Arbitration Clause in Separation Agreement: What You Need to Know
When couples decide to separate, they often enter into a separation agreement to formalize the terms of their separation. This agreement typically covers a range of issues, such as child custody, division of assets and debts, and spousal support. One key aspect of a separation agreement that is often overlooked is the inclusion of an arbitration clause.
What is Arbitration?
Arbitration is a method of resolving disputes outside of court. Instead of going to trial, the parties agree to submit their dispute to a neutral third party arbitrator who renders a binding decision. The process is more informal and generally faster than going to court, and it can also be less costly.
Why Include an Arbitration Clause in a Separation Agreement?
By including an arbitration clause in a separation agreement, the parties agree to resolve any future disputes arising from the agreement through arbitration instead of going to court. This can be beneficial for several reasons.
First, arbitration can be less stressful and more private than going to court. Court proceedings are public, whereas arbitration hearings are typically held in private and are confidential. This can be particularly beneficial for couples who are trying to keep their separation and any resulting disputes out of the public eye.
Second, arbitration can be less expensive than court proceedings. Court fees, attorney fees, and other expenses can quickly add up, whereas arbitration costs are typically less and can be shared by the parties.
Finally, arbitration can be faster than going to court. Court cases can take months or even years to resolve, whereas arbitration can be completed in a matter of weeks or months.
What Should an Arbitration Clause Include?
If you are considering including an arbitration clause in your separation agreement, there are several key elements to consider. These include:
1. The scope of the arbitration clause. The arbitration clause should specify which disputes are subject to arbitration and which are not.
2. The selection of the arbitrator. The agreement should specify how the arbitrator will be selected and who will pay for the arbitrator`s fees.
3. The location of the arbitration. The agreement should specify where the arbitration will take place.
4. The rules of the arbitration. The agreement should specify which rules will govern the arbitration process.
5. The language of the arbitration clause. The agreement should use clear and unambiguous language to avoid any potential confusion or disputes.
In conclusion, including an arbitration clause in a separation agreement can provide many benefits. It can make the process of resolving disputes less stressful, less expensive, and faster than going to court. However, it is important to carefully consider the scope of the arbitration clause and include all necessary elements to ensure that the process is fair and effective for both parties.
