Will my arbitration agreement be upheld?
Will my arbitration agreement be upheld?

The following Arbitration guidance note provides comprehensive and up to date legal information covering:

  • Will my arbitration agreement be upheld?
  • Requirements of an arbitration agreement
  • Inconsistency
  • Uncertainty
  • Non-existent institutions or rules
  • Hybrid clauses—administration of arbitration by another institution
  • Is it even an arbitration clause?
  • Being too specific
  • Provision for service of suit in dispute resolution clauses
  • Separability and scope of the arbitration agreement

This Practice Note considers the validity of arbitration agreements with a particular focus on the law of England and Wales (English and England are used as shorthand throughout), although some comparative examples from other jurisdictions are included. The Practice Note should be read in conjunction with Practice Notes: Arbitration agreements—definition, purpose and interpretation, Arbitration agreements—the in writing requirement and Arbitration agreements—content.

Requirements of an arbitration agreement

Under English law, an arbitration agreement must (among other requirements) be in writing and sufficiently certain so as to be enforceable—see the Practice Notes above. However, it is very easy for a seemingly simple clause to miss important details or a complex clause to become inconsistent and, therefore, potentially unenforceable. Indeed, dispute resolution clauses are often referred to as 'midnight clauses', ie the last to be negotiated in a substantive contract when the parties do not usually want to turn their minds to what will happen in the event of a dispute. When things go wrong, the resulting arbitration clauses are sometimes referred to as defective or pathological.

Following Fiona Trust v Privalov, the English court has shown that it will try to interpret clauses in favour of arbitration where, in its view, that was what the parties had intended—see Practice Note: Arbitration agreements—definition, purpose and interpretation. Failing to agree clearly and unequivocally to arbitration when