Who decides whether the arbitration requirements have been met?
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UPDATED: Dec 16, 2019
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Determining who decides whether the requirements to arbitrate have been met can be complicated. In some instances, the court will hear a dispute regarding whether arbitration is appropriate or not. However, other issues regarding the validity of an arbitration requirement may actually be submitted to another arbitrator.
The Rules for Arbitration Clauses
There are few major instances in which a court will get involved in determining whether an arbitration clause is valid and has met all the requirements or not. The court will get involved when the party who does not wish to arbitrate is arguing that the actual arbitration clause itself is invalid. Usually, this comes in the form of an argument that the clause was unconscionable and part of a contract of adhesion. In layman’s terms, that means that the party is arguing that the contract was one where he had no opportunity to negotiate (like for the purchase of insurance or consumer products) and that the terms of the arbitration clause themselves were grossly unfair and/or biased against him.
Other issues may generally decided on by the arbitrator. For example, if one party disputes the existence of a valid agreement at all (i.e. whether they had a contract), then that decision would need to be submitted to arbitration in most instances.
When an issue is submitted to arbitration, even if that issue is about the arbitration clause itself, the decision of the arbitrator is going to be binding. This means the parties are going to have to live with it, except in very rare occasions when they believe there was procedural bias or some other egregious error in procedure. In such cases, parties must appeal to an appellate court within the court system.
If you have an arbitration agreement of questionable validity, consult with an experienced attorney for guidance and advice on how best to proceed and argue your case.