Arbitration Act 1996

11 Consumer arbitration agreements

• (1) Where—

  • (a) a contract contains an arbitration agreement; and

  • (b) a person enters into that contract as a consumer,—

  the arbitration agreement is enforceable against the consumer only if—

  • (c) the consumer, by separate written agreement entered into by the consumer and the other party to the contract after a dispute has arisen out of, or in relation to, that contract, certifies that, having read and understood the arbitration agreement, the consumer agrees to be bound by it; and

  • (d) the separate written agreement referred to in paragraph (c) discloses, if it is the case, the fact that all or any of the provisions of Schedule 2 do not apply to the arbitration agreement.

  (2) For the purposes of this section, a person enters into a contract as a consumer if—

  • (aa) that person is an individual; and

  • (a) that person enters into the contract otherwise than in trade; and

  • (b) the other party to the contract enters into that contract in trade.

  (3) Subsection (1) applies to every contract containing an arbitration agreement entered into in New Zealand notwithstanding a provision in the contract to the effect that the contract is governed by a law other than New Zealand law.

  (4) For the purposes of article 4 of Schedule 1, subsection (1) shall be treated as if it were a requirement of the arbitration agreement.

  (5) Unless a party who is a consumer has, under article 4 of Schedule 1, waived the right to object to non-compliance with subsection (1), an arbitration agreement which is not enforceable by reason of non-compliance with subsection (1) shall be treated as inoperative for the purposes of article 8(1) of Schedule 1 and as not valid under the law of New Zealand for the purposes of articles 16(1), 34(2)(a)(i), and 36(1)(a)(i) of Schedule 1.

  (6) Nothing in this section applies to—

  • (a) a lease; or

  • (b) a contract of insurance to which section 8 of the Insurance Law Reform Act 1977 applies.

  Section 11(1)(c): substituted, on 18 October 2007, by section 5(1) of the Arbitration Amendment Act 2007 (2007 No 94).

  Section 11(2)(aa): inserted, on 18 October 2007, by section 5(2) of the Arbitration Amendment Act 2007 (2007 No 94).

  Section 11(6): substituted, on 18 October 2007, by section 5(3) of the Arbitration Amendment Act 2007 (2007 No 94).