PHILIPPINES Law and Practice Contributed by: Leland R Villadolid Jr, Gilberto D Gallos, Antonio Jose Gerardo T Paz and Leo Frederick Z Cruz, Angara Abello Concepcion Regala & Cruz
11.3 Interest Awarded on Costs Interest is generally not imputed to costs of a suit. 12. Alternative Dispute Resolution (ADR) 12.1 Views of ADR Within the Country Alternative dispute resolution (ADR) is highly encouraged by the State and the Supreme Court. In recent years, resorting to ADR (espe- cially arbitration) has become increasingly com- mon. In certain industries, ADR has become the pri- mary mode by which disputes are resolved. For example, in the construction industry, most disputes are referred to arbitration before the Construction Industry Arbitration Commission (CIAC), which the law provides as an available forum for ADR even if a different forum is stipu- lated in the construction contract. More commercial disputes are also now being referred for arbitration to (among others): • the Singapore International Arbitration Centre; • the Hong Kong International Arbitration Cen- tre; and • the International Chamber of Commerce’s International Court of Arbitration. 12.2 ADR Within the Legal System In ordinary civil cases, resorting to ADR is made mandatory by the Rules of Court as part of regu- lar procedure. After pretrial, the court directs the parties to compulsorily submit to court-annexed media- tion. If mediation at that level fails, but the origi- nal court determines that settlement is still pos-
for the continuation of litigation and reception of further evidence.
11. Costs 11.1 Responsibility for Paying the Costs of Litigation Generally, each party bears its own costs of liti- gation. Parties may, however, stipulate in their contract the amount of recoverable attorney’s fees in the case of litigation. In the absence of such a stipulation, a party may still recover attor- ney’s fees and litigation expenses when (among others): • exemplary damages are awarded; • the defendant’s act or omission has com- pelled the plaintiff to litigate with third persons or to incur expenses to protect their interest; • a clearly unfounded civil action or proceeding against the plaintiff is brought; or • the defendant acted in gross and evident bad faith in refusing to satisfy the plaintiff’s plainly valid, just and demandable claim. Courts are likewise authorised to award attor - ney’s fees based on analogous grounds, if they find that it is just and equitable that attorney’s fees and expenses of litigation should be recov- ered by the claimant. 11.2 Factors Considered When Awarding Costs Courts only consider costs actually incurred, and duly substantiated, in determining the amount that may be awarded as attorney’s fees and liti- gation expenses. In practice, however, regard- less of the amount requested or substantiat- ed, courts only award a relatively insignificant amount by way of attorney’s fees and litigation expenses.
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