If litigation is permitted under the Belocal franchise agreement, what do franchisees and principals waive?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
To the extent that litigation is permitted in accordance with the above provisions, or in the event that, notwithstanding the above provisions, it is ultimately determined that a particular claim is not arbitrable under applicable law, the following provisions shall apply:
- (1) VENUE AND JURISDICTION.
ANY ACTION BROUGHT BY ANY PARTY AGAINST THE OTHER IN ANY COURT, WHETHER FEDERAL OR STATE, MUST BE BROUGHT EXCLUSIVELY WITHIN THE COUNTY OR THE FEDERAL JUDICIAL DISTRICT WHERE FRANCHISOR'S PRINCIPAL BUSINESS OFFICE IS LOCATED.
FRANCHISEE AND ITS PRINCIPALS HEREBY SUBMIT TO THE JURISDICTION OF THOSE COURTS FOR PURPOSES OF ANY SUCH PROCEEDING AND WAIVE ANY OBJECTIONS TO JURISDICTION AND ANY CLAIM THAT SUCH PROCEEDING HAS BEEN BROUGHT IN AN INCONVENIENT FORUM OR THAT VENUE IS IMPROPER.
NOTWITHSTANDING THE ABOVE, WITH RESPECT TO ANY ACTION WHICH INCLUDES INJUNCTIVE RELIEF OR
OTHER PROVISIONAL RELIEF, ANY PARTY MAY BRING SUCH ACTION IN ANY COURT IN ANY STATE WHICH HAS JURISDICTION.
- (2) WAIVER OF JURY TRIAL. FRANCHISEE AND FRANCHISOR HEREBY IRREVOCABLY WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM, WHETHER AT LAW OR IN EQUITY, BROUGHT BY EITHER OF THEM AGAINST THE OTHER, WHETHER OR NOT THERE ARE OTHER PARTIES IN SUCH ACTION OR PROCEEDING.
- (3) WAIVER OF PUNITIVE DAMAGES. THE PARTIES HEREBY WAIVE TO THE FULLEST EXTENT PERMITTED BY LAW ANY RIGHT TO OR CLAIM OF ANY PUNITIVE OR EXEMPLARY DAMAGES AGAINST THE OTHER AND AGREE THAT IN THE EVENT OF A DISPUTE BETWEEN THEM, CLAIMS FOR DAMAGES SHALL BE LIMITED TO THE RECOVERY OF ANY ACTUAL DAMAGES SUSTAINED BY A PARTY.
- (4) Attorneys' Fees. If either party commences a legal action against the other party arising out of or in connection with this Agreement, the prevailing party shall be entitled to have and recover from the other party its reasonable attorneys' fees and costs of suit.
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, if litigation is permitted, franchisees and their principals waive certain rights. Specifically, they waive any objections to jurisdiction and any claim that a proceeding has been brought in an inconvenient forum or that the venue is improper. This means that franchisees agree to have any legal actions against Belocal heard in the specific location where Belocal's principal business office is located, giving up the right to argue for a different, potentially more convenient, venue.
Furthermore, Belocal franchisees and principals also irrevocably waive their right to a jury trial in any action, proceeding, or counterclaim, whether at law or in equity, brought by either party against the other, regardless of whether other parties are involved in the action. This means that any disputes will be resolved by a judge rather than a jury.
Additionally, the parties waive, to the fullest extent permitted by law, any right to or claim of any punitive or exemplary damages against the other. They agree that in the event of a dispute, claims for damages will be limited to the recovery of any actual damages sustained by a party. This prevents either party from seeking additional damages intended to punish the other party, limiting recovery to direct financial losses. However, the prevailing party in a legal action is entitled to recover reasonable attorneys' fees and costs of suit from the other party.