G.R. No. 267310 , November 4, 2024
FLEET MARINE CABLE SOLUTIONS INC., PETITIONER, VS. MJAS ZENITH GEOMAPPING & SURVEYING SERVICES, MR. SAMSON LATO AND TRAVELLERS INSURANCE AND SURETY CORPORATION, RESPONDENTS.

FACTS

Eastern Telecommunications Philippines, Inc., Globe Telecom, Inc., and InfiniVAN, Inc. sought to construct a new, high-capacity domestic fiber-optic submarine cable network connecting islands in Luzon, Visayas, and Mindanao. They entered into a Services Agreement with petitioner Fleet Marine Cable Solutions Inc. (FMCS) for tasks including survey, landing site determination, routing design, archival research, project planning, final desk top study report, and vessel arrangement and mobilization. To fulfill its responsibilities, FMCS subcontracted some of these tasks to respondent MJAS Zenith Geomapping & Surveying Services (MJAS). Phase One tasks for MJAS included site survey, landing site determination, routing design, archival research, project planning, and final desk top study report. Phase Two involved marine cable route survey and burial assessment. Subsequently, FMCS filed a complaint to terminate their subcontracting agreement with MJAS before the Construction Industry Arbitration Commission (CIAC), alleging MJAS failed to abide by its contractual responsibilities. The CIAC dismissed the case for lack of jurisdiction, finding that the contract between FMCS and MJAS does not involve construction in the Philippines. FMCS filed a Petition for Review on Certiorari, arguing the CIAC has jurisdiction over the dispute as it is covered by an arbitration agreement and connected with a construction project in the Philippines.

ISSUE

Whether the Construction Industry Arbitration Commission (CIAC) has jurisdiction over the dispute between FMCS and MJAS.

RULING

The dissenting opinion argues that the CIAC has jurisdiction over the dispute. The opinion emphasizes that the CIAC was established under Executive Order No. 1008 to encourage the expeditious resolution of disputes in the construction industry, which is crucial to national development. Republic Act No. 9285 (Alternative Dispute Resolution Act) provides that construction disputes between parties bound by an arbitration agreement fall within the CIAC’s original and exclusive jurisdiction. Section 4 of Executive Order No. 1008 grants the CIAC jurisdiction over disputes arising from, or connected with, contracts entered into by parties involved in construction in the Philippines, provided the parties agree to submit the dispute to voluntary arbitration. Jurisprudence establishes that for the CIAC to acquire jurisdiction, the law merely requires the parties to agree to submit to voluntary arbitration any dispute arising from construction contracts. An arbitration clause in a construction contract ipso facto vests the CIAC with jurisdiction, and any doubt should be resolved in favor of arbitration. The dissenting opinion finds that the dispute between FMCS and MJAS, arising from a subcontract connected to the overarching construction project of a submarine cable network, falls within the CIAC’s jurisdiction. Therefore, the dissenting opinion votes to GRANT the Petition for Review on Certiorari and SET ASIDE the CIAC’s Arbitral Award.