What initial steps must Bft franchisees take to resolve disputes before initiating arbitration or litigation?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
B. Internal Dispute Resolution.The Parties each agree that, except as set forth in Section 12.E below, before it (or any of its parents, affiliates, or subsidiaries, or their respective owners, officers, directors, employees, or representatives) initiates an arbitration or litigation against the other Party (or any of the other Party's parents, affiliates, or subsidiaries, or their respective owners, officers, directors, employees or representatives), the Party initiating arbitration or litigation will provide the other Party with written notice of the underlying claim or dispute specifying, in detail, the precise nature and grounds of the claim or dispute.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–66)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, before initiating arbitration or litigation against Bft, a franchisee must first provide Bft with written notice of the claim or dispute. This notice must specify in detail the precise nature and grounds for the claim or dispute. This initial step is part of Bft's internal dispute resolution process.
This requirement is fairly standard in franchise agreements, as it provides an opportunity for both parties to resolve issues amicably and potentially avoid the costs and time associated with formal legal proceedings. By requiring detailed written notice, Bft aims to understand the franchisee's concerns thoroughly and address them effectively.
However, there is an exception to this internal dispute resolution requirement, as outlined in Section 12.E of the franchise agreement (though the details of Section 12.E are not provided in the excerpt). Franchisees should carefully review the full franchise agreement to understand the specific circumstances under which they may be exempt from this initial step. Understanding these pre-arbitration or pre-litigation requirements is crucial for franchisees to ensure they are in compliance with the agreement and to protect their legal rights.