If I sign an arbitration clause with an auto loan contract and the dealership cancels said contract, is the clause canceled as well? 4 Answers as of September 18, 2017

Would it still be in effect if a new contract is written? Quick explanation: Signed arbitration with contract A. Contract A canceled by dealer. Contract B signed, no new arbitration clause given or signed.

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Ronald K. Nims LLC | Ronald K. Nims
Usually an arbitration clause in a contract applies to that contract and survives termination of the contract. So, if you have a dispute with Contract A and the arbitration provision specifies it survives termination, then you'd have to handle the dispute under Contract A's arbitration provision. Since there is no arbitration provision in Contract B, any dispute in Contract B would be handled in court. However, given the cost of going to court, if there is no arbitration provision you realistically don't have any remedy except small claims court. Few attorneys are willing to take a case unless the expected damages are over $50,000 or you agree to pay their hourly rate and deposit a retainer of $10,000.
Answer Applies to: Ohio
Replied: 9/18/2017
Richard B. Jacobson & Associates, LLC | Richard B. Jacobson
In all likelihood, there is no longer an operative arbitration clause.
Answer Applies to: Wisconsin
Replied: 9/18/2017
GARCIA & GONZALES, P.C.
GARCIA & GONZALES, P.C. | Richard N. Gonzales
Yes.
Answer Applies to: Colorado
Replied: 9/18/2017
Janet A. Lawson Bankruptcy Attorney
Janet A. Lawson Bankruptcy Attorney | Janet Lawson
The new contract replaces the old one if all the parties signed it. That is called Novation. You might have some contract defenses, (failure of consideration, duress, ect.). You need to see local counsel.
Answer Applies to: California
Replied: 9/18/2017
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