Besides mutual agreement, what is another condition that allows arbitration or litigation to commence regarding Aw franchise?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
No arbitration or litigation proceeding may be commenced until the earlier of thirty (30) days from the selection of the Mediator, or the mutual agreement by both parties that mediation has been unsuccessful, or if the notified party fails to respond to the requesting party within thirty (30) days of the delivery of notice requesting mediation.
The arbitration rules provided for herein shall apply, and the arbitration may proceed, and the arbitrator has jurisdiction, regardless of whether any party fails to actively participate or appear. In the event that any party fails without good cause (i) to appear at any properly noticed arbitration proceeding; or (ii) to make payment in full of its share of the required arbitration fees and costs within ten (10) days after notice and demand, absent a previously issued court order to the contrary, then the arbitrator or the organization/entity administering the arbitration shall be authorized to enter a final award against such party, notwithstanding the failure to appear or to make the required payment.
Notwithstanding Section 18.2 above,
- (a) We are entitled, without being required to post a bond, to seek the entry of temporary and permanent injunctions and orders of specific performance in a court of competent jurisdiction to: (1) enforce the provisions of this Agreement relating to your use of the Marks and your non-disclosure and non-competition obligations under this Agreement; (2) prohibit any act or omission by you or your employees that constitutes a violation of any applicable law, ordinance or regulation, constitutes a danger to the public, or may impair the goodwill associated with the Marks or cause irreparable harm to us or the Papa Ray's Pizza franchises.
- (b) We shall have the right to proceed by judicial process in lieu of arbitration to enforce your obligations to pay us under Section 10 of this Agreement and to seek collection of such fees due and owing to us.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, before initiating arbitration or litigation, both parties must attempt to resolve disputes through non-binding mediation. However, there are specific conditions under which arbitration or litigation can commence without mutual agreement. One such condition is if the notified party fails to respond to the requesting party within thirty (30) days of receiving a notice requesting mediation.
Another condition that allows arbitration to proceed is if a party fails to actively participate or appear at any properly noticed arbitration proceeding, or fails to pay their share of the required arbitration fees and costs within ten (10) days after notice and demand, without good cause or a court order to the contrary. In such cases, the arbitrator or administering organization is authorized to enter a final award against the non-participating party.
Aw also has exceptions to the arbitration requirement. Aw is entitled to seek temporary and permanent injunctions and orders of specific performance in court to enforce provisions related to the use of their marks, non-disclosure, and non-competition obligations, or to prevent actions that violate laws or harm the goodwill associated with the Aw brand. Aw also has the right to proceed by judicial process instead of arbitration to enforce a franchisee's payment obligations under Section 10 of the Franchise Agreement and to seek collection of fees owed to them.