NewsLocal News

Actions

Local warning about arbitration clauses in disputed auto repair claims

Posted at 11:37 PM, Mar 23, 2018
and last updated 2018-03-24 09:07:10-04

Rocco Sarli of Mentor believes he learned the hard way after he signed an auto repair agreement that included an arbitration clause.

Sarli signed up for more than $1,100 in rear frame repairs on his son's 2001 Toyota Camry, the agreement called for repair disputes to be turned over to the American Arbitration Association. 

What Sarli said he wasn't told, was that by signing the agreement, he gave up his right to take the case to court.

So, when repairs went bad, and Sarli tried to take the case to Mentor Small Claims Court, the case was quickly dismissed.

News 5 won't name the repair shop because Sarli signed the contract, but he believes he was misled, that no one explained the arbitration clause. 

"When you sign arbitration, you're signing your rights away," said Sarli 

"In order for me to take this case to arbitration, it would cost me thousands of dollars, my lawyer said it was going to cost thousands just to get things going."

"It left me in a position where I couldn't go to the court, I couldn't get the car repaired.  So we parked it, this car sat all winter in the garage."

Cleveland BBB President Sue McConnell explained the Better Business Bureau offers free arbitration with its member businesses.

McConnell said arbitration clauses through the BBB are more clearly stated in repair and purchase agreements.

Members business are required to have a separately signed arbitration clause, something McConnell believe all business should adhere to when promoting arbitration as a way to settle disputes.

"Keep in mind, if you sign a contract that has an arbitration clause, you could be giving up your right to file a private lawsuit," said McConnell.

"Our agreements need to have a separate signature line, where the customer understands that they are agreeing to arbitration."

McConnell said arbitration can be a very effective tool in settling disputes, but she said consumers need to be aware of the potential costs, that arbitration terms could require consumers to travel to out-of-town locations.

Ohio State Senator Tom Patton told News 5 he is looking into how arbitration clauses are presented in contracts, wondering if state law could be changed, requiring these clauses to be more clearly seen and explained.

Meanwhile, Sarli issues his advice.

"So, what is it, buyer beware," said  Sarli.

"And if they have arbitration in it, I would leave and take my business elsewhere."