The Optional Arbitration Clause addresses the growing need for flexible dispute resolution mechanisms in commercial relationships. This clause, governed by U.S. law, provides parties with the choice to pursue arbitration while preserving their right to litigate. Unlike mandatory arbitration provisions, the Optional Arbitration Clause allows parties to assess the most appropriate dispute resolution method when a conflict actually arises. It typically includes specific procedures for invoking the arbitration option, timeframes, and basic rules for the arbitration process, all while ensuring compliance with federal and state arbitration laws.
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1. Parties: Identifies and defines the parties involved in the arbitration agreement
2. Background: Provides context and purpose for the arbitration clause
3. Definitions: Defines key terms used throughout the arbitration clause
4. Arbitration Option: States the right to choose arbitration and conditions for exercising this option
5. Notice Requirements: Procedures for invoking the arbitration option
6. Time Limits: Deadlines for choosing arbitration
7. Basic Arbitration Procedures: Core rules governing the arbitration process
1. Arbitrator Selection: Process for choosing arbitrators (use when specific selection process desired)
2. Cost Allocation: Distribution of arbitration costs (use when default rules insufficient)
3. Discovery Rules: Special discovery procedures (use in complex matters)
4. Confidentiality: Privacy requirements (use when confidentiality important)
1. Arbitration Rules: Detailed procedures for conducting arbitration
2. Fee Schedule: Breakdown of arbitration costs and fees
3. Arbitrator Qualifications: Required qualifications for arbitrators
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