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BUILDING AN ASEAN MEDIATION MODEL:

THE PHILIPPINE PERSPECTIVE

BY:

PATRICIA-ANN T. PRODIGALIDAD1

Globalization is the buzzword of the twenty-first century.

With the exponential growth of the Internet and with tremendous innovations

in telecommunications and information technology (such as electronic commerce

and banking), parties are able to cross territorial lines without leaving the comfort

of their homes or offices. Indeed, substantial transactions are “done” without the

contracting parties needing to even meet and see each other face-to-face. As such,

inter-country trade and cross-country consumer and commercial transactions have

been on the rise. This will logically lead to, if it has not already led to, a

corresponding increase in the number of cross-border disputes.

By reason alone of the disputing parties’ presence in at least two different

territories, these cross-border disputes are, without a doubt, extremely difficult to

resolve. Expectantly, these disputes would, in a normal litigation setting, entail the

resolution of extremely difficult questions of law – such as the application of the

principles of private international law (or the so-called “conflicts of law”), the

doctrines of forum non conveniens, lex loci contractus, lex loci solutionis, and renvoi as

well as complications on the enforceability of foreign judgments, just to name a few.

It was, thus, wise for the Association of South East Asian Nations (ASEAN) to have

recognized in its Charter the need for a “globalized”, or more accurately stated

“regionalized”, form of dispute resolution and to require each of the Member States

to employ a peaceful mode of dispute resolution in, at least, economic or commercial

disputes.2 In fact, part of the ASEAN’s Blueprint towards the establishment of the

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ASEAN Economic Community (AEC) is the need to utilize “an enhanced dispute

settlement mechanism to promote a rules-based community”3 and to build a legal

infrastructure for the resolution of disputes arising from electronic commerce,

including online dispute resolution (ODR) services.4

Considering the primordial objective of employing a “peaceful” mode of

dispute resolution, it was the logical next step that ADR (or Alternative Dispute

Resolution) be considered as the mechanism to be followed. Unfortunately, the most

common and most popular form of ADR in both the international and local arenas is

arbitration, which by its very nature, is still “adversarial”. With this, it is

understandable that the ASEAN Law Association (ALA) now looks to mediation as

the possible, if not more feasible, mode of ADR in the resolution of cross-border

disputes in view of mediation’s innate “consensual”, “non-adversarial” and

“peaceful” nature.

With the foregoing backdrop, this paper seeks to provide some

recommendations that may be taken into consideration by both the Philippine

government and the ASEAN in the implementation of its AEC Blueprint particularly

in its primordial purpose of reforming the legal systems within Member States to

allow a “cross-jurisdictional” dispute resolution mechanism that fosters the

principles and promotes the values that are embodied in the ASEAN Charter – the

maintenance of peace, the promotion of a rules-based community and party

autonomy. To do this, this paper will (1) provide a brief history and explain the

current status of mediation as a form of ADR in the Philippines; (2) identify certain

“best practices” in the conduct of mediation in the Philippines; (3) examine salient

deficiencies in the regulation and implementation of mediation in the Philippines;

and (4) recommend steps to improve the local environment for mediation in the

Philippines so as to ready the nation for the “globalized” dispute resolution

mechanism within the ASEAN. The author hopes that the recommendations to the

Philippine legal community will prove helpful to the ASEAN, especially those

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charged with building the AEC and the regionalized peaceful dispute resolution

mechanism it seeks to create by 2015.

I. MEDIATION IN THE PHILIPPINES: THE STATE’S MEANS OF DECLOGGING

OF COURT DOCKETS

Mediation and conciliation have long been accepted, if not mandated by the

Constitution and law, as a means of resolving labor (i.e., employer-employee)

disputes5 as well as “neighborly” disagreements (i.e., disputes of parties residing

within the same city or municipality).6 Mediation, in its internationally accepted

sense, however, did not come to the forefront of dispute resolution in the

Philippines until after the new millennium.

Ironically, the rising popularity of mediation as the ADR mechanism most

accessible to, and most reliable for the resolution of disputes among, the common

tao was propelled by no less than the judiciary, the branch of government that once

jealously protected its Constitutional jurisdiction to adjudicate disputes.7 Now, the

Supreme Court is the staunch endorser of ADR, particularly mediation, with

administrative circulars addressed to the members of the Bench and the Bar that

prescribe mediation as the “mandatory alternative” 8 to court litigation for the

primary purpose of “decongestion of court dockets, and the enhancement of access

to justice”.9

Under the Action Program for Judicial Reform (APJR), the Supreme Court has

six (6) essential goals: delivery of speedy and fair dispensation of justice to all;

juridical autonomy and independence from political interference; improved access

to judicial and legal services; improved quality of external inputs in the judicial

process; efficient, effective and continuously improving judicial institutions; and a

judiciary that conducts its business with dignity, integrity, accountability and

transparency.10 To achieve the first of its noble objectives, the Supreme Court aimed

for the reduction of case congestion among the courts through various interventions

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and outputs including the institutionalization of ADR mechanisms.11 To attain this

goal, the Supreme Court mandated that certain cases be compulsorily required to go

through “mediation” for the purpose of reaching an amicable settlement at the

earliest stage of a court case. Thus, court-annexed mediation (CAM) was borne.

CAM refers to “any mediation process conducted under the auspices of the court,

after such court has acquired jurisdiction of the dispute”.12It is an “enhanced pre-

trial procedure that involves settling mediatable cases filed in court with the

assistance of a mediator who has been accredited by the Philippine Supreme

Court.”13 By express dictate of the Supreme Court, in conjunction with PHILJA, CAM

may be resorted to in the following types of cases:

1. All civil cases, settlement of estates, and cases covered by the Rule on

Summary Procedure, 14 except those which by law may not be

compromised;15

2. Cases cognizable by the Lupong Tagapamayapa under the

Katarungang Pambarangay Law;16

3. The civil aspect of B.P. 22 cases;17

4. The civil aspect of quasi-offenses under Title 14 of the Revised Penal

Code;18 and

5. The civil aspect of estafa and libel cases where damages are sought.19

Succinctly stated, the aforesaid cases are diverted from the usual litigation

process for the purpose of encouraging the litigants to explore an amicable

resolution of their disputes and hopefully come to a settlement. Accordingly, CAM

was mandated by the Supreme Court as a method of court diversion20 in the hope of

dispensing a higher number of cases at the soonest possible time.

With the success of the pilot implementation of CAM, in 2001, CAM was

institutionalized under the auspices of the Philippine Mediation Center (PMC) Office,

which was to be set up and governed by the Philippine Judicial Academy (PHILJA).21

Under the guidance of the PMC, several mediation units were established in various

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parts of the country such as Metro Manila, Metro Cebu, Metro Davao and adjacent

sites. As of the end of 2010, there were 97 PMC units that conduct CAM in the

country.22 Nevertheless, despite the financial and structural support provided by

the Supreme Court and PHILJA, the territorial scope of CAM and the availability of

PMC services continue to be severely limited. Thus, residents of smaller towns and

cities do not have the same extent of access to mediation services as residents in

larger, more urbanized, locations. To allow better access to residents of far-flung

areas, the Supreme Court, with the assistance of the PMC, is now providing ADR

services, particularly court-annexed mediation, through the “Justice on Wheels”

Project.23

More recently, the Supreme Court, under the JURIS Project,24 put in place the

so-called Judicial Dispute Resolution (JDR) program, which effectively serves as a

secondary tier of “mediation” conducted, not by a mediator accredited by the PMC,

but by an active judge of the first instance courts. By express provision of the

Supreme Court, JDR is resorted to only where CAM fails to result in a mediated

settlement agreement and only for the following cases:

1. All civil cases, settlement of estates, and cases covered by the Rule on

Summary Procedure, except those which by law may not be

compromised;25

2. Cases cognizable by the Lupong Tagapamayapa and those cases that may

be referred to it by the judge under Section 408, Chapter VII of Republic

Act No. 7160, otherwise known as the 1991 Local Government Code;26

3. The civil aspect of B.P. 22 cases;27

4. The civil aspect of quasi-offenses under Title 14 of the Revised Penal

Code;28 and

5. The civil aspect of estafa, libel and theft.29

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Likewise of note is the implementation of mandatory “mediation” not only in

cases under appeal before the Philippine Court of Appeals but also in cases pending

before the Ombudsman.30 Indeed, the Supreme Court has even expanded the

coverage of CAM to the mediation of family disputes, which are uniformly

considered, across the globe, as among the most sensitive of disputes to mediate.31

