If the AAA Mediation Rules differ from the Buildingstars franchise agreement, which terms will be applied?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
A. Mediation. Before any party may bring an action in court for any controversy, dispute or claim between BUILDINGSTARS and FRANCHISEE arising from this Agreement or the franchise relationship set forth in this Agreement, the parties must first have a conference with each other to try to resolve the dispute. If this fails to bring about a resolution, the dispute will first be submitted to nonbinding mediation (the "Mediation") in St. Louis County, Missouri unless the parties mutually agree to another location. The Mediation shall be conducted in accordance with then-current AAA mediation rules (the "AAA Mediation Rules") except to the extent the AAA Mediation Rules differ from the terms of this Agreement, in which event the terms of this Agreement shall be applied. Notwithstanding the foregoing, the mediation does not have to be conducted under the AAA. BUILDINGSTARS and FRANCHISEE will select the mediator. If the parties cannot agree on the selection of a mediator, the mediation shall be conducted through the AAA who will make the selection of mediator using their rules and guidelines. The cost of the Mediation, including the mediator's fee and expenses, shall be paid by the FRANCHISEE. All negotiations and mediation proceedings (including without limitation, discovery conducted therein, as well as all statements and settlement offers made by either party or the mediator in connection with the Mediation) shall be strictly confidential, shall be considered as compromise and settlement negotiations for purposes of the Federal Rules of Evidence and state rules of evidence, and shall not be admissible or otherwise used in connection with any court or arbitration proceeding for any purpose. The mediator may not be called as a witness in any court or arbitration proceeding for any purpose. If the parties, after a good faith effort to settle the dispute using Mediation, are unable to reach settlement, BUILDINGSTARS and FRANCHISEE agree that the dispute will be resolved according to the Sections below. Failure to submit the dispute to Mediation prior to commencing any litigation or arbitration proceeding shall be grounds for dismissal of the litigation or arbitration proceedings.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
According to Buildingstars's 2025 Franchise Disclosure Document, if there is a conflict between the AAA Mediation Rules and the terms outlined in the franchise agreement, the terms of the Buildingstars franchise agreement will take precedence. This stipulation is part of the dispute resolution process that Buildingstars requires franchisees to follow.
Before initiating any court action regarding disputes with Buildingstars, franchisees must first participate in a conference to attempt to resolve the issue. If this initial conference is unsuccessful, the dispute must then be submitted to nonbinding mediation in St. Louis County, Missouri, unless both parties agree to an alternative location. While the mediation is generally conducted following the AAA Mediation Rules, the franchise agreement specifies that its terms will override the AAA rules in case of any discrepancies.
This means that prospective Buildingstars franchisees should carefully review the franchise agreement to understand all the terms that will govern any dispute resolution process. Franchisees are responsible for the costs of mediation, including the mediator's fees and expenses. All negotiations and mediation proceedings are to be kept strictly confidential and are considered compromise and settlement negotiations, inadmissible in any court or arbitration proceedings.