Construction Arbitration Clause for the United States

Construction Arbitration Clause Template for United States

A Construction Arbitration Clause is a contractual provision used in U.S. construction contracts that establishes the framework for resolving disputes through arbitration rather than litigation. Operating under U.S. federal and state arbitration laws, it specifies the procedures, scope, and requirements for arbitrating construction-related disputes. The clause typically addresses arbitrator selection, applicable rules, cost allocation, and timeframes, while ensuring compliance with both federal and state-specific construction laws.

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What is a Construction Arbitration Clause?

The Construction Arbitration Clause is essential in modern U.S. construction contracts as it provides a more efficient and specialized approach to dispute resolution compared to traditional litigation. This clause becomes particularly important when parties seek to avoid lengthy court proceedings and prefer industry-expert arbitrators. It must comply with the Federal Arbitration Act and relevant state laws, while addressing construction-specific considerations such as multi-party disputes, technical expertise requirements, and interim relief provisions. The clause typically includes detailed procedures for initiator arbitration, selecting arbitrators, and managing the arbitration process.

What sections should be included in a Construction Arbitration Clause?

1. Agreement to Arbitrate: Core provision establishing parties' agreement to submit disputes to binding arbitration

2. Scope of Arbitration: Defines what types of disputes and claims are subject to arbitration under the construction contract

3. Arbitration Rules and Governing Law: Specifies applicable arbitration rules (e.g., AAA Construction Industry Rules) and governing law

4. Arbitrator Selection: Details the process for selecting arbitrators, including number of arbitrators and required qualifications

5. Notice and Procedural Requirements: Outlines procedures for initiating arbitration, including notice requirements and time limits

6. Award and Enforcement: Establishes binding nature of arbitration award and enforcement procedures

What sections are optional to include in a Construction Arbitration Clause?

1. Multi-Party Provisions: Special provisions for handling disputes involving multiple parties or related contracts

2. Consolidation and Joinder: Provisions allowing consolidation of related disputes and joinder of additional parties

3. Emergency Relief: Procedures for obtaining emergency or interim relief during the construction project

4. Cost Allocation: Specific provisions for allocating arbitration costs and attorneys' fees

5. Discovery Procedures: Special provisions regarding document exchange and discovery processes

What schedules should be included in a Construction Arbitration Clause?

1. Schedule A: Fee Schedule: Detailed breakdown of arbitration costs, fees, and payment responsibilities

2. Schedule B: Required Arbitrator Qualifications: Specific requirements for arbitrator expertise in construction matters

3. Schedule C: Arbitration Timeline: Expected timeline and deadlines for various stages of the arbitration process

4. Schedule D: Approved Arbitration Institutions: List of approved arbitration institutions and their relevant rules

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

United States

Publisher

Genie AI

Cost

Free to use
Industries

Federal Arbitration Act (FAA): Primary federal legislation that establishes the validity and enforceability of arbitration agreements, sets basic procedural requirements, and governs interstate commerce aspects

State Arbitration Acts: State-specific legislation that may provide additional requirements or protections, affect enforcement mechanisms, and contain specific construction industry provisions

Miller Act: Federal law requiring performance and payment bonds for federal construction projects

State Little Miller Acts: State-level equivalents of the Miller Act, governing bonding requirements for state construction projects

State Construction Lien Laws: State-specific legislation governing mechanics liens and other security interests in construction projects

State Prompt Payment Acts: Laws governing timing and requirements for payments in construction projects at the state level

AIA Contract Documents: Standardized construction contract documents published by the American Institute of Architects, including arbitration provisions

ConsensusDocs: Standardized construction contract documents developed by industry stakeholders, including arbitration provisions

AAA Construction Industry Arbitration Rules: Specialized arbitration rules and procedures published by the American Arbitration Association for construction disputes

JAMS Construction Arbitration Rules: Specialized arbitration rules and procedures published by JAMS for construction disputes

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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