After years of the Supreme Court “encouraging” litigants to resort to ADR, the

executive and legislative departments finally took notice. Acknowledging the need

to solve the problem of “delayed justice” that negatively impact on foreign

investments, the Philippines enacted into law Republic Act No. 9285, otherwise

known as the ADR Law of 2004, which modernized antiquated statutes that had

long become “white elephants”. Indeed, in the Philippines’ updated medium-term

plan for the years 2004 to 2010, the Philippine government expressed support for

the judicial reforms under the APJR particularly in the areas of case decongestion

and in the pursuit of an advocacy on ADR mechanisms under the ADR Law in the

judicial system.32 It was expected by the Philippine executive department that an

efficient judicial system will restore public trust and confidence in the Philippine

government and, in turn, lead to “a socioeconomic environment that is stable and

predictable, thereby encouraging increases in investments and stronger investor

confidence”.33

Subsequently, in December 2009, the executive department, through the

Philippine Department of Justice, promulgated the long-awaited Implementing

Rules and Regulations of the ADR Law (the “ADR Implementing Rules”).34 More

importantly, in October 2009, the Supreme Court promulgated the Special Rules of

Court on Alternative Dispute Resolution (the “Special ADR Rules”),35 which govern

the procedure and practice in incidents of ADR mechanisms that require judicial

intervention such as, but not limited to, the referral to ADR;36 the application for,

and grant of, interim measures of protection;37 recognition and enforcement of

foreign arbitral awards;38 the application for, and grant of, confidentiality and

protective orders; 39 and, the enforcement of mediated settlement agreements. 40

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The impetus to develop mediation and other forms of non-adversarial ADR

perhaps stemmed from the documented success rate of mediation under the

auspices of the PMC and the PHILJA. The success of court-annexed mediations

(including those before the appellate courts and those rendered as part of the

Justice on Wheels Project of the Supreme Court) continues to this date and serves as

irrefutable proof that mediation may very well be the most feasible, most

economical and most “culturally appropriate” ADR mechanism to resolve disputes

in the Philippines, a nation where “saving face” is a much-desired ingredient to a

successful resolution of disputes.

That mediation appears to be “working” in the Philippine setting is

established no less than by the quantitative data from the PHILJA-PMC.

Based on the statistical report of the PHILJA-PMC provided to the author,41 it

is evident that, over the ten-year period starting in 2002 and ending in 2011, a total

of 340,174 cases were referred to CAM. Of these 207,868 (or 61.11%) were

mediated and, of those mediated, roughly 65.11%, reached a mutually acceptable

settlement. The statistical report of the PHILJA-PMC indicates a decrease in the

number of cases being referred to mediation and an even more noticeable drop in

the number of referred cases that actually proceeded to mediation. From its peak of

71.74% in 2008, a mere 59.92% of the cases referred were mediated in 2011.

Although the report likewise shows a drop in the success rate of CAM in 2011

compared to when it began in 2001, the rate of success remains steady above the

60% mark.

Data on JDR over the past eight (8) years,42 on the other hand, prove that

even a second-tier mediation has its uses in the Philippine setting. Based on the

PHILJA-PMC statistical report, it appears that, from 2004 to 2011, 33,267 cases were

referred to JDR after a failed CAM. Of these, only 21,166, or 63.6%, were mediated

and, of those mediated, 8,247 or 38.96% were successfully settled. As in CAM, the

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number of cases being referred to JDR, as a second opportunity for mediation, has

been steadily decreasing. And, though its success rate has been erratic (that is,

ranging from 30% to 45%), the metrics show that JDR has, for the past eight (8)

years, maintained a success rate of more than 30%. Though this number may appear

insignificant compared to the success rate of CAM, the fact that parties are still

willing, 30% of the time, to agree to a mediated settlement under JDR, after having

gone through CAM and failed, is a testament to the fact that the Filipino people still

prefer a “peaceful” and swift conclusion to their dispute rather than a

confrontational, full-blown and most probably protracted litigation.

Appellate court mediation demonstrates even more encouraging metrics.43

Based on the PHILJA-PMC report covering the years 2005 to 2011, the seven-year

average success rate of appellate court mediation (ACM) is equivalent to 35.47%.

Considering that, at this stage, one litigant would have already “won” the case, it is

commendable that more than 1/3 of the cases on appeal referred to mediation have

been settled through ACM.

The statistical data for CAM, JDR and ACM, however, reflect only the

effectiveness of mediation “within the auspices of the judicial system” and do not

give feedback on how often mediation is resorted outside the authority of the PMC

and, if at all, what rate of success mediators have achieved. As to date there is no

centralized body monitoring mediation as an effective ADR mechanism, the author

is unable to evaluate whether, without the continuing “push” from the judiciary,

mediation is actively, affirmatively and genuinely pursued and appreciated as a

feasible means of dispute resolution in the Philippine nation.

With the growth of the ADR industry, it is no surprise that private ADR

providers have been established to render not just arbitration services but also

mediation services. Prominent among these ADR providers that offer private

mediation service are the Philippine Dispute Resolution Inc. (“PDRCI”), which is an

entity organized under the auspices of the Philippine Chamber of Commerce Inc.,

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and The Conflict Resolution Group Foundation Inc. or CoRe Group, an ADR provider

that focuses primarily on mediation. If the growing number of private ADR

providers proves anything at all, it is the increasing demand for alternative modes of

dispute resolution in the Philippines.

The legislative, executive and judicial support for ADR has spurred as well

the meteoric rise of ODR in the Philippines. Not only is ODR expressly recognized by

the ADR Implementing Rules in theory, the same has been practiced, in reality, since

November 2004, when the Philippine Online Dispute Resolution service was

launched by Former Philippine Supreme Court Chief Justice Artemio Panganiban.44

The Philippine Dispute Resolution service (at www.disputeresolution.ph) was

organized as, and envisioned to be, a “web-based multi-door courthouse offering

several” ADR services including online mediation and online negotiation. 45 With the

financial support of the Asia Foundation and technological backbone provided by

Microsoft Philippines, it is no surprise that availment of ODR services is encouraged

by the Philippine Department of Trade and Industry, the Philippine Franchise

Association and the Philippine Retailers Association.46 Notably, the platform for

providing the ODR services is not just through a web-based interface but also

through the very popular mobile phone short message service (or SMS).47

Evidence that ODR, particularly online mediation, has risen from a mere

theoretical application acknowledged in the ADR Law to an acceptable and utilized

mode of dispute resolution in the Philippines is the reported recent success of the

online mediation conducted by the Philippine Department of Labor and

Employment (DoLE) in a dispute involving thirteen (13) disgruntled workers

claiming separation benefits.48 Using “Skype”, a familiar online teleconferencing

application, the DoLE achieved an online mediated settlement “that ranks as the

highest of its type ever achieved in the local area where they lived” without

requiring the parties to have their respective days in court.49

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II. BEST PRACTICES IN PHILIPPINE MEDIATION UNDER THE ADR LAW

In coming up with recommendations to the Philippine government on how to

assist the ASEAN realize its goal of a “regional” dispute resolution mechanism, the

author looks into the best practices of mediation in the Philippines, which may have

contributed to mediation’s continuing success as an effective ADR mechanism.

Notably, the most popular forms of mediation in the Philippines (i.e., CAM,

ACM and JDR) are distinct from the universally accepted notion of mediation in one

very significant aspect: the process’ independence from the judiciary. As

mentioned earlier, mediation as an ADR mechanism in the Philippines was urged

primarily by the Supreme Court as a possible solution to the extremely clogged

dockets of trial courts and the nefarious consequences that resulted therefrom.

Thus, the best practices that will be discussed in this segment of the paper will

necessarily include the (a) key elements that characterized mediation under the

auspices of the PHILJA-PMC and (b) the valuable components of the architectural

blueprint provided by the ADR Law, the ADR Implementing Rules as well as the

Supreme Court Special ADR Rules. The author firmly believes that all of these best

practices are fundamental to the continuing rise in popularity and effectiveness of

mediation, in its true sense, in the Philippines.

For clarity, these so-called best practices will be discussed in relation to the

pertinent stages of the mediation: (a) “pre-process”, that is, the stage prior to the

commencement of any mediation process; (b) “in process”, that is, from the

commencement to the termination of the mediation including, if at all, the execution

of a mediated settlement agreement; (c) “post process”, the period of time after the

termination of mediation; and (d) “process en toto”, that is, elements that impact on

the entirety, or may be resorted during the whole length, of the mediation process.

