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BBB binding arbitration agreement paperwork on CATA Web site

November 18, 2010

Dealers can obtain lots of advice and many important forms on the CATA Web site,, including paperwork for their customers to enter into binding arbitration to resolve disputes without protracted and costly lawsuits.


The site offers two sets of downloadable files for dealers in northeast Illinois and northwest Indiana to enlist their customers into an arbitration program managed by the Better Business Bureau.


Dealers and their customers who sign this form would use an arbiter to resolve disputes arising from the purchase, lease, servicing or repair of a new or used automobile. "Disputes" also include any disputes relating to vehicle service contracts purchased or provided at the time vehicle was purchased or leased, except for alleging criminal violation.


"Simply put, the BBB has created a forum that is fair, equitable, inexpensive and quick," said Irv Capitel, senior counselor of the BBB-Chicago’s alternative dispute resolution division. "We want to see disputes settled smoothly and quickly. Lawsuits are antagonistic."


The downloadable forms can be reached on the CATA site by clicking on "Resources," on the horizontal bar across the top of the home page. From the drop-down menu, select "Dealer Forms (Downloadable)."


The two sets of files include an overview of the BBB binding arbitration program and the arbitration agreement. The sets are identical except for identifying which entity would sit at an arbitration hearing—the BBB office in Chicago, for disputes in northeast Illinois; or the BBB office in Merrillville, Ind., for disputes in northwest Indiana.


Dennis O’Keefe, the CATA’s general counsel, said some dealers already employ binding arbitration agreements with their customers. "The one thing that’s lacking with those individual dealer agreements," O’Keefe said, "is credibility." Some arbitration processes can be costly, he added.


The BBB-authored agreement is simple to read, to overcome charges that the customer didn’t understand what he agreed to, and is brief, on a single page.


It is suggested that customers be presented with copies of both the program overview and the agreement at closing.


Capitel said customers could be encouraged to sign the agreement based on several savings to them, compared to a lawsuit:


  • time used to prepare court documents
  • time used to prepare depositions
  • time spent in court
  • attorneys’ fees and other costs. 

"The key word under the BBB arbitration is resolution of the dispute," said Capitel. "Someone wins, someone loses, and everyone gets on with their lives."


Customers who request arbitration pay $100 to cover the arbiter’s expenses. The dealer, in turn, pays $700 to $900.