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2. DISCLOSURE STATEMENT: ARBITRATION DISCLOSURE AND RESIDENTIAL REAL PROPERTY ARBITRATION AGREEMENT ThIs form approved by the Minnesota Association of REALTORS., Which disclaims any (lability arising out of use or misuse of this form. ©2014 Minnesota Association at REALTORS', Edina, MN 1. Page 1 ARBITRATION DISCLOSURE 3. You have the right to choose whether to have any disputes about disclosure of material facts affecting the use 4. or enjoyment of the properly that you are buying or selling decided by binding arbitration or by a court of law, By agreeing 5. to binding arbitration, you give up your right to go to court. By signing the RESIDENTIAL REAL PROPERTY 6. ARBITRATION AGREEMENT ("ARBITRATION AGREEMENT") on page two (2), you agree to binding arbitration under the 7. Residential Real Property Arbitration System ("Arbitration System") administered byNational Center for Dispute Settlement 8. ("NCDS") and endorsed by the Minnesota Association of REALTORS° ("MNAR").The ARBITRATION AGREEMENT Is 9. enforceable only if Itis signed by all buyers, sellers and licensees representing ar assisting the buyers and the sellers. 10. The ARBITRATION AGREEMENT Is not part of the Purchase Agreement. Your Purchase Agreement will still be 11. valid whether or not you sign the ARBITRATION AGREEMENT. 12, The Arbitration System Is a private dispute resolution system offered as an alternative to the court system, It 13. is not government sponsored. NCDS and the MNAR jointly adopt the rules that govern the Arbitration System. NCDS 14. and the MNAR are not affiliated. Under the ARBITRATION AGREEMENT you must use the arbitration services of 15. NCDS. 16. All disputes about or relating to disclosure of material facts affecting the use or enjoyment of the property, excluding 17. disputes related to title Issues, are subject to arbitration under the ARBITRATION AGREEMENT. This includes claims 18. of fraud, misrepresentation, warranty and negligence, Nothing in this Agreement limits other rights you may have under 19. MN Statute 327A (statutory new home warranties) or under private contracts for warranty coverage. An agreement to 20. arbitrate does not prevent a party from contacting the Minnesota Department of Commerce, the state agency that 21. regulates the real estate profession, about licensee compliance with state law. 22. The administrative fee for the Arbitration System varies depending on the amount of the claim, but it is more 23. than initial court filing fees. In some cases, conciliation court Is cheaper than arbitration. The maximum claim allowed 24. in conciliation court is $15,000.Thls amount is subject to future change. In some cases, it Is quit-1<er and less expensive 25. to arbltratedisputes than to go to court, but the time to (Ile your claim and pre -hearing discovery rights are Iimited.The 26. right to appeal an arbitrator's award is very limited compared to the right to appeal a court decision. 27. A request for arbitration must be flied within 24 months of the date of the closing on the property or 28. else the ciairn cannot be pursued. In some cases of fraud, a court ar arbitrator may extend the 24 -month 29. !Imitation period provided herein. 30. A party who wants to arbitrate a dispute files a Demand, along with the appropriate administrative fee, with 31, NCDS.NODSnotiflestheotherparly,whotnaytilearesponse.NODSworkswiththepartiestoselectandappointanarbltrator 32. to hear and decide the dispute. A three -arbitrator panel will be appointed instead of a single arbitrator at the request 33. of any party The party requesting a panel must pay an additional fee. Arbitrators have backgrounds in law, real estate, 34. architecture, engineering, construction or other related fields. 35. Arbltratlon hearings are usually held at the home site. Parties are notified about the hearing at least 14 days 36. in advance, A party may bo represented by a lawyer at the hearing, at the party's own expense, If he or she gives five 37. (6) days advance notice to the other party and to NCDS. Each party may present evidence, Including documents or 38. testimony by witnesses.The arbitratormust make any awardwithin 30 days from thefinal hearing date.The award must 39. be In writing and may provide any remedy the arbitrator considers just and equitable that is within the scope of the 40. parties'agreement.Tho arbitrator does not have to make findings of fact that explain the reason for granting or denying 41. an award. The arbitrator may require the party who does not prevail to pay the administrative fee. 42. This Arbitration Disclosure provides only a general description of the Arbltratlon System and a general 43. overview of the Arbitration System rules. For specific information regarding the administrative tee, please see the 44. Fee Schedule located in the NCDS Rules. Copies of the Arbitration System rules are available from NCDS by calling 45. (866)777-8119 or(866)727-8119 or on the Web atwwwncdsusa.orgorfrom your REALTOR°.Ifyou have anyquestions 46. about arbitration, call NCDS at (866) 777-8119 or (866) 727-8119 or consult a lawyer. 23