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Here’s why an arbitration clause is smart

On Behalf of | Jul 5, 2019 | Contract Disputes |

Contract disputes can end a seemingly perfect project over problems with pay, materials or other issues. In most cases, people who have disputes can work through them and come up with a solution that will help them resolve the issues they’re having. Other times, it’s necessary to fall on a backup plan.

That plan, for most, is an arbitration clause in their contract. An arbitration clause helps make sure that you or the other party cannot sue one another. It requires you to take disputes to arbitration, which is legally binding, much like going to trial.

Why is an arbitration clause a good idea?

Arbitration will keep your case out of court, which may be necessary if you are trying to protect the privacy of a project or client. Additionally, having an arbitration clause guarantees that the other party can’t sue you and that you will both have the opportunity to go through an arbitrator for a quick resolution.

An arbitration clause is also smart because you’ll know what to expect in the future if a dispute is ever a real problem. You won’t have to worry about suing; Instead, you simply start the arbitration process with the help of your attorney.

Most people prefer to have arbitration clauses, but if you don’t, you can talk to your attorney about creating a contract that does not contain one or that has other clauses to protect your interests. Every contract that you are considering should be reviewed by your attorney before you agree to sign it, so you can protect yourself.


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