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A. “PRE-PROCESS”

i. Mandatory Training and Accreditation of Mediators

To ensure a modicum of success in mediation, the choice of one’s mediator is

key. Admittedly, under the ADR Law, mediators need not have “special qualifications

by background or profession unless the special qualifications of a mediator are

required in the mediation agreement or by the mediation parties”.50 The reason for

this is that, in recognition of party autonomy in ADR, “parties have the freedom to

select their mediator”.51 Nevertheless, Philippine mediation, whether under the ADR

Law regime52 or under the auspices of the PMC, 53 demands that mediators be

competent and, for such purpose, receive the requisite training for the honing of

their mediation skills. Thus, the ADR Implementing Rules provide:

“Article 3.6. Competence. It is not required that a mediator shall have special qualifications by background or profession unless the special qualifications of a mediator are required in the mediation agreement or by the mediation parties. However, the certified mediator shall:

(a) maintain and continually upgrade his/her professional

competence in mediation skills; (b) ensure that his/her qualifications, training and experience are

known to and accepted by the parties; and (c) serve only when his/her qualifications, training and experience

enable him/her to meet the reasonable expectations of the parties and shall not hold himself/herself out or give the impression that he/she has qualifications, training and experience that he/she does not have.

x x x” 54

On the other hand, the Code of Ethical Standards for Mediators prescribed by

the PMC and approved by the Supreme Court specifically requires:

“Competence. A Mediator shall maintain professional competence in mediation skills, including but not limited to:

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(a) staying informed of and abiding by all statutes, rules, and administrative

orders relevant to the practice of mediation; and (b) regularly engaging in educational activities promoting professional

growth.” 55

Significantly, although professional competence in mediation skills and the

requisite training therefor are deemed important requisites for an individual to

actively provide mediation services, it is only in court-related mediation (such as

CAM, ACM or JDR) that accreditation or certification is a condition precedent to

conducting mediation. Indeed, in court-related mediation, the parties may select a

mediator only from the list of PMC accredited mediators.56 In mediation under the

ADR Law, however, accreditation or certification by the Office for Alternative

Dispute Resolution (OADR), an agency attached to the Philippine Department of

Justice, is prescribed57 but, just the same, parties are not duty-bound to select only

from among the roster of certified mediators. 58 In practice, parties would have to

separately request and obtain a copy of the roster from the OADR.59

Party autonomy is a well-entrenched principle in ADR that must be kept

sacrosanct. Nonetheless, the imposition of continuing training and education for the

development of a mediator’s skills is, in the author’s opinion, the only means by

which the Philippines may ensure that the quality of mediation services provided in

its jurisdiction is, at least, at par with the rest of the ASEAN, if not the world. Thus,

laying down as mandatory pre-process requisites the need for training and

accreditation on the part of the mediator is the first best practice that should form

part of the Philippine blue print for a regionally acceptable mediation mechanism.

ii. Filtering of Disputes and Specialization of Mediators

Related to the best practice of “mandatory training and accreditation” is the

second best practice in the “pre-process” implementation of court-related

mediation: filtering of disputes and the specialization of mediators.

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As evidenced by the brief history of court-related mediation explained

earlier, one basic characteristic of mediation under the auspices of the PHILJA-PMC

is its limited scope in terms of mediatable disputes.60 Simply stated, not all disputes

that could be mediated are qualified for court-related mediation. From the initial

limited scope, the PHILJA, with the approval of the Supreme Court, eventually

broadened the coverage of court-related mediation to other forms of disputes.

Simultaneously, however, the PHILJA-PMC required a specialized form of training

for mediators of those “newly covered” or “unique” controversies. For example, in

the mediation of family disputes, parties may now only choose from a list of duly-

accredited “Family Mediators”, who have undergone the requisite training and

received the accreditation for family mediation. 61 Similarly, mediation of cases

pending appeal with the Court of Appeals poses complications that are not

encountered in the typical CAM where no party would have yet been adjudged a

“winner”. Thus, in recognition of the peculiar problems in appellate court mediation

or ACM, PMC prescribes a different form of training for ACM and gives separate

accreditation for “appellate mediators”.

In the author’s opinion, the PMC’s realization that not all disputes are alike

and the PMC’s corresponding solution of affording “dispute-specific” training and

“dispute-specific” accreditation are best practices that could form part of the

building blocks of a regionalized mediation system in the ASEAN.

B. “IN PROCESS”

Choosing the right person to mediate a dispute, however, is just the first step

at a successful ADR process. The next best practices, namely, (i) reliability and

transparency in procedure and (ii) impartiality of mediators, are essential

ingredients in the conduct of the mediation process and impact on the parties’

enduring acceptance of mediation as a feasible ADR mechanism.

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i. RELIABILITY AND TRANSPARENCY IN PROCEDURE

An undisputed characteristic of litigation as a dispute resolution method is

the existence of a pre-determined structure that allows litigants to know what to

expect. This pre-determined structure is founded on what, in the Philippines, is

referred to as the Rules of Court, which members of the Bench and the Bar are

mandated to obey. With the ADR Law and the ADR Implementing Rules, the

Philippine Legislative and Executive Departments sought to create a similar pre-

determined structure that would assure disputants that mediation is conducted, for

the most part, in a uniform and transparent process.

The backbone of this pre-determined structure is the statutory definition of

mediation, viz.:

“`Mediation’ means 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.”62

Further to this definition, the ADR Law and the ADR Implementing Rules set

forth the “skeleton” of the mediation process by stating, in categorical terms, what

role the mediator will play,63 what parties’ counsel can or cannot do,64 where the

mediation may be conducted 65 and what would happen in the event of a

settlement.66 More importantly, the ADR Implementing Rules describes what the

step-by-step mediation process should entail:

“RULE 5 - Conduct of Mediation

Article 3.17. Articles to be Considered in the Conduct of Mediation.

(a) The mediator shall not make untruthful or exaggerated claims about the dispute resolution process, its costs and benefits, its outcome or the mediator's qualifications and abilities during the entire mediation process.

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(b) The mediator shall help the parties reach a satisfactory resolution of their dispute but has no authority to impose a settlement on the parties.

(c) The parties shall personally appear for mediation and may be assisted by a lawyer. A party may be represented by an agent who must have full authority to negotiate and settle the dispute.

(d) The mediation process shall, in general, consist of the following stages:

(i) opening statement of the mediator;

(ii) individual narration by the parties;

(iii) exchange by the parties;

(iv) summary of issues;

(v) generation and evaluation of options; and

(vi) closure.

(e) The mediation proceeding shall be held in private. Persons, other than the parties, their representatives and the mediator, may attend only with the consent of all the parties.

(f) The mediation shall be closed:

(i) by the execution of a settlement agreement by the parties;

(ii) by the withdrawal of any party from mediation; and

(iii) by the written declaration of the mediator that any further effort at mediation would not be helpful.”

As an added measure of ensuring that parties are aware of their rights and

obligations, have correct expectations and do not have misimpressions, mediators

are instructed to explain to the parties the nature and character of mediation

proceedings67 as well as the salient principles thereof such as impartiality,

confidentiality68 and self-determination. 69 In fact, under the ADR Law regime, a

mediator, who believes that a party is unable to understand the mediation

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proceeding, is empowered to “recommend that the party obtain appropriate

assistance in order to continue with the process” and even to terminate the

mediation.70

Although mediators may, and are allowed to, develop their own respective

styles in facilitating a resolution of the dispute and in dealing with the parties and

their counsel, the foregoing statutory provisions, which may be deemed the third

best practice, establish a template process flow for mediations that, to a certain

degree, begets procedural stability and necessarily consistency and reliability.

Moreover, the over-arching state policy on mediation sets the parameters within

which a mediator’s personalized technique must be contained:

“In applying [and] construing the provisions of this Chapter, consideration must be given to the need to promote candor of parties and mediators through confidentiality of the mediation process, the policy of fostering prompt, economical and amicable resolution of disputes in accordance with the principles of integrity of determination by the parties, and the policy that decision-making authority in the mediation rests with the parties.”71

Consequently, disputants in the Philippines are able to set reasonable expectations,

benefit from the consistency and transparency of the mediation process and,

hopefully, by reason thereof, would be more than willing to undergo mediation a

second time around for yet another dispute.

ii. IMPARTIALITY OF MEDIATOR

Following the universally recognized requirement in mediation, the ADR Law

and the ADR Implementing Rules demand that mediators be, act and appear to be

impartial.72 In fact, the ADR Implementing Rules allows a mediator to withdraw his

services when “continuing the dispute resolution would give rise to an appearance

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of impropriety” and even authorizes a party to compel the withdrawal of a mediator

in “case of conflict of interest”.73

Vital to the assurance of impartiality on the part of the mediators are the

statutory requirements of disclosure and avoidance of any conflict of interest such

as a financial or personal interest in the outcome of the mediation or any existing or

past relationship with a party or foreseeable participant in the mediation. Hence, the

ADR Law and the ADR Implementing Rules prescribe the following:

“Article 3.7. Impartiality. A mediator shall maintain impartiality. (a) Before accepting a mediation, an individual who is requested to serve as a mediator shall:

(i) make an inquiry that is reasonable under the circumstances to determine whether there are any known facts that a reasonable individual would consider likely to affect the impartiality of the mediator, including a financial or personal interest in the outcome of the mediation and any existing or past relationship with a party or foreseeable participant in the mediation; and

(ii) disclose to the mediation parties any such fact known or learned as soon as is practical before accepting a mediation.

