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Arbitration clauses, commonly found in home inspection contracts, were once useful but now face challenges with the legal standard of care. With more states regulating arbitration, the key issue is the lack of appeal in arbitrators' decisions. Unless a narrow exception applies, decisions on law, evidence, testimony, etc., are not appealable. This means avoiding a mistake of law in arbitration requires proving fraud, which is rare in practice. The inability to file an appeal is a crucial factor in deciding to use an arbitration clause. It is advisable to check with legal professionals before including one in your contracts.
