THIRTEENTH CONGRESS OF THE REPUBLIC) 
OF THE PHILIPPINES 
) 
y)4 JJL -7 
p 1 :36 
FIRST REGULAR SESSION 
) 
L-T 
, t .  
S E N A T E  
!?'CE.IVED O V :  ~
-
-
Senate Bill No. 
Introduced by Senator Pangilinan 
EXPLANATORY NOTE 
The Action Program for Judicial Reform (APJR) initiated by Chief Justice 
Hilario G. Davide, Jr. identifies the major challenges faced by the Philippine 
Judiciary as follows.: 
(1) 
the juduciary must implement reforms which restore public trust 
and confidence in the country's justice system; 
(2) 
judicial independence will be pursued in an administrative 
environment that is traditionally centralized; 
the judiciary must take the lead in pursuing, synchronizing and 
sustaining the various reforms, several of which are not within i t s  
full administrative authority; 
(3) 
(4) 
the reforms will require sustained top-level support and 
commitment within a political environment where achieving 
broad and continuing consensus require more persistent and 
conscientious efforts and where there is inadequate appreciation 
of the role of the justice system in socio-economic development 
and global competitiveness; 
reform implementation must be programmed in accordance with 
the absorptive capacity for change of the judiciary and i t s  
stakeholders, and synchronized with oversight administrative 
reforms which impinge upon judicial reforms; and 
the judiciary must ensure the continuous development and the 
institutionalization of capacities for sustaining the reform gains. 
(5) 
(6) 
Realizing the importance of a fully effective, efficient and accountable 
judiciary in the creation of a strong republic, several stakeholders, including 
the administration, supported the call for reforms identified by Chief Justice 
Davide. In the legislative branch of government, we are called upon to enact 
landmark legislation embodying these reforms. Propelled by the vision of a 
fully trustworthy and competent judiciary, this representation initiated this 
legislative measure to reform and modernize the judiciary. 
This bill provides that for a period of six years, the judiciary will utilize 
funds allocated by Congress to address the following components of judicial 
reform: 
~ 
1 


Judicial Systems and Procedure. The JRMP shall strengthen the 
capabilities of courts for better efficiency, flexibility and 
effectiveness. Efforts to improve the courts shall address several 
areas including Court Management systems, procedural rules, 
jurisdictional structure of the courts, and alternative dispute 
resolution mechanisms. 
Institutional Development Reforms. The JRMP shall support the 
goals of providing access to justice, improving the speed of 
service delivery and ensuring the impartiality of judicial decisions. 
Human Resource Development. The JRMP shall enhance the 
quality of continuing education for judges and court personnel, 
making it continuously responsive to changing needs; increasing 
access to such education; and sustaining investments in the same. 
Reform Support Systems. 
The JRMP shall pursue the ultimate 
goals of achieving consensus by a majority of stakeholders and 
reform decision-makers, both internal and external, as well as 
harmonizing multi-sectoral support that will propel program 
implementation and the achievement of its vision. 
A strong' judiciary translates to a strong republic. 
Our country can 
achieve sustained economic and social development only if strong government 
institutions are in place to respond to the demands and needs of the people. 
In view of the above considerations, the early passage of this bill i s  
earnestly sought. 
2 


THIRTEENTH CONGRESS OF THE REPUBLIC) 
OF THE PHILIPPINES 
1 
FIRST REGULAR SESSION 
1 
Introduced by Senator Pangilinan 
AN ACT PRESCRIBING MEASURES TO REFORM AND MODERNIZE THE JUDICIAL 
BRANCH OF THE GOVERNMENT IN ORDER TO ENHANCE ITS INDEPENDENCE, 
EFFICIENCY AND EFFECTIVITY, APPROPRIATING FUNDS THEREFOR, AND FOR 
OTHER PURPOSES 
SECTION 1. Short Title. - This Act shall be known as the “Judiciary 
Reform and Modernization Act of 2003.” 
Sec. 2. 
Declaration of Policy. - It is hereby declared the policy of 
the State to reform and modernize the Judiciary to a level where it can be fully 
independent, effective and efficient, worthy of public trust and confidence. 
Toward this end, the principal thrust of this Act shall be the provision of 
full assistance and support to reform and modernization programs that 
promote: 
(a) 
the upgrading of 
appropriate technology and equipment 
necessary for the delivery of speedy and fair dispensation of 
justice to all; 
judicial autonomy and independence from political interference; 
the development of a system that shall improve the access to 
judicial and legal services and the quality of external inputs to 
the judicial process; 
the efficient, effective and continuous improvement of judicial 
institutions; and 
(b) 
(c) 
(d) 
(e) 
a judiciary that conducts business with dignity, integrity, 
accountability and transparency. 
Sec. 3. 
Objectives of the Judiciary Reform and Modernization 
Program. - The Judiciary Reform and Modernization Program (JRMP) shall be 
implemented in accordance with the following objectives: 
(a) 
to establish mechanisms that will make the independence of the 
Judiciary an operating reality; 
3 


