Spotting Arbitration Clause Pitfalls: What Every Texas Business Lawyer Should Know
Arbitration clauses are now standard fare in Texas business contracts. They appear in operating agreements, employment contracts, customer terms, vendor agreements and M&A-related documents—often copied forward from legacy templates with little thought. Adopting this casual approach is risky.
Texas courts are among the most arbitrationfriendly in the country, particularly when the Federal Arbitration Act (FAA) applies. But that friendliness does not extend to sloppy drafting. Poorly constructed arbitration clauses routinely generate threshold litigation, unexpected procedural outcomes or outright unenforceability—undermining the very efficiency arbitration is supposed to deliver.
Full article below:
Arbitration clauses are now standard fare in Texas business contracts. They appear in operating agreements, employment contracts, customer terms, vendor agreements and M&A-related documents—often copied forward from legacy templates with little thought. Adopting this casual approach is risky.
Texas courts are among the most arbitrationfriendly in the country, particularly when the Federal Arbitration Act (FAA) applies. But that friendliness does not extend to sloppy drafting. Poorly constructed arbitration clauses routinely generate threshold litigation, unexpected procedural outcomes or outright unenforceability—undermining the very efficiency arbitration is supposed to deliver.
Full article below:
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