Amending Rules 10, 16, 17, 18 and 19 of the Revised CIAC Rules

May 25, 2007

CIAC RESOLUTION NO. 07-07

AMENDING RULES 10, 16, 17, 18 AND 19 OF THE REVISED CIAC RULES

WHEREAS, Sections 6 and 21 of Executive Order 1008 empowers the Construction Industry Arbitration Commission (CIAC) "to enunciate policies and prescribe rules and procedures for construction arbitration" and "to formulate necessary rules and procedures for construction arbitration" respectively;

WHEREAS, during its 94th Regular Meeting held on 28 February 2007, the Commission discussed a resolution dated 31 January 2007 of the Court of Appeals (CA) on an appealed CIAC docketed as C.A. G.R. SP No. 81635 ruling, among others, that based on Sections 10.4 (Vacancies) and 16.2 (Form of Award) of the Revised CIAC Rules, the determination/computation of some items in the arbitral award made in compliance with the CA's order by only two (2) arbitrators (as the 3rd member of the Tribunal had passed away), "cannot be considered an award of the Arbitral Tribunal" and as such, "need not be acted upon . . . nor can it be executed"; TIEHDC

WHEREAS, in response, the Commission filed a Manifestation with the CA requesting for the necessary corrections to its Resolution of 31 January 2007 in light of the Commission's clarifications summarized as follows:

1. In general, Section 10.4 (Vacancies), Rule 10 of the Revised CIAC Rules, applies only to vacancies occurring during actual case proceedings where an arbitral award has not yet been rendered. The CIAC, in this case, found no reason to fill the vacancy arising from the demise of one of the arbitrators since an award has already been rendered and a writ of execution had been issued long before his death;

2. The final award in this case was in writing and signed by all three members of the Arbitral Tribunal pursuant to Section 16.2 (Form of Award), Rule 16 of the Revised CIAC Rules. No dissent from the deceased member, or from any other member of the Tribunal, was made. The findings and specific awards on the claims in the decision were, therefore, those of the three members of the Tribunal as a whole, not just a majority. Even if there is a dissent, the Commission stressed that the decision of a majority of the members of an Arbitral Tribunal prevails and constitutes the final award on any particular issue or claim; and

3. The Compliance made by the two remaining arbitrators on the CA's order for the determination and recomputation of disengagement costs, merely reiterated the Arbitral Tribunal's findings in the award. The recomputation of the award of 12% interest was purely arithmetical since the CA had ruled on the proper reckoning periods for the claim. In fine, the findings of the Tribunal in its final award on the claims/issues subject of the Compliance, remained undisturbed/intact;

WHEREAS, the Commission recognizes the need to amend Sections 10.4, Rule 10 and 16.2, Rule 16 of the Revised CIAC Rules based on the above clarification, to provide for cases where vacancies occur during actual case proceedings and before or up to the time a final award is rendered;

WHEREAS, the Commission, noting that the Revised CIAC Rules also provide for the continuing jurisdiction of the Arbitral Tribunal even after an award has been rendered, also deems it vital to include a provision in Section 10.4 pertaining to vacancies after an award has been rendered, and to amend the following Rules governing post-award and post-execution proceedings accordingly: TEDaAc

1. Rule 16 — for a rehearing/hearing on the merits as directed by the appellate court and/or final determination of all incidental matters (Section 16.6)

2. Rule 17 — for action on a motion for correction of final award (Section 17.1)

3. Rule 18 — for issuance of writs of execution (Section 18.5); stay of execution pending review (Section 18.6); order of restitution/reparation of damages where an award is partially or totally reversed on appeal (Section 18.7)

4. Rule 19 — for action on a motion for relief (in connection with execution of an award) not covered by the Rules (Section 19.1);

NOW, THEREFORE, WE THE UNDERSIGNED COMMISSIONERS, after due deliberations in the 97th CIAC Regular Meeting and by virtue of the powers vested in us by law, RESOLVES, as it hereby RESOLVED, to amend the pertinent sections of Rules 10, 16, 17, 18 and 19 of the Revised CIAC Rules, to read as follows:

Rule 10

"Section 10.4 Vacancies — If, at any time during the proceedings but before an award had been rendered, any arbitrator should resign, be incapacitated, refuse or be unable, or be disqualified for any reason to perform the duties of his office, CIAC may, within five (5) days from the occurrence of a vacancy or refusal/inability to accept appointment, appoint a substitute(s) to be chosen from a list of alternatives previously agreed upon by the parties. In the absence of such a list, the CIAC shall fill the vacancy from the list of accredited arbitrators. HIAESC

