For Ledgers arbitration, what three maximum numbers must be included in the legal fee Budget?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
Your attorney must include in your demand for arbitration an estimate for legal fees ("Budget") necessary to establish liability and damages. The Budget will include the maximum number of: a) witness, b) experts and c) documents. The Arbitrator will evaluate the Budget for proportionality to the Cure. The Budget must be approved by the Arbitrator, before conducting any discovery, or hearings. The Arbitrator must approve any increases in the Budget.
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to Ledgers' 2025 Franchise Disclosure Document, if a dispute proceeds to arbitration, the franchisee's attorney must provide an estimate for legal fees, referred to as a "Budget", necessary to establish liability and damages. This Budget must include the maximum number of witnesses, experts, and documents that will be used.
The arbitrator will then evaluate this Budget to ensure it is proportional to the attempted resolution (Cure) of the issue. The arbitrator must approve the Budget before any discovery or hearings can take place, and any increases to the Budget also require the arbitrator's approval.
This requirement aims to control legal costs and ensure that the resources spent on arbitration are reasonable in relation to the nature of the dispute. It also gives the franchisee some control over the arbitration legal fees. A prospective franchisee should consider the potential costs of arbitration and the need to carefully estimate and justify the resources required for a potential legal dispute.