(b) 
to strengthen the capacity of the Judiciary to operate as an 
efficient self-managing organization; 
to strengthen institutional mechanisms for accountability; and 
to ensure institutional independence and strengthening of internal 
organizational capacities that will preserve the conditions for 
decisional independence of justices and judges. 
(c) 
(d) 
Sec. 4. 
Components of the Judiciary Reform and Modernization 
Program. - The JRMP shall consist of the following components: 
(a) 
Judicial Systems and Procedure. The JRMP shall strengthen the 
capabilities of courts for better efficiency, flexibility and 
effectiveness. Efforts to improve the courts shall address several 
areas including court management systems, procedural rules, 
jurisdictional structure of the courts, and alternative dispute 
resolution mechanisms. 
Institutional Development Reforms. The JRMP shall support the 
goals of providing access to justice, improving the speed of 
service delivery and ensuring the impartiality of judicial decisions. 
(c) 
Human Resource Development. The JRMP shall enhance the 
quality of continuing education for judges and court personnel, 
making it continuously responsive to changing needs; increasing 
access to such education; and sustaining investments in the same. 
(d) 
Reform Support Systems. The JRMP shall pursue the ultimate 
goals of achieving consensus by a majority of stakeholders and 
reform decision-makers, both internal and external, as well as 
harmonizing multi-sectoral support that will propel program 
implementation and the achievement of i t s  vision. 
(b) 
Sec. 5. 
Period of Implementation. - The JRMP, under this Act, 
shall be implemented over a period of six (6) years. 
Sec. 6. 
(a) 
Definition of Terms. - 
“Alternative Dispute Resolution System” means any process or 
procedure used to resolve a dispute 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. 
“Authenticate” means to sign, execute or adopt a symbol, or 
encrypt a Record in whole or in part intended to identify the 
authenticating party and to adopt, accept or establish the 
authenticity of a Record. 
(b) 
(c) 
“Confidential Information’’ means any information expressly 
intended by the source not to be disclosed, or obtained under 
circumstances that would create a reasonable expectation on 
4 


behalf of the source that the information shall not be disclosed. 
It ?hall include (1) communication, oral or written, including any 
memoranda, notes or work product of the Mediation Party or Non- 
Party participant, as defined in this Act, which occurs during 
Mediation 
or 
for 
purposes 
of 
considering, 
conducting, 
participating, initiating, continuing or reconvening Mediation or 
retaining a Mediator; and (2) any other information expressly 
intended by the source not to be disclosed, or obtained under 
circumstances that would create a reasonable expectation on 
behalf of the source that the information shall not be disclosed. 
“Court Annexed Mediation” means any Mediation process 
conducted under the auspices of the court, after such court shall 
have acquired jurisdiction over the dispute. 
“Court Management” refers to the utilization, mobilization and 
coordination of the various inputs, including but not limited to 
cases, facilities and technologies, financial and human resources, 
as they pass through the staged operating processes within a 
specified timeframe, and within a defined institutional structure 
within the court and between courts, such that a specified output 
and output configuration is generated as the end product, in 
accordance with the provisions of law. 
“Fiscal Autonomy“ contemplates a guarantee of full flexibility to 
aLlocate and utilize esources with the wisdom and dispatch that 
the needs require. It recognizes the power and authority to levy, 
assess and collect fees, fix rates of compensation not exceeding 
the highest rates allowed by law for compensation and pay plans 
of the government and allocate and disburse such sums as may be 
provided by law or prescribed in the course of the discharge of 
functions. 
“Government Agency means any government entity, office or 
officer, other than a court which is vested by law with quasi- 
judicial power or the power to resolve or adjudicate disputes 
involving the government, i t s  agencies and instrumentalities, or 
private persons. 
“Judge-Arbitrator” 
award, in a claim or action pending before a Small Claims Court. 
“Mediated 
Settlement Agreement” 
means an 
agreement 
resulting from Mediation, addressing or resolving one, some or all 
of the issues arising from, or connected with, the pending 
dispute, drawn up by the Mediation Parties with the assistance of 
their respective counsel and the Mediator. 
“Mediation” means a process in which a Mediator, selected by 
the disputing parties, facilitates communication and negotiation, 
and assists the Mediation Parties in reaching a voluntary 
agreement regarding a dispute. 
“Mediator” means a person who conducts a Mediation; Provided, 
however, that no person shall be designated as Mediator unless he 
holds a Bachelor of Laws degree in any University in the Republic 
means the judge appointed to render an 
5 


