When parties agree to submit a dispute to arbitration, courts shall refer the parties to arbitration.

Parties to an arbitration can elevate their case to Philippine courts in case of unfair arbitration agreements

Such an arbitration agreement is the law between the parties, and they are expected to abide by it in good faith. 

So, when can the parties request Philippine Courts to step in or intervene in arbitration? 

What relief can the parties seek from the courts? 

These are what we’ll talk about in this article. For what courts can do after an arbitral award is granted, see our post Courts and invalid arbitration awards.

Parties may avail judicial reliefs from Philippine courts even before the case starts

Parties can request judicial reliefs from the Philippine Courts even before an arbitration proceedings commences.

The court remedies available to the parties prior to arbitration are:

• A party may petition the appropriate court to determine any question concerning the existence, validity and enforceability of an arbitration agreement^[1]
• File a petition for interim measures of protection^[2]
• A party to a pending action filed in violation of the arbitration agreement, whether contained in an arbitration clause or in a submission agreement, may request the court to refer the parties to arbitration in accordance with such agreement^[3]

^[1] Rule 3.2, Special ADR Rules

^[2] Rule 5.1, Special ADR Rules

^[3] Rule 4.1, Special ADR Rules

Parties must seek help from an arbitration lawyer to prepare the petition for an invalid arbitration agreement

?A party to an arbitration agreement can file a petition to the appropriate court to determine any question concerning the existence, validity, and enforceability of the arbitration agreement.^[1]

The verified petition must state the following:

• Facts showing that the persons named as petitioner or respondent have legal capacity to sue or be sued
• The nature and substance of the dispute between the parties
• The grounds and circumstances relied upon by the petitioner to establish his position
• The relief/s sought by the party

Apart from these, the petitioner must also attach to the petition an authentic copy of the arbitration agreement.^[2]

A certified copy of the invalid arbitration agreements must be attached to the petition as an exhibit

A copy of the verified petition^[3] must be served upon the respondent and may be filed at any time prior to the commencement of arbitration.

Does this mean that the arbitration proceedings are stalled pending the resolution of the court?

No, because the arbitral proceedings may still commence despite the petition.

In fact, the proceedings may continue until the rendition of an arbitral award while the issue is pending before the court.^[4]

The Court also cannot enjoin the arbitration proceedings during the pendency of the petition. Judicial recourse to the court shall not prevent the arbitral tribunal from continuing the proceedings and rendering its award.^[5]

^[1] Rule 3.2, Special ADR Rules

^[2] Rule 3.6, Special ADR Rules

^[3] Rule 1.4, Special ADR Rules

^[4] Rule 3.3, Special ADR Rules

^[5] Rule 3.18(B), Special ADR Rules

The petition must be prepared in sufficient copies and paid online through JEPS before filing in RTC-OCC

The petition challenging an invalid arbitration agreement should be filed before the Regional Trial Court (RTC) of the place where any of the petitioners or respondents has his principal place of business or residence.

A petition may be granted only if it is shown that the arbitration agreement is, under the applicable law:

• Invalid 
• Void 
• Unenforceable or 
• Inexistent.

The comment or opposition of the respondent must be filed within fifteen (15) days from service of the petition. 

The court shall render judgment on the basis of the pleadings filed and the evidence submitted by the parties within thirty (30) days from the time the petition is submitted for resolution. 

The court’s ruling cannot be challenged.

The aggrieved party may file a motion for reconsideration of the order for the court.

The decision of the court shall not be subject to appeal.

A ruling affirming the arbitral tribunal’s jurisdiction shall also not be subject to a petition for certiorari. 

However, the ruling that the arbitral tribunal has NO jurisdiction may be a subject of a petition for certiorari. 

The arbitral tribunal is only a nominal party. This means that the court shall not require the arbitral tribunal to submit any pleadings or written submissions. 

However, the Court may consider the pleadings or submission if the arbitral tribunal will participate in the proceedings as nominal parties.  

If the arbitral tribunal renders a final arbitral award and the Court has not yet rendered a decision on the petition from the arbitral tribunal’s preliminary ruling affirming its jurisdiction, that petition shall become moot and academic.

This means that the Court shall dismiss the petition.

The dismissal shall be without prejudice to the right of the aggrieved party to raise the same issue in a timely petition to vacate or set aside the award.

