There are advantages and disadvantages to both court clauses and arbitration clauses.
In a court clause, the parties agree that any future disputes will be resolved through litigation in a particular geographical court or by a particular judge. It is easier to get a ruling on your case because you don’t have to go through the process of finding an arbitrator and agreeing on one. This can also be less expensive since arbitration usually involves paying fees to the arbitrator.
In an arbitration clause, the parties agree that any future disputes will be resolved by an arbitrator rather than in court. Arbitrators are often experts in particular fields, so you may be able to find one who is specifically knowledgeable about whatever type of dispute you may have. Arbitration can also be more convenient for both parties: there generally isn’t as much paperwork involved, and the schedule is more flexible than it would be in court.
However, the first question you should ask yourself is whether you’re writing a contract for personal or professional use. If it’s for personal use, you’re probably going to want to include a court clause. A court clause dictates that any dispute related to the contract will be adjudicated by the competent court. This gives the parties involved a lot of rights and protections—and, of course, those rights come with certain responsibilities.
If, on the other hand, you’re writing a contract for professional use, an arbitration clause might be better suited. An arbitration clause means that disputes will be resolved outside of court—by an arbitrator rather than a judge and jury. The parties involved in the dispute will present their sides of the story, and then an impartial third party (an arbitrator) who has experience in the field will make a decision based on evidence and facts presented.
In many cases, arbitration clauses are easier than court clauses because they have fewer legal protections and requirements before they can be enforced—but this also means that they may not always work out fairly in your favor. It is important to think very carefully about whether one is right for you before including it in your contract.
Overall, it is recommended to put a court clause in your contract, not an arbitration clause. There are a few reasons for this:
1. The court system is familiar to most people, and the process is understood.
2. It’s less expensive than arbitration.
3. You have more privacy with a court clause (arbitration can be public).