What constitutes a 'commercially reasonable effort' to settle a dispute internally for a Fitstop franchisee?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
- 19.1 Internal Dispute Resolution. You must first bring any claim or dispute arising out of or related to the Franchised Business and/or this Agreement to our management after you have provided us with written notice as prescribed in Section 19.6 of this Agreement, and subsequently make every commercially reasonable effort to settle any such dispute or claim internally.
You must exhaust this internal dispute resolution procedure before bringing any action or claim before a third-party mediator or other adjudicating party.
This agreement to first attempt resolution of disputes internally shall survive termination or expiration of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, a franchisee must first bring any claim or dispute related to the franchised business or the Franchise Agreement to Fitstop's management after providing written notice, as prescribed in Section 19.6 of the agreement. The franchisee is then required to make every 'commercially reasonable effort' to settle the dispute internally.
This internal dispute resolution procedure must be exhausted before a franchisee can pursue any action or claim with a third-party mediator or other adjudicating party. This requirement to attempt internal resolution survives any termination or expiration of the Franchise Agreement.
While the FDD specifies the requirement for a 'commercially reasonable effort,' it does not define what actions or steps constitute such an effort. A prospective franchisee should seek clarification from Fitstop regarding the specific expectations and actions that would be considered a 'commercially reasonable effort' during the internal dispute resolution process. Understanding these expectations is crucial for franchisees to ensure they are meeting their obligations under the Franchise Agreement and preserving their rights to pursue further legal action if necessary.