Can I require customers to sign contracts with binding arbitration clauses in Tennessee? What are the requirements?

Requirements for binding arbitration clauses in Tennessee

Yes, you can require customers to sign contracts with binding arbitration clauses in Tennessee. The Tennessee Code Annotated § 29-5-302(a) states that a written agreement to submit any existing controversy to arbitration or a provision in a written contract to submit to arbitration any controversy thereafter arising between the parties is valid, enforceable, and irrevocable, save upon such grounds as exist at law or in equity for the revocation of any contract.

The arbitration clause must be in writing. The Uniform Arbitration Act, T.C.A. § 29-5-301 et seq., requires only that an agreement to arbitrate be written; it does not further require it to be signed [2]. However, for contracts relating to farm property, structures or goods, or to property and structures utilized as a residence of a party, the clause providing for arbitration shall be additionally signed or initialed by the parties [1].

Subjects of arbitration

All causes of action, whether there be a suit pending therefor or not, may be submitted to the decision of one (1) or more arbitrators, except in one (1) of the following cases: (1) Where one (1) of the parties to the controversy is an infant or a person adjudicated incompetent; (2) One (1) respecting a claim to an estate in real property, in fee or for life. Not included in the exception are: (A) A controversy in regard to an estate or term for one (1) year or less or of years not exceeding five (5); or (B) Respecting the partition of real property, or the boundaries of lands [2].

[1] Tennessee Code Annotated § 29-5-302(a) [2] TNCO 29-5-101

Jurisdiction

Tennessee

• General