Tricks, Trap, And Tips For Drafting Of An Arbitration Agreement

In today's time, a contract forms the basis of any commercial relationship. As the parties run a frequent risk of having disagreements that may lead to disputes, therefore, it is important for the parties to have a well-defined dispute resolution clause included in the contract. In case the parties have agreed to resolve their disputes through arbitration, they should be mindful of the contents of the arbitration clause since unclear or ambiguous terms tend to become a subject matter of prolonged litigation.

Though many arbitral institutions do provide samples of model arbitration clauses, however, it is never recommended to cut-copy-paste any arbitration clause into one's contract. The parties are, therefore, advised to comprehend the essential elements of an arbitration clause before finalizing an arbitration agreement.