ADR 7th and 8th CASE

8/13/2019 ADR 7th and 8th CASE

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ADR 7th

and 8th

CASE

ABS-CBN BROADCASTING CORPORATION, petitioner,

vs.

WORLD INTERACTIVE NETWORK SYSTEMS (WINS) JAPAN CO., LTD.,respondent

FACTS: ABS-CBN entered into a licensing agreement with World Interactive Network Systems (WINS)

Japan Co., Ltd., a foreign corporation licensed under the laws of Japan. Under the agreement, WINS was

granted the exclusive license to distribute and sublicense the distribution of the television service known

as "The Filipino Channel" in Japan.

A dispute arose between the parties when ABS accused WINS of inserting nine episodes of WINS

WEEKLY, a television program into the TFC programming without the authorization of ABS-CBN. Hence,

the latter issued a notice of termination of the said agreement because of breach of contract.

Thereafter, WINS filed an arbitration suit pursuant to the arbitration clause of their agreement. It

contended that the airing of WINS WEEKLY was made with ABS-CBNs prior approval.

The parties appointed Professor Alfredo F. Tadiar to act as sole arbitrator. Prof. Tadiar found in

favor of the WINS. He held that ABS-CBN gave its approval to WINS for the airing of WINS WEEKLY as

shown by a series of written exchanges between the parties.ABS-CBN then filed in the CA a petition for review under Rule 43 of the Rules of Court or, in the

alternative, a petition for certiorari under Rule 65 of the same Rules, with application for temporary

restraining order and writ of preliminary injunction. It alleged serious errors of fact and law and/or grave

abuse of discretion amounting to lack or excess of jurisdiction on the part of the arbitrator.

The CA rendered the assailed decision dismissing ABS-CBNs petition for lack of jurisdiction. It

ruled that it is the RTC which has jurisdiction over questions relating to arbitration. It held that the only

instance it can exercise jurisdiction over an arbitral award is an appeal from the trial court's decision

confirming, vacating or modifying the arbitral award. It further stated that a petition for certiorari under

Rule 65 of the Rules of Court is proper in arbitration cases only if the courts refuse or neglect to inquire

into the facts of an arbitrator's award.

The ABS-CBN moved for reconsideration but was denied. Hence, this petition.

ISSUE: Whether or not an aggrieved party in a voluntary arbitration dispute may avail of, directly in the

CA, a petition for review under Rule 43 or a petition for certiorari under Rule 65 of the Rules of Court,

instead of filing a petition to vacate the award in the RTC when the grounds invoked to overturn the

arbitrators decision are other than those for a petition to vacate an arbitral award enumerated under

RA 876.

HELD: NO. RA 876 itself mandates that it is the Court of First Instance, now the RTC, which has

jurisdiction over questions relating to arbitration,such as a petition to vacate an arbitral award. Section

24 of RA 876 provides for the specific grounds for a petition to vacate an award made by an arbitrator.

Sec. 24. Grounds for vacating award. - In any one of the following cases, the court must make an

order vacating the awardupon the petition of any party to the controversy when such party proves

affirmatively that in the arbitration proceedings:

(a) The award was procured by corruption, fraud, or other undue means; or

(b) That there was evident partiality or corruption in the arbitrators or any of them; or

(c) That the arbitrators were guilty of misconduct in refusing to postpone the hearing upon

sufficient cause shown, or in refusing to hear evidence pertinent and material to the controversy; that

one or more of the arbitrators was disqualified to act as such under section nine hereof, and willfully


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refrained from disclosing such disqualifications or of any other misbehavior by which the rights of any

party have been materially prejudiced; or

(d) That the arbitrators exceeded their powers, or so imperfectly executed them, that a mutual,

final and definite award upon the subject matter submitted to them was not made.

The law itself clearly provides that the RTC must issue an order vacating an arbitral award only

"in any one of the . . . cases" enumerated therein. Under the legal maxim in statutory construction

expressio unius est exclusio alterius, the explicit mention of one thing in a statute means the elimination

of others not specifically mentioned. As RA 876 did not expressly provide for errors of fact and/or law

and grave abuse of discretion (proper grounds for a petition for review under Rule 43 and a petition for

certiorari under Rule 65, respectively) as grounds for maintaining a petition to vacate an arbitral award

in the RTC, it necessarily follows that a party may not avail of the latter remedy on the grounds of errors

of fact and/or law or grave abuse of discretion to overturn an arbitral award.


