19/10/2026
THE ALTERNATIVE DISPUTE RESOLUTION (ADR) MODES FOR THE CONSTRUCTION, DEVELOPMENT AND CONSULTING INDUSTRIES (please note that mainly Construction Arbitration/ConArb is covered by this article)
1. Alternative Dispute Resolution (ADR)
R.A. No. 876 has been in effect from 1953 through 2004; and
UNCITRAL Model for International Commercial Arbitration was adopted with the passage of R.A. No. 9285, otherwise known as the ADR Act of 2004, which defines ADR as any process or procedure used to resolve a dispute or controversy, other than by adjudication of a presiding judge of a court or an officer of a government agency, as defined in this Act, in which a neutral third party participates to assist in the resolution of issues, which includes arbitration, mediation, conciliation, early neutral evaluation, mini-trial, or any combination thereof;
2. Some ADR Modes Under R.A. No. 9285
a) International Commercial Arbitration;
b) Domestic Commercial Arbitration;
c) Construction Arbitration (“ConArb”, where in the Department of Trade and Industry-Construction Industry Authority of the Philippines-Construction Industry Arbitration Commission (DTI-CIAP-CIAC), the construction arbitrator/s (“ConArbors”, either as a sole arbitrator or as a 3-man or 5-person Arbitral Tribunal, presides over the ConArb proceedings and adjudicates the resolution of the dispute); the voluntary settlement of the dispute by the contending parties may alternatively constitute the arbitral award that resolves the dispute;
d) Construction Mediation (where in the DTI-CIAP-CIAC, the sole construction mediator presides over the mediation process but cannot suggest solutions to the dispute); and
e) Conciliation (not offered at the DTI-CIAP-CIAC, where the conciliator presides over the conciliation process and can proactively suggest solutions to the dispute).
3. What is Construction Arbitration (ConArb)?
ConArb may be considered a private process of dispute resolution whereby parties submit their dispute to a private individual/natural person or persons, i.e., the Sole Arbitrator (“SA”) or the Arbitral Tribunal (“Tribunal”), chosen by the parties directly or indirectly for the conduct of a hearing or hearings and for the promulgation of a binding arbitral award (i.e., the equivalent of a “decision” in regular court). Noting that the DTI-CIAP-CIAC ConArbors perform a public function on behalf of said agencies, they may therefore be considered agents of the Government. All official issuances (Orders, Awards, etc.) by Philippine (PH) ConArbors are only made through the CIAC, which is a public entity. All records pertaining to CIAC ConArb proceedings are strictly confidential.
4. Why Arbitrate?
If a party to a construction and/or consulting service contract fails to deliver on a contractual commitment despite the very best of intentions, damages to the other party inevitably arises (i.e., in many different forms, as defined under R.A. No. 386, the 1949 Civil Code of the PH).
However, litigation on a contractual dispute (usually a civil action) via the Courts may take about 4-6 years at the trial court level alone depending on the court dockets (plus say 3-4 years at the Court of Appeals/CA and another 3-4 years more at the Supreme Court/SC). This is mainly because of the very heavy caseload in these courts.
Construction arbitration guarantees a dispute resolution within a six (6) calendar month period, reckoned from the official agreement to the content and signing of the Terms of Reference/ToR for ConArb, the Arbitral Award for which can be elevated to the CA or directly to the SC, depending on the reasons cited by parties/allowed under court rules.
5. What are the Advantages of Construction Arbitration/ConArb?
It is much faster because the ConArbor only handles a few cases at a time, no postponements of hearings are allowed, marathon hearings are conducted (6-8 hours for each of 1 to 2 hearing days, or shorter as needed). Simple cases may be decided in under a week (or even in a day/few hours). It is cost-efficient for the State as the parties (Claimants and Respondents) are the ones who pay for the entire ConArb process. Currently, the approximately ninety (90) active ConArbors have backgrounds in law, engineering, architecture, environmental planning, project management, construction, development, real estate and other closely related fields.
At present, nearly all domestic ConArb cases are heard at the DTI-CIAP-CIAC offices at Makati City but these can also be heard in the large cities of the Visayas and Mindanao. Since 2020 however, a large number of ConArb hearings have been regularly conducted by remote (i.e., online via Zoom platform, thereby affording parties a very cost-effective and accurate audio-visual/AV record and artificial intelligence/AI-assisted transcription, since 2024). Stenographers now use these very same ConArb AV recordings to double-check or to rectify their transcripts of stenographic notes/TSN, which are jointly paid for by parties.
6. How is Construction Arbitration/ConArb Similar to Litigation?
Due process of law is observed in ConArb proceedings, i.e., testimonial and documentary evidence required, rules of evidence are applied (although liberally construed as the PH Rules of Court are not controlling and are applied on a suppletory basis), rights to counsel and to cross-examine witnesses, affidavits (in lieu of direct testimonies) by witnesses, rebuttal affidavits, TSNs, formal offers of exhibits/FOE; final memoranda (or draft awards) from parties; orders, grant/denial of interim relief, and arbitral awards (in lieu of decisions) by the construction arbitrators, etc. The ConArbor, who hears and decides on the claims of the parties (and who pens the Arbitral Award), is considered acting as an adjudicator or a virtual “judge” in a ConArb proceeding (which may be considered similar to a civil proceeding in many ways). As previously stated, the Arbitral Award (i.e., the “decision” in a ConArb proceeding) may be appealed with the CA or directly with the SC, depending on the cause of action.
