ARBITRATION AGREEMENTS

Introduction: An arbitration agreement helps parties solve contractual issues. Just like
litigation, when parties go to the courts to have an impartial third party, that is, a judge, decide
and resolve legal issues, arbitration helps parties solve their issues by bringing an impartial third
party, also known as an arbitrator, to resolve contractual issues. Such agreements have been
mostly included in contracts and agreements for as long as business has been conducted.

DEFINITION OF ARBITRATION AGREEMENT

As per Section 7 of The Arbitration and Conciliation Act, 1996, an “arbitration agreement”
means a promise by parties to settle any disputes between them about a specific legal
relationship using arbitration. This applies whether the disputes are mentioned in a contract or
not. This type of agreement is also called a submission agreement.

An arbitration agreement is a legal contract made by two or more parties. It states that if any
disagreements or conflicts arise between them, they will use arbitration to solve the issues
instead of going to court. This is an agreement where all parties decide to present their
disagreements to an arbitrator or an arbitration panel. These arbiters will make a final and
binding decision based on the facts and arguments from both sides.

Usually, an arbitration agreement explains the terms for taking disputes to arbitration.

1. It might cover things like the types of disputes that can be addressed,

2. the rules for the arbitration process, how the arbitrator(s) will be chosen,

3. where the arbitration will happen and any other important things the parties agree on.

In United States Asphalt Refining Co. vs. Trinidad Lake Petroleum Co. (1915), the validity of such
arbitrational clauses in business dealings was questioned. The claimant, which is a corporation
in South Dakota, took steamships from the respondent, a British corporation that owned
vessels that were under British registry to be used lawfully around the world but were mostly
employed in Trinidad and the United States. These steamships were then withdrawn from the
claimant’s service during World War I. The charter for each steamer that was made in London
contained the clause that disputes were to be settled in London through arbitration and the
enforcement of such an agreement shall be made a rule of law. The claimant questioned the
validity of such a clause but as held by District Judge Hough, “under the law of the place of
contract,” which is England, “this arbitration agreement was at the time of making the charter
parties entirely valid.” The judge also based this judgement on the English Arbitration Act of
1889, as the English courts would have actually ruled in favour of the respondent given that
both parties had agreed to the terms of the clause and were able to consent, having been of
sound mind and of legal age to do so. The impact of this case led to the formation of
the Federal Arbitration Act in 1925. It then became statutory law, which helped civil matters be
decided fairly. Also, with the formation of the Act came the American Arbitration Association,
which helped strengthen confidence in using arbitration when resolving civil matters and
overcome existing hostility that evolved from English courts. The use of arbitration has grown
throughout the years to deal with civil matters and businesses have grown to see the benefits
of this dispute resolution.

ESSENTIALS OF AN ARBITRATION AGREEMENT

An arbitration agreement involves several key conditions that must be met for it to be valid and
effective. These conditions ensure that the agreement serves its intended purpose and guides
the arbitration process fairly.

1.Presence of a Dispute: For an arbitration agreement to hold weight, a dispute between the involved
parties must exist. This is a fundamental requirement for the agreement to come into effect. If no
dispute is present, the arbitration clause cannot be used to challenge a settlement that has already been
reached by the parties.

2. Written Agreement: An arbitration agreement must always be documented in writing. It can take
various forms to qualify as a written agreement. An arbitration agreement must be documented in
writing, as emphasised by Section 7(4) of the Act. This can be in the form of a written document or any
form of communication, including telegrams or telex, as long as there’s a record of the communication.

3. Appointment of Arbitrators: Section 11 grants parties the freedom to select arbitrators. If parties
can’t agree on an arbitrator, the Chief Justice of the High Court (for domestic arbitration) or the Chief
Justice of the Supreme Court (for International Commercial Arbitration) can be approached for
appointment.
3. Document with Signatures: The agreement is valid when it’s a signed document by both
parties.
4. Written Communications: Communications such as telex, letters or telegrams that record the
agreement for arbitration also suffice.
5. Exchange of Statements: When parties exchange statements outlining their claims and
defences and one party acknowledges the existence of an arbitration agreement while the
other party doesn’t dispute it, the agreement is considered valid.

6. The intention of the Parties: The intention of the parties involved is a pivotal aspect of the
agreement. While specific terms like “arbitrator” or “arbitration” need not be explicitly stated, the
intention of both parties to abide by the terms of the arbitration agreement is crucial. The agreement’s
validity is based on the shared intention to utilise arbitration for dispute resolution.

