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Arbitration clauses are commonly found in home inspection contracts and have been useful for many years. However, with more states regulating the industry, the issue of legal standard of care arises. The challenge is that decisions made in arbitration are usually not appealable, barring very limited circumstances. This means that mistakes in applying the standard of care may not be rectified unless fraud by the arbitrator can be proven. The lack of appeal option should be a significant factor to consider when deciding whether to include an arbitration clause in a contract. It is advisable to consult with legal experts before making a decision.
