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B. Arbitration Agreement

To start with, the parties need an arbitration agreement.


An arbitration agreement provides the basis for an arbitrator's jurisdiction. An arbitrator will not entertain a request for arbitration in the absence of an arbitration agreement. The parties may also modify or supplement the applicable arbitration rules by express provision in the arbitration agreement.


An arbitration agreement is usually drafted to include claims arising "out of or in connection with" a particular contract. This wording is broad enough to cover tort claims (such as misrepresentation) that relate to the parties’ transaction, and generally enables related tort and contract claims to be determined together by the arbitral tribunal.


Stay of court proceedings when an arbitration agreement exists


If a party tries to commence court proceedings in a dispute which is covered by an arbitration agreement, the court should normally stay (i.e. stop) its proceedings and decline to hear the dispute.