Following the construction industry and related legal topics in the United States.


Wednesday, December 6, 2006

Optional Dispute Resolution Clauses deserve attention

It is good to note that courts continue to honor the intentions of the parties as expressed in contracts, including the choice of alternative dispute resolution. Noted at Construction Attorney Blog is the case of Higley v. N/S Corporation, 2006 WL 985753 (6th Cir., April 17, 2006), in which the contract contained this arbitration clause: "Should [N/S] and [Higley] be unable to resolve said dispute(s) through mediation, any and all dispute(s), at the sole discretion of [Higley], shall be decided by arbitration in accordance with the Construction Industry Arbitration Rules of the American Arbitration Association." Higley filed suit and N/S sought to compel arbitration. The trial court denied the motion to compel and the Sixth Circuit affirmed, finding that a contract that gives one party the option to pick either arbitration or litigation will be upheld. Honoring such clauses allows the parties, as they see fit, to assess the underlying facts requiring dispute resolution and to utilize the most appropriate choice of dispute resolution for the circumstances. (This entry was posted by John Springer of the Womble Carlyle construction and real estate development group.)

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