Wednesday, August 29, 2012

Have an Arbitration Provision in Your Ohio Contract: Don't Expect to End Up In Court

When parties to a contract agree to resolve their disputes through arbitration, Ohio courts will generally force the parties to arbitrate. Ohio’s arbitration statute, R.C. 2711.01, offers little discretion to courts when determining the enforceability of an arbitration clause. This statute states that “a provision in any written contract…to settle by arbitration a controversy that subsequently arises out of the contract…shall be valid, irrevocable, and enforceable…”

However, a court cannot force parties to arbitrate when the parties have not agreed to do so. A recent case from Ohio’s Ninth Appellate District,  Avenbury Lakes Homeowners Assn., Inc. v. Avenbury Lakes, Inc., 2012 Ohio App. LEXIS 2253, provides an example of how courts will not expand an arbitration clause that limits itself to certain aspects of the underlying contract.

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