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Enactment of ADR Act of 2004
RA 9285: “Alternative Dispute Resolution Act of
2004”
February 4, 2004 – Passed by Congress
April 2, 2004 – Signed into law
April 13, 2004 – Published Manila Times
Exclusions to the ADR Act of 2004
(a) Labor disputes covered by the Labor Code of the
Philippines
(b) Those enumerated under Art. 2035, NCC (XPN:
Future Support)
1. Civil Status of Persons
2. Validity of a Marriage
3. Any ground for legal separation
4. Jurisdiction of Courts
5. Future legitime
(c) Criminal Liability
(d) Those which by law cannot be compromised
(e) Court Annexed Mediation
(f) Katarungang Pambarangay under RA 7160
(g) Domestic Arbitration
Definitions:
1. Court Annexed Mediation - any mediation
process conducted under the auspices of the
court, after such court has acquired jurisdiction
of the dispute
2. Court Referred Mediation - mediation ordered
by a court to be conducted in accordance with
the Agreement of the Parties when as action is
prematurely commenced in violation of such
agreement
3. Confidential Information - any information,
relative to the subject of mediation or
arbitration, expressly intended by the source not
to be disclosed, or obtained under circumstances
that would create a reasonable expectation on
behalf of the source that the information shall
not be disclosed.
4. ADR Provider - institutions or persons
accredited as mediator, conciliator, arbitrator,
neutral evaluator, or any person exercising
similar functions in any Alternative Dispute
Resolution system.
5. ADR Practitioners - individuals acting as
mediator, conciliator, arbitrator or neutral
evaluator
6. Mediation under ADR Act - a voluntary
process in which a mediator, selected by the
disputing parties, facilitates communication and
negotiation, and assist the parties in reaching a
voluntary agreement regarding a dispute.
7. Mediator - a person who conducts mediation
8. Mediation Party - a person who participates in
a mediation and whose consent is necessary to
resolve the dispute
ADR Methods under ADR Act of 2004
- Mediation
- International Commercial Arbitration
- Domestic Arbitration
- Construction Dispute Arbitration
Purposes of ADR Act of 2004
 To actively promote party autonomy in the
resolution of disputes or the freedom of the party
to make their own arrangements to resolve their
disputes;
 Encourage and actively promote the use of
Alternative Dispute Resolution (ADR) as an
important means to achieve speedy and impartial
justice and declog court dockets;
 Provide means for the use of ADR as an
efficient tool and an alternative procedure for the
resolution of appropriate cases; and
 Enlist active private sector participation in the
settlement of disputes through ADR.
Confidentiality Rule under RA 9285
Confidential Information shall not be subject to
discovery.
Qualification: However, evidence or information that is
otherwise admissible or subject to discovery does not
become inadmissible or protected from discovery solely
by reason of its use in a mediation.
GR: Information obtained through mediation shall be
privileged and confidential

