Can the arbitrator stay the effectiveness of a pending termination of the All Dogs Unleashed agreement?
All_Dogs_Unleashed Franchise · 2025 FDDAnswer from 2025 FDD Document
The decision of the arbitrator is final and binding on all parties to the dispute; however, the arbitrator may not under any circumstances: (1) stay the effectiveness of any pending termination of this Agreement; (2) assess punitive or exemplary damages; (3) certify a class or a consolidated action; or (4) make any award that extends, modifies or suspends any lawful term of this Agreement or any reasonable standard of business performance that we set.
Source: Item 23 — RECEIPTS (FDD pages 49–158)
What This Means (2025 FDD)
According to the 2025 All Dogs Unleashed Franchise Disclosure Document, the arbitrator does not have the authority to stay the effectiveness of any pending termination of the Franchise Agreement. This means that if All Dogs Unleashed decides to terminate the agreement, the termination will proceed regardless of any arbitration proceedings.
This limitation on the arbitrator's power is significant for a prospective franchisee. Even if a franchisee believes the termination is unjust or unwarranted, the arbitrator cannot prevent the termination from taking effect while the dispute is being resolved. The franchisee would lose the right to operate under the All Dogs Unleashed brand during the arbitration process.
This type of clause is not uncommon in franchise agreements, as franchisors often want to maintain control over their brand and system. However, it places the franchisee at a disadvantage, as they could be forced to close their business even if they have a strong case in arbitration. Prospective franchisees should carefully consider this limitation and seek legal advice to understand its implications fully. They may also want to negotiate this point during the franchise agreement discussions, although the franchisor may be unwilling to alter the clause.