Q: I signed arbitration agreement when buying new car at dealership. It states that all claims and disputes must be

resolved through arbitration in accordance with AAA rules. However, in AAA Consuner Rules, R-9. 'Small Claims Option for the Parties' reads as 'If a party’s claim is within the jurisdiction of a small claims court, either party may choose to take the claim to that court instead of arbitration as follows: (a) The parties may take their claims to small claims court without first filing with the AAA'.

Moreover, AAA Consumer Due Process Protocol, Principle 5. 'Small Claims' explicitly tells 'Consumer ADR Agreements should make it clear that all parties retain the right to seek relief in a small claims court for

disputes or claims within the scope of its jurisdiction'. Clearly, my arbitration clause violates R-9 and Principle 5.

Does it mean that even if I signed waiver to sue, it is not valid for small claims?

1 Lawyer Answer
Morris Leo Greb
Morris Leo Greb
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  • Estate Planning Lawyer
  • Rockaway, NJ
  • Licensed in New Jersey

A: Yes, you may proceed with filing a small claims action against the auto dealership. However be sure to follow what requirements or stipulation the AAA requires in order to proceed with filing a small claims court action.

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