Arbitration Clause for Dummies
noun
What does Arbitration Clause really mean?
Arbitration Clause
Hey there! Let me explain to you what an "Arbitration Clause" means in the simplest way possible. Imagine you have a disagreement with someone, maybe a friend or a classmate, and you both just can't seem to find a solution. It's like a never-ending argument that you want to stop but can't. That's where an "Arbitration Clause" comes into play. So, an "Arbitration Clause" is like a special rule or condition that is included in a contract or an agreement. It basically says that if any sort of disagreement or conflict arises between the people involved in the contract, they will have to settle it through a process called arbitration instead of going to court. Now, you might be wondering, what exactly is this "arbitration" thing? Well, think of it like this: it's like having a referee in a soccer match. When players can't decide on a foul or a dispute, they call the referee to make the final decision. Similarly, in arbitration, the people in the disagreement bring in a neutral third party called an arbitrator, who acts as the referee. The arbitrator's job is to listen to both sides of the disagreement, just like the referee listens to both teams in the soccer match, and then make a fair and unbiased decision. This decision is called an "arbitration award." It's like the referee blowing the whistle and saying, "Okay, this team wins, and this team loses." The arbitration award is final and binding, which means the people involved in the disagreement have to accept it, just like soccer players have to accept the referee's decision. So, when you come across an "Arbitration Clause" in a contract, it means that if any argument or disagreement arises, instead of going to court, the people involved agree to let an arbitrator make the final decision in a fair and unbiased way. Just to make sure you understand everything, let's imagine you and a friend make a deal to trade toys, and you write down the terms of the trade on a piece of paper. If you include an "Arbitration Clause" in that written agreement, it means that if you and your friend have any disagreements about the trade, you'll have to go through arbitration to settle it, just like soccer players calling the referee to settle disputes. Well, I hope that made things a lot clearer for you! Remember, an "Arbitration Clause" is just a special part of a contract that says if there's a disagreement, instead of going to court, you use a neutral third party called an arbitrator to make a decision.Revised and Fact checked by Mia Harris on 2023-10-28 03:57:27
Arbitration Clause In a sentece
Learn how to use Arbitration Clause inside a sentece
- When two people have a disagreement, instead of going to court, they can agree to use an arbitration clause. This means they'll find someone fair and neutral to help them settle their problem.
- If you buy a new phone and there is a problem with it, the company you bought it from might have an arbitration clause in their contract. This means you have to talk to a third party who will listen to both sides and decide what's fair.
- When two companies have a business disagreement, they might have an arbitration clause in their contract. This means they won't go to court, but will have a meeting with someone who will make a decision to solve the problem.
- If you're renting a house and there is a dispute about the security deposit, the landlord and tenant might have agreed to include an arbitration clause in the lease. This means they'll find a person who will listen to both sides and make a fair decision.
- When you sign up for a credit card, the agreement you make might have an arbitration clause. This means if there is a problem with the credit card company, you can't sue them but have to go through arbitration to find a solution.
Arbitration Clause Hypernyms
Words that are more generic than the original word.
Arbitration Clause Holonyms
The larger whole to which this word belongs.