of the Philippines; Provided, further, that the 
Mediation 
Agreement or the Mediation Parties may require that a Mediator 
shall have further special qualifications by background or 
profession. 
“Mediation Party” means a person who participates in a 
Mediation and whose consent i s  necessary to resolve the dispute. 
“Non-Party Participant” means a person, other than a Mediation 
Party or Mediator, who participates in a Mediation as a witness, 
resource person or expert. 
(0 
~ 
, 
(m) 
(n) 
“Proceeding” 
means a judicial, 
administrative, 
or other 
adjudicative process, including related pre-hearing or post- 
hearing motions, conferences and discovery. 
“Record” means an information written on a tangible medium or 
stored in an electronic or other similar medium, retrievable in a 
perceivable form. 
(0) 
(p) 
“SmaU Claims Court” means a court which exercises exclusive 
original jurisdiction over all civil actions where the value of the 
personal property or amount of the demand does not exceed Fifty 
Thousand Pesos (P50,OOO.OO). 
Chapter I 
JUDICIAL SYSTEMS AND PROCEDURES 
Sec. 7. 
Declaration of Policy. - It is the policy of the State to 
engage in, and fully support, all continuing efforts to strengthen the capacities 
of the courts for better efficiency, flexibility and effectiveness. It shall assist in 
the acquisition of appropriate technology and equipment and in the upgrading 
of existing systems and procedures for the delivery of speedy and fair 
dispensation of justice to all. 
Sec. 8. 
Special Concerns. -- The Judiciary shall formulate and 
implement a medium- and long-term comprehensive Judicial Systems and 
Procedures Modernization Plan that shall focus on four (4) major areas: 
(a) 
Court management systems; 
(b) 
(c) 
(d) 
Alternative dispute resolution mechanisms. 
Jurisdictional structure of the courts; 
Judicial performance management system; and 
Sec. 9. 
Court Management Systems. - The Judiciary shall, within 
six (6) months from the effectivity of this Act, develop an integrated 
development plan geared toward the strengthening and improvement of the 
Court Management systems at the court, inter-court and enterprise levels. This 
6 


plan to improve the Court Management systems shall be guided by the 
following concerns: 
Region/Province/City 
NCJR 
Malabon City 
Marikina City 
Mandaluyong City 
Update of the case management procedures and technology. - 
targets shall be set to considerably increase the capacity of courts 
to process cases on time, manage the distribution of cases, 
monitor and track case location and status among judges and 
among levels of courts, detect forum shopping, and collect and 
analyze data for monitoring and evaluating the performance of 
courts and judges; 
Improvement of the staffing and personnel capacities. - Staffing 
patterns, especially in the lower courts, shall be updated to 
enable the courts to effectively respond to the needs of the 
public. In improving the staffing patterns, the flexibility of duties 
and responsibilities and the clear distribution of staffing in 
relation to the scope and volume of work shall be taken into 
consideration; and 
Enhancement of the operating budgets of the trial courts. -- 
The Judiciary shall endeavor to improve the fiscal and operational 
capacities of the trial courts for the latter’s efficient and 
effective disposition of the case. 
No. of Proposed 
Additional 
Branches 
2 
2 
7 
Sec. 10. Judicial Performance Management System. - The Judiciary 
shall, within six (6) months from the effectivity of this Act, install a more 
effective judicial performance management system that will define 
appropriate 
performance 
parameters, 
and 
effectively 
examine 
the 
achievements and shortcomings of the courts. There shall be further developed 
a uniform system for monitoring, recording, and analyzing case data, and 
making oversight monitoring and performance evaluation. 
Sec. 11. 
Court Jurisdictional Structure. - 
(a) 
Creation of Additional Courts. 
(i) 
There shall be created the following additional courts: 
(1) 
At least one Regional Trial Court for every city, and 
Municipal Trial Courts in Cities in newly created 
cities; 
(2) 
Additional 
branches of 
Regional TriaI Courts, 
Metropolitan Trial Courts and Municipal Trial Court 
in Cities; as follows: 
7 


REGION I 
Abra 
llocos Sur 
Pangasinan 
REGION 111 
Bataan 
Bulacan 
Nueva Ecija 
Pampanga 
Tarlac 
Zambales 
1 
4 
1 
1 
1 
3 
3 
2 
3 
REGION V 
Camarines Norte 
Masbate 
Sorsogon 
REGION VI 
lloilo 
Guimaras 
8 
1 
1 
1 
3 
1 
~ 
Negros Occidental 
5 
REGION VI11 
Leyte 
Zamboanga del Norte 
Zamboanga del Sur 
Zamboanga Sibugay 
Agusan del Sur 
REGION IX 
REGION X 
Bukidnon 
2 
- 
1 
2 
2 
2 
4 


REGION XI 
Davao del Norte 
Compostela Valley 
Davao del Sur 
South Cotobato 
Saranggani 
Surigao del Sur 
REGION XI1 
4 
2 
5 
5 
3 
1 
ao del Norte 
1 
30 del Sur 
Municipal Trial Courts in Cities 
3 
REGION 
1 
No. of Proposed 
1 
uindanao 
itobato 
udarat 
1 Total 
number 
of 
proposed 
2 
2 
1 
9 
additional Regional Trial Court 
branches 
167 
REGION 1 
Alaminos City 
Baguio City 
Candon City 
Dagupan City 
Laoag City 
Additional 
Branches 
1 
7 
1 
6 
1 


San Fernando City 
Urdaneta City 
REGION I1 
Camayan City 
REGION 111 
Angeles City 
Cabanatuan City 
San Jose del Monte City 
Tarlac City 
REGION IV 
Antipolo City 
Batangas City 
Calamba 
Calapan City 
LiDa Citv 
Lkena i i t y  
Puerto Princesa City 
San Pablo City 
REGION V 
Legaspi City 
Naga City 
REGION VI 
Bacolod City 
lloilo Citv ~, 
Passi City 
Roxas City 
Valencia Citv 
Koronadal City 
Tagum Citv 
I C  
1 
12 
- 
1 - 
6 
a 
6 
1 
8 
1 
4 
1 
4 
I 1  
11 
1 
1 
32 
6 
4 
1 
1 
1 
1 
7 
1 
17 
3 
10 


