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Can a Maryland home improvement contract require arbitration?

Short answer. Yes, with limits. Under COMAR 09.08.01.25 the clause must be conspicuously displayed and cannot be a mandatory condition of the contract, so the homeowner must be able to opt out. A clause that breaks these rules is unenforceable.

  • COMAR 09.08.01.25

Work it through

You're the contractor. Pick what you'd do, then see how each choice plays out.

You're updating your standard contract template. Your attorney suggests adding a mandatory arbitration clause that would prevent homeowners from suing you in court.

"It saves time and money for everyone," he says.

  1. Correct

    COMAR 09.08.01.25 specifically addresses arbitration clauses in home improvement contracts. Arbitration clauses are permitted but must be conspicuously displayed (not buried in fine print), and cannot be a mandatory condition of the contract — the homeowner must have the option to opt out. Failing to comply with these requirements makes the clause unenforceable and generates MHIC complaints.

  2. Wrong

    COMAR 09.08.01.25 requires arbitration clauses to be conspicuously displayed, not hidden. Burying it in fine print violates the regulation and makes the clause unenforceable. More importantly, if a homeowner discovers they unknowingly waived their right to sue, that's a guaranteed MHIC complaint. Transparency builds trust; deception destroys it.

All 19 home improvement contracts questions

  1. Is a handshake deal legal for home improvement work in Maryland?
  2. What must a Maryland home improvement contract include?
  3. Which MHIC notice must every home improvement contract include?
  4. What if a signed contract is missing the completion date?
  5. Can a Maryland home improvement contract require arbitration?
  6. What happens in a scope dispute when nothing is in writing?
  7. Does a small cash side job need a written contract?
  8. Does a $2,000 job need a written home improvement contract?
  9. Can you start emergency repairs before signing a contract?
  10. Should you give a homeowner a ballpark or a written estimate?
  11. How do you fix a vague scope of work before it becomes a dispute?
  12. How should you respond when a client redlines your contract?
  13. How should a contract handle upgrades during the project?
  14. How do you price a contract for work that starts months later?
  15. Should a multi-year renovation be one contract or several?
  16. Can you sign a home improvement contract with a 17-year-old?
  17. What happens when a homeowner fires you partway through a job?
  18. Can you substitute materials named in the contract?
  19. How should you handle materials the homeowner supplies?