Asset Privatization Trust vs CA

Asset Privatization Trust vs CA

FACTS Pursuant to a Mortgage Trust Agreement, the Development Bank of the Philippines and the Philippine National Bank foreclosed the assets of the Marinduque Mining and Industrial Corporation. The assets were sold to Philippine National Bank and later transferred to the Asset Privatization Trust (APT).

In February 1985, Jesus Cabarrus, Sr., together with other stockholders of Marinduque Mining and Industrial Corporation, filed a derivative suit against Development Bank of the Philippines and Philippine National Bank before the Regional Trial Court of Makati for Annulment of Foreclosures, Specific Performance and Damages. In the course of the trial, Marinduque Mining and Industrial Corporation and Asset Privatization Trust as successor in interest of Development Bank of the Philippines and Philippine National Bank, agreed to submit the case to arbitration by entering into a Compromise and Arbitration Agreement. This agreement was approved by the trial court and the complaint was corollarily dismissed.

Thereafter, the Arbitration Committee rendered a decision ordering Asset Privatization Trust to pay Marinduque Mining and Industrial Corporation damages and arbitration costs in the amount of P2.5 Billion, P13,000,000.00 of which is for moral and exemplary damages.

On motion of Cabarrus and the other stockholders of Marinduque Mining and Industrial Corporation, the trial court confirmed the Arbitration Committee’s award. Its motion for reconsideration having been denied, Asset Privatization Trust filed a special civil action for certiorari with the Court of Appeals. It was likewise denied.

Hence, this petition for review on certiorari. ISSUE WHETHER THE RESPONDENT JUDGE COMMITTED GRAVE ABUSE OF DISCRETION AND ACTED WITHOUT OR IN EXCESS OF JURISDICTION, IN ISSUING THE QUESTIONED ORDERS CONFIRMING THE ARBITRAL AWARD AND DENYING THE MOTION FOR RECONSIDERATION OF ORDER OF AWARD. HELD As a rule, the award of an arbitrator cannot be set aside for mere errors of judgment either as to the law or as to the facts. [29] Errors of law and fact, or an erroneous decision

of matters submitted to the judgment of the arbitrators, are insufficient to invalidate an award fairly and honestly made.[32] Judicial review of an arbitration is, thus, more limited than judicial review of a trial.[33] Nonetheless, the arbitrators awards is not absolute and without exceptions. The arbitrators cannot resolve issues beyond the scope of the submission agreement. [34] While a court is precluded from overturning an award for errors in determination of factual issues, nevertheless, if an examination of the record reveals no support whatever for the arbitrators determinations, their award must be vacated. [40] In the same manner, an award must be vacated if it was made in manifest disregard of the law.[41]