It looks like the U.S. Supreme Court may be called in to arbitrate.

Within the past two weeks, two federal appeals courts have issued conflicting opinions on the legality of an identical arbitration clause. In each case, the mortgage lender Green Tree Financial Corp. required borrowers to waive their rights to a jury trial and submit all disputes to an arbitrator, although Green Tree still held the right to go to court to collect money or foreclose.

On June 22 the 11th U.S. Circuit Court of Appeals in Atlanta held that the clause was unenforceable because the potentially high costs of arbitration could prevent borrowers from using their statutory rights to pursue their claims.

Nine days later, on July 1, the 3rd U.S. Circuit Court of Appeals in Philadelphia upheld the same clause. The court did not address the issue of fees, but said the clause was fair. The court said it didn't matter that the clause was in fine print on the reverse side of the contract or that Green Tree could go to court to collect money or foreclose, while consumers were barred from litigating.

The conflicting opinions on the exact same clause further cloud the legality of arbitration provisions being used by an increasing number of companies, including credit card firms, computer makers, car dealers, insurance firms and pest control businesses. Under these clauses, consumers must agree, in advance, to give up their right to sue; any disagreements are submitted to arbitrators instead.

The companies say mandatory arbitration resolves disputes more quickly and less expensively than the courts. But lawyers representing consumers say arbitration can cost significantly more than going to court, with fees sometimes running into the thousands; permits less evidence-gathering that can help win cases; and is less likely to result in victories for consumers.

Alan Kaplinsky, who represented Green Tree before the Third Circuit court, said the company's victory there was an important precedent because it allows mortgage lenders to require arbitration, except when they want to collect money or foreclose.

Paul Bland, a lawyer with the Trial Lawyers for Public Justice, a public-interest group that is campaigning against arbitration clauses, called the decision a "hypocritical victory" for the lenders. "What this case says is that arbitration doesn't really work, so when a company has a claim, it has the right to go to court, but consumers don't."

The losing lawyers in both cases said they planned to ask the appeals courts to rehear their cases.

No matter their outcome, Kaplinsky predicts that the issue will ultimately end up before the Supreme Court. "There are a lot of cases pending around the country. It will take a while to get sorted out."