Chances are you have unknowingly entered into many arbitration agreements. When downloading an app or subscribing to a service, you have likely quickly scrolled through the “terms and conditions” and pushed “Agree”, without realizing that you had just consented to arbitration.
So, what is an arbitration? Arbitration is a type of alternative dispute resolution outside of the courts. Rather than filing a lawsuit and subsequently going to court, the dispute is resolved by a “arbitrator”. If dispute does arise, an arbitration agreement limits resolution to arbitration and sets parameters for how arbitration will be conducted.
An arbitration agreement may set specific terms and requirements for arbitration, including how the arbitrator will be found, what rules of arbitration will apply, the number of arbitrators, and the place arbitration shall occur.
The purpose of an arbitration agreement is to limit litigation costs and keep disputes confidential. Unlike the process of a trial or other court proceeding, arbitration is often faster and is not public record, saving cost and limiting publicity of the matters. The disadvantages of an arbitration agreement are that decisions cannot be appealed, there is no option for jury trial, and less ability to discover information to build your claim.
Whether you are developing a contract or contemplating signing an arbitration agreement presented to you, it is important to know the benefits and disadvantages of agreeing to arbitration. The attorneys at Simpson, Jensen, Abels, Fisher & Bouslog, P.C. are experienced in handling complex contract issues. Contact us at (515) 288-5000 to discuss implementing or enforcing your arbitration agreement.
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