. 
REGION XII 
Cotobato City 
1 
Kidapawan 
3 
~~ 
11 


the judge of the Small Claims Court where the action i s  
filed. 
Representative. - Except as permitted under this Act, no 
attorney-at-law or any individual other than the plaintiff or 
defendant may take part in the filing, conduct or defense 
of a small claims action; Provided, that an attorney-at-law 
may, for and in his own behalf, defend himself against any 
small claims action that has been filed against him; 
Provided, further, that the judgment creditor may avail of 
the services of an attorney-at-law for the enforcement of 
the judgment. Husbands and wives who sue with his or her 
spouse may represent the other in their claim or defense. 
Nature of Proceedings. - The hearing and disposition of 
small claims actions shall be informal without strict 
application of the rules of evidence, the object being to 
dispense justice promptly between the parties. The 
Supreme Court shall determine the Rules of Procedure in 
Small Claims Court, including the time and duration of 
sessions. 
(v) 
(vi) 
(vii) 
Mediation Center. - In each Small Claims Court, there shall 
be a Mediation to be presided over by the Small Claims 
Court Judge-Arbitrator or by his duly authorized Mediator; 
Provided, That no person shall be designated as Mediator 
unless he/she holds a Bachelor of Laws degree from any 
University in the Republic of the Philippines. 
(viii) Mandatory Mediation Conference. - Prior to any hearing of 
any small claims action, the Small Claims Court Judge- 
Arbitrator shall order and schedule a mandatory Mediation 
conference between or among the parties for the purpose 
of resolving the dispute, or arriving at an amicabIe 
settlement, under the supervision of the Small Claims Court 
Judge or Mediator. Any settlement or resolution of the 
dispute arising from the Mediation conference shall be in 
writing and embodied in a legally enforceable resolution to 
be signed by the Small Claims Court Judge. 
In case the Mediation efforts fail, the Small Claims Court 
Judge shall immediately set the case for hearing. 
Judgments and Processes. - All judgments determinative 
of the merits of the case shall be in writing, stating clearly 
the facts and the grounds on which they are based, signed 
by the Judge and filed with the Clerk of Court. The 
judgments or orders of the Court shall not be appealable, 
except on the ground of grave abuse of discretion. 
I 
(ix) 
(x) 
Honoraria and Allowances. 
- Judge-Arbitrators of the 
Small Claims Courts shall receive such honoraria and 
allowances as may be determined by the Supreme Court. 
Staffing Pattern and Pilot Test Areas. - The Supreme 
Court shall submit to the President, within thirty (30) days 
(xi) 
12 


from the effectivity of this Act, a staffing pattern for all 
courts constituted pursuant to this Act, including plans for 
the establishment of pilot Small Claims Courts in areas as 
may be determined by the Supreme Court. 
Sec. 12. 
Court Annexed Mediation. - 
Electronic Signatures i n  Global and E-Commerce Act. - 
The 
provisions of the Electronic Signatures in Global and E-Commerce 
Act, and i t s  Implementing Rules and Regulations shall apply to 
Proceedings contemplated in this Act. 
Exception to the Application of this Act. - The provisions of this 
Act shall not apply to resolution or settlement of labor disputes 
covered by Presidential Decree No. 442, otherwise known as the 
Labor Code of the Philippines, as amended and i t s  Implementing 
Rules and Regulations. 
Scope and Application of Rules. - Mediation ordered by a trial 
court of a civil action pending before such court shall be governed 
by Supreme Court rules and regulations, and applicable guidelines 
for the implementation of Mediation and/or 
conciliation 
Proceedings. Except as otherwise provided by the Supreme Court 
rules and regulations, the succeeding provisions shall apply to 
Court Annexed Mediation. 
Sanctions.- The Court shall impose appropriate sanctions upon 
the guilty party, including but not limited to, censure, imposition 
of a fine, or reimbursement of travel and other expenses of the 
obedient party, dismissal of action or declaration of default as 
provided in the Rules of Court if a party to the action shall: (i) 
fail to appear for Mediation; or (ii) engages in abusive conduct or 
language during Mediation Proceedings. 
Application and Interpretation.- In applying and construing the 
provisions of this Chapter, consideration must be given to the 
need to promote candor of parties and Mediators through 
confidentiality of the Mediation process, the policy of fostering 
prompt, economical and amicable resolution of disputes in 
accordance with principles of integrity of the Mediation process, 
active party involvement, and informed self-determination by the 
parties, and the policy that the decision-makin2 authority in the 
Mediation process rests with the parties. 
Confidential 
Information.- 
Information 
obtained 
through 
Mediation Proceedings shall be subject to the following principles 
and guidelines: 
(i) 
(ii) 
Information obtained through Mediation shall be privileged 
and confidential. 
A Mediation Party, a Mediator or a Non-Party Participant 
may refuse to disclose, and may prevent any other person 
from disclosing a Confidential Information. 
Confidential information shall not be subject to discovery 
and shall be inadmissible in any adversarial Proceeding, 
(iii) 
13 


