header-logo header-logo

02 October 2008
Issue: 7339 / Categories: Legal News , Arbitration
printer mail-detail

Unfair arbitration

Arbitration

Businesses that contract with consumers must ensure that arbitration clauses are fully explained at the time the contract is entered into, warn lawyers.

In Mylcrist Builders Limited v Mrs G Buck a judge refused to enforce an arbitration award against the defendant (a consumer) who had engaged the firm on its standard terms and conditions which included an arbitration clause.

The court found the arbitrator had not been properly appointed however, and that the related clauses were not binding. The judge held that the inclusion of the clause had caused a significant imbalance in the parties’ rights and obligations under the contract, to the detriment of the defendant.

Steven Friel, partner at Davies Arnold Cooper LLP, says: “English courts have gone to great lengths recently to uphold arbitration clauses, on the basis that arbitration should be considered a stand alone dispute resolution process and relatively free from interference from the courts”.

However, the judgment means that arbitration clauses could be considered unfair in consumer contracts, says Friel.

“In this case the court decided that consumer protection

If you are not a subscriber, subscribe now to read this content
If you are already a subscriber sign in
...or Register for two weeks' free access to subscriber content

MOVERS & SHAKERS

Signature Litigation—Catherine Naylor

Signature Litigation—Catherine Naylor

International fraud and asset recovery offering boosted by partner hire

Stevens & Bolton—Alexa Payet

Stevens & Bolton—Alexa Payet

Private wealth disputes team adds contentious probate specialist

Morgan Lewis—Paul Feldberg

Morgan Lewis—Paul Feldberg

Firm strengthens investigations and sanctions capabilities with London partner hire

NEWS
Cheshire West, which established an ‘acid test’ for deprivation of liberty safeguards, has been overturned by the Supreme Court
The Chancery Division and other segments of the High Court are to be replaced by a new Business and Property Division (BPD), in a major civil justice shakeup
Law firms that hold client money will need to file annual accountants’ reports and make a declaration, the Solicitors Regulation Authority (SRA) confirmed this week
Two district judges and a tribunal judge have been sanctioned for delays in delivering judgments and orders
Private equity (PE) investment into UK law firms halved to £250m last year, but deal volume rose, according to research by Acquira Professional Services’ Momentum private equity market tracker
back-to-top-scroll