7. Signatures of the Parties: The signatures of the parties play a crucial role in forming a valid
arbitration agreement. There are two scenarios:
8. Mutual Signatures: The agreement can be a document signed by both parties, outlining all
terms and conditions.
9. Unilateral Signature: Alternatively, one party can sign the document containing the terms
and the other party can express acceptance. In this case, the agreement becomes valid upon
the acceptance.

10. Interim Relief: Sections 9 and 17 of the Act address interim relief orders related to arbitration.
Section 9 permits relief petitions if there’s prima facie evidence of an arbitration agreement. Parties can
approach the Court before or after arbitration proceedings start, but before award enforcement (as per
Section 36). Section 17 empowers the tribunal to grant interim measures upon party request.

11. Finality of Arbitration Award: Section 34 establishes the finality of an arbitrator’s award, which is
binding on the contracting parties. Once a court decree is granted, it becomes enforceable under
Section 34.

12. Appeal: Section 37 provides avenues for appeal if parties are dissatisfied with arbitrator decisions.
Appeals can be made against orders under Section 9 (granting/refusing interim measures), setting aside
or refusing to set aside an award and decisions on pleas referred to in Section 16. However, no appeal is
permitted against arbitrator appointments under Section 11.

13. Seat of Arbitration: The “seat” refers to the location where the arbitration proceedings are based.
Specifying the seat is particularly crucial in international commercial arbitration. It determines the
procedural laws governing the arbitration. Notably, the seat need not coincide with the hearing location;
it’s where the arbitration process is administered.

14. Procedure for Appointing Arbitrators: The procedure for selecting arbitrators follows guidelines
outlined in the Arbitration Act. Generally, any qualified person, regardless of nationality, can be
appointed as an arbitrator unless the parties agree otherwise. Parties can also mutually decide on the
arbitrator’s appointment.

15. Language: Language plays a vital role in an agreement. The chosen language should be understood
by all parties involved to prevent misinterpretations. Clarity is essential to ensure both parties
comprehend each clause. Opting for a mutually understood language can reduce translation costs.
16. Number and Qualifications of Arbitrators: The Arbitration Act permits parties to determine the
number of arbitrators. However, an odd number is required to prevent deadlock

APPOINTMENT OF ARBITRATOR

Section 11 of the Arbitration and Conciliation Act, 1996 deals with the appointment of
arbitrators.

1. A person of any nationality may be appointed arbitrator unless the contrary

intention is expressed by the parties.
2. The parties are free to agree on a procedure for appointment of arbitrator or
arbitrators.
 3. Where parties fail to appoint three arbitrators, each party shall appoint one
arbitrator and the two arbitrators shall appoint the third arbitrator. Hence,
appointing three arbitrators is mandatory, with the third one being the
presiding arbitrator.

Where a party fails to appoint an arbitrator in accordance with the third arbitrator with the within
thirty days from the date of receipts of a request to do so from the other party or two appointed
arbitrators fail to agree on the third arbitrator within 30 days from the date of their appointment,
the appointment shall be made, upon a request of a party, by the Chief Justice of the High
Court or any person or institution designated by him.

In the absence of any procedure to appoint a sole arbitrator, if the parties fail to agree on the
arbitrator within 30 days from receipt on a request by one party from the other party to so
agree, the appointment shall be made upon request of a party, by the Chief Justice of the High
Court or any person or institution designated by him.

The decision of the Chief Justice of the High Court or the person or the institution designated by
him in appointing an arbitrator shall be final.

Section 11 only confers power on the High Court to appoint an arbitrator or presiding
arbitrator only when the following conditions are fulfilled:

 where there is a valid arbitration agreement;

 the agreement contains for the appointment of one or more arbitrators;

 the appointment of the arbitrator is to be made by mutual consent of all the parties to
the dispute.

 differences have arisen between the parties to the arbitration agreement; or between the
appointed arbitrators;

 the differences are on the appointment or appointments of arbitrators.

Important case laws:

In Indian Drugs & Pharmaceuticals Ltd. v. Indo Swiss S. Gem Mfg. Co. Ltd., it has been
held that no retired High Court Judge can be appointed as an arbitrator by the court when the
arbitration clause states categorically that the difference/dispute shall be referred �to an
arbitrator by the Chairman and Managing Director of IPDL who is the appellant in this case.�

In National Aluminium Co.Ltd v. Metalimpex Ltd., a Bangladeshi company failed to nominate

its arbitrator in terms of the arbitration agreement on an application under S.11 of the
Arbitration and Conciliation Act, 1996, the Chief Justice of India nominated an arbitrator to act
on behalf of the Bangladeshi company.