whether judicial or quasi-judicial. However, evidence or 
information that i s  otherwise admissible or subject to 
discovery does not become inadmissible or protected from 
discovery solely by reason of i t s  use in Mediation. 
In such an adversarial Proceeding, the following persons 
involved or previously involved in a Mediation may not be 
compelled to disclose Confidential Information obtained 
during Mediation: (1) the Mediation Parties to the dispute, 
(2) the Mediator or Mediators, (3) the counsel for the 
parties, (4) the Non-Party Participants, and (5) any person 
hired or engaged in connection with the Mediation as 
secretary, stenographer, clerk or assistant who obtains or 
processes Confidential Information. 
The protection of this Act shall continue to apply even if a 
Mediator is found to be partial or failed to act impartially. 
A Mediator may not be called to testify to provide 
information gathered in Mediation. 
A Mediator who is 
wrongfully subpoenaed shall be reimbursed the full cost of 
his attorney’s fees and related expenses. 
Waiver of Confidentiality. - A privilege arising from the 
confidentiality of information may be waived in a Record, or it 
may be waived orally during a Proceeding, if it i s  expressly waived 
by the Mediator and the Mediation Parties and by a Non-Party 
Participant if the information i s  provided by such Non-Party 
Participant. 
A person who discloses Confidential Information shaH be 
precluded from asserting the privilege under this Chapter to bar 
disclosure of the rest of the information necessary to a complete 
understanding of the previously disclosed information. If a person 
suffers loss or damage as a result of the disclosure of Confidential 
Information by another who gains access to such Confidential 
Information, he shall be entitled to damages in a judicial 
Proceeding against the latter. 
A person who discloses or makes a representation about a 
Mediation is precluded from asserting the privilege under this 
Chapter, to the extent that the communication prejudices 
another person in the Proceeding and it i s  necessary for the 
person prejudiced to respond to the representation of disclosure. 
Exceptions to Privilege.- 
(i) 
There i s  no privilege against disclosure under this Chapter 
for a Mediation communication which is: 
(1) 
(2) 
in agreement evidenced by a Record Authenticated 
by all parties to the agreement; 
available to the public or that i s  made during a 
session of a Mediation which is open, or is required 
by law to be open, to the public; 
a threat or statement of a plan to inflict bodily 
injury or commit a crime of violence; 
(3) 
14 


. 
(4) 
intentionally used to plan a crime, attempt to 
commit, or commit a crime, or conceal an ongoing 
crime or criminal activity; 
(5) 
sought or offered to prove or disprove abuse, 
neglect, 
abandonment 
or 
exploitation 
in 
a 
Proceeding in which a Government Agency i s  
protecting the interest of an individual protected by 
law; but this exception does not apply where a child 
protection matter is referred to Mediation by a court 
or a Government Agency participates in the child 
protection Mediation; 
sought or offered to prove or disprove a claim or 
complaint of professional misconduct or malpractice 
filed against a Mediator in a Proceeding; or 
sought or offered to prove or disprove a claim or 
complaint of professional misconduct or malpractice 
Participant, or representative of a Mediation Party 
based on conduct occurring during a Mediation. 
There i s  no privilege under this Chapter if a court finds, 
after a hearing in camara, that the party seeking discovery 
or the proponent of the evidence has shown that the 
evidence is not otherwise available, that there is a need for 
the evidence that substantially outweighs the interest in 
protecting 
confidentiality, 
and 
the 
Mediation 
communication is sought or offered in: 
(1) 
(2) 
(6) 
(7) 
I 
i 
~ 
(ii) 
, 
filed 
against 
a 
Mediation 
Party, 
Non-Party 
a court proceeding involving a crime or felony; or 
a Proceeding to prove a claim or defense under the 
law sufficient to reform or avoid liability on a 
contract arising out of Mediation, 
(iii) A Mediator may not be compelled to provide evidence of a 
Mediation communication or testify in such Proceeding. 
If a Mediation communication is not privileged under an 
exception in subsection (i) or (ii), 
only the portion of the 
communication necessary for the application of the 
exception for nondisclosure may be admitted. 
The 
admission of particular evidence for the Limited purpose of 
an exception does not render that evidence, or any other 
Mediation communication, 
admissible for any other 
purpose. 
(iv) 
(i) 
Prohibited Mediator Reports.- A Mediator may not make a 
report, assessment, evaluation, recommendation, finding, or 
other communication regarding a Mediation to a court or agency 
or other authority that may make a ruling on a dispute that is the 
subject of Mediation; Provided, that, a Mediator may disclose 
whether the Mediation occurred or has terminated, and whether a 
settlement was reached. 
(j) 
Mediator’s Disclosure and Conflict of Interest. 
~ 
Before 
accepting a Mediation, an individual who is requested to serve as 
a Mediator shall: 
15 


