By Anthony Jacoba, Partner; Ramiila Quinto, Senior Associate; Marc Angelo Guibone, Associate, Ocampo & Suralvo Law Offices
Published in Asia Business Law Journal, March/April 2026 issue (posted online June 2026).
In MAPFRE v Gulapa (18 November 2025), a case of first impression, the Philippine Supreme Court held that a rehabilitation court may refer to arbitration any dispute relating to a rehabilitation plan under section 26 of the Financial Rehabilitation and Insolvency Act (FRIA). The dispute concerned Philippine Phosphate Fertilizer Corporation’s insurance claim for Typhoon Yolanda damage, which its insurers had paid only in part. The Court reasoned that the value of the claim affects the viability of the rehabilitation plan and the pool of resources available to creditors.
The authors see two difficulties with the ruling. First, it reads the category of claims “incidental” to rehabilitation broadly, effectively enlarging the limited jurisdiction of rehabilitation courts. Second, compelling a party to arbitrate sits uneasily with party autonomy, since both the ADR Act and the New York Convention rest on a voluntary, written agreement to arbitrate. That could create problems when such an award is enforced abroad.
To reconcile section 26 with party autonomy, the authors propose that an arbitration clause be included in the rehabilitation plan itself, so that a confirmed plan supplies the written agreement. They also note that the insurance policies already contained an arbitration clause, so the case could have been decided on that basis alone.
This article was first published in Asia Business Law Journal, March/April 2026 issue (posted online June 2026).