For Crown Gold Exchange franchises purchased in Washington, where should arbitration take place?
Crown_Gold_Exchange Franchise · 2024 FDDAnswer from 2024 FDD Document
In any arbitration involving a franchise purchased in Washington, the arbitration site shall be either in the state of Washington, or in a place mutually agreed upon at the time of the arbitration, or as determined by the arbitrator.
In the event of a conflict of laws, the provisions of the Washington Franchise Investment Protection Act, Chapter 19.100 RCW shall prevail.
A release or waiver of rights executed by a franchisee shall not include rights under the Washington Franchise Investment Protection Act except when executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel. Provisions such as those which unreasonably restrict or limit the statute of limitation period for claims under the Act, rights or remedies under the Act such as a right to a jury trial may not be enforceable.
Source: Item 22 — CONTRACTS (FDD pages 38–39)
What This Means (2024 FDD)
According to the 2024 Franchise Disclosure Document, for any Crown Gold Exchange franchise purchased in Washington, the arbitration site must be in the state of Washington. However, the arbitration site can be a place mutually agreed upon at the time of the arbitration, or as determined by the arbitrator. This stipulation is part of a Washington addendum that addresses the state's franchise investment statute, which may supersede the franchise agreement in certain areas, including termination and renewal.
This means that if a Crown Gold Exchange franchisee in Washington has a dispute with the franchisor that goes to arbitration, the franchisee has some assurance that the arbitration will occur locally, unless both parties agree to an alternative location or the arbitrator decides otherwise. This can significantly reduce travel costs and logistical challenges for the franchisee. It is not uncommon for franchise agreements to specify a particular location for arbitration, often the location of the franchisor's headquarters, which could be a disadvantage for franchisees located far from that location.
However, the Washington Franchise Investment Protection Act, Chapter 19.100 RCW, will prevail if there is a conflict of laws. Additionally, any release or waiver of rights executed by a Crown Gold Exchange franchisee cannot waive rights under the Washington Franchise Investment Protection Act unless it is part of a negotiated settlement with independent legal representation after the franchise agreement is already in effect. Provisions that unreasonably restrict the statute of limitations for claims or rights to a jury trial may not be enforceable.
Crown Gold Exchange franchisees in Washington should be aware of these specific protections under Washington law, as they modify the standard terms of the franchise agreement. It would be prudent for prospective franchisees to consult with an attorney familiar with Washington franchise law to fully understand their rights and obligations.