XPNs:
No Privilege of Confidentiality if mediation
communication is:
(1) In an agreement evidenced by a record
authenticated by all parties to the agreement ;
(2) Available to the public or that is made during a
session of mediation which is open, or is
required by law to be open, to the public;
(3) A threat or statement of a plan to inflict bodily
injury or commit a crime of violence ;
(4) Intentionally used to plan a crime, attempt to
commit, or commit a crime, or conceal an
ongoing crime or criminal activity;
(5) In proceedings of abuse, neglect, abandonment,
or exploitation of an individual protected by law
in which a public agency is protecting the
interest of such individual;
(6) In a claim or complaint of professional
misconduct or malpractice filed against mediator
in a proceeding; or
(7) In a claim or complaint of professional
misconduct or malpractice filed against a party,
non-party participant, or representative of a
party based on conduct occurring during a
mediation.
XPN to the XPN:
Communication is privileged in cases where a
child protection matter is referred to mediation
by a court or a public agency participates in the
child protection mediation.
Exceptions to Confidentiality Rule
No confidential privilege if a court or administrative
agency, finds, after a hearing in camera, that the party
seeking discovery of ____ the evidence has shown:
(1) That the evidence is not otherwise available
(2) That there is a need for the evidence that
substantially outweighs the interest in protecting
confidentiality, and
(3) The mediation communication is sought or
offered in:
(a) A court proceeding involving a crime or
felony; or
(b) A proceeding to prove a claim or defense
that under the law is sufficient to reform or
avoid liability on a contract arising out of
mediation.
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Limitations to the Exceptions:
 Limited Coverage – Only the portion of the
communication necessary for the application of
the exception for nondisclosure may be
admitted.
 Limited Admissibility – The admission of a
particular evidence for the limited purpose of an
exception does not render that evidence, or any
other mediation communication, admissible for
any other purpose.
Disclosure Requirement:
(a) Make an inquiry on
(1) Known facts likely to affect the impartiality
of the mediator,
(2) Financial or personal interest in the outcome
of the mediation, and
(3) Any existing or past relationship with a
party or foreseeable participant in the
mediation
(b) Disclose any such fact before accepting a
mediation or thereafter as soon as practicable.
(c) Disclose qualifications to mediate dispute when
requested
Consequences of Confidentiality Rule
 Confidential information shall be inadmissible in
any adversarial proceeding, whether judicial or
quasi-judicial
 A party, mediator, or a non-party participant
may refuse to disclose a mediation
communication
 A party, mediator, or a non-party participant
may prevent any other person from disclosing a
mediation communication
 Confidential information shall be inadmissible
even if mediator failed to act impartially;
 A mediator may be called to testify to provide
information gathered in mediation;
 A mediator who is wrongfully subpoenaed shall
be reimbursed the full cost of his atty’s fees and
related expenses.

Waiver of Confidentiality:
Confidentiality of Information may be waived.
WHO:
(1) Party who provides such confidential
information
(2) Counsel of the Party providing such confidential
information with the consent of the latter.
(3) Mediator, if all parties agree to the waiver of
confidentiality.
How:
(1) Orally;
(2) In a record
When:
(1) During the mediation proceedings, if orally
made
(2) During any proceedings; if written
No partial waiver of Confidentiality Rule.
Person who waives the Privilege by disclosing
confidential information shall be precluded from
asserting the privilege of Confidentiality to bar
disclosure of the rest the information necessary to a
complete understanding of the previously disclosed
information.
Action for Damages against the person disclosing the
information, if a person suffers loss or damage as a
result of the disclosure of the confidential information.
Waiver of privilege is a waiver against one self.
A person who discloses or makes a representation about
a mediation is precluded from asserting the privilege of
Confidentiality of Information, to the extent that the
communication prejudices another person in the
proceeding and it is necessary for the person prejudices
to respond to the representation of disclosure.
Who are covered by Confidentiality Rule under RA
9285:
(1) Parties to the dispute
(2) Mediator/s
(3) Counsel for the parties
(4) Non-party participants
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(5) Any person hired or engaged in connection with
the mediation as secretary, stenographer, clerk
or assistant
(6) Any other person who obtains or possesses
confidential information by reason of his/her
profession.
Confidential Information includes:
(1) communication, oral or written, made in a
dispute resolution proceedings, including any
memoranda, notes or work product of the neutral
party or non-party participant, as defined in this
Act;
(2) an oral or written statement made or which
occurs during mediation or for purposes of
considering, conducting, participating, initiating,
continuing of reconvening mediation or
retaining a mediator; and
(3) pleadings, motions manifestations, witness
statements, reports filed or submitted in an
arbitration or for expert evaluation;
Liability
ADR Providers/Practitioners - the same civil liability
for the Acts done in the performance of then duties as
that of public officers as provided in Section 38 (1),
Chapter 9, Book of the Administrative Code of 1987.
Section 38. Liability of Superior Officers. - (1) A public
officer shall not be civilly liable for acts done in the
performance of his official duties, unless there is a clear
showing of bad faith, malice or gross negligence.
Mediator Reports:
GR: A mediator may not make a report, assessment,
evaluation, recommendation, finding, or other
communication regarding a mediation to a court or
agency or other communication regarding a mediation to
a court or agency or other authority except to state that:
XPNs:
(1) The mediation occurred or has terminated, or
where a settlement was reached
(2) As permitted to be disclosed under Section 13 of
this chapter
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Construction Disputes filed in Court