(b) If a mediator learns any fact described in paragraph (a) (i) of this Article after accepting a mediation, the mediator shall disclose it as soon as practicable to the mediation parties.”

Although not subject to the regime under the ADR Law and the ADR

Implementing Rules, mediators accredited by the PHILJA-PMC for court-related

mediation have a similar, if not a stronger and more categorical, proscription

against conflicts of interest. Embodied in the Code of Ethical Standards of Mediators

are the following guiding principles on the mediator’s fundamental duty to be

impartial and to be, and remain, free of any conflict of interest, to wit:

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“II

Responsibilities to Parties

Impartiality. The Mediator shall maintain impartiality toward all parties. Impartiality means freedom from favoritism or bias either by appearance, word or by action, and a commitment to serve all parties as opposed to a single party. At no time may a Mediator meet with any of the parties to discuss a case referred to him for mediation without the presence or the consent of the other party. A Mediator shall withdraw from mediation if the mediator believes he can no longer be impartial. A mediator shall not give or accept a gift, bequest, favor, loan or any other item to or form a party, attorney, or any other person involved in and arising from any mediation connection.

x x x

Conflict of Interest. The Mediator shall refrain from participating in the mediation of any dispute if he/she perceives that participation as a Mediator will be a clear conflict of interest. The Mediator shall also disclose any circumstance that may create or give the appearance of a conflict of interest and any circumstance that may raise a question as to the Mediator’s impartiality.

The duty to disclose is a continuing obligation throughout the

process. In addition, if a Mediator has represented either party in any capacity, the Mediator should disclose that representation.

A Mediator shall disclose any known, significant current or past

personal or professional relationship with any party or attorney involved in the mediation and the Mediator and parties should discuss on a case-by-case basis whether or not to continue.

After the Mediator makes his disclosures, and a party does not

seek inhibition, the Mediator shall continue as such. No Mediator shall have any interest in any property, real or

personal, that is the subject matter of the case referred to him/her for mediation. He/she may not offer to purchase or to sell such property, whether at the inception, during, or at any time after the mediation proceedings, either personally or through other parties.”

The legal environment under the ADR Law and ADR Implementing Rules

sufficiently addresses the need for impartiality in the mediation process. However,

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the author is the opinion that the better (and fourth best) practice for the Philippine

mediation system would be to adopt, in addition to the general statements in the

said laws, the more stringent and detailed directives contained in the Code of Ethical

Standards of Mediators, as shown above.

C. “POST PROCESS”

Two of the more common questions asked by parties referred to mediation

relate to what happens after the mediation is terminated, namely: (1) if a settlement

is not reached, what disadvantage do they face for making disclosures in the course

of mediation; and (2) if a settlement is reached, how can they enforce the

compromise agreed to in mediation. The Philippines has, by law, laid down two (2)

significant principles that answer these “post-process” issues: (a) the rule of

confidentiality and (b) the rule on enforcement of mediated settlements.

i. Rule on Confidentiality

Under both court-related and ADR Law governed mediation, the

maintenance of the confidentiality of communications and disclosures made in the

course of the process is sacred. For court-related mediation, mediators are governed

by the provisions of Supreme Court guidelines74 and by their duties under the Code

of Ethical Standards of Mediators.75 For mediation under the ADR Law regime, on

the other hand, confidentiality is mandated by legal fiat.

Presumably because the Philippine Legislature was aware that the success of

mediation is enhanced, if not dependent, on an environment conducive to

spontaneous, free and effective communication between and among the parties and

the mediators, the ADR Law expressly decrees the rule of confidentiality,76

enumerates the limited exceptions thereof77 and the instances where a waiver may

be construed78 as well as the sanctions for breaches of confidentiality including an

20

award of damages.79 As to what constitutes “information” or “communication” that

is protected by the confidentiality privilege, the ADR Law provides the following all-

encompassing definition, viz.:

“(h) "Confidential information" means 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. It shall include (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”80

The author is of the opinion that the unequivocal nature of the statutory

provisions of the ADR Law on the definition of confidential information, the

application and implementation of the rule of confidentiality as well as the sanctions

for breaches thereof is the fifth best practice of Philippine mediation.

ii. Enforcement of Mediated Settlements

The sixth best practice that can be taken from the legal regime that governs

Philippine mediation is the formulation of a specific court procedure that aggrieved

parties may resort to for the purpose of judicially enforcing a mediated settlement

without need of a protracted litigation.

Under the ADR Law, once a settlement is reached, the parties, their respective

counsel, if any, and the mediator prepare the written agreement and are urged to

“endeavor to make the terms and conditions thereof complete”, “make adequate

provisions for the contingency of breach” and “avoid conflicting interpretations of

the agreement”.81 Once the written agreement has been finalized, diligently

21

explained by the mediator to the parties and thereafter signed by the parties and, if

any, their counsel, the parties to the mediation have two (2) options, both of which

are intended to expedite enforcement in case of breach:

(1) Agree to deposit the signed mediated settlement agreement with the

Clerk of Court of the Regional Trial Court for possible summary

enforcement by the said court in accordance with the Special ADR Rules,

particularly Rule 15 thereof;82 or

(2) Agree to stipulate in the settlement agreement that the mediator shall

become a sole arbitrator for the dispute, who shall then treat the

settlement agreement as an arbitral award subject to enforcement under

Republic Act No. 876, otherwise known as “The Arbitration Law”.83

Significantly, under Rule 15 of the Special ADR Rules, the enforcement of a

mediated settlement agreement may be done through a verified petition filed with

the same court where the agreement was deposited. The verified petition needs

only to (i) name and designate, as petitioner or respondent, all parties to the

mediated settlement agreement and those who may be affected by it; (ii) state the

addresses of the parties and the ultimate facts showing the adverse party’s default;

and (iii) attach an authentic copy of the agreement with the Certificate of Deposit

evidencing the deposit of the mediated agreement with the Clerk of Court.84 Upon

notice or service of the petition, the adverse party may file an opposition within an

inextendible period of fifteen (15) days.85 After a summary hearing, which is to be

scheduled no later than five (5) days from the lapse of the period to file the

opposition86 and which shall be conducted in one (1) day and only for purposes of

clarifying facts,87 the court has a period of thirty (30) days from the day of the

hearing within which to decide the petition for enforcement.88 Thus, unlike ordinary

out-of-court settlement agreements, the enforcement proceedings of a deposited

mediated settlement would generally be complete in less than three (3) months.

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D. “PROCESS EN TOTO”

i. Availability of Limited, Well-Circumscribed and Expeditious Judicial

Intervention

The expedited process for the enforcement of mediated settlements is made

possible by the promulgation of the Special ADR Rules, which were approved by the

Supreme Court as a means of encouraging and promoting the use of ADR as an

“important means to achieve speedy and efficient resolution of disputes, impartial

justice, curb a litigious culture and to de-clog court dockets.”89 Thus, if there is a

seventh best practice to be learned from the Philippine mediation system, it is that

ADR mechanisms particularly mediation need to be complemented by the existence

of a cooperative judiciary, that is tasked to ensure that a party’s resort to ADR is not

rendered inutile.

A key feature of the Philippine mediation system, which exemplifies the

willingness of the Philippine judiciary to provide active support to mediation, is the

right of parties in mediation to go to court, even during mediation, to seek interim

measures of protection 90 as well as secure protective/confidentiality orders

whenever the circumstances warrant.

Among the interim measures of protection available to parties in mediation

are:91

(a) preliminary injunction directed against a party to the mediation;

(b) preliminary attachment against property or garnishment of funds in

custody of a bank or a third person;

(c) appointment of a receiver; and

(d) detention, preservation, delivery or inspection of property.

23

In granting the relief, the courts shall consider, among others, the applicant’s need

(i) to prevent irreparable loss or injury; (ii) to provide security for the performance

of any obligation; (iii) to produce or preserve evidence; or (d) to compel any other

appropriate act or omission.92

The Special ADR Rules also expressly prescribes the procedure for a party,

counsel or witness to obtain a protective order any and every time there is a need to

enforce the confidentiality of information obtained, or to be obtained, in a

mediation.93 Rule 10 of the Special ADR Rules recognizes the right of a party,

counsel or witness to file a verified petition to prevent confidential information in

mediation from being disclosed, or further disclosed, without express written

consent of the source or the party who made the disclosure.94 Significantly, although

the Special ADR Rules directs courts to be guided by the confidentiality principles

set forth in the ADR Law in resolving petitions,95 the same Rule 10 expressly states

that a protective order may be granted “only if it is shown that the applicant would

be materially prejudiced by an authorized disclosure of the information obtained, or

to be obtained”, during mediation.96

Among the other areas where courts may provide relief under the Special ADR

Rules are in the (a) compulsory referral to mediation when a party bound by a

mediation agreement prematurely goes to court;97 (b) appointment of mediator;98

and (c) termination of the mandate of mediators.99

Notably, under the Special ADR Rules, all proceedings taken thereunder

including petitions for interim reliefs and protective or confidentiality orders are

summary in nature. Thus, by express decree, these special proceedings should be

resolved within no more than thirty (30) days from the day of the hearing on the

verified petition, which, as mentioned earlier, is set no more than five (5) days from

the last day for the adverse party to file its opposition. Accordingly, unlike

proceedings governed by the regular procedural rules, proceedings under the

Special ADR Rules are designed to be expeditiously resolved.

