Arbitration Clauses in Contracts


An arbitration clause is a section of a contract requiring disputes to be resolved through arbitration. If you have agreed to the terms of a credit card, insurance policy, or bank loan, you have probably agreed to an arbitration clause. Often the arbitration clause is included in the fine print of an agreement.
Unfortunately, arbitration is not always in the interests of consumers. Consumer rights groups claim that mandatory arbitration circumvents the protections of the legal system, such as the ability to file class-action lawsuits. Moreover, consumers rarely voluntarily agree to arbitration, but do so in ignorance, when they sign lengthy contracts with mandatory arbitration clauses buried in legalese.
If you are involved in a dispute and are facing mandatory arbitration, talk to your lawyer about how best to proceed.