Does the Afuri Ramen Dumpling agreement require mediation before taking legal action in a dispute?
Afuri_Ramen_Dumpling Franchise · 2024 FDDAnswer from 2024 FDD Document
Agreement), the rights, privileges and benefits granted to you in this Agreement may only be exercised and enjoyed jointly; and your obligations, liabilities and responsibilities under this Agreement will be joint and several obligations of each such person and entity.
- 9.8 Enforcement. From time to time there may be controversy about this Agreement, its interpretation, or performance or breach by the parties.
- 9.8.1 Mediation. If a dispute arises between the parties, before taking any other legal action,
the parties agree to participate in at least six hours of mediation in accordance with the mediation procedures of Arbitration Service of Portland, Inc. or of any similar organization that specializes in the mediation of commercial business disputes. The party demanding mediation must provide written notice to the other party of the demand for mediation. If the other party does not respond to the mediation demand within 30 days of written notice, or indicates a refusal to participate in mediation, then the party providing notice may proceed with other forms of dispute resolution. The parties agree to equally share the costs of mediation.
Source: Item 23 — Receipts (FDD pages 50–189)
What This Means (2024 FDD)
According to Afuri Ramen Dumpling's 2024 Franchise Disclosure Document, the franchise agreement outlines a specific dispute resolution process. Before initiating any legal action, both Afuri Ramen Dumpling and the franchisee must participate in at least six hours of mediation. This mediation should align with the procedures established by Arbitration Service of Portland, Inc., or a similar organization specializing in commercial business disputes.
The process begins with the party seeking mediation providing written notice to the other party. The recipient of the notice then has 30 days to respond, indicating their willingness to participate. Should they fail to respond or explicitly refuse mediation, the initiating party is then free to pursue other legal avenues for resolving the dispute. The costs associated with the mediation are to be shared equally between Afuri Ramen Dumpling and the franchisee.
However, there are exceptions to this mediation requirement. Specifically, if either party seeks injunctive relief or specific performance authorized by the franchise agreement, they are not obligated to participate in mediation. These types of claims can be brought directly to a court with appropriate jurisdiction. This is a fairly common clause in franchise agreements, as injunctive relief is often time-sensitive and requires immediate court intervention.
This mediation clause aims to encourage parties to resolve disputes amicably and efficiently before resorting to potentially costly and time-consuming litigation. Franchisees should understand this process and its exceptions, as it can significantly impact how disputes with Afuri Ramen Dumpling are handled.