Does the Body20 franchise agreement allow the arbitrator to award interest on unpaid amounts?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
- (c) Relief. The arbitrator has the right to award or include in his or her award any relief which he or she deems proper, including money damages (with interest on unpaid
amounts from the date due), specific performance, injunctive relief, and attorneys' fees (on a solicitor and its own client basis) and costs, provided that the arbitrator may declare any Mark generic or otherwise invalid or, except as expressly provided in Section 16.5 (Mutual Waiver of Punitive Damages), award any special, consequential, exemplary, or punitive damages against either party (we and you hereby waiving to the fullest extent permitted by law, except as expressly provided in Section 16.5 below, any right to or claim for any special, consequential, exemplary, or punitive damages against the other).
Source: Item 23 — RECEIPT (FDD pages 74–251)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, the arbitrator in a dispute has the authority to award interest on unpaid amounts. This means that if a franchisee is found to owe Body20 money, the arbitrator can include in the award a provision for interest to be paid on those unpaid amounts, calculated from the date the payment was originally due. This clause aims to compensate Body20 for the time value of money and any financial losses incurred due to the delayed payment.
This provision is fairly standard in franchise agreements, as it provides an incentive for franchisees to make timely payments and ensures that Body20 can recover any losses associated with late payments. However, the arbitrator's discretion is not unlimited. While they can award interest on unpaid amounts, the agreement also stipulates that the arbitrator cannot award special, consequential, exemplary, or punitive damages against either party, except as expressly provided in another section regarding mutual waiver of punitive damages.
For a prospective Body20 franchisee, this means understanding the importance of adhering to the payment terms outlined in the franchise agreement. Failure to make timely payments could result not only in the original amount owed but also in additional interest charges if a dispute goes to arbitration. It is crucial to carefully review the payment terms and obligations within the franchise agreement and seek clarification from Body20 or legal counsel on any aspects that are unclear.