IP-E GAMING VENTURES v BEIJING PERFECT WORLD

FACTS:
• IPEGV entered into a publishing agreement with BPW
• Said agreement, which had an arbitration clause, states that BPW gave IPEGV
authority to publish Zhu Xian Online in the Ph
• The game then ceased to operate due to unfixed bugs
• BPW filed a request for Arbitration
• IPEGV changed their venue to the Singapore International Arbitration Centre
• Arbitrator issued a final award in favor of BPW
• Upon IPEGV’s inaction, BPW filed a petition for enforcement, which was
granted.
• IPEGV assailed the RTC before CA.
• CA ruled in favor of BPW dismissing the appeal stating that IPEGV failed to file
an appeal within the reglementary period.
• IPEGV filed a MR arguing that the petition was filed in accordance with the
Special Rules of Court on ADR where filing via private courier was allowed.
• CA dismissed the MR. Hence, this case.

ISSUE:
Whether the CA erred in not applying the Special ADR Rules.

HELD: YES
The CA erred in not applying the Special ADR Rules. The court stated that while
the actual arbitration between the parties ended upon the rendition of the Final Award,
the conclusion does not take their dispute out of the jurisdiction of the Special ADR as
it must continue to apply to such disputes even when they move from the actual
arbitral phase to the recognition and enforcement phase.
MABUHAY HOLDINGS v SEMBCORP

FACTS:
• Mabuhay, IDHI, and Sembcorp entered into a shareholders’ agreement, which
had an arbitration clause, for the expansion for their business of common
carriage by inter-island fast ferry.
• They agreed that Sembcorp would receive a minimum guaranteed return.
• Sembcorp then requested for the payment of its guaranteed return, however,
Mabuhay failed to pay any amount.
• Sembcorp filed a Request for Arbitration with the International Court of
Arbitration (ICA) of the ICC.
• ICA rendered a final award ordering the Mabuhay to pay Sembcorp.
• Mabuhay filed an opposition arguing that it is an intra-corporate controversy,
which is excluded from the scope of the arbitration clause in the agreement.
• RTC dismissed the petition of enforcement of award and ruled that it could not
be enforced, as the obligation converted into an intra-corporate matter.
• CA reversed the decision. Hence, this case.

ISSUE:
Whether the RTC correctly refused to enforce the Final Award.

HELD: NO
Pursuant to the State's policy in favor of arbitration and enforcement of arbitral
awards, the Court adopts the majority and narrow approach in determining whether
enforcement of an award is contrary to our public policy. Mere errors in the
interpretation of the law or factual findings would not suffice to warrant refusal of
enforcement under the public policy ground. The illegality or immorality of the award
must reach a certain threshold such that, enforcement of the same would be against
Our State's fundamental tenets of justice and morality, or would blatantly be injurious
to the public, or the interests of the society.
FRUEHAUF v SIGNETICS

FACTS:
• Fruehauf leased several parcels of land to Signetics for a period of 25 years.
• Team Holdings Limited (THL) bought Signetics and changed its name to
Technology Electronics Assembly and Management (TEAM)
• Fruehauf and TEAM, upon agreement, entered into a 15-year lease agreement,
which included an arbitration clause.
• Upon expiration of the lease contract, the sub lessor of TEAM named Capital
failed to vacate its premises.
• Fruehaf filed a complaint against the RTC, in which RTC directed the parties to
comply with the arbitration clause of the contract.
• RTC ruled in favor of Fruehaf, ordering TEAM to pay.
• TEAM petitioned the RTC to modify the award, which RTC denied.
• TEAM appealed to CA, arguing that the RTC committed grave abuse of discretion
in denying to issue a notice of appeal.
• CA denied the petition.
• CA then amended its decision stating that Fruehaf may file a petition for review
with the SC, hence, this case.

QUESTION:
What are the remedy against an unfavorable arbitral award?

