Can an arbitrator extend, modify, or suspend any terms of the Baya Bar franchise agreement?

According to Baya Bar's 2024 Franchise Disclosure Document, an arbitrator is not permitted to extend, modify, or suspend any terms of the franchise agreement. The FDD specifies that in arbitration proceedings, the arbitrator is bound by the original terms and conditions outlined in the agreement and the reasonable standards of business performance and operation established by Baya Bar.

This restriction ensures that the arbitrator's role is to interpret and apply the existing agreement, not to rewrite or alter its provisions. This protects Baya Bar from potential arbitrary changes to the franchise agreement through arbitration. It also maintains consistency and predictability in the enforcement of franchise terms across all franchisees.

This clause is fairly typical in franchise agreements, as franchisors generally want to maintain uniformity and control over their franchise system. Prospective franchisees should understand that they are agreeing to resolve disputes within the confines of the original contract, without the possibility of an arbitrator changing the fundamental terms of the agreement.

However, if a court determines that any of the provisions are unlawful, the court will modify or interpret the provisions to the minimum extent necessary to have them comply with the law.