Is the mediation process for Southern Steer disputes binding?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
RDING A FORUM AND DISPUTE RESOLUTION MECHANISM TO RESOLVE ANY DISPUTES THAT MAY ARISE BETWEEN FRANCHISEE AND FRANCHISOR AND HAVE AGREED TO SELECT FORUMS AND DISPUTE RESOLUTION MECHANISM IN ORDER TO PROMOTE STABILITY IN FRANCHISEE RELATIONSHIP WITH FRANCHISOR AS PROVIDED IN THIS SECTION 22.
(a) Negotiation. FRANCHISOR AND FRANCHISEE WILL USE BEST EFFORTS TO RESOLVE AND SETTLE BY DIRECT, PRIVATE NEGOTIATION ANY DISPUTES, SUBJECT TO THE EXCLUSIONS SET OUT IN SECTION 22.4 BOTH PARTIES MAY SEEK THE ADVICE AND ASSISTANCE OF LEGAL COUNSEL IN CONNECTION WITH ANY SUCH NEGOTIATION.
(b) Mediation. SUBJECT TO SECTION 22.4, IF THE PARTIES CANNOT RESOLVE AND SETTLE A DISPUTE BY PRIVATE NEGOTIATION WITHIN 60 DAYS AFTER A PARTY GIVES THE OTHER WRITTEN NOTICE THAT A DISPUTE EXISTS, THE PARTIES WILL SUBMIT ALL DISPUTES BETWEEN THE FRANCHISOR AND THE FRANCHISEE TO MANDATORY NON-BINDING MEDIATION WITHIN 20 DAYS AFTER NEGOTIATION DESCRIBED IN SECTION 22.1(a) IS CEASED BY THE PARTIES. THE MEDIATION WILL BE CONDUCTED IN ACCORDANCE WITH THE THEN-CURRENT OR SUCCESSOR CODE OF PROCEDURE. THE MEDIATOR WILL BE APPOINTED IN ACCORDANCE WITH THE THEN-CURRENT OR SUCCESSOR CODE OF PROCEDURE UNLESS THE PARTIES AGREE ON A MEDIATOR IN WRITING WITHIN 10 DAYS AFTER EITHER PARTY GIVES WRITTEN NOTICE OF MEDIATION. THE MEDIATOR MAY NOT BE CALLED AS A WITNESS IN ANY COURT OR ARBITRATION PROCEEDING FOR ANY PURPOSE.
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to Southern Steer's 2025 Franchise Disclosure Document, the mediation process is not binding. The FDD specifies that if the parties cannot resolve a dispute through negotiation, they will submit to mandatory non-binding mediation. This mediation must occur within 20 days after negotiations cease.
Following the mediation, if the parties still cannot fully resolve the dispute within 30 days after the mediation concludes, the unresolved issues will be submitted to binding arbitration if either party demands it. This means that while mediation is a required step, it serves as a preliminary effort to resolve issues before proceeding to a legally binding decision through arbitration.
Each party is required to send a representative to the mediation conference who has the authority to enter into binding contracts on their behalf. The costs of the mediation, including the mediator's fees and expenses, will be split equally between Southern Steer and the franchisee. This ensures both parties share the financial burden of attempting to resolve the dispute through mediation before moving to arbitration.