Post – 2015 amendment: Judicial intervention was reduced by the insertion of 6A, whereby
the courts had to confine their role to the examination of the existence of an arbitration
agreement. The new section does not allow the court to conduct an examination of its validity.
This provision helps to avoid delays in the proceedings.
 In the case of Prime Market Reach Pvt. Ltd. v. Supreme Advertising Ltd. (2019), the Delhi High
Court refused to refer the parties to arbitration after finding that the agreement was invalid as it
did not abide by the requirements laid down in Section 7 of the Act.

Post-2019 amendment: This amendment brought in significant change by shifting the

responsibility of appointment to arbitral institutions. This amendment significantly reduced
judicial intervention and institutionalised the system of arbitration.

In the case of Vishram Varu and ors. v. Union of India (2022), the Supreme Court held that an
application made under Clause 6 of Section 11 is barred by limitation. In this case, the
arbitration clause was invoked nearly thirty-two years after the emergence of the dispute.

ATTRIBUTES OF ARBITRATION AGREEMENT

In the notable legal case of K.K. Modi v. K.N. Modi and Ors. (1998) 3 SCC 573, the Hon’ble
Supreme Court highlighted several crucial attributes that must be present in an arbitration
agreement:

 1. Binding Decision: The agreement should explicitly state that the tribunal’s decision will be
legally binding on both parties involved.
 2. Jurisdictional Consent: Both parties must mutually agree on the tribunal’s jurisdiction to
arbitrate the matters concerning their rights. This consent can either arise from a consensual
decision or from a court order directing that the proceedings proceed through arbitration.
 3. Fair and Impartial Determination: The tribunal holds the responsibility to impartially
determine the rights of the parties, ensuring a fair judgment.
 4. Legally Enforceable: The agreement’s terms, which outline the parties’ commitment to
arbitration, must adhere to the legal framework and be enforceable by law.
 5. Timely Formulation: The agreement should specify that any decisions rendered by the
tribunal on the dispute must be formulated prior to the commencement of the arbitration
process.

DISQUALIFICATION OF ARBITRATORS & PROCEDURE FOR CHALLENGING ARBITRATOR

Grounds for challenging Arbitrator’s appointment:

The appointment of an arbitrator can only be challenged if the grounds given under the Act are
satisfied. Recently, in the case of McLeod Russel India versus Aditya Birla Finance Limited
(2023 SCC Online Cal 330), the Hon’ble Calcutta High Court ruled that an arbitrator's eligibility
to oversee arbitration proceedings is not automatically compromised merely because one of
the disputing parties appointed them. The court emphasized that an arbitrator can only be
deemed ineligible if their appointment is affected by any of the grounds specified in the
Seventh Schedule.

Section 12 of the Act lays down a set of provisions for the disqualifications of an arbitrator
and 13 the procedure for a challenge.

According to Section 12(1) of the Act, an arbitrator, upon being appointed, must reveal:
 1. Any direct or indirect connections with either party.
2. Any relationships with the subject matter in dispute, encompassing financial, business,
professional, or other affiliations that might impact the impartiality of the resolution
process.

For example, an arbitrator, Mr. Sharma, is appointed to preside over a dispute between
Company A and Company B. As per Section 12 of the Act, Mr. Sharma is obligated to disclose
any direct or indirect connections he may have with either Company A or Company B.
Additionally, he must reveal any financial, business, or professional relationships with the
subject matter in dispute, such as prior consulting work for either company.

For instance, if Mr. Sharma had previously served as a consultant for Company A or had
financial interests in a business affiliated with Company B, these connections should be
disclosed. This transparency ensures that the arbitrator's role remains impartial and free from
potential conflicts of interest.

Under Section 12(2) of the Act, challenging the appointment of an arbitrator is permissible only
if:

1. There are circumstances raising justifiable doubts about the arbitrator's independence
or impartiality.
2. The appointed arbitrator lacks the qualifications agreed upon by the parties involved.

Fifth Schedule: The first one states that the Fifth Schedule should be referred to understand whether
circumstances under Section 12(1)(a) exist.