(i) 
make an inquiry that is reasonable under the circumstances 
to determine whether there are any known facts that a 
reasonable individual would consider likely to affect the 
impartiality of the Mediator, including a financial or 
personal interest in the outcome of the Mediation and any 
existing or past relationship with a party or foreseeable 
participant in the Mediation; and 
disclose to the Mediation Parties any such fact known or 
learned as soon as i s  practical before accepting a 
Mediation. 
. 
(ii) 
If a Mediator learns any fact described in subsections (i) and (ii) of 
this Section after accepting a Mediation, the Mediator shall 
disclose it as soon as practicable. 
At the request of a Mediation Party, an individual who is 
requested to serve as Mediator shall disclose the Mediator’s 
qualifications to mediate a dispute. 
Participation in Mediation. - Except as otherwise provided in this 
Act, 
an individual designated by a Mediation Party may 
accompany a Mediation Party; or an attorney may provide Legal 
representation and assistance to a Mediation Party. A waiver of 
this right shall be made in writing subscribed by the Mediation 
Party waiving it. A waiver of participation or legal representation 
may be rescinded at any time. 
Enforceability of an Agreement to Mediate. - An agreement by 
the disputants to mediate shall not constitute a ground for the 
dismissal of the same complaint in court. Likewise, an agreement 
to mediate should not be used to delay the processing of the case, 
thus, Mediation should be completed within sixty (60) days from 
the signing of the agreement, but may be renewed by a joint 
agreement signed by the parties for another thirty (30) days. 
(k) 
(I) 
(m) 
Enforcement of Mediated Settlement Agreements.- 
(i) 
Mediation Parties who have entered into a Mediated 
Settlement Agreement evidenced by a Record that has 
been Authenticated by the Mediator, Mediation Parties and 
if not waived, their attorneys may move the court or 
agency to enter a judgment in accordance with the 
mediated settlement agreement if: 
(1) 
all Mediation Parties to the Mediated Settlement 
Agreement join in the motion; 
(2) 
no litigation is pending on the subject matter of the 
Mediation; 
(3) 
at1 Mediation Parties to the Mediated Settlement 
Agreement are represented by counsel at the time it 
is entered and the motion is filed or such right to 
counsel is waived in writing by the Mediation Party; 
16 


(ii) 
(iii) 
~ 
I 
, 
~ 
See. 13. 
(4) 
the Mediated Settlement Agreement contains a 
statement to the effect that the Mediation Parties 
desire to seek summary enforcement of their 
agreement; 
no Mediation Party withdraws support for the motion 
before entry of judgment; and 
the Mediated Settlement Agreement does not relate 
to a separation or marriage dissolution. 
(5) 
( 6 )  
If the requirements of the preceeding subsection are 
satisfied, the Court shall enter judgment. The judgment 
may be Recorded, docketed and enforced as any other 
judgment in a civil action. 
A settlement agreement following successful Mediation 
shall be drawn up by the Mediation Parties with the 
assistance of their respective counsel and the Mediator. In 
drawing up a settlement agreement in which the whole or 
part of the obligation of at least one of the Mediation 
Parties will be fulfilled in the future, the Mediation Parties 
and the Mediator shall endeavor to make the terms and 
conditions thereof complete and make adequate provisions 
for the contingency of breach and avoid conflicting 
interpretations of the Mediated Settlement Agreement. 
The Mediation Parties may agree, 
in the Mediated 
Settlement 
Agreement 
or 
during 
the 
Mediation 
Proceedings, that the Mediator shall become a sole 
arbitrator for the dispute and release the Mediated 
Settlement Agreement as an arbitral award which shaIL be 
subject to enforcement under the provisions hereof. 
Chapter II 
INSTITUTIONS DEVELOPMENT 
Declaration of Policy. - It is the policy of the State to 
provide the systems and resources needed to support the reform efforts of the 
Judiciary by equipping it with the structures integral to the reformation and 
modernization of the entire judicial system. It shall assist in the acquisition of 
appropriate technology and equipment and in the upgrading of existing systems 
and procedures for the delivery of speedy and fair dispensation of justice to 
all. 
Sec. 14. 
Special Concerns. - The plan for Institutions Development 
shall deal with the following areas of concern: 
(a) 
(b) 
Administrative structure and operations; 
(c) 
(d) 
Infrastructure and support facilities. 
Fiscal autonomy and financial resources generation; 
Information systems capacity improvement; and 
17 


Sec. 15. 
Fiscal autonomy and financial resources generation. - 
The Judiciary shall improve i t s  organizational capacities to respond to i t s  
internal management operations and effectively exercise fiscal autonomy in 
the generation and utilization of i t s  financial resources. 
Sec. 16. 
Administrative structure and operations - The Judiciary, 
during the first year of the implementation of the JRMP, shall reengineer i t s  
administrative 
structure, 
staffing and 
operations 
system 
to 
reflect 
improvements in the following areas: 
(a) 
Financial management and administrative functions that i s  
effectively linked with the planning, budgeting and performance 
management systems of the entire court system; 
(b) 
Overall control and coordination of enterprise-wide mission- 
critical and support operations; 
Revenue generation capacities and performance; and 
(c) 
(d) 
Scope of financial and administrative functions, 
authority, 
responsibility, accountability and resources of the courts. 
Sec. 17. 
Information systems 
capacity improvement - 
The 
Judiciary shall, within the first year from the effectivity of this Act, develop a 
comprehensive Information Systems Strategic Plan that will direct the use of 
information technology to achieve operational efficiency and effectiveness. 
This strategic plan shall be formulated to attain a cohesive enterprise- 
wide information system that will seamlessly integrate mission-critical and 
administrative and financial business processes, in order to generate 
comprehensive analytic information that will allow the management of 
performance, improve revenue generation, facilitate better-informed decision- 
making, streamline and interconnect workflows and transaction processes, and 
generally simplify work. 
Chapter 111 
HUMAN RESOURCE DEVELOPMENT 
Sec. 1%. 
Declaration of Policy. - It is the policy of the State to fully 
support all efforts geared toward the development of judicial human resources, 
particularly the cooperation and effective performance of human resource 
development efforts of institutions inside and outside the Judiciary and the 
improvement of the quaIity of, and access to, the judicial and (egal education 
in the country. 
Sec. 19. 
Special Concerns. - The Supreme Court shall develop a 
Comprehensive Human Resource Development Plan that will identify the 
training needs in the context of reforming the entire judicial organization. This 
Plan shall include, but shall not be limited to, the following areas of concerns: 
18 


