When litigants may choose their own judges

MANILA, Philippines–To boost its theme of “One Global Filipino” as well as to stabilize its claim of being ?the voice of Philippine business and the catalyst in creating wealth in the country,? the Philippine Chamber of Commerce and Industry (PCCI) organized a Council of Senior Advisers (CSA).

Who?s who in big business. Recently inducted as members of the CSA were Enrique M. Aboitiz Jr., Ramon S. Ang, Jorge L. Araneta, Francis Chua, Eduardo L. Cojuangco, John L. Gokongwei, Andrew L. Gotianun Sr., Menardo R. Jimenez, Oscar M. Lopez, Rafael Ortigas Jr., Artemio V. Panganiban, Manuel V. Pangilinan, Jose T. Pardo, Enrique K. Razon Jr., Henry Sy Sr., Washington Sycip, Andrew Tan, Lucio C. Tan, George S.K. Ty, Cesar E.A. Virata, Alfonso T. Yuchengco and Fernando Zobel de Ayala.

Pleading that I did not belong to the “who’s who of big business,” I initially refused membership in the CSA. But I was prevailed upon to accept it by PCCI President Samie Lim. According to him, business people needed advice on the workings of the justice system, especially in understanding the business-related decisions of the Supreme Court.

After the induction, PCCI President Lim and CSA Chair Titoy Pardo called on each of the senior advisers for individual consultations. When they visited me at home a few weeks ago, they asked me to suggest one important advocacy that the PCCI could do immediately to help both the business community and the justice system.

After briefing them on the many problems besetting the speedy delivery of quality justice in our country, I advised them to embrace and promote the use of arbitration as an alternative mode of settling business conflicts. According to Republic Act 9285, arbitration is a voluntary process in which arbitrators, who are appointed in accordance with the written agreement of the parties, resolve a dispute by rendering an award or a judgment.

Privatizing the courts. The Supreme Court encourages the use of arbitration, because it helps to unclog the dockets of the judiciary and to improve its efficiency. As its distinct advantage, arbitration is the only method in which the litigants can choose their own judges and craft the rules to be used in deciding their disputes. It is akin to “privatizing” the courts, a concept that should endear arbitration to private business.

Because arbitrators are chosen on a case-to-case basis and, therefore, have no other disputes to attend to, they are able to hasten the procedures and the judgment. Equally important, the judgment is credible, because it is rendered by ?judges? implicitly trusted by the litigants who chose them.

To be sure, arbitration may be conducted prior to, or in the course of, a court litigation. For this purpose, several privately-run arbitration centers have been organized both in the Philippines and abroad. One such entity that has attained acceptance is the Philippine Dispute Resolution Center, which provides a list of arbitrators, administrative services and hearing facilities. The administrative costs as well as the arbitrators? fees are borne by the parties. These expenses are pre-agreed upon prior to the arbitration process itself.

Since it encourages arbitration, the Supreme Court almost always upholds the validity of agreements to arbitrate as well as the finality of arbitral awards. To enforce them, there is in general a need for judicial confirmation. But the process is fairly simple and the “execution” of arbitral judgments is almost always granted.

Our laws especially encourage the arbitration of construction disputes. A special government agency, the Construction Industry Arbitration Commission (CIAC), has been organized to handle these problems. Different from ordinary arbitration, those falling under the CIAC’s jurisdiction do not choose their own arbitrators. To balance this disadvantage, CIAC arbitral awards do not need judicial confirmation.

International arbitration. Arbitration is especially popular in settling international commercial disputes. In fact, most international contracts contain stipulations expressly instituting arbitration as the mode of settling disputes that may arise from them. Sometimes, the parties even specify the country and the private dispute center they want. Consistent with global practice, Sec. 19 of RA 9285 states that “international commercial arbitration shall be governed by the Model Law on International Commercial Arbitration adopted by the United Nations Commission on International Trade Law” (UNCITRAL Model Law).

Several global organizations are home to arbitration centers. For instance, the World Bank sponsors the International Center for the Settlement of Investment Disputes in Washington D.C., and the International Chamber of Commerce promotes the International Court of Arbitration in Paris. Though private in character, these arbitral bodies have dispensed awards in the hundreds of millions of dollars.

Retired Supreme Court justices, like Florenz D. Regalado, Florentino P. Feliciano, Vicente V. Mendoza, and Bernardo P. Pardo, have served as domestic and international arbitrators.

Some of the Filipino lawyers specializing in arbitration are Custodio O. Parlade, Sedfrey A. Ordoñez, Eduardo R. Ceniza, Wilfredo M. Chato, Beda G. Fajardo, Victor P. Lazatin, Eduardo de los Angeles, Eduardo P. Lizares, Claro V. Parlade, Augusto A. San Pedro, Mario E. Valderama, Philip Sigrid Fortun, Jose Vicente B. Salazar, Bienvenido S. Magnaye, and Rogelio C. Nicandro..

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