Switched my mind on arbitration clauses after a small claims court trip

I used to always put binding arbitration clauses in my freelance contracts because everyone online said it kept things out of court and cheaper. But last summer I had a client in Austin refuse to pay a $2,800 invoice and I couldn't take them to small claims because of that very clause. I had to pay $400 just to start the arbitration process and it dragged on for 4 months. So I ripped arbitration out of my template and replaced it with a simple provision that says disputes under $5,000 go to small claims court in my county. Has anyone else had problems with arbitration actually costing more than they saved?

3 comments

3 Comments

charlieh743d ago

@evan_grant70 not quite right on the timeline though, small claims can take longer than six weeks in some places.

river_thompson3d ago

Oh man that's brutal. $400 to start and 4 months to get it sorted? That's literally more than I pay for my entire small claims filing here. Totally feel your pain on this one though, I learned the hard way too after getting burned on a similar setup with a contractor who ghosted me on a job. Switched to the small claims route too and it's been way simpler.

evan_grant703d agoMost Upvoted

Dude seriously! I got burned so bad on a similar thing last year. Paid a guy $350 to start on some fence work and he just stopped showing up after two weeks. Left me with a half built mess for three months while I was trying to get my money back through some stupid arbitration thing. Small claims was a lifesaver though. I filed for $1200, got a hearing in like six weeks, and the judge actually ruled for me. Never looking back after that mess lol.