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A B S -C B N B R O A D C A S TIN G

C O R P O R ATIO N V S . W O R LD
IN TER A C TIV E N EW S
S Y S TEM

FACTS:
Petitioner ABS- CBN entered into a licensing

agreement with World Interactive Network


System (WINS) Japan Co. Ltd., a foreign
corporation licensed under the laws of
Japan.
The respondent was granted the exclusive
license to distribute a television service
known as The Filipino Channel
A dispute arose between the parties when
the ABS-CBN accused WINS of inserting a
program called WINS WEEKLY.

ABS CBN claimed they were unauthorized

insertions constituting a material breach of


their agreement.
Petitioner ABS CBN then notified WINS of
their intention to terminate the agreement.
Respondent WINS filed an arbitration suit
pursuant to the arbitration clause with the
petitioner.
The parties appointed Prof. Alfredo F. Tadiar
to act as sole arbitrator
WINS contented that the airing of WINS
WEEKLY was made with the prior approval
of ABS CBN.

WINS also alleged that the petitioner

only threatened to terminate the


agreement because it wanted to
renegotiate the terms of thereof to
allow it to demand higher fees.

The sole arbitrator found in favor of

respondent
He held that the petitioner gave its
approval to the respondent for the
airing of WINS WEEKLY as shown by a
series of written exchanges between
the parties

Petitioner filed in the Court of Appeals a

Petition for Review under Rule 43 of the


Rules of Court, or, in the alternative a
Petition for Certiorari of the same Rules
with application for temporary restraining
order and writ of preliminary injunction.
It alleges serious errors of fact and law
and/or grave abuse of discretion
amounting to lack or excess of jurisdiction
on the part of the arbitrators
Respondent WINS filed for a petition for
confirmation of arbitral award before the
Regional Trial Court (RTC) of Quezon City

Petitioner ABS CBN filed a supplemental

petition in the CA seeking to enjoin the RTC


of QC from further proceeding with the
hearing of respondents petition for
confirmation of the arbitral award.
Petition was admitted by CA. CA issued an
order enjoining the RTC from hearing the
petition for confirmation of the arbitral
award.
CA rendered a decision dismissing the
petition of ABS CBN.
Petitioner filed a Motion for
Reconsideration but the same was denied.
Hence, this petition.

ISSU E
Whether or not an aggrieved party in

an arbitration dispute may avail of,


directly in the CA, a petition for
review under Rule 43, or a petition
for certiorari under Rule 65 of the
Rules of Court?

H ELD :
Sec. 24 of RA 876 ( Arbitration Law) provides

for the specific grounds for a petition to


vacate an award made by an arbitrator:
Sec. 24. Grounds to vacate an arbitral award.
a. the award was procured by corruption,
fraud, or other undue means; or
b. that there was evident partiality or
corruption in the arbitrators or any of
them

c. That the arbitrators were guilty of


misconduct in refusing to postpone a
hearing upon sufficient cause shown, or in
refusing to hear evidence pertinent and
material to the controversy; that one or
more of the arbitrators was disqualified to
act as such under section nine hereof, and
willfully refrained from disclosing such
disqualifications or any other misbehavior
by which rights of any party have been
materially prejudiced.
d. That 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.

As RA 876 did not expressly


provide for errors of fact and/or law
and grave abuse of discretion (proper
grounds for a petition for review under
Rule 43 and a petition for certiorari
under Rule 65, respectively) as a
grounds for maintaining a petition to
vacate an arbitral award in the RTC, it
necessarily follows that a party may
not avail of the latter remedy on the
ground of errors of fact and/or law or
grave abuse of discretion to overturn
an arbitral award.

The Special ADR Rules adds the

following as grounds to vacate an


arbitral award, namely:
a. the arbitration agreement did not

exist, or is invalid for any ground for


the revocation of the contract, or is
otherwise enforceable; or
b. that a party to the arbitration is a
minor or a person judicially declared
to be incompetent.

Another ground is when the

arbitrators were not appointed in


accordance with their arbitration
agreement