What state's law governs the arbitration of disputes under the Bhc Multi-Unit Master Franchise Agreement?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in | Summary |
|---|---|---|
| Multi-Unit Master Franchise Agreement | (if the amount in controversy is less than $250,000 - https://www.jamsadr.com/rules-streamlined- arbitration/) or its Comprehensive Arbitration Rules and Procedures (if the amount in controversy is $250,000 or more - https://www.jamsadr.com/rules- comprehensive-arbitration/). Or, if the parties mutually agree, the dispute may be submitted to arbitration conducted by and before another mutually acceptable arbitrator. | |
| w. Choice of forum | 14.1, 14.2 | Mediation and arbitration proceedings will take place in Los Angeles County, California. Any litigation proceedings will take place in an appropriate court in California. |
| x. Choice of law | 16.13 | California law governs the arbitration of disputes under the MFA. |
Source: Item 17 — Renewal, Termination, Transfer, And Dispute Resolution (FDD pages 43–49)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, California law governs the arbitration of disputes arising from the Multi-Unit Master Franchise Agreement (MFA). This means that any arbitration proceedings related to the MFA will be interpreted and conducted in accordance with California's legal principles and statutes.
For a prospective Bhc franchisee, this is important because it establishes the legal framework for resolving potential disputes with Bhc through arbitration. Franchisees should familiarize themselves with California law regarding arbitration to understand their rights and obligations in such proceedings. This includes understanding the rules of evidence, the process for selecting arbitrators, and the potential for appealing arbitration decisions.
Furthermore, the FDD specifies that mediation and arbitration proceedings will take place in Los Angeles County, California, regardless of where the franchisee's business is located. This could mean increased travel costs and logistical challenges for franchisees located outside of California. Franchisees should factor these potential costs into their financial planning and consider seeking legal counsel in California if a dispute arises.