24

This limited, well-circumscribed and expeditious judicial intervention, if not

judicial assistance, in the process of mediation is, as mentioned above, the seventh

best practice in Philippine mediation. And, thus, the author firmly believes that the

ASEAN model of a regional ADR system should have a specific and express

recognition of the importance of judicial intervention in select aspects of ADR

including, insofar as mediation is concerned, the right to secure interim measures of

protection and protective/confidentiality orders.

III. SIGNIFICANT DEFICIENCIES IN THE PHILIPPINE ENVIRONMENT FOR

MEDIATION

Despite the best practices described above and notwithstanding its

documented success (at least insofar as court-related mediation is concerned), the

Philippine legal and regulatory environment for mediation still has significant

deficiencies, which must be, in the opinion of the writer, remedied or improved so

as to allow disputants in the country to enjoy, to the fullest extent, the benefits of

mediation as an ADR mechanism.

The main catalyst in the growth and development of mediation as a reliable

mode of ADR in the Philippines was, undeniably, the State’s need to declog the court

dockets and thereby render impartial justice in a timely manner. In the mind of the

writer, this efficient catalyst is the source of the system’s first deficiency – that is,

the misconception by the overwhelming majority that mediation is a “remedial” or

“curative” form of dispute resolution and not an equivalent alternative to litigation

and arbitration.

Proponents of ADR understand that mediation has benefits that far outweigh

its advantages as a mode of court diversion. By reason of its non-adversarial nature,

mediation is a “consensus-based form of social peace-keeping”100 that finds

25

application in situations where the declaration of a “winner” or a “loser” resulting

from the application of the law would nevertheless not foster satisfaction in the

dispute resolution process such as, for instance, in family disputes.101 Through

mediation, parties “resume dialogue and come to a real” and mutually acceptable

solution to their dispute “through negotiation instead of getting locked into a logic of

conflict and confrontation” until one is adjudged in the right.102 In the European

Union, for example, mediation has been successfully employed to resolve complex

commercial disputes (where the disputing parties thereafter retain a continuing

commercial relationship) as well in medical malpractice and accidents cases (where

the satisfactory relief is often out of the norm of remedies available through court

processes).103

The author is of the opinion that, through education and information

dissemination, the general public should be made aware of the benefits of mediation

and should be disabused of the possible misimpression that mediation is an inferior,

second, choice to litigation rather than a co-equal alternative. This writer believes

that, armed with a correct appreciation of mediation, the Filipino people would

resort to this ADR mechanism with more frequency and enthusiasm as it would be

culturally appropriate for a nation that is composed of individuals naturally averse

to emotional and adversarial confrontation.

Likewise arising from the Supreme Court’s strong push on litigants to go

through mediation is the possible mistaken notion that mediation, in the normal

out-of-court scenario, would have a “compulsory” rather than consensual nature as

it does in court-related mediation such as CAM, JDR and ACM. Recent jurisprudence

affirms the authority of the trial court in court-annexed mediations to “impose the

appropriate sanction including but not limited to censure, reprimand, contempt and

such other sanctions as are provided under the Rules of Court” including the

outright dismissal of the pending case undergoing mediation “for failure to appear

for pre-trial, in case any or both of the parties absent himself/themselves, or for

abusive conduct during mediation proceedings”.104 This author believes that an

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unfettered exercise of this judicial power may obscure the voluntariness of the

“typical” and “globally accepted” mediation process and, as a consequence, wittingly

or unwittingly promote an aversion to mediation as an ADR mechanism. Hence,

though the procedural guidelines of the Supreme Court consider CAM as part of pre-

trial, the writer is of the belief that courts should exercise this power of reprisal with

utmost circumspection so as to ensure that mediation, as an accepted mode of

dispute resolution distinct from CAM, would not, at least in public perception, lose

its essence as a consensual process that is characterized by party autonomy and

self-determination.

The third deficiency of the mediation regime in the Philippines is the lack of

an express statutory provision on the impact of the commencement of mediation on

the running of the statute of limitations. Although the Philippine New Civil Code

states that the prescriptive period for filing civil actions is interrupted by the service

an extra-judicial demand,105 often times mediation is contractually stipulated as the

first level process in a multi-tiered dispute resolution clause. Under these

circumstances, the normal communication would be a notice to mediate, rather than

an official demand letter. As mediation may entail substantial time, especially in

extremely complex cases, the author is of the opinion that the ADR Law should be

amended to explicitly indicate that the commencement of mediation would suspend

the running of the statute of limitations and resume only after the parties have

received the mediator’s written report or communication that the mediation is

terminated.

Fourth, unlike court-related mediation,106 mediation fees and costs under the

ADR Law are neither regulated nor monitored. Rather, the ADR Implementing Rules

authorizes the parties in ad hoc mediation107 to “make their own arrangements as to

mediation cost and fees”108 and suggest that certain factors (such as the complexity

of the case, the number of hours spent in mediation and the training, experience and

stature of the mediators) be considered in the final determination of the mediation

27

fees.109 In default of an agreement for ad hoc mediation, the schedule of cost and

fees to be approved by the OADR shall be followed.110

As a consequence of the lack of regulation, disputants would, in the normal

course, be unable to quickly assess the realistic amount of fees and costs they would

incur in undergoing mediation (especially ad hoc mediation). Worse, the lack of

regulation (or even monitoring) may result in the indiscriminate rise of mediation

service fees and expenses that may, in the worst case scenario, lead to the

continuing decline in (if not eventual extinction of the) demand for mediation in the

Philippines, a third world nation where cost would, and should be, a primary

concern. The author believes that accessibility of mediation, as an ADR mechanism

is highly dependent on its affordability. And, hence, not only should institutional

mediation service providers in the Philippines be required to be transparent about

their fees, costs and administrative charges but, more importantly, parties should be

afforded the opportunity to give feedback to the OADR on the reasonableness of

mediation fees assessed by ad hoc service providers.

Lastly and most importantly, the area where the Philippine mediation system

needs the most immediate improvement is in the area of standardized regulation

and governance.

As evident from the foregoing discussion, court-related mediation in the

Philippines such as CAM, ACM and JDR is governed by Supreme Court guidelines and

directly supervised by the PHILJA-PMC. In addition, mediators accredited by

PHILJA-PMC and conducting court-related mediation are expressly excluded from

the coverage of the ADR Law and the ADR Implementing Rules but are, nevertheless,

bound by the Code of Ethical Standards of Mediators that embodies the basic

guiding principles contained in the ADR Law. Uniquely, however, the mediators in

court-related mediation are subject to the disciplinary authority of the Supreme

Court under the Grievance Machinery provided by the PHILJA-PMC,111 under which

28

mediators may be preventively suspended, de-accredited or sanctioned with the

non-renewal of their accreditation.

On the other hand, private mediation service providers are, for the most part,

self-regulated and their mediation practice governed only by the statutory

principles embodied in the ADR Law and ADR Implementing Rules. Though

accreditation by the OADR is a possibility, it is not legally mandated. Worse, parties

to private mediation under the ADR Law do not have equivalent or similar feedback

mechanism and grievance machinery that parties to court-related mediation do. In

fact, the OADR is not empowered to discipline mediators through the imposition of

sanctions such as de-certification or non-renewal of accreditation/certification.

Insofar as liability of mediators is concerned, the ADR Law simply states that private

mediation service providers shall have “the same civil liability” as public officers

“for the Acts done in the performance of their duties” “as provided in Section 38(1),

Chapter 9, Book I of the Administrative Code of 1987.112 Hence, the ADR Law merely

lays down the rule on the civil liability of mediators for damages in the event they

acted with bad faith, malice or gross negligence, which would necessarily entail

parties commencing litigation to recover damages. Whether the same liability can be

imposed on mediators of court-related processes is yet undetermined but seemingly

possible.

In view of the lack of consolidation of the governance documents, rules and

laws pertaining to the conduct of mediation in this jurisdiction, the author fears that

the quality of mediation service and the competence of the mediator providing it

may not be uniform, standardized or even existent across the various forms of

mediation in the Philippines. Worse, as the Special ADR Rules provides judicial

remedies that may be essential to the protection of the interests of the parties in

mediation, the exclusion of court-related mediation from the scope of the Special

ADR Rules may result in the inequitable situation where parties in private

mediation have more rights than those undergoing mediation under the auspices of

the PHILJA-PMC. As a regionally-acceptable system of mediation in the ASEAN

29

should afford Member States the assurance of a reliable and credible mediation

process, this author firmly believes that the standardization of the legal and

regulatory regime for mediation should be a priority project of the various branches

of the Philippine government especially in view of the ASEAN Community target of

2015 that is fast approaching.

