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Facts:
On sept 2007, the arbitral tribunal rendered the first partial award In favor of
RCBC
Respondents filed a motion to vacate the same
ICC the invited RCBC to substitute respondents in paying share of BDO in the
adv. Costs. RCBC accepted.
RCBC reiterated its plea that respondents be declared as in default.
Baker states in his Dec 18 2007 letter:
The Tribunal interprets the claimants lates letter as an application by the
claimant to the tribunal for the issue of a partial award against the
respondents I respect of their failure to pay their share of the ICC requests for
advance on costs.
RCBC confirmed the tribunals interpretation that it was applying for a partial
award against respondents.
Meanwhile, RTC confirmed the first parial award.
Respondents MR was denied and thus filed a petition for Review ( GR#
182248) which affirmed RTCs ruling.
On Jan 18 2008, the tribunal set a timetable for the filing of submission by the
parties on whther it should issue a second partial award.
In compliance, RCBC filed an application for reimburesemnt of advance costs
paid.
Respondents filed their opposition saying that the tribunal has lost its
objectivity.
Baker advised the parties in his March 13 2008 letter:
The tribunal notes that neithr party has referred to an article by Mathew
Secomb on this very subject which appears in ICC Bulletin Vol.14..
The parties complied by submitting their respective comments.
RCBC refuted respondents allegation using said article.
On may 2008, the tribunal rendered the 2nd partial award. EPCIB filed a
motion to vacate such award but was denied.
Later, EPCIB filed for a petition for review ( CA-GR SP 113525)
On june 2010, the tribunal issued a final award in favor of RCBC and was
confirmed.
Issue: Whether or not there is a legal ground to vacate the second partial award
Ruling: Yes. Rule 11.4 of the special ADR rules sets forth that evident partiality or
corruption in the arbitral tribunal or any of its members is a ground for vacating an
arbitral award. The court adopts the reasonable impression of partiality standard,
which requires a showing that a reasonable person would have to conclude that an
arbitrator was partial to the other party to the arbitration. Such interest or bias,
moreover, must be direct, definite, and capable of demonstration rather than
remote, uncertain, or speculative. When a claim of arbitrators evident partiality is
made, the court msut ascertain from such record as available whether the
arbitrators conduct was so biased and prejudiced as to destroy fundamental
fairness. In the case at bar, Chairman Baker was predisposed to grant relief to RCBC
was shown by his act of interpreting RCBCs letter, which merely reiterated its plea
to declare the respondents in default and consider all counterclaims withdraw- as
what the ICC rules provide- as an application to the tribunal to issue a partial award.
Also by furnishing the parties with a copy of Secombs article, Baker armed RCBC
with supporting legal arguments under the contractual approach discussed by
secomb.