An arbitration agreement is a legally binding contract between two parties who agree to resolve any disputes that may arise from their working relationship through arbitration instead of court action. The agreement outlines the terms and procedure for the arbitration process, such as the appointment of an arbitrator, rules of evidence, and governing law, among other details. Create your attorney-drafted arbitration agreement sample on Lawrina, customized to your specific situation and built on the information you provide, or download and use it as is.
To ensure the enforceability of the arbitration agreement or clause, the agreement should:
Parties in a blank arbitration letter template may include:
The agreement specifies details of an arbitration process, and the arbitrator's decision is legally binding to them.
To fully appreciate the implications of an arbitration agreement, all parties must understand the complex terminologies they may find in it. Some of them are:
There are a few key reasons you should consider signing a simple arbitration agreement form:
Reducing the costs of dispute resolution –– no more expensive fees for court hearings and hours of work of attorneys
Improving the speed of dispute resolution –– with a signed arbitration agreement, you can resolve a dispute much quicker
Protecting sales in a digital world –– with a signed arbitration, your consumer rights are protected and you have no need to pay for expensive litigation in case of disputes
Getting more flexible rulings than the civil court can issue –– because the process is far more casual, there are higher chances both parties can enjoy the final outcome
Avoiding public records of proceedings –– this is a common reason why people prefer arbitration to litigation, as there is no public record. Confidentiality is much higher during arbitration
Arbitration cases are more flexible in terms of witnesses’ testimonials. Any person with information of the relevant facts and pieces of evidence can be a witness as is mentioned in most state laws. Cross-examination is regularly used in arbitrations in the U.S.
Make sure to cover all the following points in your printable arbitration contract example:
The agreement should start with the full names and contact information of both parties who sign the agreement, including a registered address.
There should be contact details of individuals who have been chosen to provide counsel and arbitration for this agreement. These arbitrators should be approved by both parties of the agreement and have no connection or biased attitude to any party. Parties specify how many arbitrators there should be. It is often better to have three arbitrators since each party gets a chance to nominate one for a more objective decision.
There are generally no restrictions on the parties’ autonomy to select the arbitrators. The arbitration agreement or clause can specify particular criteria that an arbitrator must meet, the number of arbitrators, the method of their selection, and each party's input into the arbitrator selection process.
This is an important clause that proves that both parties are aware of the pre-hearing conference in case the arbitrators need details or clarification of any claims.
Details on when and where the final hearing will take place.
This clause states that both parties will split all arbitration-related fees and expenses equally unless agreed upon differently.
This clause should state in accordance with which laws the arbitration will take place.
This clause outlines any awards that should be granted to the aggrieved party, the date they should be delivered, and an explanation of the award.
Although the clauses mentioned above are the most common, arbitration agreements can actually cover many more issues that may arise after signing a contract. The more detailed your arbitration agreement is, the higher the chances that the parties will be able to minimize disagreements and be satisfied with the final outcomes of arbitration. It is also common to include an arbitration clause to a contract that covers specific issues as opposed to signing a separate arbitration agreement.
Writing an arbitration form pdf requires close collaboration between all the parties involved. Everyone must agree to all terms outlined in the document. The steps each party should take include the following:
Identify the purpose of the arbitration agreement — Determine the purpose of the arbitration agreement and the types of disputes it will cover.
Choose the arbitration institution — Decide which arbitration institution will hear and resolve disputes. Examples include an established arbitration institution, such as the American Arbitration Association (AAA), the International Chamber of Commerce (ICC), or an ad-hoc arbitration not administered by any established organization.
Choose the governing law — Identify the law that will govern arbitration, considering the nature of the dispute. The legal system that governs the dispute determines the outcome. Therefore, parties must work closely with an attorney to identify the governing law.
Agree on the process of selecting an arbitrator — Agree on the number of arbitrators, their qualifications and experience, and the process of choosing them.
Set the procedural rules for arbitration — Think through the rules governing arbitration, including the rules of evidence, discovery, and other relevant procedures.
Draft and sign the arbitration agreement — Jointly prepare a document that reflects the agreed-upon terms and have all parties sign it.
Each party should carefully consider the terms of the arbitration agreement, as it will govern the process and outcome of the dispute. The parties should carefully draft the contract to ensure that each entity's rights and obligations are clearly defined and protected. Additionally, the parties should be mindful of any legal requirements for arbitration agreements, such as the requirement for a written agreement or specific language.
Domestic arbitration awards as well as international arbitration awards rendered in the US must be “confirmed” by an order of the court before enforcing. The FAA, which stipulated the requirement for confirmation of the arbitration awards in federal courts, requires the filing of a petition to confirm along with supporting documents (e.g., a copy of the award and a copy of the arbitration agreement). Such a petition shall be filed within one year after the award is made by any party of the arbitration.
When two or more parties are in a contractual engagement, another formal arrangement may opt for arbitration instead of court action to resolve their disputes.
You can have an arbitration agreement for the following types of disputes:
Not all disputes between parties can be solved in arbitration or through the dictates of an arbitration agreement. Some instances when an agreement will not be helpful include:
The Federal Arbitration Act (9 U.S.C. § 1-16 “FAA”) governs arbitration agreements in contracts involving interstate commerce and applies in both federal and state courts. FAA requires that arbitration agreements be in writing to be enforceable.The form can vary; it can be an arbitration clause in a commercial contract, a stand-alone arbitration agreement, or other type of written agreement.
Chapter 1 (9 U.S.C. § 1-16) stipulates general provisions applicable to arbitration agreements involving maritime, interstate, and foreign commerce.
The 1958 Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the "New York Convention") is implemented in Chapter 2 (9 U.S.C. 201-208), which governs any contractual or non-contractual relationship between parties that is deemed to be commercial in nature, unless both parties are citizens of the United States and the relationship involves property located abroad or has some other reasonable connection to one or more foreign states.
Chapter 3 (9 U.S.C. §§ 301-307) implements the 1975 Inter-American Convention on International Arbitration (“Panama Convention”). Where both the New York and Panama Convention could apply to the enforcement of an arbitral award, the NY Convention applies, unless the parties indicate the Panama Convention should apply.
The US has not enacted the United Nations Commission on International Trade Law (“UNCITRAL”) Model Law, however several states have enacted statutes based on Model Law, namely: California, Connecticut, Florida, Georgia, Illinois, Louisiana, Oregon, and Texas.
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The general legal limits of forced arbitration are still not defined and will depend to a degree on the state court system. Different federal courts of appeal have different positions on forced arbitration in general.
State contract law always governs whether the agreement to arbitrate is enforceable. Specific contract laws depending on a state may make an arbitration agreement sample template unenforceable depending on the details of that case/contract.
The standard is that an arbitrator should be mutually selected by both parties and should not be interested in (or somehow related to) one of the parties. Otherwise, objectivity is questionable.