How long do Chatime parties have to resolve a dispute before either party can refer the matter to a mediator?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
- 16.2 Mediation. If the parties cannot resolve their Dispute within 30 days from the date of service of the Notice of Dispute, either party may refer the matter to a mediator and if the parties cannot agree upon the appointment of a mediator, either party may submit the matter to the American Arbitration Association ("AAA") and obtain the appointment of a mediator under the AAA mediation rules from the AAA Franchise Panel.
- (1) The mediation may take place by videoconference, unless the parties agree upon a different location. The mediator may decide the date and time for mediation and the parties will attend the mediation and use reasonable endeavors to resolve the dispute.
- (2) The parties to the mediation agree that: everything that occurs before the mediator will be in confidence and in closed session; all discussions will be without prejudice; and no documents brought into existence specifically for the purpose of the mediation process will be called into evidence in any subsequent litigation by either of the parties. The mediator will deal with any matter as expeditiously as possible by no later than 30 Business Days after referral to the mediator.
- (3) The parties to the mediation will bear the costs of the mediation on an equal basis. Each party will bear its own costs of attending and preparing for the mediation.
- (4) The mediator will have no power to make any decision binding on the Parties to resolve the dispute.
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, if a dispute arises, both parties have 30 days from the date of service of the Notice of Dispute to resolve it. If they cannot resolve the dispute within this timeframe, either party has the option to refer the matter to a mediator. If the parties cannot agree on a mediator, either party can submit the matter to the American Arbitration Association (AAA) to obtain the appointment of a mediator under the AAA mediation rules from the AAA Franchise Panel.
This means that a Chatime franchisee must first formally notify the other party of the dispute. Only after 30 days from this notification can the franchisee initiate mediation. This waiting period is intended to allow both parties an initial opportunity to resolve the issue themselves before incurring the costs and time associated with mediation.
The mediation may occur via videoconference unless both parties agree to a different location. The mediator will determine the date and time for the mediation, and both parties are required to attend and make reasonable efforts to resolve the dispute. The mediator is expected to handle the matter as quickly as possible, with a deadline of no later than 30 business days after the referral to the mediator.
It is important to note that the mediator does not have the power to make any binding decisions. If mediation is unsuccessful, the next step is binding arbitration, where a final and legally enforceable decision will be made. Understanding this process is crucial for any prospective Chatime franchisee, as it outlines the steps and timelines for resolving disputes with the franchisor.