ARBITRATION
FAM charges a one-time administrative processing fee of $950 for arbitrations involving a single
arbitrator and $1,900 for arbitrations involving multiple arbitrators (some franchise agreements
call for a panel of three arbitrators when the amount in dispute exceeds a certain sum). FAM referred
arbitrators have agreed to charge their normal hourly rate (but not to exceed $500) for FAM-referred
matters. Typically this fee is split between the parties. After receipt of the fee and either (i)
a Demand for Arbitration (if there is a clause in the franchise (or other) agreement between the
disputants which names FAM as the forum to handle the arbitration) or (ii) a Submission Agreement
(if FAM is not named as arbitration forum in the agreement between the parties), FAM will poll its
panel of referral arbitrators situated in the general vicinity of the designated venue for the
arbitration for potential conflicts. Referred arbitrators are usually trial attorneys with extensive litigation experience involving franchise issues.
After this screening is complete, FAM will forward to the
attorneys for the disputants the name of eligible, prospective referral arbitrators including
brief resumes (Three nominees for a single arbitrator proceeding or nine nominees for a multiple arbitrator proceeding).
Both parties rank the proposed arbitrators in order of preference and return the list to FAM. FAM
will attempt to accommodate each party's preferences in referring the matter. The arbitrator to
whom FAM refers the matter will contact the attorneys for the parties and make arrangements to
collect a retainer and proceed in accordance with FAM's Arbitration Guidelines. The arbitrator
collects another retainer before each subsequent hearing day. When the matter is concluded, any
remaining retainer will be promptly refunded.
ARBITRATOR'S DUTIES
- To determine the issues in dispute.
- To determine what documents, correspondence, books or records are expected to be produced, when they should be produced and by whom.
- To settle the forum for the hearings, the procedures to be followed and the law governing the arbitration.
- To consider whether "on site" inspection will be part of the proceedings.
- To establish the arbitration site.
- To establish a timetable for each step in the process to be taken to ensure completion of the arbitration in the shortest time possible.
- To conduct the arbitration and render an award or decision as soon as practicable.
ARBITRATOR'S QUALIFICATIONS
The arbitrator:
- Must have the qualifications and experience as a trial attorney and not less than 5 years of experience in trials involving franchise issues to enable him or her to undertake the task the parties have assigned;
- Has a duty to the public to act faithfully in support of the arbitration process as a means of facilitating the administration of justice;
- Will at all times from his or her appointment until the publication of his award act independently, fairly and impartially between the parties; and
- Will not solicit a specific appointment for himself or herself as an arbitrator but may indicate a general willingness to serve as an arbitrator.
ARBITRATION AWARD
In preparation for the award, the arbitrator takes into account:
- Facts submitted by both parties to the dispute;
- Admissions by one party of allegations made by another party;
- The scope of permissible discovery (if any) provided for in the franchise agreement or as otherwise agreed to by the parties;
- Oral, documentary or demonstrative evidence presented to the or arbitrator;
- Evidence personally seen by the arbitrator at a viewing which both parties have been given the opportunity to be present; and
- Arguments addressed to the arbitrator.
Within 20 business days after conclusion of the arbitration, and presuming all fees have been paid, the arbitrator sends a written award or summary of the arbitration proceeding to each disputant.
Please use the appropriate form in "View Forms" to initiate alternative dispute resolution proceedings before FAM.