7. How is Construction Arbitration/ConArb Different from Litigation?
The ConArb procedure is considered to be more civil than adversarial. In an in-person ConArb hearing, parties face each other directly across a table and do not face the ConArbors. Parties can talk freely (but are supervised by the arbitrators). Witness conferencing (or hot-tubbing”) is allowed depending on agreements reached among the parties and the ConArbors, i.e., statements from opposing witnesses can be immediately rebutted, and the counsels (lawyers) are expected to play a more passive role as the ConArbors themselves ask most of questions directed at the opposing witnesses.
Oftentimes, the ConArb process is considered inquisitorial as the primary role of the ConArbors is to doggedly seek the truth through the legal and technical means available to them. As such, ConArbors even proactively interject during a cross examination whenever a crucial question crops up in their minds. The ConArbors may also impart certain interpretations of law or of industry practices or traditions, so that these will be made well known to parties in advance and not be considered by parties as “secret knowledge” for selective use, especially when later used in the crafting of the Arbitral Awards.
ConArbors are deliberately chosen by the parties based on expertise, i.e., the ConArbor may be a lawyer, ex-judge, engineer, architect, accountant, environmental planner, constructor, developer, etc.
ConArb venues and the mode of hearings (in person or by remote) are usually agreed upon by the parties well in advance, particularly during the conduct of the Preliminary Conference, where the contents of the ToR are dissected.
Arbitral Awards may be immediately carried out provided the winning party posts a bond to address CA/SC reversals.
8. Arbitration is Part of the Scope of a PH Architect’s Professional Practice
R.A No. 9266 Section 3. Definition of Terms. - As used in this Act, the following terms shall be defined as follows: ###
(3) "General Practice of Architecture" means ###
(h) building programming, building administration, construction arbitration and architectural conservation and restoration;
Very Important Note: DTI-CIAP-CIAC ConArbors must be at least 40 years of age and must undergo a potentially 70-hour long, intensive training that may cost about Php35,000.00 at the minimum, to be paid for by the candidate ConArbor.
9. Construction Arbitration Process
a) Parties Agree to Arbitrate (and to follow the DTI-CIAP-CIAC ConArb Rules); it is quite important to note here that the DTI-CIAP-CIAC cannot automatically acquire jurisdiction over a ConArb case unless a ConArb clause is in the construction, development or consulting service agreement/contract, or if such a clause in inexistent, to separately agree to undertake ConArb;
b) Preliminary Conference (to confine the issues of the case and to establish the sum in dispute/SID);
c) Hearings (marathon, day-long events);
d) Ocular Inspections (Optional);
e) Submission of the Final Memoranda (or Draft Award) by parties;
f) Arbitral Award;
g) Ex*****on of Arbitral Award; and
h) Petition for Review at the CA (or directly with the SC), depending on the cause of action.
10. How can a PH Architect become a Construction Arbitrator/ConArbor or Mediator?
To be accredited by the DTI-CIAP-CIAC as a ConArbor, an Architect must first apply, be interviewed and be finally accepted to undergo an intensive DTI-CIAP-CIAC training in ConArb. Upon completion, the PH Architect is sworn into office as a DTI-CIAP-CIAC-accredited ConArbor, usually by a Justice of the Supreme Court (SC). Should the Architect-ConArbor still desire to become a Construction Mediator, a shorter course is separately taken.
11. Does Construction Arbitration/ConArb Pay?
Yes, for the parties concerned, a “decision” in the form of an Arbitral Award is promulgated within 6.0 calendar months reckoned from the signing of the Terms of Reference/ToR (which limits the scope of the ConArb proceedings). The losing party is immediately able to elevate the case to the CA or directly to the SC, depending on the cause of action.
For the Court, ConArb helps reduce the number of pending cases docketed (backlog).
For the ConArbors, they get compensated equitably at a percentage of the costs of the consolidated claims of the parties, i.e., the total sum in dispute/SID.
12. Caveats
The completion of the ConArb process does not preclude the filing of administrative, criminal, civil or special legal action (or possibly even other types of arbitration) in other fora by any of the parties. The ex*****on of an Arbitral Award must be attended by a bond in case of reversal at the superior courts.
Unlike judges, ConArbors sometimes get sued, often by the dissatisfied losing parties. Depending on the nature and venue of the suit, the arbitrators may (or may not) be defended by the Office of the Solicitor General (OSG). Otherwise, the ConArbors must fend for themselves out of their own pockets. To defend their honor, the ConArbors may countersue in civil court to or file a complaint (including disbarment) against the lawyer/s of the parties who brought suit at the IBP or the SC. ConArbors who refuse to accept case assignments, without a valid reason, can also lose their DTI-CIAP-CIAC accreditation.
13. How Does a Party Ensure Construction Arbitration/ConArb in the Event of Contractual Disputes?
An arbitration clause in a construction, development or consulting service contract shall fully ensure that the CIAC shall automatically acquire exclusive jurisdiction over any dispute arising from the construction, development and/or consulting service contract, i.e., the dispute cannot be brought to another lower court, only to CIAC, for dispute resolution. Thank You.