The fifth schedule deals with following types of relations which might give rise to reasonable
doubts:

1. Arbitrator’s relationship with parties or counsel

2. Arbitrator’s relationship to the dispute
3. Arbitrator’s interest in the dispute
4. Arbitrator’s past involvement with the dispute
5. Relationship of co-arbitrator’s
6. Relationship of the arbitrator with parties and others in the dispute
7. Other Circumstances
If the factual scenario of a case falls under any of the above headings, then the arbitrator may
be challenged.

Seventh Schedule: Section 12(5), inserted by the 2015 amendment, automatically disqualifies
any potential arbitrator who falls in any category under the Seventh Schedule of the Act.
This schedule also covers most of the headings under the Fifth Schedule. The list isn’t as
exhaustive as the Fifth Schedule but as stated above, simply acts as a bar to appointment as
arbitrator. However, this bar can be waived by the parties by an agreement in writing.

The Schedule covers:

1. Arbitrator’s relationship with the parties or counsel

2. Relation of Arbitrator to the dispute
3. Arbitrator’s interest in the dispute.

Voestalpine Schienen v. Delhi Metro Rail Corporation 2015

This was the first case adjudicated by the Supreme Court after the 2015 amendment was
passed. It is thus significant in clarifying the scope of this important section.

Held: The Supreme Court pointed that the main purpose of amending Section 12 was to
maintain a higher level of arbitrator impartiality. In light of this, it stated that in the event that
the arbitration clause was in contradiction to Section 12 (5), the latter would prevail. In such a
case the court would appoint an arbitrator and a party cannot claim appointment as per the
agreement.

However, in the case, the Court held that only because of the fact that the suggested
arbitrators were former or current government employees they won’t be automatically
disqualified from being arbitrators. If they didn’t have any relation to any of the parties, they
were not barred under Section 12(5).

The court differentiated between the concepts of ‘impartiality’ and ‘independence’. Thus, the
court held, any question on impartiality or independence would surface when the arbitrator
discloses any interest in writing. The Court declined jurisdiction in the case.

The Court directed DMRC to delete the clauses from SCC and GCC and asked it to constitute a
broader panel.

DBM Geotechnics v. Bharat Petroleum Ltd, The applicants argued that the nomination procedure
would be unlawful in light of Section 12. The Court rejected this argument and held that in spite of the
fact that the DM was barred from presiding as the arbitrator, he could still nominate someone else as
the presiding arbitrator.

TRF Ltd v. Energo Engineering Projects, The Supreme Court analyzed the clause under GTCPO which
mentioned the MD as the sole arbitrator or any of his nominees. It arrived at the conclusion that,
although the MD may be a respectable person and otherwise eligible to arbitrate, he is ineligible in the
present case. Thus, that makes him ineligible to nominate anyone else as an arbitrator as well. The Court
said, once the infrastructure collapses, the superstructure collapses as well.
SECTION 15. TERMINATION OF MANDATE AND SUBSTITUTION OF ARBITRATOR UNDER ARBITRATION
AND CONCILIATION ACT, 1996

Section 15 (2) Where the mandate of an arbitrator terminates, a substitute arbitrator shall be
appointed according to the rules that were applicable to the appointment of the arbitrator
being replaced.
(3) Unless otherwise agreed by the parties, where an arbitrator is replaced under sub-section

Scope of Section 15 of Arbitration and Conciliation Act, 1996

In S.B.P. and Company v. Patel Engineering Limited and Another (2009), the Supreme Court
held that: “Even Section 15(2), which regulates appointment of a substitute arbitrator, requires
that such an appointment shall be made according to the rules which were applicable to the
appointment of an original arbitrator. The term “rules” used in this sub-section is not confined
to statutory rules or the rules framed by the competent authority in exercise of the power of
delegated legislation but also includes the terms of agreement entered into between the
parties.”
In Yashwith Constructions (P) Ltd. v. Simplex Concrete Piles India Ltd. and Another (2006
Latest Caselaw 359 SC), the Supreme Court held as under:
“The withdrawal of an arbitrator from the office for any reason is within the purview
of Section 15(1)(a) of the Act. Obviously, therefore, Section 15(2) would be attracted
and a substitute arbitrator has to be appointed according to the rules that are
applicable for the appointment of the arbitrator to be replaced. Therefore,
what Section 15(2) contemplates is an appointment of the substituted arbitrator or
the replacing of the arbitrator by another according to the rules that were applicable
to the appointment of the original arbitrator who was being replaced. “
In Rajasthan Small Industries v. M/S Ganesh Containers Movers (2019 Latest Caselaw 52
SC), Supreme Court stated that appointment of the substitute arbitrator must be done
according to the original agreement or provision applicable to the appointment of the
arbitrator at the initial stage.
In Shailesh Dhairyawan v. Mohan Balkrishna Lulla (2015 Latest Caselaw 712 SC) the Supreme
Court enunciated that the provisions of Section 15(2) of the Act require purposive
interpretation so that the aforesaid objective/ purpose of such a provision is achieved
thereby.

