Does the time limitation apply to claims by Bombs Away Franchising related to non-payment?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
- 17.4 Time Limitation. Any arbitration or other legal action arising from or related to this Agreement must be instituted within two years from the date such party discovers the conduct or event that forms the basis of the arbitration or other legal action.
The foregoing time limit does not apply to claims (i) by one party related to non-payment under this Agreement by the other party, (ii) for indemnity under Article 16, or (iii) related to unauthorized use of Confidential Information or the Marks.
Source: Item 22 — CONTRACTS (FDD pages 35–36)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, the two-year time limitation for instituting arbitration or legal action does not apply to claims by either party related to non-payment under the Franchise Agreement. This means Bombs Away Franchising is not restricted by the two-year limitation when pursuing legal action against a franchisee for non-payment.
This exception to the time limitation benefits Bombs Away, allowing them more flexibility in pursuing outstanding payments. For a prospective franchisee, this signifies that Bombs Away can pursue non-payment claims regardless of when the franchisee discovers the grounds for such a claim, which could extend their potential liability.
It is important for a potential Bombs Away franchisee to understand the implications of this clause. While the franchisee has two years to bring most claims against Bombs Away, Bombs Away has an unlimited time to bring a claim against the franchisee for non-payment. Franchisees should ensure they have sufficient financial resources and maintain meticulous records of all payments to avoid potential disputes.