(a) 
(b) 
(c) 
Judicial education; 
(d) 
Remuneration systems reengineering; and 
(e) 
Legal education 
Juhicial appointments and career development; 
Training and development of court personnel; 
1 
Sec. 20. 
Judicial career development. - The Judiciary shall 
conduct an evaluation of the present career development of the members of 
the Bench with the end goal of developing a career path mechanism that shall 
serve as a strategy for improved performance and accountability in the judicial 
system. 
Sec. 21. 
Training and development of court personnel. - The 
Supreme Court shall institute a formal planning system, where goals and 
objectives for the court workforce are developed, the requisite skills are 
identified, and gaps are pinpointed as objects of needed training. The Supreme 
Court shall thereafter develop a comprehensive training and development 
program that shall provide training opportunities among court personnel. 
Sec. 22. 
Judicial education, - The Supreme Court shall strengthen 
the overall capacities of the Philippine Judicial Academy (PHILJA), reengineer 
i t s  judicial education program, improve mechanisms to increase access to 
judicial education, and maximize investments in judicial education. 
The Supreme Court shall assess the entire judicial education 
environment and conditions as basis for better-informed reform formulation 
through a survey and definition of overall judicial training requirements. 
The Supreme Court shall also conduct an institutional assessment of the 
PHILJA, formulate the Academy's medium term investment requirements for 
reforms and programs in judicial human resource development, identify and 
define the level and mix of resources required to operate the PHILJA, and 
support its corporate plan implementation. 
The Judiciary shall conduct an evaluation of judicial education programs 
and curricular revisions, develop new curricula, and train new judicial 
educators as well as court-annexed and court-referred Mediation. It shall also 
formulate the technical basis and preparation of modules for distance judicial 
education for judges and produce helping tools and materials for trial court 
judges. 
Within five (5) years from the effectivity of this Act, the PHILJA shall 
endeavor to regionalize i t s  operations by delivering i t s  programs to the judges 
and court personnel in the different regions throughout the country. 
A PHILJA training complex shall be constructed to include appropriately 
equipped conference rooms, a library, teleconferencing facilities, comfortable 
accommodation for participants and lecturers, and medical and recreational 
facilities. The Academy will also acquire basic equipment for the printing of i t s  
materials, as well as other instructional hardware. Computer units and 
19 


appropriate applications required in training shalt be installed in the training 
center; and equipment needed for distance-education shall be acquired. 
Sec. 23. 
Legal education. - The Judiciary shall conduct a survey 
and a comprehensive assessment of the law schools in the country, including 
their curricula, institutional structures, teaching manpower, resources, among 
others. 
i 
Also, the Judiciary, after the expiry of the first period of the Mandatory 
Continuing Legal Education Program of the Supreme Court, shall make an 
overall assessment of the service providers and shall document and analyze the 
quality of training provided during the said period. 
Chapter IV 
GENERAL PROVISIONS 
Sec. 24. Appropriations for the Judiciary Reform and Modernization 
Program. - The annual appropriations for the Judiciary Reform and 
Modernization Program shall include the amounts necessary to support the 
funding requirements for all modernization projects provided under the 
preceding sections. 
The funds to be appropriated by Congress under this Act shall be treated 
as a distinct and separate budget item from the regular appropriation for the 
Judiciary and shall be administered by the Supreme Court. 
The proposed program shall be based on a ceiling of Two Billion Five 
Hundred Forty Eight Million One Hundred Thirty Thousand Nine Hundred Eleven 
Pesos (PhP2,548,130,911); 
Provided, that the amount shall be allocated and 
disbursed as follows: 
Two Hundred Fifty Million Pesos (PhP250,000,000) for the 
creation of Small Claims Courts: 
Thirty Six Million Nine Hundred Sixteen Thousand Eight 
Hundred Seventy Eight Pesos (PhP36,916,878) 
for the 
improvement of the Court Management Systems; 
Three Million Twenty Five Thousand Two Hundred Seventy 
Four Pesos (PhP3,025,274) 
for the development of the 
Judicial Performance Management System; 
Two Billion Eighty Six Million Six Hundred Fifty Eight 
Thousand 
Seven 
Hundred 
Thirty 
Nine 
Pesos 
(PhP2,086,658,739) 
for 
the 
Institutions 
Development 
component of the JRMP; 
One Hundred Sixty Two Million Four Hundred Eighty Seven 
Thousand One Hundred Eighty Six Pesos (PhP162,487,186) for 
the Human Resource Development component of the JRMP; 
20 