If the vacancy occurs after the award has been rendered but before the jurisdiction of the Arbitrator/s over the dispute is terminated under Section 16.6 of Rule 16 hereof, the CIAC may, on its own initiative, or upon written request of any of the parties, appoint a replacement from the list of alternatives previously agreed upon by the parties or the list of accredited arbitrators. The request shall state the justification/s for the need for a replacement and shall be filed together with the required deposit of arbitrators fees for the substitute/s. The CIAC may, if it finds it necessary, appoint a substitute/s. If the CIAC finds the request to be unnecessary (e.g. for Motions for correction of final award under Rule 17.1; Motions for execution or stay of execution under Rules 18.5 and 18.6; Motions for relief not covered by the Rules under Rule 19.1; cases where the appellate court merely directs a re-computation of the award or a clarification thereof, or other matters which do not entail a re-hearing of the case, or a hearing on the merits of any issue, or would not disturb/alter the findings in the final award; and other similar instances as determined by the CIAC), it shall deny the same, refund the deposit made, and direct the remaining/surviving arbitrator/s to act on pending matters.

The decision of the CIAC on vacancies shall be final."

Rule 16

"Section 16.2 Form of Award — The Final Award shall be in writing and signed by the Arbitral Tribunal or a majority of its members. A dissent from the decision of the majority or a portion thereof shall be in writing, specifying the portion/s dissented from with a statement of the reason/s therefor and signed by the dissenting member."

Rule 17

"Section 17.1 Motion for correction of final award — Any of the parties may file a motion for correction of the Final Award within fifteen (15) days from receipt thereof upon any of the following grounds:

a. an evident miscalculation of figures, a typographical or arithmetical error; cADSCT

b. an evident mistake on the description of any person, date, amount, thing or property referred to in the award.

c. Where the arbitrators have awarded upon a matter not submitted to them, not affecting the merits of the decision upon the matter submitted;

d. Where the award is imperfect in a matter of form not affecting the merits of the controversy.

The motion shall be acted upon by the Arbitral Tribunal or the surviving/remaining members."

Rule 18

"Section 18.5 Execution/Enforcement of awards — As soon as a decision, order or final award has become executory, the Arbitral Tribunal (or the surviving remaining member/s), shall, with the concurrence of CIAC, motu proprio or on motion of the prevailing party issue a writ of execution requiring any sheriff or proper officer to execute said decision, order or final award. If there are no remaining/surviving appointed arbitrator/s, the Commission shall issue the writ prayed for.

Section 18.6 Stay of execution pending review — Execution issued under the preceding section may be stayed upon the approval by the Arbitral Tribunal (or the surviving/remaining member/s), with the concurrence of CIAC, of a bond posted by the petitioner in an amount equal to the award, conditioned upon the performance of the judgment of the appellate court in case it upholds the award in whole or in part. Such bond shall be posted within such period of time, which shall in no case be less than fifteen (15) days, as may be granted by the Arbitral Tribunal during the hearing on the motion for execution and the opposition thereto. The Surety Company posting the bond must be included in the latest list of surety companies accredited by the Supreme Court and must comply with the requirements set by the CIAC for bond approval, concurrence, and/or acceptance, such as, but not limited to, the prescribed "Surety Undertaking form. If there are no remaining/surviving appointed arbitrators, the Commission may approve the required bond.

Section 18.7 Effect of reversal of award — Where an award is partially or totally reversed on appeal, the Arbitral Tribunal (or the surviving/remaining members, or the Commission if there are no remaining/surviving appointed arbitrator) may on proper motion, issue such order of restitution or reparation of damages as equity and justice may warrant under the circumstances." SaCIAE

Rule 19

"Section 19.1 Motion for relief not covered by the Rules — Every motion or other paper filed in connection with the execution of an award not expressly authorized by the Rules shall be charged a filing fee of P3,000.00 or as may be prescribed by CIAC.

The Motion shall be acted upon by the Arbitral Tribunal (or the surviving/remaining members, or the Commission if there are no remaining/surviving appointed arbitrators)."

The foregoing amendments shall take effect fifteen (15) days from receipt by the National Administrative Register, U.P. Law Center, pursuant to Memorandum Circular No. 11 from the Office of the President.

UNANIMOUSLY APPROVED.

Adopted: May 25, 2007.

 

Date Filed: July 11, 2007.

THE COMMISSION:

 

(SGD.) SEDFREY A. ORDONEZChairman

 

(SGD.) ISAAC S. DAVID	(SGD.) SAMSON C. LAZO
Member	Member

Published in the National Administrative Register, Vol. XVIII No. 3 (July-September 2007).