This bill amends existing law regarding the validity of arbitration agreements, specifically targeting those between consumers and business entities. It introduces a new provision stating that such agreements will not be valid if either party attempts to apply them to disputes that are unrelated to the terms of the contract. Additionally, these disputes must be ones that would typically be invalidated by general contract defenses recognized in law or equity.

The bill aims to enhance consumer protection by ensuring that arbitration agreements cannot be enforced in situations where they are not relevant to the original contractual relationship. This change is intended to prevent businesses from using arbitration clauses to sidestep legal accountability in unrelated disputes. The act will take effect 90 days after enactment and will apply to all arbitration agreements issued, executed, or renewed after that date.

Statutes affected:
Introduced: 2A:23B-6