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Nestling Arbitration Agreements in Contracts

We’ve blogged about legal language translation services and contact law. It is standard that an arbitration agreement nestled in a commercial contract has legal validity of its own. Further, once a court makes the determination that the nestled agreement to arbitrate is enforceable, then the arbitrator has jurisdiction to determine the enforceability of the contract.

However, if there isn’t anything for the arbitration agreement to nestle into, the contract will be held to have only evidenced an agreement to arbitrate.

In other words, it will be judged as nothing more than a mutual agreement to arbitrate claims.

This distinction can have a significant impact on a contract dispute. For example, it could determine jurisdiction and procedure which may or may not be favorable to one of the parties. It becomes even more crucial in an international contract, as it could determine which country – and which laws – will govern the dispute resolution. If dealing with a foreign language contract, be sure the foreign language translation contains a nestled arbitration agreement.

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