IV. A ROADMAP TO AN ASEAN MODEL OF MEDIATION: RECOMMENDATIONS

BASED ON THE PHILIPPINE EXPERIENCE

The desire to establish a regional and cross-jurisdictional dispute resolution

mechanism is not a novel one. Almost a decade ago, the European Commission

launched a program aimed at adopting an ADR mechanism that could be utilized by

the various members of the European Union with a modicum of consistency and

uniformity. In providing the following recommendations for a roadmap to an ASEAN

Model of Mediation, the author takes heed of the European Commission’s

experience and factors in the local dimension -- both the Philippines’ best practices

and its areas of improvement.

Of prime importance in creating a regionally acceptable mediation model is

the understanding that the ASEAN’s objective should not be to make all laws across

all Member States uniform. Harmonization and reconciliation of ADR laws should

likewise not be the goal. Rather, the author believes that the ASEAN should identify

the essential or vital elements of the desired mediation system and, to the extent

possible, mandate compliance therewith across the Member States. Otherwise

stated, what is essential, across the ASEAN region, is the standardization of the

mediation system on pre-determined essential items so as to convince Member

States to believe that they may rely on the quality, reliability and credibility of the

mediation process in other members of the ASEAN.

The first crucial element of the ASEAN Model for Mediation should be the

adoption of fundamental legal rules aimed at creating a legal environment that

30

assures Member States of consistency, reliability and quality in the conduct of

mediation. In the mind of the author, the seven (7) best practices identified above

should be embodied in the legal regime of every Member State. To reiterate, these

best practices are:

(1) Mandatory training and accreditation of mediators;

(2) Filtering of disputes and specialization of mediators;

(3) Reliability and transparency in procedure through a legislative instruction of a standardized process;

(4) Imposition of impartiality of mediators;

(5) Categorical and detailed rules on confidentiality of information

disclosed and obtained in mediation, waivers, exceptions and sanctions for breach;

(6) Formulation of a process for the quick enforcement of mediated settlements; and

(7) Availability of limited, well-circumscribed and expeditious judicial

intervention for interim measures of protection and confidentiality orders.

In addition to the foregoing, however, the author recommends the inclusion of

provisions relating to (a) the impact of mediation on the statute of limitation and (b)

the organization of a national centralized agency that would, using standardized

criteria and methods, train, accredit or certify and, possibly, sanction mediators. As

mentioned above, these last two (2) items are sorely missing from the current

Philippine legal regime and are gaps that should be filled.

With the foregoing, it is the author’s recommendation that the ASEAN Model

of Mediation dictate the so-called bare minimum for the foregoing items and

possibly use as bases the Philippine best practices discussed above.

31

The second crucial element is the promulgation of a Code of Ethical Conduct

of ASEAN Mediators to which mediators and mediation service providers across

Member States would be required to adhere, on the bare minimum, as a

precondition to accreditation. Similar to the Code of Ethical Standards of Mediators

governing court-related mediation,113 the ASEAN standardized ethical code should

specifically and clearly set forth, in more detail than the legal rules, desired norms of

conduct that tend to assure Member States of the credible and good quality results

that mediation provides within the ASEAN. Among these vital norms of conduct are

those discussed in the best practices and suggested areas of improvement in the

Philippine legal system including matters pertaining to the following:

(1) competence, training, accreditation and appointment of mediators;

(2) independence, impartiality and conflict of interest;

(3) the mediation agreement and process as well as the role of the

mediator and parties’ counsel in mediation;

(4) the execution and enforcement of a mediated settlement;

(5) confidentiality, waiver and exceptions thereto as well as

consequences for breach thereof;

(6) mediation fees, expenses and costs; and

(7) sanctions and liabilities for misconduct.

Admittedly, incorporating all the norms of conduct in the national law of every

Member State would be ideal. However, the author recognizes that, to garner

acceptance of the ASEAN Model of Mediation, there is a need to strike a delicate

balance between each State’s need for flexibility and national identity and the

ASEAN’s need to guarantee to each Member State the consistent and standardized

quality and reliability of mediation across the region. In attaining this state of

equipoise, the author believes that what cannot be dictated to be incorporated in

national legislation must, at least, be incorporated in an ethical code that follows the

standards of the Ethical Code of Conduct for ASEAN Mediators and that mediators

32

and mediation service providers across Member States should be willing to commit

fidelity to.

After standardizing the legal and ethical environments in each Member State,

the next vital element is in the design of the architecture within which each national

mediation system operates. Of primary concern to the author is the need to ensure

that the conduct of mediation is independent of each Member State’s judiciary so as

to maintain, as much as possible, a harmonious relationship between courts of each

nation. In addition, the infrastructure for mediation services, which in the

Philippines is currently lacking, should be built with the clear intention that it be

accessible to all. Obviously, an ASEAN Model of Mediation would be meaningless if

only selected parts of each Member State are able to resort to it. Indeed, the

objective of the ASEAN Model of Mediation should be that the great majority of

cross-country mediation be conducted consistent with, and employing, the ASEAN

model. Lastly, whenever practicable, the advances in information technology and

communication should be utilized in the conduct of mediation. In connection with

this, ODR should be encouraged in each Member State as the preferred platform for

easily accessible and available mediation services. Indeed, taking the successful

online mediation in the Philippines as an example, Member States should consider

adapting the most common and widespread of technologies in their territories (such

as “short message service” of mobile telephony in the Philippines) as an interface for

ODR for the purpose of employing mediation in the widest geographical area as

possible.

Lastly, after standardization is accomplished across Member States within

the ASEAN, the last step would be the organization of a regional mediation center

that would be tasked to, among others, (i) disseminate legal information and salient

updates on the practice of mediation across the region, (ii) collate and update

rosters of accredited mediators and mediation service providers on per Member

State basis with sufficient details so as to allow quick access and communication,

(iii) act as the repository of the official documents pertaining to the ASEAN Model of

33

Mediation including the formal accession of each Member State to the Ethical Code

of Conduct of ASEAN Mediators and (iv) act as the liaison or communication channel

between and among the centralized mediation agencies in each Member State.

With the four crucial steps and elements achieved, the author believes that

the ASEAN Model of Mediation would successfully provide a standardized, efficient

and acceptable mechanism for resolving cross-jurisdictional disputes and, thereby,

evoke confidence that, regardless of the venue, disputants are assured of quality

mediation on a consistent basis throughout the ASEAN region.

V. CONCLUSION

It is without doubt that the ASEAN is fast becoming a “community” to be

reckoned with. To attain an ASEAN community with “one vision, one identity”, the

“roadmap to change” expects each Member State to provide inputs and give

recommendations based on its local perspective and national experience in the hope

that unified blueprints for the ASEAN political-security, economic and socio-cultural

communities would be fully integrated throughout the region by 2015. It is in line

with this that we, as members of the ALA, come together to do our share in the

building of the AEC.

The recommendations given in this paper for the establishment of an ASEAN

Model of Mediation stem primarily from the Philippines’ unique experience in the

area of mediation. Despite this, the author believes that these recommendations

hurdle the cultural divide by satisfying the universal and pressing need for

standardization in this highly globalized and diversified world. Indeed, as the

proposed ASEAN Model of Mediation is designed to withstand, if not ignore, cultural

and territorial differences, cross-border disputes should be mediated consistently,

competently and predictably regardless of the venue because standards would have

been embedded in each local regime.

34

1 Atty. Patricia-Ann T. Prodigalidad has a Bachelor of Laws degree, cum laude, from the

University of the Philippines and a Master of Laws degree from Harvard Law School. She is partner of the Angara Abello Concepcion Regala & Cruz Law Offices in the Philippines specializing in commercial litigation and arbitration. She is currently the Chairperson of the Law Practice Management Committee of the Integrated Bar of the Philippines as well as the co-Chairperson of the ADR Committee of the Philippine Bar Association.

2 ASEAN Charter, Chapter I, Article 2, par. 2 (d) and Chapter VIII, Articles 22 and 25, which respectively provide:

“ARTICLE 2 PRINCIPLES

2. ASEAN and its Member States shall act in accordance with the following Principles:

x x x

(d) reliance on peaceful settlement of disputes;”

“ARTICLE 22

GENERAL PRINCIPLES

1. Member States shall endeavour to resolve peacefully all disputes in a timely manner through dialogue, consultation and negotiation.

2. ASEAN shall maintain and establish dispute settlement mechanisms in all fields of

ASEAN cooperation.”

