G.R. No.

163101 February 13, 2008

BENGUET CORPORATION, petitioner,

vs.
DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES -MINES ADJUDICATION BOARD and J.G.
REALTY AND MINING CORPORATION, respondents.

Facts:

On June 1, 1987, Benguet and J.G. Realty entered into a RAWOP, wherein J.G. Realty was acknowledged
as the owner of four mining claims respectively named as Bonito-I, Bonito-II, Bonito-III, and Bonito-IV,
with a total area of 288.8656 hectares, situated in Barangay Luklukam, Sitio Bagong Bayan, Municipality
of Jose Panganiban, Camarines Norte. The parties also executed a Supplemental Agreement dated June
1, 1987. The mining claims were covered by MPSA Application No. APSA-V-0009 jointly filed by J.G.
Realty as claimowner and Benguet as operator. Thus, on August 9, 1989, the Executive Vice-President of
Benguet, Antonio N. Tachuling, issued a letter informing J.G. Realty of its intention to develop the
mining claims. However, on February 9, 1999, J.G. Realty, through its President, Johnny L. Tan, then sent
a letter to the President of Benguet informing the latter that it was terminating the RAWOP. J.G. Realty
filed a Petition for Declaration of Nullity/Cancellation of the RAWOP with the Legaspi City POA, Region
V, docketed as DENR Case No. 2000-01 and entitled J.G. Realty v. Benguet.POA issued a decision
declaring[RAWOP] and its Supplemental Agreement is hereby declared cancelled and without effect.
Benguet filed a notice of appeal to MAB

Issue: Whether or not the case should have first been brought to voluntary arbitration before the
POA.

Ruling: Yes. Secs. 11.01 and 11.02 of the RAWOP pertinently provides an Arbitratio Clause. In RA 9285
or the "Alternative Dispute Resolution Act of 2004," the Congress reiterated the efficacy of arbitration as
an alternative mode of dispute resolution by stating in Sec. 32 thereof that domestic arbitration shall
still be governed by RA 876. Clearly, a contractual stipulation that requires prior resort to voluntary
arbitration before the parties can go directly to court is not illegal and is in fact promoted by the State.
Thus, petitioner correctly cites several cases whereby arbitration clauses have been upheld by this
Court. To reiterate, availment of voluntary arbitration before resort is made to the courts or quasi-
judicial agencies of the government is a valid contractual stipulation that must be adhered to by the
parties. As stated in Secs. 6 and 7 of RA 876. In other words, in the event a case that should properly be
the subject of voluntary arbitration is erroneously filed with the courts or quasi-judicial agencies, on
motion of the defendant, the court or quasi-judicial agency shall determine whether such contractual
provision for arbitration is sufficient and effective. If in affirmative, the court or quasi-judicial agency
shall then order the enforcement of said provision. POA is a quasi-judicial body which forms part of the
DENR, an administrative agency. Hence, the provision on mandatory resort to arbitration, freely entered
into by the parties, must be held binding against them.
RIZAL COMMERCIAL BANKING CORPORATION, petitioner

VS

MAGWIN MARKETING CORPORATION, respondent

PARDO, J.:

Facts: On 4 March 1999 petitioner Rizal Commercial Banking Corporation (RCBC) filed a complaint for
recovery of a sum of money with prayer for a writ of preliminary attachment against respondents
Magwin Marketing Corporation, Nelson Tiu, Benito Sy and Anderson Uy.1 On 26 April 1999, the trial
court issued a writ of attachment.2 On 4 June 1999 the writ was returned partially satisfied since only a
parcel of land purportedly owned by defendant Benito Sy was attached.3 In the meantime, summons
was served on each of the defendants, respondents herein, who filed their respective answers, except
for defendant Gabriel Cheng who was dropped without prejudice as party-defendant as his
whereabouts could not be located.4 On 21 September 1999 petitioner moved for an alias writ of
attachment which on 18 January 2000 the court a quo denied.5On 31 July 2000 petitioner moved for
reconsideration of the Order by informing the trial court of respondents' unremitting desire to settle the
case amicably through a loan restructuring program.11 On 22 August 2000 petitioner notified the trial
court of the acquiescence thereto of respondent Nelson Tiu as an officer of Magwin Marketing
Corporation and defendant in the civil case.12

Issue: Whether court a quo had no authority to compel the parties in Civil Case No. 99-518 to enter into
an amicable settlement nor to deny the holding of a pre-trial conference on the ground that no
compromise agreement was turned over to the court a quo.

