Provisions the documents cite: s.89 (Part 2 of the Consumer Rights Act 2015 extended to a term which constitutes an arbitration agreement; meaning of arbitration agreement; applies whatever law governs the agreement), s.90 (applies where the consumer is a legal person), s.91 (arbitration agreement unfair where modest amount sought; orders specifying the amount), s.108(1) and (3) (extent)
What it requires
Sections 89 to 91 extend the application of Part 2 (unfair terms) of the Consumer Rights Act 2015 to a term which constitutes an arbitration agreement — an agreement to submit present or future disputes or differences (whether or not contractual) to arbitration — whatever the law applicable to the arbitration agreement (s.89). Part 2 applies where the consumer is a legal person as it applies where the consumer is an individual (s.90). A term which constitutes an arbitration agreement is unfair for the purposes of Part 2 so far as it relates to a claim for a pecuniary remedy which does not exceed the amount specified by order (s.91(1)); orders are made for England and Wales by the Secretary of State with the concurrence of the Lord Chancellor, for Scotland by the Secretary of State, and for Northern Ireland by the Northern Ireland department (s.91(3)). The amount for England and Wales and Scotland is £5,000 (Unfair Arbitration Agreements (Specified Amount) Order 1999, register entry uaa-specified-amount-order-1999); Northern Ireland has a separate order, not held. Under Part 2 an unfair term is not binding on the consumer, though the consumer may rely on it if they choose (Consumer Rights Act 2015 s.62, register entry cra-2015). REASONING from the texts — a builder's contract term requiring a homeowner to take a money claim of £5,000 or less to arbitration does not bind the homeowner, who can use the court instead; above that amount s.91 does not make the term unfair, and whether it is unfair is decided under Part 2 in the ordinary way. Sections 89, 90 and 91 extend to England and Wales, Northern Ireland and Scotland (s.108(1), (3)).
The instrument itself: https://www.legislation.gov.uk/ukpga/1996/23/part/II. The summary above is our plain-English reading, not the text of the instrument — always work from the source.
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The 2 documents that cite it
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