Arbitration Clause in a contract

Hello, I am wondering if anyone has an arbitration clause in their contract? I was told that this is important to have if a job goes sour. The homeowner and contractor would go through the arbitration process before a lawsuit could be files. Any help would be great!

Bahah, that's awesome Tim. When I worked in the computer business, I got mixed in with a lawsuit. An email I wrote to boss & coworkers saying 'If you have anything important to tell me, let me know because apparently I've been missing a few emails lately' That made me look very innocent(which I was) in court years later.

So there I was, under oath, with the opposing attorney laying a cut & pasted copy of a post I sent on RCS where I called the defendant a crook. Oops. :)

I had to explain that I was just kind of wound up at the time.

I too feel safe with e mail communications. It is a form of documentation.

Mike, emails show up in depositions. When we were involved in a trial in 2004, during depositions the opposing attorney laid in front of me dozens of emails I sent and posts I made to this forum over a period of years...and asked me to explain them:)

Since then I never Delete emails as they can provide a solid evidentiary paperless trail of what was said.

Toward your post, if I get a new customer I don't know to give me the go ahead via email, I feel reasonably protected, especially when I email him the quote on our proposal forms.

Like Lefty, I think contracts are highly over rated. I think my biggest job without a contract last year was 400K. Getting ready to start one that's 1.5M next month. Nothing more than an email notice that the job was ours, get things moving. The actual system spec is all verbal.

If they chose not to pay, i'd be a duster. I just don't see it happening. Never been wrong about the people I needed I get a contract from,.... knock on wood.

But when I do use one, it does have an arb clause

Back in the 1980's we sued Gulf States Asphalt. They sold us a bunch of emulsion which we used to install over 150 commercial roofs before we figured out that it would re-emulsify when exposed to water for any length of time.

During the depositions their smart a## attorney was aggressive and irritating. He kept asking me if I looked everywhere for a certain document. I said "No, I didn't look behind my refrigerator." Everyone but him laughed. He asked if it might be behind the refrigerator. I said "I don't know, I didn't look behind the refrigerator."

Then, as each of my brothers got up to do their depositions, he'd ask if they looked everywhere, and they said "No, I didn't look behind my refrigerator." The attorney got really frustrated - and hour latter they settled out of court.

I had to go to court ONE time to defend my company. This crazy lady tried to sue me over her rotten gutters and facia which we had nothing to do with. They were that way when we roofed the house and she didn't want to pay to have them replaced. She got one of my competitors to be her "STAR" witness in court. Of course he was to get the work if she was able to win and have me pay for it.

I represented myself without an attorney and I cross examined this guy. He went to bragging about how he does 10 estimates a day and blah blah blah. I said that's a high number but it leaves me concerned about the quality. That got him riled up and he went to stuttering around. I then asked "Did you see anything wrong with the roof to cause any damage to the facia"? He said I can't remember and then said well if I did, then I would have wrote it down but I didn't write anything down.

At the end of the trial the judge said I find the defendant not liable in this case "Based on the testimony of the plantiff's STAR WITNESS! :laugh:

Derf Daddy Said: Thanks for the responses - the arbitration clause in the contract is essential, because if there is a dispute, it will go to arbitration before going to court....this will and would help all of us, at least in MI Im trying to cover all the basses.

The point of arbitration is to avoid a trial, and thus I think most arbitrations are binding. Once it is arbitrated it is unlikely you can go to a trial.

MI has contractor licensing. What does the law say?

Thanks for the responses - the arbitration clause in the contract is essential, because if there is a dispute, it will go to arbitration before going to court....this will and would help all of us, at least in MI I'm trying to cover all the basses.

"I am more leery of other contractors then homeowners."

No doubt. Me too B)

My son puts everything in a contract. It is the law.

I just did 2 siding jobs without a contract. One for $26,000 and one for $20,000. A handshake is fine with me. I just tell them when I can start. Only take money down if they insist.

The state made a law about 3 years ago that anything over $500 needs to be done with a contract. These people could just refuse to pay and that would be the end of it.

I am more leery of other contractors then homeowners.[size=4][/size]

Our contracts have had an arbitration clause for decades but we've about decided it doesn't help much.

Back in 2004 we went to arbitration and it still cost us 6-figures. We still had to hire attorneys, still had to travel across the country for depositions; it was pretty much just like a trial except it was binding.

I've never been screwed on a roof replacement but once. After I got the "I'm a man of God" lecture and was told what a great man of religion I was dealing with, I had my lawyer send a letter. He paid up , minus $200......and I regret not going after him for it.

I've had a couple of repair jobs just straight out rip me off and refuse to pay. None had contracts. In 24 yrs. I've probably been ripped off for about $1,000 total

I'm with tinner for the most part. I only get a signed contract if I'm doing a full replacement which is rarely ever. I gave a guy a price on a repair today and he said ok let me write you a check and oh by the way when can you get started? I never asked for a check and he never asked for a contract, I just told him how much it would cost.

Repair jobs being lower amounts is one reason a contract is not needed but the biggest reason by far is that I do my own work, they trust me to do it right and do what I say and that's what I do!