APPOINTMENT OF SUBSTITUTE ARBITRATORS

The appointment of substitute arbitrators is governed by section 15 of the Arbitration and

Conciliation Act, 1996 (‘Act’) which essentially provides that when the mandate of an arbitrator
terminates, then a substitute arbitrator shall be appointed according to “the rules that were
applicable to the appointment of the arbitrator being replaced.”

Rules applicable to the appointment of the arbitrator being replaced

In Yash with Constructions (P) Ltd. v. Simplex Concrete Piles India Ltd., the Supreme Court
interpreted this phrase of section 15 (2) of the Act. In this case, when a dispute arose between
Yashwith and Simplex, the managing director of Simplex was appointed as the arbitrator who
ultimately resigned and appointed a substitute arbitrator as his replacement. This appointment
was challenged by Yashwith before the Andhra Pradesh High Court by moving an application
under section 15(2) read with section 11 of the Act. The principal argument advanced by
Yashwith before the High Court was that the term “rules” in section 15 (2) referred only to
statutory rules of appointment of an arbitrator. However, the High Court rejected this
argument and dismissed the application stating that there was no occasion for the High Court
to invoke its powers under section 11 (6). This decision was challenged by Yashwith before the
Supreme Court. The Supreme Court upheld the decision of the Andhra Pradesh High Court and
categorically held as follows:

1. The term “rules” used in section 15 (2) is not confined to statutory rules under the Act;
2. The said term must be interpreted to mean that the substitute arbitrator must be
appointed according to the terms of the arbitration agreement or the rules that were
applicable to the appointment of the original arbitrator at the initial stage; and
3. In case of absence of any provision as to the appointment of the substitute arbitrator in
the arbitration agreement, the jurisdiction under section 11(6) can be attracted only
when there is a failure in appointing the substitute arbitrator in accordance with the
appointment procedure contemplated in the arbitration agreement.

The procedure for challenging an arbitratormoutlined in Section 13 of the Act.

If a party, within 15 days of discovering information under Section 12 that raises concerns
about the arbitrator's impartiality or independence, or within 15 days of the Tribunal's
constitution, fails to agree on an alternative procedure, they must submit a written statement
detailing the reasons for the challenge to the Tribunal.

This written statement should comprehensively present all relevant facts contributing to the
suspicion, accompanied by a reasoned explanation of the arbitrator's conduct that gives rise to
the challenge. The 15-day timeframe is crucial, serving as a limitation period, and any delay
beyond this period may be considered an implied waiver. This timeframe is not only significant
for challenging the arbitrator but also in assessing the arbitrator's conduct. Instances have been
noted where arbitrators proceeded hastily without waiting for the completion of the 15-day
buffer period, accepting references and conducting procedural meetings. The failure to disclose
information promptly, despite repeated requests, formed the basis for challenge applications

under Sections 12 and 13 of the Act.

Benefits of arbitral agreements

1. Arbitration agreements are used in contracts because they are beneficial in contractual
matters. In the recent case of Coinbase, Inc. vs. Bielski (2023), Justice Kavanaugh
highlighted these benefits, stating that arbitration offers “efficiency, less expense, less
intrusive discovery and the like.”
2. Arbitration is a quicker and more efficient way to solve legal matters, saving
businesses time and money. If parties decide to go through the courts to solve legal
matters, they may find themselves waiting for quite a while.Also, litigation can be costly,
as money must be spent on legal representation and other expenses that may arise.
3. Arbitration offers a more efficient solution as matters can be heard faster and a
decision can be rendered, sometimes within the same day.
4. Unlike litigation, arbitration follows a simple set of rules of evidence and procedure;
there is less intrusive discovery under arbitration.
5. Only evidence needed to resolve the dispute under arbitration is considered and the
process time for discovery is therefore shortened. Additional evidence isn’t necessarily
considered unless it pertains to the subject matter.
6. Also, unlike the courts, which are bound by precedent, arbitration proceedings are
more flexible in nature and are based on evidence. Parties can create their own rules
that are to be followed during proceedings, which will then be considered and possibly
enforced by the arbitrator. Arbitrators are also experts in their field, bringing their own
knowledge of the specific industry to legal proceedings.
7. There is also greater confidentiality offered when using arbitration. Businesses may
prefer to keep certain matters private and this is easier if parties go to arbitration. Trials
often do not offer the same kind of confidentiality and the decisions of cases under
litigation become public knowledge after rulings.