A preliminary injunction against a party is one of the temporary measures of protection that a court may grant.

A party to an arbitration agreement may petition the court for interim measures of protection.

The interim measures of protection that a Court may grant are as follows:

• Preliminary injunction directed against a party to arbitration
• Preliminary injunction against property or garnishment of funds in the custody of a bank or a third person
• Appointment of a receiver
• Detention, preservation, delivery or inspection of property
• Assistance in the enforcement of an interim measure of protection granted by the arbitral tribunal which the latter cannot enforce effectively 

The comment/opposition by the other party must be filed within fifteen (15) days from service of the petition. 

The comment/opposition should state the reasons why the interim measures of protection should not be granted.

Before arbitration begins, a request for a temporary safeguard may be made.

A petition for an interim measure of protection may be made:

• Before arbitration is commenced
• After arbitration is commenced but before the constitution of the arbitral tribunal
• After constitution of the arbitral tribunal and at any time during the arbitral proceedings
  • At this stage, only to the extent that the arbitral tribunal has no power to act or is unable to act effectively

The petition must be filed with the RTC having jurisdiction over any of the following places:

• Where the principal place of business of any of the parties to arbitration is located
• Where any of the parties who are individuals reside
• Where any of the acts sought to be enjoined are being performed, threatened to be performed or not being performed
• Where the real property subject of arbitration or a portion thereof is situated

The court will need to weigh the parties’ respective interests after considering the petition.

The following grounds indicate the nature of the reasons that the court shall consider in granting the interim measure of protection: 

• The need to prevent irreparable loss or injury
• The need to provide security for the performance of any obligation
• The need to produce or preserve evidence
• The need to compel any other appropriate act or omission 

After hearing the petition, the court will have to balance the relative interests of the parties and inconveniences that may be caused. 

On that basis the court must resolve the matter within thirty (30) days from:

• Submission of the opposition
• Upon lapse of the period to file the opposition
• From termination of the hearing, which may be set by the court only if there is a need for clarification or further argument.

A temporary order of protection that is immediately executory may also be issued by the court.

Yes, the court can, by itself, render judgment only on the basis of the allegations of the petition that are substantiated by supporting documents and limited to what is prayed in the petition.

The court can also issue an immediately executory temporary order of protection if it finds that there is an urgent need to:

• Preserve property
• Prevent the respondent from disposing of or concealing the property 
• Prevent the relief prayed from from being illusory because of prior notice

This ex parte temporary order of protection shall be valid only for a period of twenty (20) days from service for the party required to comply with the order.

Within that period, the court shall:

• Furnish the respondent a copy of the petition and a notice requiring him to comment on or before the petition will be heard
• Notify the parties that the petition shall be heard on a day specified in the notice, which must not be beyond the twenty (20) day period of the effectivity of the ex parte order

Within five (5) days of receiving the order, the bond needs to be provided.

The petitioner will be required by the court to post a bond to answer for any damage that the respondent may suffer as a result of the order.

The bond must be posed within five (5) days from receipt of the order. 

The respondent has the option of having the temporary order of protection lifted by posting an appropriate counter-bond as determined by the Court. 

After notice and hearing, the court may either grant or deny the petition for an interim measure of protection.

Such order granting or denying any application for interim measure of protection in aid of arbitration must indicate that it is issued without prejudice to subsequent grant, modification, amendment, revision or revocation by an arbitral tribunal.  

This order by a court shall be immediately executory but may be subject of a motion for reconsideration and/or appeal or, if warranted, a petition for certiorari.

The court’s order will take effect right away, but it may be the subject of an appeal, reconsideration motion, or, if necessary, a petition for certiorari.

However, this only applies if the respondent was given an opportunity to be heard on a petition for an interim measure of protection. 

Any court order granting or denying interim measures of protection is issued without prejudice to the subsequent grant, modification, amendment, revision or revocation by the arbitral tribunal. 

The arbitral tribunal can also issue any interim measure of protection.

Upon its issuance, it is deemed to have modified, amended, revised or revoked an interim measure of protection previously issued by the court. 

However, note that this is only to the extent that it is inconsistent with the subsequent interim measure of protection issued by the arbitral tribunal. 

In such a case, any question involving this inconsistency shall be immediately referred by the court to the arbitral tribunal, which shall have the authority to decide such a question.