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Can an Arbitration Clause Affect Your Injury Claim?

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By Christopher Coble, Esq. on February 18, 2015 1:08 PM

It feels like arbitration has been coming up in the news more frequently lately, from NFL injury lawsuits to Sirius XM in your new car to Lance Armstrong. It's possible that you're subject to an arbitration clause and may not even know it.

So how can these clauses affect a potential injury claim? Here's a general overview:

What Is an Arbitration Clause?

Arbitration clauses are often inserted into contracts. They require the parties to enter into arbitration, rather than litigation, to resolve certain disputes regarding the contract. Although the figurative jury is still out on whether arbitration is cheaper than facing a literal jury, many parties prefer to avoid standard litigation in contract disputes.

For workers injured on the job, many employment contracts will mandate that any dispute regarding a work-related injury or worker's compensation be handled in arbitration. These clauses can also come into play when consumers are injured by products or even in nursing home injury cases.

The arbitration itself can take several forms, mostly consisting of a neutral third party or panel deciding the proper resolution a dispute -- often without the procedural confines, or protections, of a standard lawsuit.

Whether an arbitration clause is enforceable could depend on the contract language, the underlying dispute, or even how far the parties are into litigation.

How Can Arbitration Clauses Affect an Injury Claim?

If your injury claim is subject to an arbitration clause, both the process and the result could be different than if the case were to go to court.

Procedurally, both parties to an arbitration must agree on a single arbitrator or a small panel to decide the claim. And the rules of evidence may be relaxed as opposed to those in a normal trial, making it easier for each side to use documents and records to make their case.

In terms of a result, an arbitrator's decision, as opposed to most court rulings, is final and generally cannot be appealed. (Though, as seen in Lance Armstrong's case, an arbitration can sometimes be re-opened, depending on the circumstances.) This can be a double-edged sword, as it prevents a defendant from overturning or delaying an arbitration award while also denying a plaintiff review of a denial or less-than-favorable settlement.

Still, every injury case is unique, and it may take an experienced injury lawyer to say for sure how an arbitration clause will affect yours.

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