“ARTICLE 25 ESTABLISH OF DISPUTE SETTLEMENT MECHANISMS

Where not otherwise specifically provided, appropriate dispute settlement mechanisms, including arbitration, shall be established for disputes which concern the interpretation or application of this Charter and other ASEAN instruments.”

3 ASEAN Roadmap for an ASEAN Community 2009-2015, ASEAN Economic Community

Blueprint, p. 39. 4 Ibid., at p. 36. 5 CONST., Art. XIII, sec. 3; Philippine Labor Code, Pres. Decree No. 442, as amended, Art. 211 (a). 6 Philippine Local Government Code of 1991, Rep. Act No. 7160, Secs. 399-422. 7 SC Resolution in A.M. No. 99-01-SC-PHILJA dated 19 October 1999, which approved the

issuance of PHILJA proposed resolution to pilot test the efficacy of mandatory mediation/conciliation in the pilot areas of Mandaluyong City and Valenzuela City..

8 SC Resolution in A.M. No. 01-10-5-SC-PHILJA dated 16 October 2001, which, among others, designated PHILA as the component unit of the Supreme Court for court-referred, court-related mediation cases and other forms of ADR mechanisms; prescribed the Revised Guidelines for the Implementation of Mediation Proceedings; laid down the Standards and Procedures for Accreditation of Mediators for Court Referred, Court Related Mediation Cases; and set forth the Code of Ethical Standards for Mediators.

9 SC Resolution in A.M. No. 01-10-5-SC-PHILJA dated 16 October 2001. 10 Tan, Jr., Judge Rafael Cresencio, “Public Administration in the Judiciary: The Benefits of

Mediation”, April 23-30, 2007, at http://www.fnf.org.ph/seminars/reports/public-administration-in-judiciary.htm (last accessed on 15 January 2012).

35

11 M&E Plan for the Action Program for Judicial Reform, p. 5. 12 Republic Act No. 9825, sec. 3(l). 13 Herrera, Hon. A. M., “Court-Annexed Mediation (CAM) – Making it Work: The Philippine

Experience”, presented at the International Conference and Showcase on Judicial Reforms, Parallel Session C, 29 November 2005 at the Makati Shangri-La, Philippines, at http://jrn21.judiciary.gov.ph/forum_icsjr/ICSJR_Philippines%20(A%20Herrera).pdf (last accessed on 15 January 2012).

14 SC Resolution in A.M. No. 01-10-5-SC-PHILJA dated 16 October 2001. 15 Under Article 2035 of the New Civil Code, the following may not be compromised:

(1) the civil status of persons; (2) the validity of a marriage or a legal separation; (3) any ground for legal separation; (4) future support; (5) the jurisdiction of courts; and (6) future legitime.

16 SC Resolution in A.M. No. 01-10-5-SC-PHILJA dated 16 October 2001. 17 Ibid. 18 Id. 19 SC Resolution in A.M. No. 04-2-04-SC dated 20 July 2004, effective 16 August 2004. 20 The “Court Diversion Approach” to unclog the court dockets, as differentiated from the

“Output-Oriented Approach” and the “Input-Oriented Approach”, addresses the number of cases that have already been filed and are still awaiting disposition. These pending cases are “diverted” from the traditional court process to an alternative mode of dispute resolution. [Tadiar, A.F., “Unclogging the Court Dockets”, paper presented in the Symposium on Economic Policy Agenda for the Estrada Administration, June 1, 1999 at INNOTECH, Commonwealth Avenue, Diliman, Quezon City, Philippines, at http://dirp4.pids.gov.ph/ris/taps/tapspp9926.pdf (last accessed on 15 January 2012).

21 SC Resolution in A.M. No. 01-10-5-SC-PHILJA dated 16 October 2001. 22 PHILJA 2010 Annual Report, p. 21. 23 Under the “Justice on Wheels” project, three (3) buses are deployed to different areas in the

country as Mobile Courts for the purpose of improving physical access to court services especially by the poor. In 2009, two of these buses were utilized for ADR through the Mobile Court-Annexed Mediation (MCAM) proceedings in Rizal and Bulacan. By 2011, the Justice on Wheels project involved eight (8) Mobile Courts.

24 The Justice Reform Initiatives Support (JURIS) Project is implemented by the PHILJA “with the assistance of the Canadian International Development Agency (CIDA) to deliver training programs and supporting ADR mechanisms”. [World Bank, Report No. 55655-PH, Philippines Discussion Notes, Challenges and Options for 2010 and Beyond, June 2011, at http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2011/06/15/000386194_20110615035150/Rendered/INDEX/556550ESW0P118090June02011000final.txt (last accessed on 16 January 2012)].

25 SC Resolution in A.M. No. 04-1-12-SC dated 20 January 2004. 26 Ibid. 27 Id. 28 Id. 29 Id. 30 Ombudsman Adm. Order No. 20, series of 2008, dated 29 April 2008 entitled “Ombudsman

Rules of Procedure for Mediation”. 31 A.M. No. 10-4-16-SC dated 22 June 2010 (re: “Rule on Court-Annexed Family Mediation”). 32 National Economic Development Authority (NEDA), Updated Medium-Term Philippine

Development Plan 2004-2010, Chapter 17 (Rule of Law), p. 224. 33 Ibid., at p. 223.

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34 DOJ Circular No. 98 dated 4 December 2009. 35 A.M. No. 07-11-08-SC dated 1 September 2009 entitled “Special Rules of Court on Alternative

Dispute Resolution”. 36 Special ADR Rules, Rule 1.1 in relation to Rule 4. 37 Ibid., at Rule 1.1 in relation to Rule 5. 38 Id., at Rule 1.1 in relation to Rule 13. 39 Id., at Rule 1.1 in relation to Rule 10. 40 Id., at Rule 1.1 in relation to Rule 15. 41 PHILJA-PMC Office, CAM Statistical Report (2002-2011). A copy of the report is available from

the author upon request. 42 PHILJA-PMC Office, JDR Statistical Report (2004-2011). 43 PHILJA-PMC Office, ACM Statistical Report (2005-2011). 44 Rule, C., “Asia: The New Frontier for Online Dispute Resolution”, Spring 2005, ACRESOLUTION

at http://www.mediate.com/Integrating/docs/34worldviews.pdf (last accessed on 15 January 2012).

45 Ibid. 46 Id. 47 Hattotuwa, S. and M.C.Tyler, “An Asian Perspective on Online Mediation” at

http://sanjanah.wordpress.com/2006/02/02/an-asian-perspective-on-online-mediation/ (last accessed on 10 January 2012).

48 “Online Mediation Successful in Philippines Labor Case”, Monday, October 3, 2011, at http://www.mediation.com/articledetail.aspx/article/online-mediation-successful-in-philippines-labor-case (last accessed on 10 January 2012).

49 Ibid. 50 ADR Law, sec. 13. 51 ADR Implementing Rules, Chapter 3, Rule 2, Art. 3.3. 52 ADR Implementing Rules, Chapter 3, Rule 3, Art. 3.6. 53 SC Resolution in A.M. No. 01-10-5-SC-PHILJA dated 16 October 2001, Code of Ethical

Standards for Mediators, Article II on Competence. 54 ADR Implementing Rules, Chapter 3, Rule 3, Art. 3.6. 55 SC Resolution in A.M. No. 01-10-5-SC-PHILJA dated 16 October 2001, Code of Ethical

Standards for Mediators, Article II on Competence. 56 Ibid., Second Revised Guidelines for the Implementation of Mediation Proceedings, Art. 4 on

Selection of Mediator. 57 ADR Law, sec. 50 and ADR Implementing Rules, Chapter 2, Rule 1, Art. 2.4. 58 ADR Implementing Rules, Chapter 3, Rule 3, Art. 3.6. 59 Ibid. 60 SC Resolution in A.M. No. 01-10-5-SC-PHILJA dated 16 October 2001, Second Revised

Guidelines for the Implementation of Mediation Proceedings, Art. 1 on Coverage. 61 A.M. No. 10-4-16-SC dated 22 June 2010, Rule on Court-Annexed Family Mediation, Rule 4. 62 ADR Law, sec. 3(q). 63 ADR Law, sec. 3(q); ADR Implementing Rules, Chapter 3, Arts. 3.9, 3.10, 3.12 and 3.17. 64 ADR Law, sec. 14; ADR Implementing Rules, Chapter 3, Arts. 3.15 and 3.16. 65 ADR Law, sec. 15; ADR Implementing Rules, Chapter 3, Art. 3.18. 66 ADR Law, sec. 17; ADR Implementing Rules, Chapter 3, Arts. 3.19 and 3.20. 67 ADR Implementing Rules, Chapter 3, Rule 3, Art. 3.9. 68 Id., at Art. 3.8. 69 Id., at Art. 70 Id., at Art. 3.9 71 ADR Law, Chapter 2, sec. 8; ADR Implementing Rules, Chapter 3, Rule 1, Art. 3.2. 72 ADR Law, Chapter 2, sec. 13; ADR Implementing Rules, Chapter 3.7. 73 ADR Implementing Rules, Chapter 3, Rule 2, Art. 3.5.