Ruling: No, it would violate Art. 2029 of the Civil Code which provides that "the court shall endeavor to
persuade the litigants in a civil case to agree upon some fair compromise," and this Court's ruling in
Goldloop Properties, Inc. v. Court of Appeals where it was held that the trial court cannot dismiss a
complaint for failure of the parties to submit a compromise agreement. It is speculative to reckon the
effectivity of the Order of dismissal without prejudice to the presentation of the compromise
agreement. Ostensibly, while the rules allow the trial court to suspend its proceedings consistent with
the policy to encourage the use of alternative mechanisms of dispute resolution, in the instant case, the
trial court only gave the parties fifteen (15) days to conclude a deal. This was, to say the least, a passive
and paltry attempt of the court a quo in its task of persuading litigants to agree upon a reasonable
concession. Hence, if only to inspire confidence in the pursuit of a middle ground between petitioner
and respondents, we must not interpret the trial court's Orders as dismissing the action on its own
motion because the parties, specifically petitioner, were anxious to litigate their case as exhibited in
their several manifestations and motions.
G.R. No. 126619 December 20, 2006

UNIWIDE SALES REALTY AND RESOURCES CORPORATION, petitioner,

vs.
TITAN-IKEDA CONSTRUCTION AND DEVELOPMENT CORPORATION, respondent.

Facts: The case originated from an action for a sum of money filed by Titan-Ikeda Construction and
Development Corporation (Titan) against Uniwide Sales Realty and Resources Corporation (Uniwide)
with the Regional Trial Court (RTC), Branch 119, Pasay City arising from Uniwide's non-payment of
certain claims billed by Titan after completion of three projects covered by agreements they entered
into with each other. Upon Uniwide's motion to dismiss/suspend proceedings and Titan's open court
manifestation agreeing to the suspension, Civil Case No. 98-0814 was suspended for it to undergo
arbitration.Titan's complaint was thus re-filed with the CIAC. Before the CIAC, Uniwide filed an answer
which was later amended and re-amended, denying the material allegations of the complaint, with
counterclaims for refund of overpayments, actual and exemplary damages, and attorney's fees.

Issue : Whether or not findings of fact of administrative agencies and quasi-judicial bodies are generally
accorded not only respect, but also finality.

Ruling: Yes. In particular, factual findings of construction arbitrators are final and conclusive and not
reviewable by this Court on appeal. This rule, however admits of certain exceptions. As exceptions,
factual findings of construction arbitrators may be reviewed by this Court when the petitioner proves
affirmatively that: (1) the award was procured by corruption, fraud or other undue means; (2) there was
evident partiality or corruption of the arbitrators or of any of them; (3) the arbitrators were guilty of
misconduct in refusing to hear evidence pertinent and material to the controversy; (4) one or more of
the arbitrators were disqualified to act as such under Section nine of Republic Act No. 876 and willfully
refrained from disclosing such disqualifications or of any other misbehavior by which the rights of any
party have been materially prejudiced; or (5) the arbitrators exceeded their powers, or so imperfectly
executed them, that a mutual, final and definite award upon the subject matter submitted to them was
not made. Other recognized exceptions are as follows: (1) when there is a very clear showing of grave
abuse of discretion resulting in lack or loss of jurisdiction as when a party was deprived of a fair
opportunity to present its position before the Arbitral Tribunal or when an award is obtained through
fraud or the corruption of arbitrators, (2) when the findings of the Court of Appeals are contrary to
those of the CIAC, and (3) when a party is deprived of administrative due process. A review of the CIAC's
findings of fact would have had the effect of "setting at naught the basic objective of a voluntary
arbitration and would reduce arbitration to a largely inutile institution.
G.R. No. 132848-49 June 26, 2001

PHILROCK, INC., petitioner,

vs.
CONSTRUCTION INDUSTRY ARBITRATION COMMISSION and Spouses VICENTE and NELIA CID,
respondents.

Facts: On September 14, 1992, the Cid spouses, herein private respondents, filed a Complaint for
damages against Philrock and seven of its officers and engineers with the Regional Trial Court of Quezon
City, Branch 82.On December 7, 1993, the initial trial date, the trial court issued an Order dismissing the
case and referring the same to the CIAC because the Cid spouses and Philrock had filed an Agreement to
Arbitrate with the CIAC. Thereafter, preliminary conferences were held among the parties and their
appointed arbitrators. At these conferences, disagreements arose as to whether moral and exemplary
damages and tort should be included as an issue along with breach of contract, and whether the seven
officers and engineers of Philrock who are not parties to the Agreement to Arbitrate should be included
in the arbitration proceedings. No common ground could be reached by the parties, hence, on April 2,
1994, both the Cid spouses and Philrock requested that the case be remanded to the trial court. On April
13, 1994, the CIAC issued an Order stating the Arbitral Tribunal hereby formally dismisses the above-
captioned case for referral to Branch 82 of the Regional Trial Court, Quezon City where it first originated.
The trial court declared that it no longer had jurisdiction over the case and ordered the records of the
case to be remanded anew to the CIAC for arbitral proceedings.

