What is the process for resolving disputes related to the collection of money owed to 1 800 Packouts?
1_800_Packouts Franchise · 2025 FDDAnswer from 2025 FDD Document
Matters relating solely to the collection of money by one Party against the other are not subject to a face-to-face meeting, mediation, or arbitration. Such matters include collection efforts against you or us solely for the failure to make timely payment of any amount due to the other. In such an event, such matter may be brought in a court of competent jurisdiction and venue. If, however, one Party to such action pleads another claim, cross-claim, counter-claim or affirmative defense based on anything other than the mere collection of money, or if the other Party alleges facts concerning fraud or any other equitable defense, then the entire matter, including the collection-of-money effort will be subject to the alternative dispute resolution procedures of this Article.
Source: Item 23 — RECEIPT (FDD pages 67–238)
What This Means (2025 FDD)
According to the 2025 FDD, 1 800 Packouts does not require disputes solely regarding the collection of money to undergo mediation or arbitration. This means that if 1 800 Packouts is attempting to collect money owed by a franchisee, or vice versa, the dispute can be taken directly to a court of competent jurisdiction. This differs from typical franchise agreements, which often require mediation or arbitration as a first step in dispute resolution.
However, this exception applies only if the dispute is solely about the collection of money. If the party being pursued for payment raises other claims, cross-claims, counter-claims, or affirmative defenses beyond the simple failure to pay, or alleges fraud or any other equitable defense, then the entire matter becomes subject to alternative dispute resolution procedures. This means that even if the initial issue is about money owed, introducing additional factors can trigger the requirement for mediation or arbitration.
In such cases, where alternative dispute resolution is required, the FDD does not specify the exact procedures to be followed. It only mentions a "face-to-face meeting" and mediation as potential steps. Franchisees should seek clarification from 1 800 Packouts regarding the specific steps and rules governing these alternative dispute resolution processes to fully understand their obligations and rights in case of a dispute that extends beyond simple collection matters.