Are disputes related to leases or subleases with Degree Wellness or its affiliates subject to arbitration?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
a. Agreement to Arbitrate. Except insofar as we elect to enforce this Agreement or to
seek temporary or permanent injunctive relief as provided above, all controversies, disputes or claims arising between us, our affiliates, and our and their respective owners, officers, directors, agents, and employees (in their representative capacity) and you (and your Principal Owners and guarantors) arising out of or related to: (1) this Agreement, any provision thereof, or any related agreement (except for any lease or sublease with us or any of our affiliates); (2) the relationship of the parties hereto; (3) the validity of this Agreement or any related agreement, or any provision thereof; or (4) any specification, standard or operating procedure relating to the establishment or operation of the Franchise, shall be submitted for arbitration to be administered by the office of the American Arbitration Association.
Source: Item 23 — Receipts (FDD pages 66–257)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, disputes arising from leases or subleases with Degree Wellness or its affiliates are explicitly excluded from mandatory arbitration. The document states that all controversies, disputes, or claims between Degree Wellness, its affiliates, and franchisees related to the franchise agreement, the relationship of the parties, the validity of the agreement, or any operating procedure, must be submitted for arbitration. However, this requirement does not apply to disputes arising from any lease or sublease agreement with Degree Wellness or its affiliates.
This exclusion means that if a Degree Wellness franchisee has a dispute with Degree Wellness or its affiliates regarding a lease or sublease, the franchisee is not required to resolve the dispute through arbitration. Instead, the franchisee would typically have the option to pursue the matter in court or through other legal means. This is a significant point for potential franchisees to consider, as lease-related disputes can be complex and involve substantial financial implications.
For a prospective Degree Wellness franchisee, this information highlights the importance of carefully reviewing the lease agreement and understanding their rights and obligations as a tenant. It also suggests that franchisees should be prepared to handle lease-related disputes through traditional legal channels, if necessary, rather than relying on the potentially more streamlined process of arbitration. Understanding this distinction is crucial for managing risk and protecting their investment in the Degree Wellness franchise.