se$tion 25. Hearing b arbitrators. Arbitrators may, at t#e

$ommen$ement o/ t#e #earing, as' bot# parties /or brie/ statements o/

t#e issues in $ontroversy and*or an agreed statement o/ /a$ts.

"#erea/ter t#e parties may oJer su$# eviden$e as t#ey desire, and s#all

produ$e su$# additional eviden$e as t#e arbitrators s#all re1uire or

deem ne$essary to an understanding and determination o/ t#e

dispute. T e =e ?'e o@ =e4%&c/

%&' m%=e!8%>8=/ o@ =


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o$ular inspe$tion o/ any matter or premises #i$# are in dispute, but

su$# inspe$tion s#all be made only in t#e presen$e o/ all parties to t#e

arbitration, unless any party #o s#all #ave re$eived noti$e t#ereo/ /ails

to appear, in #i$# event su$# inspe$tion s#all be made in t#e absen$e

o/ su$# party. (Hmp#asis supplied.)

"#e ell%settled rule is t#at administrative agen$ies e>er$ising 1uasi%+udi$ial

poers s#all not be /ettered by t#e rigid te$#ni$alities o/ pro$edure, albeit t#ey are,

at all times re1uired, to ad#ere to t#e basi$ $on$epts o/ /air play.

A)S-C)N )ROADCASTING CORPORATION, petitioner,

vs.

WORLD INTERACTIVE NETWORK SYSTEMS WINS7 #APAN CO., LTD.,

respondent.

G.R. No. 1692 (e!%!/ 11, 2""0

(ACTS:

AIS%CIE Iroad$asting Corporation (AIS%CIE) entered into a li$ensing

agreement it#


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CIE led in t#e CA a petition /or revie under Rule 8 o/ t#e Rules o/ Court or, in

t#e alternative, a petition /or $ertiorari under Rule 5 o/ t#e same Rules, it#

appli$ation /or temporary restraining order and rit o/ preliminary in+un$tion.


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grounds /or maintaining a petition to va$ate an arbitral aard in t#e R"C, it

ne$essarily /ollos t#at a party may not avail o/ t#e latter remedy on t#e grounds o/

errors o/ /a$t and*or la or grave abuse o/ dis$retion to overturn an arbitral aard.

Proper issues t#at may be raised in a petition /or revie under Rule 8 pertain

to errors o/ /a$t, la or mi>ed 1uestions o/ /a$t and la.

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Case Digest Project on ADR