. 
, 
L- 
(f) 
Two Million Seven Hundred Twenty Four Thousand Five 
Hundred Sixteen Pesos (PhP2,724,516) for the improvement 
of the jurisdictional structure of the courts; and 
Six Million Three Hundred Eighteen Thousand Three Hundred 
Eighteen Pesos (PhP6,318,318) for the development of the 
Alternative Dispute Resolution System. 
(9) 
Sec. 25. 
Initial and Continuing Appropriation. - For the first year 
of implementation of this Act, the amount of Four Hundred Twenty Four Million 
Six Hundred Eighty Eight Thousand Four Hundred Eighty Five Pesos and 166/100 
Centavos (PhP) i s  hereby appropriated. Thereafter, the Department of Budget 
and Managemeqt (DBM) i s  hereby mandated to include annually in the next five 
(5) years, in the President‘s program of expenditures for submission to Congress 
and retease, an amount not less than Four Hundred Twenty Four Million Six 
Hundred Eighty Eight Thousand Four Hundred Eighty Five Pesos and 166/100 
Centavos (PhP) for the implementation of this Act. 
Additional funds over and above the regular yearly budget of the 
Judiciary shall be sourced from twenty percent (20%) of the proceeds of the 
securitization of government assets. 
Other sources of funds shall be from the following: 
(a) 
Twenty five Percent (25%) of the net earnings of the government 
of the Republic of the Philippines from the imposition of excise 
tax on tobacco and alcoholic beverages; 
Twenty five Percent (25%) of the net earninss of the government 
of the Republic of the Philippines from the imposition of excise 
tax on automobiles; 
Twenty five Percent (25%) of the net earnings of the government 
of the Republic of the Philippines from the imposition of 
registration fees on heavy equipment; and 
Loans, grants, bequest, or donations, whether from local or 
foreign sources. 
(b) 
(c) 
(d) 
Sec. 26. 
Multi-year Contracts, Other Contractual Arrangements 
and Donations to Supreme Court. -- The Supreme Court may, pursuant to the 
JRMP, enter into multi-year contracts, lease and lease-purchase agreements, 
and other contractual agreements and may receive and accept income, 
legacies, gifts and donations for i t s  support and maintenance and for career 
and personnel development programs for the members of the judiciary and 
their personnel. 
Sec. 27. 
Judiciary Reform and Modernization Act Trust Fund. - 
There i s  hereby created a trust fund, to be known as the Judiciary Reform and 
Modernization Trust Fund (“Trust Fund”). The Trust Fund shall be used 
exclusively for the Judiciary Reform and Modernization Program and shall be 
the basis for the preparation of the Judiciary Annual Expenditure Program 
under a total-resource budgeting approach that will ensure efficient 
21 


generation, allocation and utilization of cash resource. The trust fund shall be 
obtained from the following: 
(a) 
Appropriations from the National Government for the JRMP as 
provided in this Act; 
Judicial revenues as determined by, and at the option of, the 
Supreme Court; and 
All interest income of the Trust Fund. 
(b) 
(c) 
The National Treasury, in accordance with existing government auditing 
rules and regulations, shall administer the Trust Fund. 
Sec. 28. 
Role of Other Agencies. - All units and agencies of the 
government shall support the Judiciary in the implementation of the JRMP. 
I 
In particular, the Department of Justice and the Department of Public 
Works and Highways shall coordinate with the Judiciary with respect to the 
infrastructure support aspect of the plan in order to accomplish networking of 
related infrastructure facilities. 
The Department of Interior and Local Government shall provide 
assistance to the Department in mobilizing resources under the control of local 
government units. 
The Departments of Trade and Industry shall coordinate i t s  investment 
programs and activities to complement the Department's implementation of 
the JRMP. 
Congressional initiatives shall also be coordinated by the Committees on 
Justice of both Houses to complement and enhance the programs and activities 
of the Judiciary in the implementation of the JRMP. 
Sec. 29. 
Implementing Rules and Regulations. - The Supreme 
Court, within ninety (90) working days from the effectivity of this Act, shall 
promulgate the rules and regulations for the effective implementation of this 
Act. 
The Supreme Court shall submit to the Committee on Justice of both 
Houses of Congress copies of the implementing rules and regulations within 
thirty (30) days after their promulgation. 
Sec. 30. 
Monitoring and evaluation. - Not later than the end of the 
first quarter of the succeeding year: 
(a) 
The Supreme Court shall submit to the President and Congress an 
annual report on the status of the Judiciary Reform and 
Modernization Act Trust Fund created under Section 28 of this 
Act: 
(b) 
The Supreme Court shall submit to the President and Congress, an 
annual report containing the progress of the implementation of 
the JRMP under this Act. 
22 


Sec. 31. 
Separability Clause. - If any provision of this Act is 
declared invalid or unconstitutional, the provisions not affected hereby shall 
continue to be in full force and effect. 
Sec. 32. 
Repealing Clause. - All laws, decrees, executive orders or 
rules and regulations contrary to or inconsistent with the provisions of this Act 
are hereby repealed or modified accordingly. 
Sec. 33. 
Effectivity Clause. - This Act shall take effect fifteen (15) 
days after the completion of i t s  publication in at least two (2) national 
newspapers of general circulation. 
Approved, 
23