Q: Meaning of mediation/arbitration clause in business partnership contract might skip arbitration.
In a business partnership contract, there's a clause stating that "mediation and arbitration may only occur if both members are paid in full from out of pocket expenses." I would like a clearer explanation of what this means in the context of resolving disputes. Specifically, I want to understand how this affects the process of dispute resolution, given that "members" refers to the owners or partners, and "out of pocket expenses" refers to money members have paid from their personal finances, not the business. If one member does not agree, will it skip arbitration and go to court?
A: An Illinois attorney could advise best, but your question remains open for a week. I don't blame you for seeking clarity here. The provision does not appear to be drafted in a clear and unambiguous manner. It is open to interpretation in the manner you describe. That's probably why your post remained open - it isn't easy to answer directly and clearly. One option is to consult with attorneys who could review the contract with you. Another is to ask the party(s) who drafted the provision as to exactly what they meant. Good luck
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