Under the Devon Creek franchise agreement, what rules govern arbitration proceedings?
Devon_Creek Franchise · 2024 FDDAnswer from 2024 FDD Document
- 20.3.2 All issues relating to arbitrability or the enforcement of the agreement to arbitrate contained in this Article 20 will be governed by the Federal Arbitration Act (9 U.S.C. §1 et seq.) and the federal common law of arbitration.
All hearings and other proceedings will take place in North Carolina, or the offices of the American Arbitration Association, or, if Franchisor so elects, in the county where the principal place of business of Franchisee is then located.
- 20.3.3 This arbitration provision is self-executing and will remain in full force and effect after expiration or termination of this Agreement.
Any arbitration will be conducted on an individual, and not a class-wide or multiple plaintiffs, basis.
If either party fails to appear at any properly noticed arbitration proceeding, an award may be entered against the party by default or otherwise, notwithstanding the failure to appear.
Judgment upon an arbitration award may be entered in any court having jurisdiction and will be binding, final and not subject to appeal.
No punitive or exemplary damages will be awarded against Franchisor, Franchisee, or entities related to either of them, in an arbitration proceeding or otherwise, and are hereby waived.
20.3.4 The provisions of this Section 20.3 are independent of any other covenant or provision of this Agreement; provided, however, that if a court of competent jurisdiction determines that any of the provisions are unlawful in any way, the court will modify or interpret the provisions to the minimum extent necessary to have them comply with the law.
20.3.5 In proceeding with arbitration and in making determinations hereunder, no arbitrator shall extend, modify, or suspend any terms of this Agreement or the reasonable standards of business performance and operation established by Franchisor in good faith.
No notice, request or demand for arbitration shall stay, postpone, or rescind the effectiveness of any termination of this Agreement.
- 20.3.6 Except as expressly required by law, Franchisor, Franchisee and any Principal shall keep all aspects of any mediation and/or arbitration proceeding in confidence, and shall not disclose any information about the proceeding to any third party other than legal counsel who shall be required to maintain the confidentiality of such information.
Source: Item 22 — CONTRACTS (FDD page 45)
What This Means (2024 FDD)
According to the 2024 Devon Creek Franchise Disclosure Document, several rules govern arbitration proceedings. All issues relating to whether something is subject to arbitration or the enforcement of the arbitration agreement itself will be governed by the Federal Arbitration Act and federal common law. All hearings and other proceedings will occur in North Carolina, at the American Arbitration Association, or, if Devon Creek chooses, in the county where the franchisee's principal place of business is located.
The arbitration provision is self-executing and remains in effect even after the agreement expires or is terminated. Any arbitration will be conducted on an individual basis, not as part of a class-wide or multiple plaintiffs case. If either party does not attend a properly noticed arbitration proceeding, a decision may be made against them by default. The judgment upon an arbitration award is final, binding, and not subject to appeal in any court with jurisdiction.
Furthermore, no punitive or exemplary damages will be awarded against Devon Creek or the franchisee in any arbitration proceeding. All aspects of any mediation or arbitration proceeding must be kept confidential by Devon Creek, the franchisee, and any involved principals, and information about the proceeding can only be disclosed to legal counsel who must also maintain confidentiality. No arbitrator can extend, modify, or suspend any terms of the agreement or the reasonable standards of business performance established by Devon Creek. Finally, any notice, request, or demand for arbitration will not delay or cancel the effectiveness of any termination of the agreement.