Can the arbitrator amend or modify the terms of the Chicken Guy agreement?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
- (1) The arbitrator will have the right to award or include in the award any relief which the arbitrator deems proper under the circumstances, including, without limitation, money damages (with interest on unpaid amounts from the date due), specific performance, injunctive relief, and reasonable attorneys' fees and costs, provided that the arbitrator will not have the right to amend or modify the terms of this Agreement, declare any Proprietary Marks generic or otherwise invalid, or award any punitive or exemplary damages against either party (Chicken Guy and Developer hereby waiving to the fullest extent permitted by law any right to or claim for any punitive or exemplary damages against the other).
Source: Item 23 — RECEIPTS (FDD pages 50–286)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, the arbitrator in a dispute resolution is explicitly prohibited from amending or modifying the terms of the franchise agreement. However, the arbitrator has the authority to award relief deemed proper, including money damages, specific performance, injunctive relief, and reasonable attorneys' fees and costs. This ensures that while the arbitrator can enforce the existing agreement and provide remedies for breaches, they cannot alter the original terms agreed upon by Chicken Guy and the developer.
This limitation on the arbitrator's power is significant for prospective Chicken Guy franchisees. It means that the terms of the franchise agreement, as initially signed, remain the governing document throughout the relationship. Franchisees can be assured that an arbitrator cannot unilaterally change the agreement to their detriment. However, it also means that franchisees must carefully review and understand the agreement before signing, as any issues or concerns cannot be resolved through arbitration by modifying the original terms.
This approach is fairly standard in franchising, where the franchise agreement is intended to be a stable and predictable framework for the relationship between the franchisor and franchisee. While arbitration offers a quicker and often less expensive method of dispute resolution compared to litigation, the inability of the arbitrator to modify the agreement reinforces the importance of due diligence and legal review before entering into the franchise agreement with Chicken Guy.
Furthermore, the FDD specifies that the arbitrator cannot declare any Proprietary Marks generic or otherwise invalid, or award any punitive or exemplary damages against either party. This further clarifies the scope and limitations of the arbitrator's authority, focusing the arbitration on resolving disputes within the confines of the existing contractual obligations and protecting Chicken Guy's intellectual property.