Is All Arbitration Binding in Texas?

Full Question:

Our arbitration laws all binding in Texas.
10/26/2011   |   Category: Arbitration and Me...   |   State: Texas   |   #25534

Answer:

Arbitration is recognized in Texas. Written arbitration agreements are generally valid, enforceable and irrevocable. In rare cases, a court may set aside an arbitration clause under contract law principles. Courts have held that a party may rescind a contract for fraud, incapacity, duress, undue influence, material breach in performance of a promise, or mistake, among other grounds. Lack of ability to pay to defend yourself in arbitration is not a reason accepted by the court for setting aside an arbitration clause.

When arbitration is binding, you have to use it and can't mediate or sue. Some companies also stipulate in their clauses that if a court sets aside the arbitration clause, you waive your right to a jury trial. That means you can go to court, but the dispute will have to be heard by a judge rather than a jury.

For further discussion, please see:

http://www.bankrate.com/brm/news/advice/20041117a1.asp
http://texas-arbitration-case-law.blogspot.com/
http://www.window.state.tx.us/taxinfo/proptax/arbitration05/