Increasing Numbers of Consumer Contracts Contain Arbitration Clauses in Which

Essay

Increasing numbers of consumer contracts contain arbitration clauses in which the consumer agrees in advance that any dispute related to the contract will be submitted to an arbitrator,often chosen by the other party to the contract.Agreements between consumers and insurance companies,as well as agreements between stockbrokers and their clients,are two areas where these are increasingly common.What are the advantages and disadvantages to the consumer of such a clause? Should these clauses be effective to allow consumers to give up their rights to use the court system? Does it affect your analysis if you learn that many consumers are not aware of these provisions or do not understand them when they enter into these agreements? How enforceable should these mandatory arbitration clauses be?