Does the Better Blend franchise agreement require the franchisee to agree to arbitration of disputes at a location remote from the franchisee's business in North Dakota?
Better_Blend Franchise · 2024 FDDAnswer from 2024 FDD Document
- 2. Amendments. The Agreement (and any Guaranty Agreement) is amended to comply with the following:
- (1) Restrictive Covenants: Every contract by which Franchisee, any Guarantor, or any other person is restrained from exercising a lawful profession, trade, or business of any kind is subject to NDCC Section 9-08-06.
- (2) Situs of Arbitration Proceedings: Franchisee and any Guarantor are not required to agree to the arbitration of disputes at a location that is remote from the site of Franchisee's business.
- (3) Restrictions on Forum: Franchisee and any Guarantor are not required to consent to the jurisdiction of courts outside of North Dakota.
- (4) Liquidated Damages and Termination Penalties: Franchisee is not required to consent to liquidated damages or termination penalties.
- (5) Applicable Laws: The Agreement (and any Guaranty Agreement) is governed by the laws of the State of North Dakota.
- (6) Waiver of Trial by Jury: Franchisee and any Guarantor do not waive a trial by jury.
- (7) Waiver of Exemplary and Punitive Damages: The parties do not waive exemplary and punitive damages.
- (8) General Release: Franchisee and any Guarantor are not required to sign a general release upon renewal of the Agreement.
- (9) Limitation of Claims: Franchisee is not required to consent to a limitation of claims. The statute of limitations under North Dakota law applies.
- (10) Enforcement of Agreement: The prevailing party in any enforcement action is entitled to recover all costs and expenses including attorney's fees.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2024 FDD)
According to the 2024 Better Blend Franchise Disclosure Document, if a franchisee's business is located in North Dakota, the franchisee is not required to agree to arbitrate disputes at a location that is remote from the site of their business. This protection is specifically outlined in the North Dakota Rider to the Franchise Agreement. This means a Better Blend franchisee operating in North Dakota has the right to have any arbitration proceedings occur within a reasonable distance of their business location.
This provision is beneficial for prospective Better Blend franchisees in North Dakota because it prevents the franchisor from forcing them to travel long distances for dispute resolution, which could be costly and inconvenient. It ensures that arbitration proceedings are accessible and do not unduly burden the franchisee. This type of clause is not uncommon, as many states have specific addenda to franchise agreements to protect franchisees from unfavorable terms, especially regarding dispute resolution.
The North Dakota Rider also includes several other protections for franchisees in that state. Franchisees and any guarantors are not required to consent to the jurisdiction of courts outside of North Dakota, consent to liquidated damages or termination penalties, waive a trial by jury, sign a general release upon renewal of the agreement, or consent to a limitation of claims. The agreement is governed by the laws of North Dakota, and the prevailing party in any enforcement action is entitled to recover all costs and expenses, including attorney's fees. These stipulations collectively provide a more balanced legal framework for Better Blend franchisees operating in North Dakota.