In an All Team arbitration, are punitive, exemplary, or consequential damages allowed in the award?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
The arbitrator will have the right to award or include in his award any relief which he deems proper in the circumstances, including money damages (with interest on unpaid amounts from date due), specific performance, and attorneys' fees and costs; however, the arbitrator will not be allowed to award or include in his award any punitive, exemplary, or consequential damages, to which the parties waive any right.
Source: Item 23 — RECEIPT (FDD pages 34–161)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, an arbitrator is not allowed to include punitive, exemplary, or consequential damages in their award. The document states that the parties involved in the arbitration waive any right to claim such damages.
This means that if a franchisee pursues arbitration against All Team, they cannot seek damages intended to punish the company (punitive or exemplary) or damages that are an indirect result of the issue (consequential). The arbitrator is limited to awarding other forms of relief, such as money damages with interest, specific performance, and attorney's fees and costs, but cannot award the franchisee additional compensation beyond these direct losses.
This limitation on damages could significantly impact the potential financial recovery for a franchisee in a dispute with All Team. It is a fairly common practice in franchise agreements to limit the types of damages that can be awarded in arbitration, as it provides the franchisor with a degree of protection against large or unpredictable financial liabilities. Prospective franchisees should carefully consider this limitation and its potential impact on their ability to seek full compensation for any losses they might incur.