Arbitration Model Clause
Ensure an effective and proportionate response in the future should a dispute arise.
On this page
Overview
There are options available depending on whether the parties wish arbitration to proceed on an ad hoc basis under the Arbitration Act 1996 or under the BDT Arbitration Rules.
Model clause for future disputes (BDT Arbitration Rules)
Looking for a clause to insert in your next contract? Use our model clause to access the most proportionate arbitration process should a dispute arise in the future
Model clause for future disputes (ad hoc)
Prefer an ad hoc arbitration process under the Arbitration Act 1996? Use this model clause to access ad hoc arbitration in the future.
Existing disputes
Parties to an existing dispute can agree to refer it to arbitration, under the BDT Arbitration Rules or as an ad hoc arbitration under the Arbitration Act 1996. View the template arbitration agreement below.
Overview
We recommend including one of the following two model arbitration clauses in any contract to ensure you can access that process in the future before a dispute arises.
What about mediation? At any stage the parties can agree to mediate (or negotiate) their dispute. In arbitration under the Building Disputes Tribunal’s Arbitration Rules (option 1 below), there will be a mandatory stay of the arbitration proceeding where the parties wish to refer the dispute to mediation after the arbitration has commenced.
The two options for arbitration are:
1. Arbitration under the Building Disputes Tribunal’s Rules – this model clause will ensure that any dispute is automatically filtered into the most proportionate arbitration process based on the value of the dispute (the parties can always agree on another process, but the default is the most proportionate option in terms of time and cost):
Value of dispute | Default Rules | Key Features |
|---|---|---|
$2.5M or greater | Standard Arbitration Rules | Timetable to be agreed by the parties or determined by the arbitral tribunal
Hearing, unless parties agree otherwise |
$1M up to $2.5M | ECA90 Arbitration Rules | 90 working days to an award
5 working day hearing, unless parties agree otherwise |
$250K up to $1M | ECA60 Arbitration Rules | 60 working days to an award
3 working day hearing, unless parties agree otherwise |
Up to $250k or declaratory relief | ECA45 Arbitration Rules* |
On the documents only (no hearing)
Fixed fee service available 45 working days to an award |
* terms and conditions apply
2. Ad hoc arbitration – this model clause ensures you can access the Building Disputes Tribunal’s case management and administrative oversight and support.
Either option allows the appointment of the arbitral tribunal to be agreed by the parties. However, in the absence of agreement (which is often the case), either model clause will ensure the parties have an effective mechanism for the prompt and efficient appointment of the arbitral tribunal, allowing the arbitration to proceed without unnecessary delay.
Model Clause for Arbitration under the BDT Arbitration Rules
The following clause should be included in contracts where the parties wish to have any future disputes resolved by arbitration under the Building Disputes Tribunal’s Arbitration Rules:
“Any dispute or difference arising out of or in connection with this contract, or the subject matter of this contract, including any question about its existence, validity or termination, shall be referred to and finally resolved by arbitration in accordance with the Arbitration Rules of the Building Disputes Tribunal.”
Note: parties to an existing dispute that have not incorporated the Building Disputes Tribunal Model Arbitration Clause into a prior agreement may still agree to refer that dispute to arbitration under the Building Disputes Tribunal Arbitration Rules by signing the Arbitration Agreement in the form found at Appendix 2 to those Rules.
Model Clause for ad hoc Arbitration under the Arbitration Act 1996
The following arbitration clause should be included in contracts where the parties wish to have any future disputes resolved by arbitration under the Arbitration Act 1996:
“Any dispute or difference arising out of or in connection with this contract, or the subject matter of this contract, including any question about its existence, validity or termination, shall be referred to and finally resolved by arbitration in accordance with the Arbitration Act 1996. The arbitral tribunal shall be appointed from the panel of arbitrators maintained by the Building Disputes Tribunal and, in the event the parties are unable to agree on the composition of the arbitral tribunal within seven days of written notice of the dispute being given, the arbitral tribunal shall be appointed by the Building Disputes Tribunal upon application by any party to this agreement.
1. The number of arbitrators shall be one [or may choose three].
2. The language to be used in the Arbitration shall be English [or choose another language].
3. The governing law of the contract shall be the substantive law of New Zealand [or choose another country].
Note: parties to an existing dispute that have not incorporated this Building Disputes Tribunal Model Clause into a prior agreement may agree to refer that dispute to arbitration under the Arbitration Act by signing one of the Arbitration Agreements available on the Arbitration Guides and Resources page.
Got an existing dispute?
Parties to an existing dispute that have not incorporated the BDT Model Arbitration Clause into a prior agreement may still agree to refer that dispute to arbitration under the BDT Arbitration Rules by signing an agreement to refer their dispute to arbitration.