In the US, most companies make you sign a legally binding arbitration agreement (they include it in the terms of service contract) before they'll sell you internet service, phone service, or a car, or get access to a web site, rent an apartment, and almost everything else that involves any sort of agreement.

What this means: You agree that if you have a problem that they won't solve and believe you are owed money by them, instead of suing them, you'll allow them to take the case to an arbitrator, which is someone they pay to hear the case and decide who's right. Obviously, that's an enormous conflict of interest–but nearly all companies do it, so you basically can't live without agreeing to these contracts.

The second thing they do is state in their contract that anything their sales people promise you is not binding. In other words, no matter what the company's representative tells you, the only thing that matters is what's in the contract. So if the sales person or rep lies and makes promises the company won't keep, you already agreed that's OK when you accepted the contract. This one isn't quite as bad as the first one, because you can read the contract to see exactly what you're signing up for, so you have control over it. Of course many contracts are so lengthy and difficult to read, that makes it harder, but you still have a chance. With arbitration agreements, you can't opt out, and knowing what's in the contract won't help.

Are either of these contract stipulations illegal in any countries you know about?


Leave a Reply