Arbitration has become a popular means of resolving disputes between parties without going to court. An arbitration clause in a contract is a provision that mandates any dispute arising from the agreement to be resolved through arbitration.

Here are some examples of arbitration clauses in contracts:

Example 1

“Any dispute or claim arising out of or in connection with this agreement shall be settled by arbitration in accordance with the rules of the American Arbitration Association, and judgment upon the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof.”

This clause is commonly found in commercial contracts. It specifies that any dispute arising from the agreement will be resolved through arbitration under the rules of the American Arbitration Association. The clause also allows the final award to be enforced in court.

Example 2

“All disputes arising out of or in connection with this agreement shall be referred to a single arbitrator to be agreed upon by the parties, or in the absence of agreement, to be appointed by the President of the Law Society of [State].”

This arbitration clause sets out a process for appointing an arbitrator when the parties cannot agree on one. It also specifies that only one arbitrator will be used to resolve any dispute arising from the agreement.

Example 3

“In the event of any controversy or claim arising out of or relating to this agreement, or the breach thereof, the parties hereto shall consult and negotiate with each other and, recognizing their mutual interests, attempt to reach a solution satisfactory to both parties. If the parties do not reach settlement within a period of 60 days, then any unresolved controversy or claim shall be submitted to mediation. If settlement is not reached through mediation, then it shall be resolved by binding arbitration in accordance with the rules of the [State] Arbitration Association.”

This arbitration clause specifies a process for resolving disputes in a step-by-step manner. The parties are first required to consult and negotiate with each other and attempt to find a mutually satisfactory solution. If they are unable to do so within 60 days, the dispute is then submitted to mediation. If the parties are still unable to reach a settlement through mediation, then the dispute is resolved through binding arbitration under the rules of the state`s arbitration association.

In conclusion, arbitration clauses are essential provisions in contracts. They provide an alternative means of resolving disputes between parties with minimal formalities and procedures. The examples above show how such clauses can be tailored to meet the specific needs of parties and ensure the resolution of disputes in a timely and cost-effective manner.