Franchise Advice
If you’re ever in the position of wondering which ADR step is best for you, here’s a breakdown of what you should know about each one.
Communicate
Lack of communication may often be the root of a problem. While some disputes cannot be avoided, many could be avoided through clear, open and eff ective communication. A cost-eff ective solution may simply be to open that dialogue with your franchisor, and negotiate and work together towards a solution.
Mediate
Mediation is a private, confi dential and fl exible form of ADR, facilitating the parties in reaching an agreement where possible. If the parties have agreed to mediate, discussions are carried out on a without- prejudice basis. Therefore, it is not binding unless the parties, with the help of a neutral third party mediator, reach an agreement, which is then recorded in writing and signed by all parties.
A mediation can include all aspects of
the relationship and is not limited to the legal issues. A facilitative mediation can, with agreement, become an evaluative mediation if the parties so choose, where the mediator can provide a solution that the parties agree to honour. In this case, the franchise relationship can be preserved and the process is cost eff ective. The bfa operates a mediation scheme.
Arbitrate
Arbitration is more formal than mediation and an alternative to litigation. The parties agree to resolve their disputes through the arbitration, rather than court. While it tends to follows a similar structure to court proceedings, depending on the arbitration rules applicable, it is a private process, confi dential and binding. The parties choose and pay for the process and the arbitrators and their expertise. Arbitration is usually less expensive than litigation. The bfa operates an arbitration scheme, which is being updated and will apply to all bfa members in 2018.
Litigate
Litigation or court proceedings are often the last resort. The parties follow court rules and an independent impartial judge will make a binding judgment. Court fees apply but not for the judge or venue.
So, where does that leave me? Here are the top tips: • Avoid communication breakdown • Seek an informal solution • Negotiate
• Check the ADR clause and steps • Check the governing law and jurisdiction • Seek a solution using ADR.
About the author Kate Matthews QFP is a
founding partner of Boddy Matthews Solicitors
September 2017 |
BusinessFranchise.com | 57
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