Contract With Arbitration Clause Example
Sample Contract with Arbitration Clause
This agreement serves as an example and should be reviewed and modified by legal counsel to fit the specific circumstances of your situation. The following is not legal advice.
Agreement for Services
This Agreement (“Agreement”) is made and entered into as of [DATE], by and between [SERVICE PROVIDER NAME], residing at [SERVICE PROVIDER ADDRESS] (“Service Provider”), and [CLIENT NAME], residing at [CLIENT ADDRESS] (“Client”).
1. Scope of Services
Service Provider agrees to provide the following services to Client (the “Services”):
- [Specifically describe the services to be provided. Be detailed and avoid ambiguity. Example: “Website design, development, and deployment, including creation of a mobile-responsive website with up to ten (10) pages, integration of a content management system (CMS), and hosting setup.”]
- [Another service, if applicable. Example: “Search engine optimization (SEO) services, including keyword research, on-page optimization, and link building.”]
- [Another service, if applicable. Example: “Ongoing website maintenance and support, including monthly backups, security updates, and technical support.”]
2. Term and Termination
This Agreement shall commence on [START DATE] and shall continue for a term of [DURATION – e.g., one year] (the “Term”), unless earlier terminated as provided herein.
Either party may terminate this Agreement upon [NUMBER] days written notice to the other party if the other party materially breaches this Agreement and fails to cure such breach within such [NUMBER] day period.
Client may terminate this Agreement for convenience upon [NUMBER] days written notice to Service Provider, subject to payment for all services performed and expenses incurred up to the date of termination.
3. Compensation
In consideration for the Services, Client shall pay Service Provider as follows:
- [Describe the payment structure. Example: “A flat fee of $[AMOUNT] for the website design and development Services.”]
- [Example: “An hourly rate of $[AMOUNT] for SEO Services, billed monthly.”]
- [Example: “A monthly retainer fee of $[AMOUNT] for website maintenance and support.”]
Payment shall be due within [NUMBER] days of receipt of invoice from Service Provider.
4. Intellectual Property
All intellectual property rights in and to any materials created by Service Provider in connection with the Services shall be owned by [STATE WHO OWNS THE INTELLECTUAL PROPERTY – Service Provider or Client or some other arrangement].
[If Client owns the intellectual property, include a clause such as: “Service Provider hereby assigns to Client all right, title, and interest in and to any and all such intellectual property.”]
[If Service Provider retains ownership, include a clause such as: “Client is granted a non-exclusive, perpetual license to use such materials for the intended purpose of the Services.”]
5. Confidentiality
Each party agrees to hold confidential any information received from the other party that is designated as confidential or that reasonably should be understood to be confidential. This obligation shall survive the termination of this Agreement.
6. Limitation of Liability
IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL, OR PUNITIVE DAMAGES ARISING OUT OF OR RELATING TO THIS AGREEMENT, WHETHER BASED ON CONTRACT, TORT, OR ANY OTHER LEGAL THEORY, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. EACH PARTY’S TOTAL LIABILITY UNDER THIS AGREEMENT SHALL BE LIMITED TO THE AMOUNT PAID BY CLIENT TO SERVICE PROVIDER HEREUNDER.
7. Force Majeure
Neither party shall be liable for any failure to perform its obligations under this Agreement due to any cause beyond its reasonable control, including, but not limited to, acts of God, war, terrorism, riots, strikes, fire, flood, or government regulation.
8. Governing Law
This Agreement shall be governed by and construed in accordance with the laws of the State of [STATE NAME], without regard to its conflict of laws principles.
9. Entire Agreement
This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior or contemporaneous communications and proposals, whether oral or written.
10. Amendment
This Agreement may be amended only by a written instrument signed by both parties.
11. Severability
If any provision of this Agreement is held to be invalid or unenforceable, such provision shall be struck and the remaining provisions shall remain in full force and effect.
12. Arbitration
Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, shall be settled by arbitration administered by the American Arbitration Association in accordance with its Commercial Arbitration Rules, and judgment on the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof. The place of arbitration shall be [CITY, STATE]. The arbitration shall be conducted in the English language. The arbitrator(s) shall have the authority to award any remedy or relief that a court could order or grant, including, without limitation, specific performance. The decision of the arbitrator(s) shall be final and binding on the parties. Each party shall bear its own costs and expenses of arbitration, and the parties shall share equally the costs and expenses of the arbitrator(s) and the administrative fees of the American Arbitration Association. This arbitration clause shall survive the termination of this Agreement.
Explanation of the Arbitration Clause: This clause dictates that instead of going to court, any disputes related to this agreement will be resolved through arbitration. Arbitration is a form of alternative dispute resolution (ADR) where a neutral third party (the arbitrator) hears evidence and makes a binding decision. This clause specifies that the American Arbitration Association (AAA) rules will govern the arbitration, ensuring a structured and fair process. It also specifies the location of the arbitration and states that the arbitrator’s decision is final, limiting the possibility of appeals. The costs are typically split between the parties, although this can be modified. Finally, the clause ensures that even if the main agreement ends, the commitment to arbitrate disputes remains in effect.
Considerations when using an arbitration clause include: The choice of arbitration administrator (AAA, JAMS, etc.), the location of the arbitration, the number of arbitrators (one or three), the scope of discovery allowed, and the allocation of costs. You may also want to consider including a clause specifying that the arbitrator must be an expert in the relevant field of the agreement. It’s crucial to understand the implications of agreeing to arbitration, as it typically limits your right to pursue a lawsuit in court. It is always recommended to consult with an attorney before entering into any agreement containing an arbitration clause.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.
_________________________
[SERVICE PROVIDER NAME]
_________________________
[CLIENT NAME]
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