What costs is a party responsible for if they request an appeal of a Stretch Zone arbitration award?
Stretch_Zone Franchise · 2025 FDDAnswer from 2025 FDD Document
If any party to arbitration wishes to appeal any final award (there will be no appeal of interim awards or other interim relief), the party may appeal, within 30 days of the final award, to a 3-arbitrator panel appointed by the same organization that conducted the arbitration.
The issues on appeal will be limited to the proper application of the law to the facts found at the arbitration hearing and will not include any trial de novo or other fact-finding function.
The party requesting the appeal must pay all expenses charged by the arbitration appeal panel and/or arbitration organization in the appeal and must post any bond deemed appropriate by the arbitration organization or arbitration appeal panel.
In addition, a party requesting appeal that does not prevail on the appeal will pay the attorneys' fees and other costs that the other party incurred in responding to the appeal.
Source: Item 8 — Receipts. Any sale made must be in compliance with § 683(8) of the Franchise Sale Act (N.Y. Gen. Bus. L. § 680 et seq.), which describes the time period a Franchise Disclosure Document (offering prospectus) must be provided to a prospective franchisee before a sale may be made. New York law requires a franchisor to provide the Franchise Disclosure Document at the earliest of the first personal meeting or ten (10) business days before the execution of the franchise or other agreement or the payment of any consideration that relates to the franchise relationship. (FDD pages 99–263)
What This Means (2025 FDD)
According to the 2025 Stretch Zone Franchise Disclosure Document, a party appealing a final arbitration award is responsible for specific costs. The party requesting the appeal must cover all expenses charged by the arbitration appeal panel and/or the arbitration organization involved in the appeal process. Additionally, they must post any bond deemed necessary by the arbitration organization or the appeal panel.
Furthermore, if the party initiating the appeal does not win the appeal, they will be required to pay the attorneys' fees and other costs incurred by the opposing party in responding to the appeal. This could include a substantial financial burden beyond the direct costs of the appeal itself.
This arrangement is designed to discourage frivolous appeals and ensure that parties carefully consider the merits of their case before initiating an appeal. It also protects the party who prevailed in the initial arbitration from incurring additional expenses due to an unsuccessful appeal. Prospective Stretch Zone franchisees should be aware of these potential costs when considering dispute resolution options.