What dispute resolution methods are required for disputes with C3 Wellness Spa, and where must they take place?
C3_Wellness_Spa Franchise · 2024 FDDAnswer from 2024 FDD Document
| q. Non-competition covenants during the term of the franchise | Not applicable | Not applicable as to Multi-Unit Development Agreement. However, each Spa Location Franchise developed pursuant to Multi-Unit Development Agreement will be subject to non-competition covenants set forth in each respective Franchise Agreement. |
|---|---|---|
| r. Non-competition covenants after the franchise is terminated or expires | Not applicable | Not applicable as to Multi-Unit Development Agreement. However, each Spa Location Franchise developed pursuant to Multi-Unit Development Agreement will be subject to non-competition covenants set forth in each respective Franchise Agreement. |
| s. Modification of the agreement | 5.4, 7.11 | Only by written agreement between you and us or if governing law requires a modification. We can change the form of the Franchise Agreement for future Spa Location Franchises which will not alter your obligations under the Multi-Unit Development Agreement. |
| t. Integration/merger clauses | 7.12 | Any representation of promises outside of the Franchise Disclosure Document and other agreements may not be enforceable. Notwithstanding the foregoing, nothing in any agreement is intended to disclaim the express representations made in the Franchise Disclosure Document, its exhibits and amendments. |
| u. Dispute resolution by arbitration or mediation | 7.5, 7.6 | Except for certain claims for injunctive relief, all disputes must first be submitted to non-binding mediation in Osceola County, Florida and, if mediation is unsuccessful, then to binding arbitration in Osceola County, Florida. This provision is subject to applicable state law. |
| v. Choice of forum | 7.5, 7.6 | All mediation, arbitration and, if applicable, litigation proceedings must be conducted in, or closest to, State court of general jurisdiction that is within or closest to Osceola County, Florida. This provision is subject to applicable state law. |
| w. Choice of law | 7.5, 7.6 | Florida law will govern. However, this provision is subject to state law and as otherwise disclosed in Exhibit I to this Disclosure Document. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 43–50)
What This Means (2024 FDD)
According to C3 Wellness Spa's 2024 Franchise Disclosure Document, dispute resolution involves specific methods and locations. Except for claims seeking injunctive relief, all disputes must initially undergo non-binding mediation in Osceola County, Florida. If mediation fails to resolve the dispute, the matter then proceeds to binding arbitration, also in Osceola County, Florida. These stipulations are subject to applicable state law, meaning that state-specific regulations may influence the process.
For a prospective C3 Wellness Spa franchisee, this means that any disputes with the franchisor, excluding those seeking immediate court orders (injunctive relief), will first be addressed through mediation. Mediation is a process where a neutral third party helps facilitate a discussion to reach a mutually agreeable resolution. If mediation does not produce a settlement, the dispute will be settled through binding arbitration, where a neutral arbitrator makes a final decision that both parties must legally adhere to.
The requirement for both mediation and arbitration to occur in Osceola County, Florida, has significant implications. Franchisees located outside of Florida would need to travel to Osceola County for these proceedings, incurring travel, accommodation, and legal costs. The franchisee should also be aware that Florida law governs the agreement, although state law may have an impact and is further detailed in Exhibit I of the Disclosure Document. Prospective franchisees should carefully review Exhibit I and consult with a legal professional to understand their rights and obligations regarding dispute resolution with C3 Wellness Spa.