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Mandatory binding arbitration is a private proceeding to settle disagreements between two parties. Parties to a contract agree to have their case reviewed by a third party?called an arbitrator?and to be bound by the arbitrator's decision.
A claimant initiates an arbitration by filing a statement of claim that specifies the relevant facts and remedies requested. A respondent responds to an arbitration claim by filing an answer that specifies the relevant facts and available defenses to the statement of claim.
The Scope of the Clause. This section of the clause is critical; it sets the boundaries for which disputes the tribunal is authorised to determine. ... Choice of Rules. ... The Number of Arbitrators. ... Appointing Authority. ... Choice of Venue. ... The language of the proceedings. ... Finality. ... Exclusion of the right of appeal.
Some contracts give you the right to opt out of the forced arbitration clause within a certain period of time, often 30 to 60 days, after signing the agreement by notifying the company that you wish to opt out. Check your contract for the deadline and for specific instructions for opting out.
Despite the existence of an arbitration agreement, it is widely accepted that a party's right to arbitrate may be waived by either an explicit contractual provision or its subsequent conduct. The courts have taken different approaches to this issue in different jurisdictions, however.