Consumer Arbitration Agreements: Not Understanding What You Didn’t Agree To
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A recently posted paper, reporting on the results of an empirical study, reveals unsettling facts about consumer understanding of arbitration contracts. Titled “Whimsey Little Contracts” With Unexpected Consequences: An Empirical Analysis of Consumer Understanding of Arbitration Agreements, the paper explores the extent to which consumers are aware of, and understand the effect of, arbitration clauses in connection with their purchases of goods and services.
The authors report “a profound lack of understanding about the existence and effect of arbitration agreements among consumers.” Fewer than half of those surveyed recognized that a sample contract included an arbitration clause, and more than half of those respondents believed that the clause not deprive them of a right to seek judicial redress.
So in whose book is this a contract?
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