Prior to mediation, what must a Fitstop franchisee do to resolve disputes?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
| s. Modification of the agreement | Sections 5.2, 20.4 | No modifications generally except by written agreement, but we may change the Operations Manuals and Franchise System standards at any time. You will be required to implement these changes at your own cost. |
|---|---|---|
| t. Integration/merger clause | Section 20.2 | Only the terms of the Franchise Agreement (including the Operations Manuals) are binding (subject to state law). Any other promises may not be enforceable. No claim made in any franchise agreement is intended to disclaim the express representations made in this Franchise Disclosure Document. |
| u. Dispute resolution by arbitration or mediation | Section 19.1.1 | You must submit any disputes, claims and/or causes of action you have arising out of or related to the Franchise Agreement to our management for review and subsequent discussions regarding the same, and you agree to attempt to resolve any such matters internally prior to submitting any such matter to mediation. |
| Section 19.1.2 | We have the irrevocable right to submit all matters that are not resolved via internal dispute resolution procedures set forth in the Franchise Agreement to non-binding mediation that will be conducted at Franchisor's then-current headquarters and in accordance with the Commercial Mediation Rules promulgated by t |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 42–47)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, a franchisee must first submit any disputes, claims, or causes of action arising from the Franchise Agreement to Fitstop's management for review. Following this submission, the franchisee is obligated to engage in discussions with Fitstop to attempt to resolve the issues internally before considering mediation. This initial step of internal dispute resolution is a mandatory prerequisite before proceeding to mediation.
This requirement for internal dispute resolution before mediation is a fairly common practice in franchising. It aims to foster open communication and provide an opportunity for both parties to resolve disagreements efficiently and cost-effectively. By attempting to resolve disputes internally, Fitstop and its franchisees may avoid the expenses and time associated with formal mediation or litigation.
Fitstop also retains the right to submit unresolved matters to non-binding mediation, which will occur at Fitstop's headquarters and follow the Commercial Mediation Rules set by the AAA. Fitstop has 30 days from receiving written notice of a dispute to decide whether to exercise this right and inform the franchisee accordingly. This clause ensures that Fitstop has the option to initiate mediation if internal efforts fail, providing another avenue for conflict resolution before resorting to litigation.