What law must the arbitrator follow when arbitrating a Carbones Pizzeria franchise dispute?
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.
The arbitrator is expressly prohibited from determining whether class, mass, collective or consolidated relief is permitted hereunder or from awarding the same.
All findings, judgments, decisions and awards of the arbitrator shall be limited to the dispute or controversy set forth in the written demand for arbitration and response to that demand.
Source: Item 23 — RECEIPTS (FDD pages 30–116)
What This Means (2025 FDD)
According to the 2025 Carbones Pizzeria Franchise Disclosure Document, the arbitrator is instructed to follow the substantive law, requirements, waivers, and limitations outlined in the franchise agreement. The arbitrator cannot alter the terms of the agreement or excuse performance of a material term. However, if a contractual limitations period is deemed unenforceable, the arbitrator will apply the relevant statute of limitations. The arbitrator is prohibited from determining or awarding class, mass, collective, or consolidated relief. All findings must be limited to the issues in the written demand for arbitration.
This means that a Carbones Pizzeria franchisee can expect the arbitrator to adhere strictly to the franchise agreement's provisions and applicable laws. The arbitrator's authority is limited to the specific dispute raised and cannot expand beyond the agreement's scope. This ensures that the arbitration process remains focused on the contractual obligations and legal requirements relevant to the dispute.
This approach is fairly standard in franchise agreements, as it aims to provide a predictable and controlled dispute resolution process. By specifying the governing law and limitations on the arbitrator's powers, Carbones Pizzeria seeks to manage the risks associated with arbitration and ensure that disputes are resolved in a manner consistent with the terms of the franchise agreement. Prospective franchisees should carefully review these provisions to understand their rights and obligations in the event of a dispute.