Can an arbitrator modify the terms and provisions of the Carbones Pizzeria Agreement?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
The arbitrator will be instructed that he or she must follow the substantive law and the other requirements, waivers and limitations of this Agreement.
The arbitrator shall have no authority to add, delete or modify in any manner, the terms and provisions of this Agreement and may not excuse performance of a material term of this Agreement.
However, if an arbitrator determines that any contractual limitations period provided for in this Agreement is not applicable or enforceable, then the parties agree to be bound by the provision of any statute of limitations which would otherwise be applicable to the controversy, dispute or claim which is the subject of any arbitration proceeding initiated hereunder.
Source: Item 23 — RECEIPTS (FDD pages 30–116)
What This Means (2025 FDD)
According to the 2025 Carbones Pizzeria Franchise Disclosure Document, an arbitrator does not have the authority to alter the franchise agreement. The document specifies that the arbitrator is bound by the existing terms and requirements of the agreement.
Specifically, the arbitrator cannot add to, delete from, or change any of the terms in any way. They are also prohibited from excusing the performance of any significant requirement outlined in the agreement. This ensures that the arbitrator's role is to interpret and apply the existing agreement, not to rewrite it.
However, there is an exception regarding contractual limitations. If the arbitrator finds that any contractual limitations period within the agreement is not applicable or enforceable, the parties will then be bound by the statute of limitations that would otherwise apply to the dispute. This exception ensures that legal statutes of limitations are considered if the agreement's own limitations are deemed invalid. This provision aims to provide a fair legal process while still adhering to the original intent of the franchise agreement as much as possible.