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Arbitration Agreement Can Be in Written Form Only

Arbitration Agreement Can be in Written Form Only: Here`s Why

Arbitration is a dispute resolution method that is popular in both business and personal settings. It involves resolving disputes between two parties outside of the courtroom, usually with the help of an impartial third party. One key aspect of arbitration is the arbitration agreement – a contract that outlines the terms and conditions of the arbitration process.

One important thing to note about arbitration agreements is that they can only be in written form. This means that oral agreements or agreements made through electronic communication are not enforceable. This rule applies in both state and federal courts.

So, why is it important for arbitration agreements to be in written form only? Here are a few reasons:

1. Clarity and Agreement: Written agreements ensure that all parties are clear on the terms and conditions of the arbitration process. This helps prevent later disputes about what was agreed upon.

2. Evidence: Written agreements provide evidence that a valid arbitration agreement exists. In the event of a dispute, a written agreement can be used to prove that the parties agreed to the arbitration process.

3. Protection: Written agreements offer legal protection and security to both parties. They ensure that both parties have the same level of protection in the event of a dispute.

4. Enforceability: Written agreements are easier to enforce than oral agreements. They provide a clear record of the parties` intentions and can be referenced in court if necessary.

There are some exceptions to the rule that arbitration agreements must be in written form. For example, if the parties involved in the arbitration process have previously agreed to an oral or electronic communication arbitration agreement, this may be enforceable.

It`s important to note that the written agreement rule doesn`t mean that the arbitration process itself has to be conducted entirely in writing. The parties can still engage in verbal discussions and present oral arguments during the arbitration process.

In conclusion, the rule that arbitration agreements must be in written form only is an important aspect of the arbitration process. It ensures clarity, provides evidence, offers protection and security, and makes the agreement easier to enforce. So, if you`re considering an arbitration agreement, be sure to put it in writing.

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