Janna Purdie considers the fairness of arbitration clauses in consumer contracts
Arbitration agreements and the Consumer Contracts Regulations 1999
The Technology and Construction Court refused to enforce an arbitration award under s 66(3) of the Arbitration Act 1996 (AA 1996) on the grounds that:
● the arbitrator had not been validly appointed in accordance with AA 1996.
● the arbitration clause did not comply with SI 1999/2083
Facts of the case
The claimant had carried out building work for the defendant and a dispute arose. The claimant's standard terms and conditions provided for any dispute to be referred to arbitration.
The defendant having taken advice, maintained that the standard terms and conditions were contrary to SI 1999/2083 and therefore the arbitration clause did not apply. Therefore, any dispute between the two parties should be dealt with in the courts. The defendant maintained this stance by refusing to participate in the appointment of an arbitrator, disputing the arbitrator's jurisdiction and refusing to take part in the arbitration.
The arbitrator considered that he had jurisdiction and made an award in favour of the claimant.
