Equitable PCI Bank v. Judge Oscar Pimentel,
RCBC Capital Corporation, Sir Ian Barker
and Neil Kaplan,
CA-G.R. Sp. No. 93966, March 30, 2007:
The Facts:
A dispute between Equitable PCI Bank [EPCI] and RCBC Capital
Corporation [RCBC] was submitted to arbitration under ICC Rules. The
Philippines was the place of arbitration. Two of the three members of
the Tribunal, Sir Ian Barker and Neil Kaplan, are foreigners and
non-members of the Philippine Bar. EPCI moved to disqualify
Barker and Kaplan on the ground that they are engaged in the practice
of law in the Philippines and are therefore ineligible to rule on the
merits of the issues raised in the arbitration. In a petition
filed with the RTC of Makati, Judge Pimentel held: that the
arbitral tribunal which includes a former justice of the Supreme Court
and two foreign lawyers are not considered to be engaged in the
practice of law in the Philippines.
Petition for certiorari before the Court of Appeals on the argument
that Barker and Kaplan are non-members of the Philippine Bar, that they
are not eligible to render arbitration services in the country for two
reasons: 1) practice of profession is reserved to Filipinos, except as
provided by law; and 2) arbitration constitutes practice of law which
is reserved only to members of the Philippine Bar1. Practice of law has been broadly defined2
to include “any activity, in or out of court, which requires the
application of law, legal procedures, knowledge, training and skill.
Generally, to practice is to give advice or render any kind of service
that involves legal knowledge or skill”. The Court said that the
argument loses sight of the very nature and purpose of
arbitration and the fact that law and jurisprudence sanction
arbitration as a mode of alternative dispute resolution. While
arbitrators have full control of the proceedings in arbitration and act
as a substitute court or tribunal, the powers they exercise are derived
from the agreement of the parties.
“The minimum
requirements for the appointment of a person as arbitrator are that he
be of legal age, in full enjoyment of his civil rights and must know
how to reach and write. Being a member of the Philippine Bar is not one
of the said requirements. An arbitrator need not necessarily be a
lawyer. Law and jurisprudence support the authority of arbitrators who
may be lawyers or not to rule on facts and evidence presented and
interpret points of law to arrive at a decision. We therefore hold that
the services rendered by Barker and Kaplan do not constitute
unauthorized practice of law in the country."
But are they qualified to act as arbitrators?
The Arbitration Law makes
no qualification as to citizenship or preference for lawyers to act as
arbitrators. Both RA 9285 and the Model Law provide that no person
shall be precluded by reason of his nationality from acting as
arbitrator, unless otherwise agreed by the parties.
This article was prepared
by Custodio O. Parlade, of-counsel of the Parlade Hildawa Parlade Eco
& Panga and president emeritus of the Philippine Dispute Resolution
Center, Inc. For further information on this topic, please
contact Custodio O. Parlade at (632) 687 5362; by mail at 26th Floor,
The Orient Square, F. Ortigas, Jr., Ortigas Center, Pasig City 1605
Philippines, or by e-mail at: coparlade@phpeplaw.com or
gingparlade@yahoo.com
__________________________
1 Section 42. Application of the New York Convention.
- The New York Convention shall govern the recognition and
enforcement of arbitral awards covered by the said
Convention.
The recognition and enforcement of such arbitral awards shall be filed
with the regional trial court in accordance with the rules of procedure
to be promulgated by the Supreme Court. Said procedural rules
shall provide that the party relying on the award or applying for its
enforcement shall file with the court the original or
authenticated copy of the award and the arbitration agreement. If
the award or agreement is not made in any of the official languages,
the party shall supply a duly certified translation thereof into any of
such languages.
The applicant shall establish that the country in which the foreign
arbitration award has been made is a party to the New York Convention.
If the application for rejection or suspension of enforcement of an
award has been made, the regional trial court may, if it considers it
proper, vacate its decision
and may also, on the application of the party claiming recognition or
enforcement of the award, order the party to provide appropriate
security.
Section 45. Rejection of a Foreign Arbitral Award.
- A party to a foreign arbitration proceeding may oppose an
application for recognition and enforcement of an arbitral award in
accordance with the procedural rules to be promulgated by the Supreme
Court only on those grounds raised under Article V of the New York
Convention. Any other ground raised shall be disregarded by the
regional trial court.
2 Ulep v. Legal, Clinic, Inc. 223 SCRA 378 and Cayetano v. Monsod, 201 SCRA 210.
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