QuestionsQuestions (EXECUTIVE ORDER NO. 1008)
It is known as the “Construction Industry Arbitration Law.” It creates an arbitration machinery (CIAC) to settle construction-related disputes in an early, expeditious manner.
The State policy is to encourage the early and expeditious settlement of disputes in the Philippine construction industry.
The Construction Industry Arbitration Commission (CIAC) is established in the CIAP, under the administrative supervision of the Philippine Domestic Construction Board (PDCB).
CIAC has original and exclusive jurisdiction over disputes arising from or connected with construction contracts entered into by parties involved in construction in the Philippines, whether the dispute arises before or after abandonment or breach.
The parties to the dispute must agree to submit the dispute to voluntary arbitration.
Examples include: violation of specifications for materials and workmanship; violation of agreement terms; interpretation/application of contractual provisions; amount of damages and penalties; commencement time and delays; maintenance and defects; payment default of employer/contractor; and changes in contract cost.
Disputes arising from employer-employee relationships are excluded and remain covered by the Labor Code of the Philippines.
CIAC consists of a Chairman and two (2) members. They are appointed by the CIAP Board upon recommendation by the PDCB.
The term is six (6) years. For the initial composition: one member holds for six years, another for four years, and the third for two years.
The presence of a majority of the CIAC members constitutes quorum.
Decisions are arrived at by majority vote.
The Secretariat is headed by an Executive Director. It receives requests for arbitration and pleadings, notifies parties, and fixes/receives filing fees, deposits, costs of arbitration, administrative charges, and related fees.
The dispute may be settled by a sole arbitrator or three arbitrators. Parties may agree on a sole arbitrator from the CIAC list; if no agreement, CIAC may appoint a single arbitrator, or form an arbitral tribunal of three with each party nominating one and CIAC appointing the third acceptable to both.
Arbitrators must be persons in whom business sector and government have confidence. They are not permanently employed with CIAC; they serve only when called to arbitrate and receive fees per dispute.
Experts may be used if requested by either party or by the arbitral tribunal. If requested by the parties, the tribunal must confirm the expert. Fees/expenses are generally shouldered equally by both parties; if only one party requests, that party shoulders the full amount. Half the fees are deposited before service if requested by both; full amount if requested by one party.
Arbitration expenses include filing fees, administrative charges, arbitrator fees, expert fees and expenses, and other charges imposed by CIAC. Administrative charges and arbitrator fees are computed based on a percentage of the sum in dispute, according to a table of charges/fees.
If one party fails to contribute his share, the other party must pay in full. If both fail to tender the required deposit, the case is considered dismissed, but the parties remain liable to pay one half (1/2) of the agreed administrative charge.
The arbitral award is binding, final, and unappealable except on questions of law, which may be appealed to the Supreme Court.
After a decision/order/award becomes final and executory, the arbitral tribunal or single arbitrator, with the concurrence of CIAC, may issue a writ of execution motu proprio or upon motion of an interested party, requiring the sheriff or proper officer to execute the award.