Section 35 affirms CIAC jurisdiction over Construction
Disputes although it falls within the definition
“Commercial Disputes”.
Section 39 authorizes the court:
- To dismiss the construction cases
- To refer parties to the CIAC arbitration
- Upon motion filed not later than Pre-Trial
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INTRODUCTION TO ARBITRATION - Hearing are private

Definitions:
1. Arbitration - a voluntary dispute resolution
process in which one or more arbitrators,
appointed in accordance with the agreement of
the parties, or rules promulgated pursuant to this
Act, resolve a dispute by rendering an award;
2. Arbitrator - the person appointed to render an
award, alone or with others, in a dispute that is
the subject of an arbitration agreement;
3. Award - any partial or final decision by an
arbitrator in resolving the issue in a controversy;
4. Arbitration Agreement – an agreement by the
parties to submit to arbitration all or certain
disputes which have arisen or which may arise
between them in respect of a defined legal
relationship, whether contractual or not. An
arbitration agreement may be in the form of an
arbitration clause in a contract or in the form of
a separate agreement;
5. Agreement to Submit to Arbitration –
agreement to submit some future dispute to
arbitration.
6. Submission Agreement – agreement to submit
an existing dispute to arbitration
Arbitration:
- Agreement based
- Merit or evidence based form of ADR
- Requires the testimony of witnesses and the
presentation of evidence
- A decision (award) is rendered
- Arbitration is a creature of a contract
Seat of Arbitration:
Means: “The jurisdiction whose national law governs an
arbitration proceeding.”
- The seat of arbitration might not be the same as
the place where proceedings are actually
happening.
- Awards are confidential
- Remedies are fixed by law
- Parties select their neutral arbitrator
Disadvantages:
- Final and binding
- Less formal than litigation
- Very limited appeal rights
- One party wins, one party loses
- Unlikely to reach creative solutions
Comparison (Arbitration vs Litigation)
Arbitration Litigation
Private Proceedings Public proceedings
May be adjudicated by Adjudicated by a judge
experts in the field
Ease of international Difficulty in enforcing
enforcement foreign judgments
Characteristics of Arbitration:
- Private proceedings, usually behind closed doors
o Useful if franchise involves trade
secrets/know how
- Parties can appoint a sole arbitrator, or a panel
of arbitrators
o Parties will know who will resolve their
dispute
- Arbitrators can be an expert in the field
o Helpful if area is technical in nature or
requires special knowledge
- In certain situations, arbitration award may
enforced in country where loser’s assets are
situated
o Useful if dispute involves cross-border
elements
- However, arbitration is not necessarily cheaper
than litigation in the courts
- Arbitrators’ and Counsels’ fees have to be paid

Requirements of Arbitration:
Advantages: - Arbitration clause/agreement in writing signed
- Final and binding by parties or contained in exchange of letters;
- Less formal than litigation - Parties undertake to submit disputes arising from
- Less expensive than litigation the agreement to arbitration
- Faster than litigation - Choice of arbitrator(s)
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- Choice of governing law and applicable rules of

arbitration
- Choice of arbitration institution
(ICC/AAA/CIETAC/LCIA/SIAC)

Why arbitrate?
Reasons for choosing Otherwise
arbitration
Neutral Inability to join
additional parties or
claims
Enforceability – NY Lack of predictability or
Convention transparency
Many nations have signed
Confidentiality Lack of right to appeal
Choice of Arbitrators Cost?
(expertise of arbitrators)
Choice of Procedure
(speed and flexibility
Cost?