Grounds for Vacating Award Under RA 876

The grounds for vacating an award in RA 876 arbitration cannot be invoked in a

petition to set aside a Model Law award. Rule 1.24 of the Special ADR Rules excludes even
the use of RA 876, Section 24 grounds for setting aside a Model Law award. This clarification
needs to be made because, in resolving appeals, appellate courts appeared not to have made a
distinction between Model Law award and RA 876 awards.

Forms and Contents of Petition to Set Aside

A. Petition Regarded as Special Proceeding

Like an RA 876 award, a petition to confirm or set aside a Model Law award shall be
filed with the RTC as a special proceeding. Also, Section 47 of ADR Act provides that arbitration
for assistance and supervision shall be deemed as special proceedings. This is reiterated in
Rule 1.2 of the SADR that all proceedings under the SADR are special proceedings. They are
not to be treated as if they are civil actions.

B. Venue

The venue of such proceeding may be the place where:

a. The arbitration proceedings were conducted;
b. Where the asset to be attached or levied upon, or the act to be enjoined is
located;
c. Where any of the parties to the dispute resides or has his place of business;
or
d. In the National Judicial Capital Region, at the option of the applicant. (Section
47, ADR Act; Rule 12.3, SADR)
This is particularly important to the party in arbitration whose place of business is outside
the Philippines who may encounter difficulty in establishing the place of business of the
respondent in the Philippines.

C. Who May File Petition

Any party to an international commercial arbitration in the Philippines may petition the
proper court to recognize and enforce or set aside an arbitral award. (Rule 12.1, SADR)

D. Period of Filing Petition

The prevailing party may file a petition seeking recognition and enforcement of a Model
Law award at any time after it is received but the party seeking to have it set aside must
do so within three (3) months from its receipt. A petition to set aside the award beyond the 3-
month period from receipt shall be time-barred and the affected party shall be precluded from
raising grounds to resist its enforcement. (Rule 12.2 (B), SADR)

E. Court Cannot Review Findings of Fact and/or Law

 An arbitral award is presumed to have been made in due course of arbitration and is
subject to confirmation by the court. It is the party who seeks to set it aside or is resisting
enforcement that has the burden to establish a ground for setting aside the arbitral award. (Rule
12.12, SADR)

A Model Law award gives the court only two (2) options. If a ground for setting it aside is
fully established, the court shall set aside the award; otherwise, the court shall recognize and
enforce the award. The court, under the Model Law Article 34, may not entertain any application
to amend or modify the award which thereby would disturb the arbitral tribunal’s determination
of facts and/or interpretation of law.

F. Petitions and Counter-Petitions

The petition to recognize and enforce a Model Law award may be opposed by the
adverse party who may file a timely counter-petition to set it aside. Conversely, if a timely
petition to set aside the award is filed, the prevailing party may file a counter-petition to
recognize and enforce it. (Rule 12.2 (A) & (B), SADR)
In addition to the usual contents of a petition identifying the parties, it is important to
allege:
a. Their addresses of record to show that the arbitration is international,
b. That an arbitration agreement exists between the parties,
c. The names of the arbitrators and proof of their appointment,
d. That an award was made, and
e. The relief sought which is either to recognize and enforce it or to set it aside.
Authentic copies of the arbitral award shall be attached to the petition. If the petition is
one to set aside the award, it shall also state the grounds relied upon.

G. Suspension of Proceedings to Set Aside

When an application to set aside an arbitral award is made by a party resisting its
recognition, either party to the proceedings may request the court to suspend the proceedings
to set it aside and to remit the case to the arbitral tribunal to resume the arbitral proceedings or
to take such action as in the arbitral tribunal’s opinion may eliminate the ground for setting aside
the arbitral award. The court, in referring the case back to the arbitral tribunal, may not direct the
latter to receive the evidence in a particular way, or to revise its findings of fact or conclusion of
law, or otherwise encroach upon the independence of the arbitral tribunal in the making of its
final award.

H. Procedure where Tribunal Makes Preliminary Ruling in Favor of its Own Jurisdiction

The second part of Rule 12.11 of the SADR contemplates a situation where earlier, in an
arbitral proceeding, the arbitral tribunal makes a preliminary ruling in favor of its own jurisdiction
and this preliminary ruling is appealed to