Disadvantages to using arbitration clauses

Although arbitrational clauses provide numerous advantages, there are still several
disadvantages that arise when using arbitrational agreements.

1. Most general arbitration clauses tend to declare that they are binding. This therefore
means that if both parties agree that legal matters are to be decided through
arbitration, they are bound by that decision and the decision of the arbitrator. Some
arbitration agreements may state that the decision is non-binding and that the
disgruntled party can take the matter to court. However, this is even an additional
expense, as not only would they have to be for the arbitration but also court and other
legal fees.
2. It is usually assumed that arbitration is an affordable legal recourse, but that may not
necessarily be the case, especially when dealing with larger corporations.
3. Another issue that may deem arbitration unfair is that of mandatory arbitration. The
idea of mutual consent is not considered here, as arbitration is mandatory by contract.
 These types of agreements can restrict the rights that would otherwise be available to
other parties to the agreement.
4. Unlike ligation, which allows for appeals should one party not agree with the judicial
rulings, as seen in the following cases, arbitrational agreements are not easily repealed.

Improving arbitration agreements

Arbitrational clauses can be improved to ensure that proceedings are more efficient.

Determining the validity of arbitrational agreements has introduced agreements that should
be resolved through arbitration to the court system, which invalidates the entire concept of
arbitration. Improving the validity of arbitrational agreements therefore needs to be considered
to remove ambiguity and allow agreements to be solved outside of the courts by arbitrators.

Sometimes, implementing these improvements may be considered, depending on the nature of

the agreement. Drafting the actual arbitration clauses rather than using the boilerplate clause
can ensure that both parties needs and expectations are met. Also, parties can consider
whether the language used in the clause only addresses contractual issues or whether it should
be drafted to include other forms of dispute, such as torts or statutory claims. The language
used in such a clause can affect how it is interpreted by the arbitrators, should it become an
issue in the future.

Also, selecting arbitrators with actual legal experience and experience in that industry can
ensure that the matter is efficiently dealt with, as can the number of arbitrators that are to be
on the panel. In some cases, introducing third party discovery may be advantageous to one
party who believes that the other party is hiding relevant evidence or other subject matter,
which can negatively impact arbitrational proceedings. A three-party panel may result in a more
fair and balanced decision than just having one person presiding over the matter. This can be
stated if the clause is being drafted to the specific agreement rather than being a boilerplate
clause. When drafting the clause, it may also be beneficial to add a severability clause, which
can render parts of the clause unenforceable without affecting the entire clause. Another
aspect that can be considered while drafting is adding a severability clause that allows the
arbitration clause to continue even after the contract has been terminated or expired. Creating
a budget also ensures that the parties do not overspend and that costs are reasonable for both
parties.

Trends in arbitration agreements

As business keeps evolving, so do the terms of contracts. Arbitration and arbitrational clauses
have also evolved in modern times. With the development of COVID, arbitration can be
carried out online, which is even more efficient than meeting with the other party and
arbitrator in person. Additionally, the use of clickwrap agreements may help high-volume
businesses improve arbitrational clauses on their site, which has improved since the cases
of Nguyen vs. Barnes & Noble, Inc. (2014), where it didn’t create a reasonable terms of notice
for users to agree to the terms of use given it was presented in a browsewrap with hyperlinks
alone and Sarchi vs. Uber Technologies, Inc. (2022), where Justice Horton held that the claimant
wasn’t given sufficient notice of Uber’s terms and conditions, whether original or updated,
where she was to give actual consent, as it was easy to bypass these terms due to it being in
clickwrap.

Another trend that may be introduced in future arbitration agreements is following precedent
in other matters. This has already been done in class action law suits. This may create some
predictability as to how cases will be decided in the future.

Conclusion
The essentials of arbitration agreement include a genuine dispute, a written agreement, parties’
intent to arbitrate and their signatures. These essential conditions of an arbitration agreement
help to define its validity.

Understanding the essential elements and optional provisions of an arbitration agreement is

pivotal for creating effective and enforceable contracts that promote fair and efficient dispute
resolution between parties.