Issue: Whether or not CIAC lost jurisdiction over the arbitration case after both parties had withdrawn
their consent to arbitrate.

Ruling: We disagree. Section 4 of Executive Order 1008 expressly vests in the CIAC original and exclusive
jurisdiction over disputes arising from or connected with construction contracts entered into by parties
that have agreed to submit their dispute to voluntary arbitration. It is undisputed that the parties
submitted themselves to the jurisdiction of the Commission by virtue of their Agreement to Arbitrate
dated November 24, 1993. Signatories to the Agreement were Atty. Ismael J. Andres and Perry Y. Uy
(president of Philippine Rock Products, Inc.) for petitioner, and Nelia G. Cid and Atty. Esteban A. Bautista
for respondent spouses. This contention is untenable. First, private respondents removed the obstacle
to the continuation of the arbitration, precisely by withdrawing their objection to the exclusion of the
seven engineers. Second, petitioner continued participating in the arbitration even after the CIAC Order
had been issued. It even concluded and signed the Terms of Reference10 on August 21, 1995, in which
the parties stipulated the circumstances leading to the dispute; summarized their respective positions,
issues, and claims; and identified the composition of the tribunal of arbitrators. The document clearly
confirms both parties’ intention and agreement to submit the dispute to voluntary arbitration. In view of
this fact, we fail to see how the CIAC could have been divested of its jurisdiction.
G.R. No. 122605 April 30, 2001

SEA-LAND SERVICE, INC., petitioner,

vs.
COURT OF APPEALS and COMMISSIONER OF INTERNAL REVENUE, respondents.

PARDO, J.:

Facts: Sea-Land Service Incorporated (SEA-LAND), an American international shipping company licensed
by the Securities and Exchange Commission to do business in the Philippines entered into a contract
with the United States Government to transport military household goods and effects of U.S. military
personnel assigned to the Subic Naval Base. From the aforesaid contract, SEA-LAND derived an income
for the taxable year 1984 amounting to P58,006,207.54. During the taxable year in question, SEA-LAND
filed with the Bureau of Internal Revenue (BIR) the corresponding corporate Income Tax Return (ITR)
and paid the income tax due thereon of 1.5% as required in Section 25 (a)(2) of the National Internal
Revenue Code (NIRC) in relation to Article 9 of the RP-US Tax Treaty, amounting to P870,093.12.
Claiming that it paid the aforementioned income tax by mistake, a written claim for refund was filed
with the BIR on 15 April 1987. However, before the said claim for refund could be acted upon by public
respondent Commissioner of Internal Revenue, petitioner-appellant filed a petition for review with the
CTA docketed as CTA Case No. 4149, to judicially pursue its claim for refund and to stop the running of
the two-year prescriptive period under the then Section 243 of the NIRC. In 21 February 1995, CTA
rendered its decision denying SEA-LAND’s claim for refund of the income tax it paid in 1984.

Issue: Whether or not the income that petitioner derived from services in transporting the household
goods and effects of U.S. military personnel falls within the tax exemption provided in Article XII,
paragraph 4 of the RP-US Military Bases Agreement.

Ruling: We deny the petition. Laws granting exemption from tax are construed strictissimi juris
against the taxpayer and liberally in favor of the taxing power. Taxation is the rule and
exemption is the exception. The law "does not look with favor on tax exemptions and that he
who would seek to be thus privileged must justify it by words too plain to be mistaken and too
categorical to be misinterpreted. Under Article XII (4) of the RP-US Military Bases Agreement,
the Philippine Government agreed to exempt from payment of Philippine income tax nationals
of the United States, or corporations organized under the laws of the United States, residents in
the United States in respect of any profit derived under a contract made in the United States
with the Government of the United States in connection with the construction, maintenance,
operation and defense of the bases. It is obvious that the transport or shipment of household
goods and effects of U.S. military personnel is not included in the term "construction,
maintenance, operation and defense of the bases. Neither could the performance of this
service to the U.S. government be interpreted as directly related to the defense and security of
the Philippine territories. When the law speaks in clear and categorical language, there is no
reason for interpretation or construction, but only for application. Any interpretation that
would give it an expansive construction to encompass petitioner’s exemption from taxation
would be unwarranted.