Prior to arbitration, what are Hydrodog franchisees and the franchisor expected to do to resolve disputes?
Hydrodog Franchise · 2025 FDDAnswer from 2025 FDD Document
our approval of any action or omission by you. If we provide to you any waiver, approval, consent, or suggestion, or if we neglect or delay our response or deny any request for any of those, we will not be deemed to have made any warranties or guarantees which you may rely on, and will not assume any liability or obligation to you.
21. DISPUTE RESOLUTION.
- 21.1 Agreement to Arbitrate. You and we acknowledge that resolving disputes prior to commencing arbitration hearings or court proceedings is in the best interests of both parties, all other franchisees and our System. Therefore, the parties agree that they will seek to settle any dispute between them through good faith negotiations prior to arbitration. However, if the parties are unable to settle the dispute or controversy, then except as expressly provided to the contrary in this Agreement, all disputes and controversies between you and we, including allegations of fraud, misrepresentation and violation of any state or federal laws, rules or regulations, arising under, as a result of, or in connection with this Agreement or the HydroDog Business are subject to and will be resolved exclusively by arbitration conducted according to the then current commercial arbitration rules of the American Arbitration Association.
- 21.2 Notice of Dispute. The party alleging the dispute must provide the other party with written notice setting forth the alleged dispute in detail. The party who receives written notice alleging the dispute will have thirty (30) days after receipt of the written notice to correct, settle or compromise the dispute specified in the written notice. If the written notice alleges that the Franchisee is delinquent in the payment of any fees or other payments payable to us, the Franchisee will have ten (10) days to make full payment (including interest and Administrative Fees as provided for herein) to us.
- 21.3 Demand for Arbitration.
Source: Item 23 — RECEIPTS (FDD pages 43–166)
What This Means (2025 FDD)
According to the 2025 Hydrodog Franchise Disclosure Document, both the franchisee and franchisor acknowledge that resolving disputes through negotiation is in the best interest of all parties involved. Therefore, both parties agree to settle any dispute through good faith negotiations before starting arbitration hearings or court proceedings.
If negotiations fail to resolve the dispute, the party alleging the dispute must provide the other party with a written notice detailing the alleged dispute. The recipient of the notice then has thirty days to correct, settle, or compromise the dispute. However, if the dispute involves the franchisee's failure to pay fees or other payments, the franchisee has only ten days to make full payment, including interest and administrative fees.
If the dispute remains unresolved after the allotted time, either party may demand arbitration following the American Arbitration Association's procedures. During the arbitration process, both the franchisee and Hydrodog must continue to fulfill their obligations under the Franchise Agreement. Unless both parties agree otherwise, three arbitrators will be selected to hear the matter, one of whom must be a retired judge.
For a prospective Hydrodog franchisee, this means that before entering into costly arbitration, there is a required period of good faith negotiation and an opportunity for the other party to resolve the issue. Franchisees should be aware of the specific timelines for resolving payment disputes, which are significantly shorter than those for other types of disputes.