The main argument of this paper is that the law should generally enforce pre-dispute consumer arbitration clauses. If the consumer is given a choice between litigation and arbitration at the time of contracting and she chooses arbitration, that choice should generally be enforceable, provided appropriate safeguards are in place guaranteeing access to justice. Consumer protection comes at a cost, which the consumer ultimately pays in the price of the product or service purchased: assuming arbitration is the more cost-efficient dispute-resolution mechanism, consumers choosing arbitration would, in theory, pay a lower price than those choosing litigation. The blanket hostility towards pre-dispute arbitration clauses under the present law is not in the interest of the entire group of consumers, as, in the current system, the majority subsidizes the few who litigate. A new, ‘bespoke’ approach for different sub-groups of consumers is needed. Provided appropriate safeguards are in place guaranteeing access to justice, consumers would benefit from the freedom to agree to pre-dispute arbitration clauses waiving their right to litigation. Giving consumers a choice between arbitration and litigation would allow particularly the weak consumers—who may prefer a cheaper product over a more expensive one—access to the market.
Andreas von Goldbeck,
Consumer Arbitrations in the European Union,
18 Pepp. Disp. Resol. L.J.
Available at: https://digitalcommons.pepperdine.edu/drlj/vol18/iss2/4