In the Dog Haus Development Agreement, what happens if mediation does not resolve the dispute?
Dog_Haus Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | (Exhibit B) | Summary |
|---|---|---|
| expenses of the mediator will be shared equally by you and us. | ||
| If the parties cannot resolve and settle the dispute through | ||
| mediations, all unresolved claims between you and us will be | ||
| submitted to binding arbitration, which will occur in Los Angeles, | ||
| California. The fees and expenses of the arbitrator will be shared | ||
| equally by you and us. | ||
| (subject to applicable state law) |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 63–72)
What This Means (2025 FDD)
According to Dog Haus's 2025 Franchise Disclosure Document, if mediation fails to resolve a dispute under the Development Agreement, the matter will proceed to binding arbitration. The arbitration will take place in Los Angeles, California. Both the franchisee and Dog Haus will equally share the fees and expenses of the arbitrator, subject to applicable state law.
This means that a prospective Dog Haus franchisee should be aware that disputes arising from the Development Agreement will be subject to mandatory arbitration if mediation is unsuccessful. Arbitration is generally less formal than court litigation, but the arbitrator's decision is binding and enforceable. The location of arbitration in Los Angeles, California, could create additional travel and legal costs for franchisees located outside of California.
It is typical in franchising for agreements to include dispute resolution procedures like mediation and arbitration. These methods are often favored for their potential to be faster and less expensive than traditional litigation. However, franchisees should carefully consider the implications of agreeing to binding arbitration, including the loss of the right to a jury trial and the potential limitations on appeal rights.