How are the fees and expenses of the mediator shared between Dog Haus and the franchisee?
Dog_Haus Franchise · 2025 FDDAnswer from 2025 FDD Document
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ITEM 17 RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP
This table lists certain important provisions of the franchise and related agreements. You should read these provisions in the agreements attached to this Disclosure Document.
FRANCHISE AGREEMENT (INCLUDING REMOTE KITCHEN ADDENDUM)
| Provision | | Section In Area | Summary | |---|---|---|---| | | | Development Agreement (Exhibit B) | 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) | | v. Choice of forum | Section 15.1 | | All proceedings will be held in Los Angeles County, California, | | | | | subject to applicable state law. See the State Specific Addenda | | | | | (Exhibit H) attached to this Disclosure Document. | | w. Choice of law | Section 15.1 | | California, subject to the exception provided in Section 15.1of the | | | | | Area Development Agreement and applicable state law. See the | | | | | State Specific Addenda (Exhibit H) attached to this Disclosure | | | | | Document. |
| Section In Franchise | |||
|---|---|---|---|
| Agreement | |||
| (Exhibit A) and | |||
| in Remote | |||
| Kitchen | |||
| Addendum | |||
| Provision | (Exhibit C) | Summary |
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, both the franchisee and Dog Haus will equally share the mediator's fees and expenses. This applies to disputes arising under both the Franchise Agreement and the Development Agreement. Specifically, the FDD states that mediation will occur in Los Angeles, California. If mediation does not resolve the dispute, the matter proceeds to binding arbitration, also in Los Angeles, where the arbitrator's fees and expenses are also shared equally between the franchisee and Dog Haus. This arrangement is subject to applicable state law, potentially modifying the process based on the franchisee's location.
For a prospective Dog Haus franchisee, this equal sharing of mediation and arbitration costs offers a degree of financial predictability and fairness in the event of a dispute. It prevents Dog Haus from unilaterally imposing high dispute resolution costs on the franchisee. However, franchisees should still be aware of the potential expenses associated with travel, legal counsel, and preparation for mediation and arbitration, as these costs are typically borne individually.
It's worth noting that the FDD specifies that all proceedings will be held in Los Angeles County, California, regardless of the franchisee's location. This could significantly increase costs for franchisees located outside of California, as they would need to factor in travel and accommodation expenses for themselves and their legal representatives. Franchisees should carefully consider this forum selection clause and its potential financial implications before investing in a Dog Haus franchise.