What happens to unresolved issues after mediation between Southern Steer and the Multi-Unit Developer?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
- Definition of Dispute.
Subject to Section 14.4, "Dispute" means any disputes, controversies or claims between Franchisor, its Affiliate, shareholders, owners, officers, directors, agents, employees and attorneys (in their respective capacity) and Multi-Unit Developer and Controlled Entity (if any) and Multi-Unit Developer and Controlled Entity (if any)'s Operating Principal, Owners, Guarantors, Designated Manager(s), affiliates, officers, directors, agents and employees (collectively, "Parties") (a) arising out of or related to this Agreement or any other agreement between the Parties relating to the Southern Steer Business or the relationship of the Parties hereto; (b) the relationship of the Parties hereto; (c) the Multi-Unit Developer or Controlled Entity's development of Southern Steer Businesses; (d) the scope or validity of this Agreement or any other agreement between the Parties relating to the Southern Steer Business or the relationship of the Parties hereto or any provision thereof (including the validity and scope of the arbitration obligation, which Multi-Unit Developer and Controlled Entity (if any) and Franchisor acknowledge will be determined by an arbitrator and not a court, unless the arbitrator invalidates the Arbitration provision in its entirety, in which case, wither party has the right to appeal such invalidation to a court of competent jurisdiction).
- Business Judgment.
The Parties recognize and any mediator, arbitrator and judge is affirmatively advised, that certain provisions of this Agreement reflect rights of Franchisor and Multi-Unit Developer and Controlled Entity (if any) to take (or refrain from taking) certain actions in exercise of its business judgment based on its assessment of the long term interests of the franchised system as a whole.
Where such discretion has been exercised and is supported by the business judgment of Franchisor or Multi-Unit Developer and Controlled Entity (if any), a mediator, arbitrator or judge shall not substitute his or her judgment for the judgment so exercised by Franchisor or Multi-Unit Developer and Controlled Entity (if any).
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)
I am unable to provide information about what happens to unresolved issues after mediation between Southern Steer and a Multi-Unit Developer. The provided excerpts from the 2025 Franchise Disclosure Document do not discuss the specific procedures or next steps following mediation. The excerpts do define what constitutes a 'Dispute' and mention that certain provisions reflect the rights of Southern Steer and the Multi-Unit Developer to exercise business judgment, which a mediator, arbitrator, or judge should respect. However, they do not detail the process or requirements if mediation fails to resolve the dispute.
A prospective franchisee should ask Southern Steer's franchisor for details about the dispute resolution process, specifically what steps are taken if mediation does not result in a resolution. Understanding the subsequent procedures, such as arbitration or litigation, is crucial for assessing the potential costs and time involved in resolving conflicts.
It would be beneficial for a potential Multi-Unit Developer to understand the criteria used to select a mediator, whether the mediator's decision is binding, and what options are available if either party is unsatisfied with the mediation outcome. Knowing these details can help a franchisee better prepare for and navigate potential disputes with Southern Steer.