Arbitration agreements are often included as clauses in a broad range of contracts, including consumer, commercial, and employment contracts. An agreement to arbitrate means that the two or more parties who enter into a contract agree, at the beginning of their contractual relationship, to resolve any dispute that may arise in arbitration as opposed to resolving the dispute in the court system.

What kinds of contracts contain arbitration agreements?

Individuals and businesses are generally free to arbitrate almost any legal issue that they could settle in court through litigation. Consumers frequently see arbitration agreements in contracts for telephone/cell phone service, credit cards, bank accounts, healthcare, auto loans, and investment broker agreements, among other services.

How do arbitration agreements work?

Consumers should be aware that arbitration agreements in contracts must be in writing, but may not necessarily require a signature. A contract and its arbitration agreement can, under many circumstances, be legally enforceable once the consumer has used the product or service in the contract. For example, the arbitration agreement in a credit card contract can become valid once the consumer first uses the credit card to make a purchase or payment.

Am I required to agree to arbitration?

Many arbitration agreements contain “opt-out” clauses, which allow consumers to reject arbitration within an allotted timeframe while still agreeing to the rest of the contract. If a contract contains an arbitration “opt-out” provision, the exact procedure for rejecting arbitration will be contained in the contract itself.

How do I locate and understand my arbitration agreement?

Information on how to find and comprehend your arbitration agreement is available, visit Arbitration Agreements.