Does the time limitation apply to claims by Better Blend for indemnity?

According to the 2024 Better Blend Franchise Disclosure Document, any arbitration or other legal action related to the Franchise Agreement must be initiated within two years from the date of the event that forms the basis of the action. However, this time limitation does not apply to claims by Better Blend related to non-payment of Royalty Fees and other amounts owed by the franchisee.

In practical terms, this means a Better Blend franchisee has a limited window to bring any claims against the franchisor, but Better Blend has an extended period to pursue franchisees for unpaid royalties or other financial obligations. This creates an imbalance where franchisees need to act quickly on potential claims, while Better Blend faces less urgency in recovering payments.

This type of clause is relatively common in franchise agreements, as franchisors want to ensure timely resolution of disputes. However, the exception for royalty and fee payments is noteworthy and something prospective franchisees should carefully consider. Franchisees should be diligent in documenting any potential claims and seeking legal advice promptly to ensure they do not miss the two-year deadline. Franchisees should also be aware that the obligation to pay royalties continues even if they have other claims against Better Blend.