HELD:
The Special ADR Rules allow, the RTC to correct or modify an arbitral award
pursuant to Section 25 of the Arbitration Law. However, this authority cannot be
interpreted as jurisdiction to review the merits of the award. The RTC can modify or
correct the award only in the following cases:
a. Where there was an evident miscalculation of figures or an evident mistake
in the description of any person, thing or property referred to in the award;
b. Where the arbitrators have awarded upon a matter not submitted to them, not
affecting the merits of the decision upon the matter submitted;
c. Where the arbitrators have omitted to resolve an issue submitted to them for
resolution; or
d. Where the award is imperfect in a matter of form not affecting the merits of
the controversy, and if it had been a commissioner's report, the defect could have been
amended or disregarded by the Court.
In sum, the only remedy against; a final domestic arbitral award is to file petition
to vacate or to modify/correct the award not later than thirty (30) days from the
receipt of the award. Wherefore, the petition is granted and decision of RTC is affirmed.
BUSAN v METRO RAIL TRANSIT

FACTS:
• Metro Rail entered into a joint venture for MRT3 with the petitioners and was
incorporated as a special company known as BURI.
• Petitioner filed to pay Billing nos. 9 to 18.
• Both parties then agreed to commence arbitration proceedings.
• Petitioner filed a petition for the issuance of Temporary Order of Protection
under Special ADR Rules.
• RTC denied.
• Respondent then issued a decision terminating their Contract.
• Hence, this case.

ISSUE:
Whether the RTC erred in dismissing the case.

HELD: NO
Republic Act No. 9285 allows a Regional Trial Court to grant interim or
provisional relief, including preliminary injunction, to parties in an arbitration case
prior to the constitution of the arbitral tribunal. This general statute, however, must
give way to a special law governing national government projects, Republic Act No.
8975 which prohibits courts, except the Supreme Court from issuing TROs and writs
of preliminary injunction in cases involving national government projects.
CAGAYAN v PASAL

FACTS:
• Cagayan Water District entered into a bulk water supply agreement with Rio
Verde.
• Upon starting the delivery by Rio Verde, it presented a new rate per cubic meter.
• COWD informed Rio Verde that it cannot pay the new rate as it was not what
they agreed upon.
• Both of them then agreed to go back to the previous rate.
• However, it was not long before Rio Verde requested for a price increase.
• COWD denied.
• Rio Verde, suggested arbitration, to which COWD ignored, therefore Rio filed
with the RTC where it directed them to arbitration.

ISSUE: Whether a party may file a petition to compel such arbitration.

HELD: YES
The court stated Section 6 of RA 876 which states that a party aggrieved by the
refusal of another to perform under an agreement, may petition the court for an order
directing the parties to proceed to such arbitration.
FEDEX v AIR21

FACTS:
• FedEx lost its International Freight Forwarder’s license to engage in the PH
• It then entered into a Global Service Program with Air21 to undertake its delivery
within the country
• However, several issues relating to money remittance arose from the parties.
• Both parties agreed to an arbitration.
• During the arbitration, Jennings, the Managing Director of FedEx stated that one
of the directors of Ace, which was a company who filed against FedEx resulting
to their loss of their IFF, was a friend of Lina, an employee of Air21.
• Feeling aggrieved, she filed a complaint for slander against Jennings.
• Jennings argued that the statements were confidential information and shall
not be used as evidence.
• RTC denied FedEx’s petition, hence, this case.

ISSUE:
Whether the information was confidential.

HELD: YES
A person who participates in an arbitration proceeding is entitled to speak his or
her piece without fear of being prejudiced should the process become unsuccessful.
Hence, any communication made towards that end should be regarded as confidential
and privileged.
Thus, the claimed slanderous statements by Jennings during the arbitration
hearing are deemed confidential information and the veil of confidentiality over them
must remain.
METRO ILOILO WATER v FLO WATER

FACTS:
• MIWD and Flo water executed a Bulk Water Supply Contract.
• MIWD raised that Flo Water was not able to meet the required volume.
• Later on it was discovered that the shortage was due to the incapacitated
transmission pipeline.
• However, Flo water still demanded the original payment despite the shortage of
its supply.
• Both parties agreed to enter into arbitration proceedings.
• The tribunal issued the arbitral award ordering MIWD to pay Flo.
• MIWD appealed to the CA but was denied, hence this case.

ISSUE:
Whether the CA erred in dismissing the petition on the grounds of wrong
remedy.

