Sample Arbitration Clauses
Sample Clauses
The costs and delays involved in litigating business disputes in court motivate parties to turn to alternatives such as arbitration. To take full advantage of arbitration’s cost and time savings, choose an experienced administrator that is focused on fairness, speed and efficiency. At FORUM we deliver on the promise of arbitration by providing a simpler and more efficient approach that lowers total cost and by providing multiple paths to resolution for business disputes with FORUM’s complete suite of services.
The key to taking advantage of arbitration is to plan ahead. Include a FORUM arbitration clause in your standard and negotiated contracts so that the parties know that any disputes will be handled efficiently and cost-effectively in arbitration rather than in court.
Drafting an effective arbitration clause is not difficult, but there are some important options to consider. Below in italics are sample arbitration clause language and drafting options to consider. Or, for additional options, visit FORUM’s Clause Generator.
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Standard Commercial Arbitration Clause Example
This Standard Clause provides the basics for an enforceable agreement to engage in binding arbitration. The first sentence states the broad scope of the obligation to arbitrate as covering “any claim or dispute” and names both the administrator (“FORUM”) of the arbitration and the applicable arbitration rules (“the Code of Procedure for Resolving Business-to-Business Disputes”). The second sentence states that an arbitration award is binding and enforceable in any court having jurisdiction.
"We agree that any claim or dispute between us shall be resolved by arbitration administered by FORUM under the Code of Procedure for Resolving Business-to-Business Disputes in effect when the claim is filed. Any award by the arbitrator(s) may be entered as a judgment in any court having jurisdiction."
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Sample Arbitration Clause Options
Arbitration Location
The procedural law of the location you select can influence your case through application of certain statutes of limitations or other procedural rules. If there is no agreement by the parties, the location will be determined by FORUM based on factors including the location of the circumstances of the dispute, the convenience of the parties, and the financial burden on the respective parties.
The arbitration shall take place in [City, State (or) State].
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Number of Arbitrators
Electing to have a single arbitrator hear and decide your case will save considerable time and money. A three-arbitrator panel is more difficult to schedule and much more expensive to pay. On the other hand, for a bet-the-company dispute, you might want to take advantage of the collective wisdom of a three-arbitrator panel in place of a single arbitrator.
Any arbitration will be heard and decided by [a single arbitrator (or) three arbitrators].
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Sharing Limited Jurisdiction with Court
Sharing jurisdiction to resolve a dispute between arbitration and a court would be extremely inefficient and wasteful. However, there are situations where a court can quickly and temporarily preserve the status quo so that a dispute can be resolved in arbitration. Appropriate clause language such as provided to the left enables this reasonable approach.
Any party may seek provisional injunctive relief in aid of arbitration from a court of appropriate jurisdiction.
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Cost and Fee Allocation
The parties may wish to alter the default “American rule” that each party is responsible for its own attorney fees and arbitration costs. Such a change can fundamentally alter the dispute resolution dynamics between the parties.
Each party will pay its own Attorney’s Fees and an equal share of the costs of arbitration. (or) A prevailing party, if one is determined by the Arbitrator(s), is entitled to recover reasonable attorney’s fees and arbitration costs.
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Different Arbitration Rulesets
Employment Disputes
FORUM’s Employment Code include minimum Due Process Safeguards for employees to ensure employee parties have reasonable access to justice, including affordable fees, convenient hearing locations, and the right to legal representation. These rules also ensure efficient discovery and provide all parties with the right to file an early dispositive motion.
We agree that any claim or dispute between us shall be resolved by arbitration administered by FORUM under the Code of Procedure for Resolving Employment Disputes in effect when the claim is filed. Any award by the arbitrator(s) may be entered as a judgment in any court having jurisdiction.
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Franchise Disputes
Franchise disputes often involve sales and valuation of franchises, terminations, compliance with franchise agreement standards, intellectual property use and infringement and territorial disputes. These disputes are often resolved through out of court resolution processes, including fair and efficient arbitration under FORUM’s Franchise arbitration rules.
We agree that any claim or dispute between us shall be resolved by arbitration administered by FORUM under the Code of Procedure for Resolving Franchise Disputes in effect when the claim is filed. Any award by the arbitrator(s) may be entered as a judgment in any court having jurisdiction.
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Intellectual Property Disputes
FORUM's Intellectual Property Code of Procedure was built with the fair and efficient resolution of IP disputes in mind. The IP Code provides the appropriate balance between flexible procedures and discovery with the need to control dispute resolution costs. Confidentiality is maintained, including the protection of parties’ trade secrets. The IP Code also permits Markman hearings to be conducted in the context of arbitration.
We agree that any claim or dispute between us shall be resolved by arbitration administered by FORUM under the Code of Procedure for Resolving Intellectual Property Disputes in effect when the claim is filed. Any award by the arbitrator(s) may be entered as a judgment in any court having jurisdiction.
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Disclaimer : This page and this website provide general information about arbitration and dispute resolution, but you should not rely on this information without first obtaining the advice of an attorney.
FORUM Arbitration Clause Generator
FORUM's Clause Generator is an intuitive, easy-to-use tool that helps you determine which elements to include in your arbitration clause. Clause Generator automatically builds the clause for you so you can copy/paste it into your agreement.
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