Is Your Construction Arbitration Clause Enforceable in Florida?

Short Answer: Florida Courts Generally Enforce Written Arbitration Clauses

Florida courts generally enforce a written arbitration clause in a construction contract. Under Fla. Stat. § 682.02, an agreement in a record to arbitrate is valid, enforceable, and irrevocable. The exception is a ground that exists at law or in equity to revoke a contract.

Enforcement is not automatic, though. A court asks two main questions. Does the clause cover this dispute? Was the agreement properly formed when the contract was signed?

Both answers turn on the clause’s exact wording and the facts of how the contract was made. Two contracts with similar clauses can lead to different results. This page walks through the main issues so you can review your own contract.

The Statutes That Govern Arbitration Clauses in Florida

The main state law is the Florida Arbitration Code, Chapter 682 of the Florida Statutes. It governs an agreement to arbitrate made on or after July 1, 2013, and since July 1, 2016, any agreement to arbitrate is subject to it, under Fla. Stat. § 682.013.

Federal law can apply too. Under 9 U.S.C. § 2, a written arbitration provision in a contract involving commerce is valid, irrevocable, and enforceable, save upon grounds that exist at law or in equity for revoking any contract. A project that uses out-of-state materials or financing may involve interstate commerce. Whether it does is a question of the project’s facts.

Statutes and court rules can shape how these disputes proceed. The contract language and the facts of the dispute decide how that framework applies to your case.

Scope: Does the Clause Cover This Particular Dispute?

Broad wording usually reaches more claims than narrow wording. A clause covering disputes “arising out of or relating to” the contract reaches more than one limited to change orders.

Under Fla. Stat. § 682.02, a court decides whether an agreement to arbitrate exists and whether a controversy is subject to it. An arbitrator decides whether a condition to arbitration has been met and whether a contract with a valid arbitration agreement is enforceable. That two-step split matters when a party says the clause does not reach its claim.

Tort claims, such as negligence or fraud, may or may not fall within a clause. The exact words decide that. A subcontractor, surety, or lender that did not sign the main contract may argue it is not bound by the clause.

Formation: Was the Arbitration Agreement Properly Made?

Courts first check that both sides agreed to arbitrate. A clause in a signed contract is the simplest case. An oral agreement must still meet basic contract requirements. The Florida Supreme Court in St. Joe Corp. v. McIver says an oral contract needs offer, acceptance, consideration, and enough detail on essential terms.

Clauses buried in incorporated documents raise a different question. If the arbitration term sits in general conditions or a standard form the contract references, a party may argue it never saw or accepted that term. The answer turns on what was shown and signed.

Under Basulto v. Hialeah Automotive, both the procedural and substantive aspects of unconscionability must be present. Under Basulto v. Hialeah Automotive, a court looks at both how the deal was made and how unfair the terms are. Those aspects need not be present to the same degree, and they should be evaluated interdependently rather than as independent elements, as stated in Basulto v. Hialeah Automotive. Unequal bargaining power alone is not enough. Fraud and duress claims are fact-specific and are judged case by case.

Waiver: How Litigation Conduct Can Affect an Arbitration Clause

Courts look at how each side has acted in the case, not only what the contract says. The other side may argue that a party gave up arbitration by acting as if the dispute belongs in court.

When a party asks the court to compel arbitration, the court must act quickly. Under Fla. Stat. § 682.03, if the other side opposes, the court proceeds summarily. It orders arbitration unless it finds no enforceable agreement exists. The court also may not refuse arbitration because the claim lacks merit.

Under the same statute, the court on just terms must stay any court proceeding that involves a claim alleged to be subject to arbitration until it makes a final decision on the motion. Fla. Stat. § 682.03 provides that if a party asks the court to order arbitration, the court on just terms must stay any court proceeding involving a claim alleged to be subject to arbitration until it makes a final decision.

A practical step is to raise arbitration in your first filing or response.

Construction Liens and Arbitration Clauses

Lien claims run under their own statute. Lien timing matters, so it helps to discuss your situation with counsel early.

Whether a lien foreclosure stays in court or moves to arbitration turns on the contract wording and the claims pleaded. An arbitration clause does not decide a lien case on its own.

Unpaid change orders need careful records. Keep signed change orders, written approvals, invoices, and payment records together. Review those amounts alongside the arbitration language before you send a demand.

Arbitration Versus Court: How the Choice Affects Timing and Cost

Arbitration follows the procedure set by the agreement and any rules it names. Court cases follow the Florida Rules of Civil Procedure, which cover pleadings and discovery. The timeline is set by the agreement, the arbitrator’s schedule, and the case itself.

Review of an award is narrow. Under Fla. Stat. § 682.13, a court must vacate an award procured by corruption, fraud, or other undue means. It also must vacate an award if an arbitrator exceeded the arbitrator’s powers. A motion to vacate generally must be filed within 90 days after notice of the award; if it alleges corruption, fraud, or other undue means, it must be filed within 90 days after that ground is known or reasonably should have been known. Appeals of certain arbitration orders are allowed under Fla. Stat. § 682.20.

Cost follows the fee terms. Under Price v. Tyler, each party generally bears its own attorneys’ fees unless a contract or statute provides otherwise. Fee-shifting terms and arbitrator fee terms in your contract matter for that reason.

Questions to Review in Your Construction Contract

Start with these questions. Each answer can change how a dispute moves forward.

• Does the clause make arbitration mandatory, or can either side choose court?
• What disputes does it cover, and does it name an arbitration provider or rules?
• Where would arbitration take place, and who pays the arbitrator and administrative fees?
• Does the contract shorten the time to file a claim? Under Fla. Stat. § 95.03, a contract provision setting a shorter period than the statute of limitations is void.
• Was the clause signed, or was it added later or pulled in from another document?
• Is each party licensed for the work? The Florida DBPR Construction Industry area publishes contractor licensing requirements and license verification.

Frequently Asked Questions

Talk With Ayala Law PA About Your Arbitration Clause

If a payment dispute with a general contractor is growing and your contract has an arbitration clause, the firm can review that clause with your timeline and records. Eduardo A. Maura is the lawyer responsible for this page. The firm focuses on business litigation, including construction and contract disputes.

Ayala Law PA’s only office is at 1646 W Snow Ave in Tampa, Florida. The firm works with businesses in Hillsborough County and the Tampa Bay area. Call (305) 570-2208 or use the contact page to start the conversation.