This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
This contract entered into this---------day of---------, at the City of---------, between A. B., of the City of---------, and C. D., of the City of---------, Witnesses:
That, whereas, heretofore on or about the --------- day of ---------, the said
A. B. and the said C. D. entered into a contract for the [state substance of contract]; and whereas disputes have arisen between the said A. B. and C. D. as to the true meaning and construction of said contract, and as to the performance thereof, by the parties respectfully; and whereas A. B. and C. D. are mutually desirous of submitting this controversy to arbitration;
Now, therefore, the said A. B. and the said C. D. do hereby mutually covenant and agree that they will submit said controversy for arbitration to three arbitrators, two of Whom shall be E. F. and 6. H., and the third of whom shall be a person mutually to be agreed upon by the said E. F. and G. H. Said arbitrators shall fix a time and place for hearing and shall give notice thereof to the said A. B. and C. D., and shall give an opportunity to the said A. B. and C. D. respectively, to offer evidence in support of their respective contentions. The determination and award of said three arbitrators, or of any two of them shall be final and binding upon said A. B. and said C, D.; and the said A. B. and C. D. do covenant that they will well and truly perform the award thus made. Said award shall be made in writing, and signed by said arbitrators; and a true copy shall be given by said arbitrators to said A. B. and C. D.
respectively, within --------- days of the date of said hearing. Said A. B. and
C. D. each agrees to pay one-half (1/2) of the costs and expenses of said arbitration, including a fee of --------- dollars to be paid to each of the said three arbitrators.
The said A. B. and C. D. hereby covenant with each other that they will not revoke this contract for arbitration; or the authority and power herein conferred upon the arbitrators.
In witness whereof, etc.
Because of the power of the parties to revoke a common-law contract for arbitration, and because of the difficulty of recovering substantial damages for a breach of such covenant, a covenant for liquidated damages is sometimes inserted so as to provide compensation for the expense to which the parties have been put in preparing for arbitration.
For the validity of a contract for arbitration, see Sec. 721 et seq. and 2627.