If arbitration costs for consumer exceed inspector's limitation of liability will...

… the court find your contract unconscionable?

It depends.

An arbitration clause needs to be ONEROUS, in most cases, to be set aside. In this case, I believe the Court was CORRECT in reversing the lower court ruling. In addition to the limit of liability portion, the costs of arbitration were pretty damned hign, IMO. Cant have it both ways. Finally, CAS does NOT arbitrate HI disputes any longer, so the clause would likely get thrown out for non-enforceability. $275 recovery at a cost of $1350 is absurd. This is a prime example, IMO, of how inspectors screw themselves by failing to use common sense when ACCEPTING what someone decides to put in their inspection agreement. An idiot would understand the flays in this arbitration model.

In general, if the arbitration clause is too one-sided, there is more of a chance it will be tossed. In this case it was both lop-sided and unenforceable, IMO. And we didnt even discuss the merits of the claim.

This is the BEAUTY of the IAS model. It is fixed-price arbitration and mediation at just $350.

We’ve had our clause challenged 3 times, and each time the clause compelling arbitration was UPHELD, as our service is fair, our price is fixed and affordable, and there is nothing draconian about the service.

Still cheap to subscribe (you MUST subscribe at $90 per annum).

Fee paid by party bringing the action. At the end of the day, fee may be transferred to losing party (if they havent already paid) or split between the two via some equitable and agreed-to means.

SEVERAL times in KC the court has rejected the $$$$ limitation BUT upheld the arbitration clause and sent the case to arbitration. I’ve always referred to CAS because the party starting the arbitration has to kick out the $$$$$$$$$$ #2 they try to hold the arbitration at the property; #3 they have never around here used

I like that.


CAS is out of the business of home inspection arbitration for about the past 2 years now.

They used to be in Dallas.

Not there anymore. I’ve worked with them before in arbitrations. I likewise thought they were gone. One of our local inspectors talked to them 3 months ago and said they were now up in Minnesota I believe ???

Highly unlikely you can enforce the arb clause with the arbitrator no longer in business.

Every now and then you see and/or hear a statement being made :roll: that just requires this answer… duh:wink:

In the state of Indiana even if the arbitration company is no longer in business, the arbitration clause will be enforced. Since the arbitration company named in the contract cannot be used, the two lawyers need to negotiate on the new arbitrating company if a second company is not already named in the contract.

Four things that really helped me here in Indiana:

  1. Naming the arbitration company to be used.
  2. Naming another arbitration company if the first cannot be used.
  3. Plaintiff is responsible for the full cost of the arbitration fee.
  4. If part of the contract is unenforceable, the rest of the contract will stand.