Before filing an arbitration action, what step must be taken in resolving disputes with Aw?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
| PROVISION | SECTION IN FRANCHISE AGREEMENT | SUMMARY |
|---|---|---|
| u. Dispute resolution by arbitration | Sections 18.1 and | Disputes must be mediated before filing an |
| or mediation | 18.2 | arbitration action. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 34–36)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, before a franchisee can file an arbitration action to resolve a dispute, they must first attempt mediation. This requirement is detailed in Item 17, which outlines the dispute resolution process. Specifically, Sections 18.1 and 18.2 of the franchise agreement mandate mediation as a preliminary step.
Mediation is a common alternative dispute resolution method in franchising. It involves a neutral third party who helps facilitate a discussion between the franchisee and franchisor to reach a mutually agreeable solution. This process can often be less costly and time-consuming than arbitration or litigation.
For a prospective Aw franchisee, this means that if a dispute arises with Aw, they will be obligated to participate in mediation before pursuing arbitration. Failing to do so could potentially invalidate their right to arbitrate the dispute. Franchisees should familiarize themselves with Sections 18.1 and 18.2 of the franchise agreement to fully understand the mediation process and their obligations.