An Arbitration Agreement Cannot Be

An Arbitration Agreement Cannot Be Ignored

An arbitration agreement is a legal contract between two parties that decides to resolve their disputes outside of court, through arbitration. In most cases, arbitration is faster and less expensive than going to trial, making it an attractive option for businesses and individuals alike. However, some people believe that arbitration agreements can be ignored, which is a mistake.

An arbitration agreement cannot be ignored or dismissed just because a party does not want to comply with it. When parties enter into an arbitration agreement, they are bound by its terms and conditions. This means that if a dispute arises, they must resolve it through arbitration.

One common misconception about arbitration agreements is that they are not enforceable. This is not true. Courts generally uphold arbitration agreements and will enforce them if they are properly drafted and executed. In fact, the Federal Arbitration Act (FAA) makes it clear that contracts that include arbitration agreements are just as valid and enforceable as any other type of contract.

Another myth is that arbitration agreements are unfair to the weaker party in a dispute. This is also untrue. In many cases, arbitration can be a more equitable and fair process than litigation. Arbitration allows both parties to present evidence and arguments, and the arbitrator makes a decision based on the facts and the law. In addition, arbitration can be less intimidating and stressful than going to court.

Some people believe that arbitration agreements limit their legal rights and remedies. This is also false. Although arbitration agreements may restrict certain types of claims or damages, parties can still pursue legal action in court if they are not satisfied with the outcome of arbitration. Courts can also review arbitration awards and overturn them if they are not in accordance with the law.

In conclusion, an arbitration agreement cannot be ignored or dismissed. When parties enter into an arbitration agreement, they are bound by its terms and must resolve any disputes through arbitration. Although there are some misconceptions about arbitration agreements, they are generally enforceable, fair, and equitable. As a result, businesses and individuals should carefully consider whether an arbitration agreement is right for them before entering into one.

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