What is arbitration?

legal basics

Hello and welcome!

It's Tamsen Horton from PBK, the gathering place for preneurs worldwide. Those of us unlocking our superpowers and living our vacationing life using Kajabi. Lives and businesses we don't need to escape from. Giving us health, wealth, and family freedom.

And this is your PBK Power-up for June 3, 2019.

Arbitration and why this matters to what you're building with Kajabi.

You need purchase terms when you are selling your products and services on Kajabi. And having an arbitration clause in that contract makes a lot of sense.

What is the purpose of arbitration?
It is an alternative dispute resolution to a court proceeding, also called litigation.

Litigation can get quite expensive and often takes a very long time. Using an arbitration clause allows you to set the rules for what happens if a dispute arises between you and a buyer.

Arbitration is the process of bringing a business dispute before a disinterested third party for resolution. The third party, an arbitrator, hears the evidence presented by both sides and makes a decision (much like a judge would).

Arbitration is often confused with mediation. In mediation, picture two parties who aren't getting along put in separate rooms and then the mediator goes back and forth trying to help the highly emotional people reach a resolution.

What is an arbitration clause?
A typical arbitration clause in a contract might look like this (from the American Arbitration Association):

Any controversy or claim arising out of or relating to this contract, or its breach, shall be settled by arbitration administered by the American Arbitration Association under its Commercial Arbitration Rules, and judgment on the award rendered by the arbitrator(s) may be entered in any court having jurisdiction.

What does that all really mean?
If we have a disagreement or this contract is breached, then we agree now in this contract to use arbitration (as opposed to litigation or mediation) to settle our disagreement.

  • So do you have purchase terms on your Kajabi offer checkout page?
  • Do you have an arbitration clause?

I highly recommend having purchase terms tailored to what you are selling and avoiding litigation is typically advantageous for everyone involved.

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