HELD: NO
To question an arbitral award, the Special ADR Rules allow the filing of a petition
to vacate or correct/ modify before the RTC based on specific grounds.
The Court will not review the factual findings of an arbitral tribunal upon the
artful allegation that such body had "misapprehended the facts'' and will not pass upon
issues which are, at bottom, issues of fact, no matter how cleverly disguised they might
be as "legal questions."
It is established that courts are called to exercise judicial restraint and deference
when asked to review the findings of arbitral tribunals, to avoid defeating the purpose
of arbitration.
USON v PECCI

FACTS:
• Uson was appointed as the General Manager of PECCI
• However. After 2 years the Board of Directors of PECCI declared all position in
the cooperative as vacant including Uson’s position.
• Uson then filed a complaint for illegal dismissal to the Labor Arbiter.
• Pecci argued that Uson was a cooperative officer and that the matter should be
adjudicated by the CDA. (Cooperative Development Authority)
• The Labor Arbiter ruled in favor of Uson.
• Pecci appealed to CA, to which the CA reversed the decision of the RTC stating
that it is within the jurisdiction of the CDA.
• Hence, this case.

ISSUE:
Whether the case is an intra-cooperative dispute within the jurisdiction of CDA
(arbitration)

HELD: YES
PECCI is a cooperative that is registered with the CDA and existing under the
laws of the Republic of the Philippines. The Cooperative Code is the law that governs
cooperatives.
Therefore, the Cooperative Code applies to PECCI, its officers, members, and any
inter-cooperative dispute that may arise.
Therefore, the court ruled that the dismissal of Uson is an intra-cooperative
dispute, which is within the jurisdiction of the CDA and the decision of the Labor
Arbiter is void.
J PLUS v UTILITY ASSURANCE

FACTS:
• J Plus entered into a Construction Agreement with Mabunay, whereby the latter
agreed to build a condo for J Plus.
• However, Mabunay failed to accomplish the construction at the stipulated date.
• Petitioner then terminated the contract and sent demand letters to Mabunay
and respondent surety.
• Mabunay did not respond, so petitioner filed a request for arbitration to
Construction Industry Arbitration Commission (CIAC)
• CIAC rendered decision in favor of J Plus ordering the respondents to pay the
former.
• Respondent filed a petition for review to the CA.
• CA affirmed the decision of CIAC however, it stated that J plus is not entitled to
liquidated damages.
• Hence, this petition by J plus.

ISSUE:
Whether arbitral awards made by CIAC must be confirmed by RTC before being
executory.

HELD: NO
The court held that R.A. No. 9285 did not confer on regional trial court’s
jurisdiction to review awards or decisions of the CIAC in construction disputes. A CIAC
arbitral award need not be confirmed by the regional trial court to be executory as
provided under E.O. No. 1008.
By express provision of Section 19 thereof, the arbitral award of the CIAC is final
and unappealable, except on questions of law, which are appealable to the Supreme
Court.
REYNALDO v ROSITA

FACTS:
• Spouses Ang own a 2-storey residential house, where their neighbour, Angel
started a construction of a 5-storey commercial building on the adjoining lot.
• Spouses noticed cracks in their walls and found that these were due to the
construction works of Angel.
• Spouses filed a case to the RTC after it was unsatisfied with the repair done by
Angel.
• A circular was then promulgated stating that all pending cases involving
construction disputes are to be referred to the CIAC.
• In response, the spouses filed a motion to retain jurisdiction and proceed to trial,
but was denied. Hence, this case.

ISSUE:
Whether the CIAC has jurisdiction over an ordinary civil case for damages filed
by a non-party to a construction contract

HELD: NO
This provision lays down three requisites for acquisition of jurisdiction by the
CIAC:

1. a dispute arising from or connected with a construction contract

2. such contract must have been entered into by parties involved in construction in the
Philippines
3. an agreement by the parties to submit their dispute to arbitration.

The foregoing requisites obviously do not apply to the case as there is no

construction contract between the spouses Ang and the respondents. The spouses
Ang's cause of action does not proceed from any construction contract but from the
alleged damage inflicted upon their property by virtue of respondents' construction
activities.