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74 SC Resolution in A.M. No. 01-10-5-SC-PHILJA dated 16 October 2001, Second Revised

Guidelines for the Implementation of Mediation Proceedings, Arts. 6 (on Mediation Proceedings) and 7 (on Confidentiality of Records).

75 SC Resolution in A.M. No. 01-10-5-SC-PHILJA dated 16 October 2001, Code of Ethical Standards for Mediators, Article II on Confidentiality.

76 ADR Law, Chapter 2, secs. 9 and 12, which provide:

“SEC. 9. Confidentiality of Information. - Information obtained through mediation proceedings shall be subject to the following principles and guidelines:

(a) Information obtained through mediation shall be privileged and confidential. (b) A party, a mediator, or a nonparty participant may refuse to disclose and may prevent any other person from disclosing a mediation communication. (c) Confidential Information shall not be subject to discovery and shall be inadmissible in any adversarial proceeding, whether judicial or quasi-judicial, 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. (d) In such an adversarial proceeding, the following persons involved or previously involved in a mediation may not be compelled to disclose confidential information obtained during mediation: (1) the parties to the dispute; (2) the mediator or mediators; (3) the counsel for the parties; (4) the nonparty participants; (5) any persons hired or engaged in connection with the mediation as secretary, stenographer, clerk or assistant; and (6) any other person who obtains or possesses confidential information by reason of his/her profession. (e) The protections of this Act shall continue to apply even of a mediator is found to have failed to act impartially. (f) A mediator may not be called to testify to provide information gathered in mediation. A mediator who is wrongfully subpoenaed shall be reimbursed the full cost of his attorney's fees and related expenses.

“SEC. 12. Prohibited Mediator Reports. - A mediator may not make a report, assessment, evaluation, recommendation, finding, or other communication regarding a mediation to a court or agency or other authority that may make a ruling on a dispute that is the subject of a mediation, except:

(a) Where the mediation occurred or has terminated, or where a settlement was reached. (b) As permitted to be disclosed under Section 13 of this Chapter.”

77 Ibid., at sec. 11, which provides:

“SEC. 11. Exceptions to Privilege. - (a) There is no privilege against disclosure under Section 9 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 a 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;

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(4) intentionally used to plan a crime, attempt to commit, or commit a crime, or conceal

an ongoing crime or criminal activity; (5) sought or offered to prove or disprove abuse, neglect, abandonment, or exploitation

in a proceeding in which a public agency is protecting the interest of an individual protected by law; but this exception does not apply where a child protection matter is referred to mediation by a court or a public agency participates in the child protection mediation;

(6) sought or offered to prove or disprove a claim or complaint of professional misconduct or malpractice filed against mediator in a proceeding; or

(7) sought or offered to prove or disprove a claim or complaint of professional misconduct of malpractice filed against a party, nonparty participant, or representative of a party based on conduct occurring during a mediation.

(b) There is no privilege under Section 9 if a court or administrative agency, finds, after a hearing in camera, that the party seeking discovery or the proponent of the evidence has shown that the evidence is not otherwise available, that there is a need for the evidence that substantially outweighs the interest in protecting confidentiality, and the mediation communication is sought or offered in:

(1) a court proceeding involving a crime or felony; or (2) a proceeding to prove a claim or defense that under the law is sufficient to reform or avoid a liability on a contract arising out of the mediation.

(c) A mediator may not be compelled to provide evidence of a mediation communication or testify in such proceeding. (d) If a mediation communication is not privileged under an exception in subsection (a) or (b), only the portion of the communication necessary for the application of the exception for nondisclosure may be admitted. The admission of particular evidence for the limited purpose of an exception does not render that evidence, or any other mediation communication, admissible for any other purpose.”

78 Id., at sec. 10, which states:

“SEC. 10. Waiver of Confidentiality. - A privilege arising from the confidentiality of information may be waived in a record, or orally during a proceeding by the mediator and the mediation parties.

A privilege arising from the confidentiality of information may likewise be waived by a

nonparty participant if the information is provided by such nonparty participant. A person who discloses confidential information shall be precluded from asserting the

privilege under Section 9 of this Chapter to bar disclosure of the rest of the information necessary to a complete understanding of the previously disclosed information. If a person suffers loss or damages as a result of the disclosure of the confidential information, he shall be entitled to damages in a judicial proceeding against the person who made the disclosure.

A person who discloses or makes a representation about a mediation is precluded from

asserting the privilege under Section 9, to the extent that the communication prejudices another person in the proceeding and it is necessary for the person prejudiced to respond to the representation or disclosure.”

79 Id. 80 Id., at Chapter 1, sec. 3(h).

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81 ADR Law, Chapter 2, sec. 17. 82 ADR Implementing Rules, Chapter 3, Rule 8, Art. 3.20 (c) states:

“If the parties agree, the settlement agreement may be jointly deposited by the parties or deposited by one party with prior notice to the other party/ies with the Clerk of Court of the Regional Trial Court (a) where the principal place of business in the Philippines of any of the parties is located; (b) if any of the parties is an individual, where any of those individuals resides; or (c) in the National Capital Judicial Region. Where there is a need to enforce the settlement agreement, a petition may be filed by any of the parties with the same court, in which case, the court shall proceed summarily to hear the petition, in accordance with the Special ADR Rules.”

83 Ibid., at Art. 3.20 (d), which provides:

“The parties may agree in the settlement agreement that the mediator shall become a sole arbitrator for the dispute and shall treat the settlement agreement as an arbitral award which shall be subject to enforcement under Republic Act No. 876, otherwise known as "The Arbitration Law", notwithstanding the provisions of Executive Order No. 1008, s. 1985, otherwise known as the "Construction Industry Arbitration Law" for mediated disputes outside of the Construction Industry Arbitration Commission.”

84 Special ADR Rules, Part III, Rules 15.5 and 15.6. 85 Ibid., at Rule 15.7 in relation to Part I, Rule 1.6 (on prohibited submissions such as a motion for

extension of time). 86 Id., at Rule 1.3(B). 87 Id., at Rule 1.3 (C). 88 Id., at Rule 15.8 in relation to Part I, Rule 1.3(D) (on period for resolution). 89 Id., at Rule 2.1. 90 Id., at Rule 5.1. in relation to Rules 1.12 and 14.1. 91 Id., at Rule 5.6. 92 Id., at Rule 5.4. 93 Id., at Rule 10 [on Confidentiality/Protective Orders]. 94 Id., at Rule 10.1. 95 Id., at Rule 10.8. 96 Id., at Rule 10.4. 97 Id., at Rule 4 [on Referral to ADR]. 98 Id., at Rule 6 [on Appointment of Arbitrators]. 99 Id., at Rule 8 [on Termination of the Mandate of Arbitrator]. 100 “The European Union is very interested in alternative dispute resolution” from “Alternative

dispute resolution – Community Law” at http://ec.europa.eu/civiljustice/adr/adr_ec_en.htm (last accessed on 15 January 2012).

101 Ibid. 102 Id. 103 Id. 104 In Chan Kent v. Micaraz, et al., G.R. No. 185758, 9 March 2011, the Supreme Court affirmed the

trial court’s power to order the dismissal of the case by reason of one party’s absence during the mediation session. However, the Supreme Court concluded that dismissal is too severe a sanction to be imposed “where the records of the case is devoid of evidence of willful or flagrant disregard of the rules on mediation proceedings”. According to the Supreme Court, “[t]here is no clear demonstration that the absence of petitioner’s representative during mediation proceedings” “was intended to perpetuate delay in the litigation case” or “indicative

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of lack of interest on the part of petitioner to enter into a possible amicable settlement of the case”.

105 New Civil Code, Art. 1155. 106 In court-related mediation, the PHILJA-PMC prescribes a schedule of mediation fees that is

publicly available and that has been approved by the Supreme Court. 107 For institutional mediation, Article 3.26 of the ADR Implementing Rules states that the parties’

agreement would be followed and, in default of an agreement, the fees and expenses (which shall include administrative charges of the institution) shall be determined in accordance with the institution’s internal rules.

108 ADR Implementing Rules, Chapter 3, Rule 10, Art. 3.25. 109 Ibid., at Art. 3.26. 110 Id., Art. 3.25. 111 S.C. A.M. No. 04-3-15-SC-PHILJA dated 23 March 2004. 112 Administrative Code of 1987, Book I, Chapter 9, sec. 38(1) provides:

“Sec. 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.” (emphasis supplied)

113 SC Resolution in A.M. No. 01-10-5-SC-PHILJA dated 16 October 2001.