Where does the Southern Steer Franchise Agreement require negotiation, non-binding mediation, and binding arbitration to take place, and who bears the costs?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
THE MEDIATION AND ARBITRATION PROCEEDING WILL TAKE PLACE IN CLEARWATER, FLORIDA OR THE CITY NEAREST FRANCHISOR'S PRINCIPAL PLACE OF BUSINESS AT THE TIME AS DETERMINED BY FRANCHISOR, AS THE CASE MAY BE, UNLESS THE PARTIES MUTUALLY AGREE TO ANOTHER LOCATION.
- Consent to Jurisdiction.
MULTI-UNIT DEVELOPER, CONTROLLED ENTITY (IF ANY) AND THEIR OWNERS, GUARANTOR(S), DIRECTORS, OFFICERS, AGENTS, DESIGNATED MANAGER(S), EMPLOYEES, AFFILIATES AND OPERATING PRINCIPAL(S) HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION AND VENUE OF THE COURTS IN CLEARWATER, FLORIDA AND MEDIATION AND ARBITRATION IN CLEARWATER, FLORIDA OR AS PROVIDED IN SECTIONS 14.4 OR 14.5.
THE COST OF THE MEDIATION, INCLUDING THE MEDIATOR'S FEE AND EXPENSES, SHALL BE SPLIT EQUALLY BETWEEN FRANCHISOR AND MULTI-UNIT DEVELOPER AND/OR THE CONTROLLED ENTITY (IF ANY).
IF THE PARTIES CANNOT FULLY RESOLVE AND SETTLE A DISPUTE THROUGH DIRECT MEDIATION WITHIN 30 DAYS AFTER THE MEDIATION CONFERENCE CONCLUDES, ALL UNRESOLVED ISSUES INVOLVED IN THE DISPUTE (SUBJECT TO SECTION 14.4) WILL BE SUBMITTED TO BINDING ARBITRATION TO THE FORUM ON DEMAND OF EITHER PARTY.
THE ARBITRATION PROCEEDING WILL BE BEFORE ONE NEUTRAL ARBITRATOR WITH CONTRACT EXPERIENCE APPOINTED BY THE FORUM IN ACCORDANCE WITH THE THEN-CURRENT OR SUCCESSOR CODE OF PROCEDURE.
THE ARBITRATOR WILL AGREE TO FOLLOW AND APPLY THE EXPRESS PROVISIONS OF THIS AGREEMENT IN DETERMINING THE ARBITRATION AWARD.
THE ARBITRATOR SHALL BE BOUND TO APPLY THE APPLICABLE LAW AND SHALL NOT RULE INCONSISTENTLY WITH APPLICABLE LAW.
Source: Item 5 — and 7 of the FDD, Section 3.1 of the Franchise Agreement and Section 4.1 of the Multi-Unit Development Agreement are hereby amended to state that payment of the initial franchise fee and development fee will be deferred until We have satisfied Our pre-opening obligations, and You have commenced business operations. (FDD pages 168–290)
What This Means (2025 FDD)
According to the 2025 Southern Steer Franchise Disclosure Document, both mediation and arbitration proceedings will take place in Clearwater, Florida, or the city nearest to Southern Steer's principal place of business at the time, as determined by Southern Steer, unless both parties agree to an alternative location. The FDD specifies that Multi-Unit Developers, Controlled Entities, and their related parties irrevocably submit to the jurisdiction and venue of the courts in Clearwater, Florida, for mediation and arbitration.
The cost of the mediation, including the mediator's fees and expenses, will be split equally between Southern Steer and the Multi-Unit Developer and/or the Controlled Entity, if any. This equal division of mediation costs is a fairly standard practice in franchising, as it encourages both parties to participate in the mediation process in good faith.
If direct mediation does not fully resolve the dispute within 30 days after the mediation conference concludes, all unresolved issues will be submitted to binding arbitration to the Forum on demand of either party. The arbitration proceeding will be before one neutral arbitrator with contract experience appointed by the Forum. The arbitrator must follow the express provisions of the Franchise Agreement and apply applicable law, and cannot extend, modify, or suspend any terms of the agreement or the reasonable standards of business performance established by Southern Steer.