A recent Supreme Court decision (Carr v Gallaway Cook Allan [2014] NZSC 75) illustrates that parties contemplating arbitration must take care in drafting their agreement.

In Carr v Gallaway Cook Allan, the parties had agreed to arbitrate a dispute between them, but had made an error in how they dealt with rights of appeal from the arbitration. This error rendered the entire arbitration agreement invalid, which meant that the outcome of the parties’ lengthy (and consensual) arbitration process was also invalidated.

For details on the courts decision see our earlier client update: Drafting arbitration agreements: Supreme Court takes a strict approach.