What is a non-signatory to a binding arbitration agreement?

A non-signatory to a binding arbitration agreement in Delaware is a party not explicitly named in the agreement. This could be an individual, a group, or an organization that is involved in the dispute but is not directly party to the arbitration agreement. A binding arbitration agreement is a contract under which two or more parties agree to resolve disputes through arbitration rather than a court of law. Generally, signatories of such agreements must abide by the terms and conditions set out in the agreement, including any related rulings or decisions made by the arbitrators. Non-signatories, however, are not bound by the agreement or the decisions of the arbitrators and may take the dispute to court. This can occur if a party that is directly affected by the dispute is not included in the arbitration agreement. For example, if a contract between two employers and an employee is disputed, and the employee is not named as a signatory, then they are considered a non-signatory and may pursue legal action in court. In Delaware, non-signatories may also be bound to the arbitration agreement in certain scenarios, such as when the agreement is between two parties that are related to the non-signatory or when the non-signatory has acted as though they are a party to the agreement. It is important to ensure that all necessary parties are included as signatories to any binding arbitration agreement, as non-signatories may be able to pursue legal action in court and would be immune to any rulings made by the arbitrators.

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