Case Summary (G.R. No. 210858)
Petitioner
The Department of Foreign Affairs of the Republic of the Philippines, owner and contracting party in the MRP/V Project.
Respondent
BCA International Corporation, a domestic corporation awarded the MRP/V Project under the Amended Build-Operate-Transfer Agreement.
Key Dates
• 5 April 2002 – Date of the Amended BOT Agreement
• 29 June 2009 – Constitution of the ad hoc arbitral tribunal
• 16 May 2013 – BCA’s petition for assistance in taking evidence filed with RTC Makati
• 2 September, 11 October 2013 and 8 January 2014 – RTC orders and resolution on subpoenas and motions to quash
• 2 April 2014 – Temporary Restraining Order issued by the Supreme Court
• 29 June 2016 – Date of Supreme Court decision
Applicable Law
1987 Philippine Constitution; Republic Act No. 9285 (Alternative Dispute Resolution Act of 2004) and its Implementing Rules and Regulations; Special Rules of Court on Alternative Dispute Resolution; Republic Act No. 876 (Arbitration Law); 1976 UNCITRAL Arbitration Rules; constitutional right to information and deliberative process privilege.
Arbitration Agreement Provisions
Section 19.02 of the Amended BOT Agreement required disputes to be settled by an arbitral tribunal under the UNCITRAL Arbitration Rules, seated in the Philippines, conducting proceedings in English, and granting finality to its awards.
Petition for Assistance in Taking Evidence
Pursuant to RA 9285 and the Special ADR Rules, BCA petitioned RTC Makati for subpoenas ad testificandum and duces tecum to compel testimony and production of numerous DFA documents and high-ranking officials, including the Secretary of Foreign Affairs, Secretary of Finance, and Commission on Audit Chairperson.
RTC’s Grant of Subpoenas
In its 2 September 2013 Resolution, RTC Makati held that deliberative process privilege no longer attached once a “definite proposition” had been made by DFA and granted BCA’s petition. Subpoenas issued 6 September 2013; motions to quash were denied in Orders dated 11 October 2013 and 8 January 2014, on grounds of procedural impropriety.
Temporary Restraining Order
DFA elevated the matter directly to the Supreme Court, which on 2 April 2014 issued a temporary restraining order enjoining the arbitral tribunal from receiving the compelled testimony.
Issues Presented
- Whether RA 9285, its IRR and the Special ADR Rules apply instead of RA 876 and the Rules of Court or the 1976 UNCITRAL Rules exclusively;
- Whether the witnesses and documents are protected by the deliberative process privilege.
Procedural Law Governing Arbitration Assistance
The Court held that arbitration is a special proceeding governed by RA 9285, its IRR and the Special ADR Rules, which apply retroactively to pending proceedings. Those rules authorize courts to issue subpoenas for evidence and render such orders immediately executory and not subject to reconsideration or appeal, except by prescribed hierarchy.
Subpoena Power under Alternative and Ordinary Law
Even without RA 9285, RTC authority to issue subpoenas is affirmed under Section 14 of RA 876 and Article 33 of the UNCITRAL Rules, applying lex loci contractus given the Agreement’s perfection in the Philippines.
Deliberative Process Privilege Standard
Under the 1987 Constitution’s right to information and judicial precedents, the deliberative process privilege shields predecisional and deliberative internal communications. Two requirements must be established: (a) the material preceded final policy or decision, and (b) it reflects advisory opinions or recommendations whose disclosure would chill candid governmental deliberation.
Application to the Present Case
The Court determined that the RTC misapplied Chavez v. Public Estates Authority by treating any post-contrac
Case Syllabus (G.R. No. 210858)
The Case
- G.R. No. 210858, decided June 29, 2016 by the Supreme Court, Second Division
- Petition under Rule 45 assailing Regional Trial Court (RTC) of Makati City, Branch 146, orders:
• Resolution dated 2 September 2013 granting subpoenas in SP Proc. No. M-7458
• Order dated 11 October 2013 denying DFA’s motion to quash subpoenas
• Order dated 8 January 2014 denying reconsideration as moot - Petitioner: Department of Foreign Affairs (DFA)
- Respondent: BCA International Corporation (BCA)
Factual Background
- DFA entered into an Amended Build-Operate-Transfer Agreement on 5 April 2002 with BCA for the Machine Readable Passport and Visa Project (MRP/V Project)
- DFA attempted to terminate the Agreement; BCA invoked arbitration under Section 19.02 (UNCITRAL Arbitration Rules, 1976)
- An ad hoc arbitral tribunal was constituted on 29 June 2009
- On 15 April 2013 the tribunal authorized BCA to seek judicial subpoenas without affecting its own schedule
Petition for Assistance in Taking Evidence
- On 16 May 2013 BCA filed before the Makati RTC a petition under RA 9285 (Alternative Dispute Resolution Act of 2004) IRR for:
• Subpoena ad testificandum and subpoena duces tecum directed to high‐ranking DFA, DOF, COA, DTI-BOT Center and MRP/V Advisory Board officials
• Production of voluminous contract-negotiation, site‐selection, financial-capacity and correspondence records (items a-p) - DFA’s 1 July 2013 comment invoked the deliberative process privilege to bar disclosures
RTC Rulings on Evidence Assistance
- 2 September 2013 Resolution: petition granted, subpoenas issued for hearings in October 2013
- 6 September 2013: subpoenas formally issued by the RTC
- 11 October 2013 Order: DFA’s motion to quash denied as impermissible reconsideration under Special ADR Rules, Rule 9.9
- 14–17 October 2013: testimony taken from Usec. Franklin M. Ebdalin, Atty. Voltaire Mauricio, and Mr. Luisito Ucab before the tribunal
- 8 January 2014 Order: DFA’s motion for reconsideration denied as moot in view of witnesses’ appearance
Supreme Court Proceedings and Temporary Restraining Order
- DFA directly appealed to the Supreme Court, seeking:
• Declaration that UNCITRAL Rules