The bill amends the General Laws in Chapter 10-3, which pertains to arbitration, by clarifying the enforceability of written arbitration agreements and detailing the process for serving notice of intention to arbitrate. It states that arbitration agreements are generally valid and enforceable, with exceptions based on legal or equitable grounds. The bill also requires that if an arbitration clause is not immediately before the signature clauses in a primary insurance contract, the insured retains the option to enforce arbitration. The notice of intention to arbitrate must inform the other party of their rights and the consequences of not applying for a stay of arbitration, with this information presented in bold print and highlighted.
Furthermore, the bill adds new sections to the General Laws, ensuring the right of a party to be represented by an attorney in arbitration and addressing the fees and costs associated with initiating arbitration. It places the responsibility for these fees on the drafting party unless otherwise agreed, and if the drafting party fails to pay within 30 days, they are in breach of the agreement and waive the right to compel arbitration. The bill provides options for an employee or consumer in the event of the drafting party's default, including withdrawing the claim to proceed in court or compelling arbitration with the drafting party bearing the costs. It also includes provisions for tolling the statute of limitations when a claim is withdrawn from arbitration and pursued in court. The bill mandates sanctions against the drafting party for material breach of the arbitration agreement, which may include monetary sanctions, issue, evidence, or terminating sanctions, and takes effect upon passage.