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TRANSFIELD PHILIPPINES, INC.,petitioner,

vs.

LUZON HYDRO CORPORATION, AUSTRALIA and NEW ZEALAND BANKING GROUP LIMITED and

SECURITY BANK CORPORATION, respondents.

FACTS: Transfield Philippines and Luzon Hydro Corporation entered into a contract whereby Transfield

undertook to construct a hydro-electric power station at the Bakun River in the provinces of Benguet

and Ilocos Sur. The parties stipulated in the contract that in case of dispute, the parties are bound to

settle their differences through mediation, conciliation and such other means enumerated under the

same.

In the course of the construction of the project, Transfield sought various extensions of time to

complete the Project. The extensions were requested allegedly due to several factors which prevented

the completion of the Project on target date, such as force majeure occasioned by typhoon Zeb,

barricades and demonstrations. Luzon Hydro denied the requests, however. This gave rise to a series of

legal actions between the parties.

The adjudication of this case proved to be a two-stage process as its constituent parts involve

two segregate but equally important issues. The first stage relating to the merits of the case, specificallythe question of the propriety of calling on the securities during the pendency of the arbitral proceedings,

was resolved in favor of Luzon Hydro with the Courts Decisionof 22 November 2004. The second stage

involved the issue of forum-shopping.

Luzon Hydro claims that Transfield is guilty of forum-shopping when it filed the following suits:

1. a civil case pending before the RTC of Makati for confirmation, recognition and enforcement of the

Third Partial Award in the case entitled Transfield Philippines, Inc. v. Luzon Hydro Corporation filed

before the International Court of Arbitration, ICC

2. ICC Case Transfield Philippines, Inc. v. Luzon Hydro Corporationfiled before the International Court of

Arbitration, ICC a request for arbitration pursuant to the contract between Luzon Hydro and Transfield;

and

3. G.R. No. 146717, Transfield Philippines, Inc. v. Luzon Hydro Corporation, Australia and New ZealandBanking Group Limitedand Security Bank Corp., which was anappeal by certiorari with prayer for

TRO/preliminary prohibitory and mandatory injunction, of the Court of Appeals Decision

ISSUE: Whether or not Transfield Philippines is guilty of forum-shopping when it filed a civil case before

the RTC of Makati and an appeal by certiorari on the Court of Appeals Decision while an arbitration case

filed before the International Court of Arbitration is still pending.

HELD: NO. Forum-shopping has been defined as the act of a party against whom an adverse judgment

has been rendered in one forum, seeking and possibly getting a favorable opinion in another forum,

other than by appeal or the special civil action of certiorari, or the institution of two or more actions or

proceedings grounded on the same cause on the supposition that one or the other court would make a

favorable disposition. Thus, for forum-shopping to exist, there must be (a) identity of parties, or at least

such parties as represent the same interests in both actions; (b) identity of rights asserted and relief

prayed for, the relief being founded on the same facts; and (c) the identity of the two preceding

particulars is such that any judgment rendered in the other action will, regardless of which party is

successful, amount to res judicatain the action under consideration.

There is no identity of causes of action between and among the arbitration case, the appeal by

certiorari, and the civil case filed before the RTC. Neither is there an identity of parties between and

among the three (3) cases.


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As a fundamental point, the pendency of arbitral proceedings does not foreclose resort to the

courts for provisional reliefs. The Rules of the International Chamber of Commerce (ICC), which governs

the parties arbitral dispute, allows the application of a party to a judicial authority for interim or

conservatory measures. Likewise, Section 14 of Republic Act No. 876 (The Arbitration Law) recognizes

the rights of any party to petition the court to take measures to safeguard and/or conserve any matter

which is the subject of the dispute in arbitration. In addition, R.A. 9285, otherwise known as the

"Alternative Dispute Resolution Act of 2004," allows the filing of provisional or interim measures with

the regular courts whenever the arbitral tribunal has no power to act or to act effectively.

Thus, the civil case filed in the RTC f Makati and the appeal on certiorari on the CAs decision

filed by Transfield Philippines pending an arbitration case in the International Chamber of Commerce

does not constitute forum-shopping. They are rather interim or conservatory measures resorted by the

Transfield Philippines to safeguard its interests regarding the two (2) standby letters of credit it opened

in favour of Luzon Hydro as a security for its performance of its obligation under their contract.

Documents

ADR 7th and 8th CASE