Complaint Review: Family Tree Digital Video Inc.

BBB                   Decision

Customer: Geoffrey ****               Arbitration No.: MIP7868172

Business (es): Family Tree Digital Video, Inc.             Date: 8/24/09

Having heard the claims and considered the evidence as it relates to the dispute between the parties named above, the decision of the undersigned arbitrator(s) is as follows:

West is deemed the prevailing party to the arbitration and Family Tree is ordered to pay West Six Hundred Eighty Dollars ($680.00) in certified funds (i.e., money order, official bank check or cashier's check) by September 28, 2009.

Signature of arbitrator(s)

J. P. MILLER, JR., ESQ.          Date: 8-28-09

REASONS FOR DECISION ATTACHMENT

 BBB ARBTTRATION NO.: MIP7868172

Customer: Geoffrey ****

Business: Family Tree Digital Video, Inc.

Date of Arbitration: 8/24/09

This matter came on for hearing pursuant to a stipulated binding arbitration between GEOFFREY **** ("****") and FAMILY TREE DIGITAL VTDEO, INC. ("FAMILY TREE"). FAMTLY TREE was represented by its principal, Rob Fritzer ("Fritzer"). The arbitration arose out of a dispute between the parties wherein FAMLL Y TREE had made an offer to WEST to reimburse travel expenses to San Diego, California in exchange for WEST being present during a FAMTL Y TREE business opportunity presentation.

ISSUE TO BE DECIDED UPON

The issue upon which the case rests is the contractual duties of the parties respectively with regard to the enforceability of the reimbursemcnt offer as that ofFer may be contingent upon conditions preccdcnt or subsequent requiring additional actions on behalf of ****.

California law imposes a burden upon individuals who sign and execute contracts or who detrimentally rely upon contracts and other offers. This burden is that the individual signing said contracts have read and understood the contracts to which they now intend to be bound. Basic contract law calls for an offer, an acceptance and consideration in order for a contract to be valid.

California law also imposes a burden upon the drafter of any contract (or offer to be relied upon as a contract). This part of California law states that all interpretation is to fall in favor of the non drafting party where circumstances arise that can lead to reasonable differing minds or two or more different conclusions as to what the contract requires for completion and satisfaction.

FAMILY TREE through documentary evidence presented as well as oral testimony provided by its representative, Fritzer, clearly identified itself as the drafter of all documents associated with its company. These documents include exhibits 1, 4, and 9 to the hearing which encompass documentation from FAMILY TREE's website, the written offer for **** to come to California and the first of two non compete/non disclosure agreements. Based upon the foregoing all ambiguities contained within these agreements are interpreted against FAMILY TREE pursuant to California law.

WEST'S CHIEF COMPLAINT

It is ****'s position that he acted in reliance upon the offers contained within Exhibit I and Exhibit 4 in traveling to Califomia with Jeri Fickes ("Fickes"). WEST contends that Fickes was to work with the potential business opportunity and alleges that Exhibit 4, as well as oral assertions by Fritzer required that any individuals whom would have inlluence in the decision making process us to whether or not to purchase a business opportunity from FAMILY TREE be present at the time of FAMlLY TREE's presentation. In reliance upon the reimbursement portion of Exhibit 1 and Exhibit 4 he undertook and expended $680.00 for round trip airfare for himself and Fickes in order to attend FAMILY TREE's presentation. The cost of the airfare is substantiated by Exhibit 5 to the hearing.

At the time of the presentation in San Diego, California Fritzer ran the meeting and at approximately one to one and a half hours into the meeting required of **** and Fickes to sign a non compete/non disclosure agreement prior to proceeding with additional information about FAMILY TREE's business opportunities. This document is identified as Exhibit 9 to the hearing. Fritzer acknowledges this document and acknowledges the hand written limitations of two years existing on the document at the time all parties executed the document making it actionable. **** contends that the execution of the document was neither a condition precedent nor a condition subsequent to the obligation of FAMILY TREE to reimburse his travel expense.

**** prays for relief in the amount of $680.00.

FAMILY TREE'S DEFENSE ARGUMENT

Family Tree contends that the language contained within its offer is, "clear" as associated with the requirement of signing a non compete and non disclosure document as well as an additional requirement that **** prove fInancial viability in such a fashion as to he able to purchase a business costing approximately $70,000.00. Fritzer states that the guarantee language for reimbursement contained within the aforementioned Exhibits 1 and 4 can be, "whatever he wants it to be" and that based upon ****'s failure to execute a yet second subsequent non disclosure and non compete agreement that F AMTLY TREE is not obligated to repay tbe travel expenses at issue.

FAMILY TREE contends that Exhibit 9 is possibly not enforceable in the state of Calitornia thus requiring of **** to sign an additional non compete/non disclosure agreement containing substantiatIy different material terms and conditions.

As an alternative argument FAMILY TREE contends that Fickes is not entitled to her travel reimbursement because she was not a spouse of ****. Fritzer in oral argument stated that he enquired as to whether or not Fickes would be involved in decision making or running of the potential business opportunity and that Fickes responded negatively to this inquiry.

FAMILY TREE requests a denial of ****'s claim.

ANALYSIS

The airfare reimbursement offer (Exhibit 4 to the hearing) states in relevant part as follows:

We (FAMILY TREE) would also like to reimburse you for 100% or your round trip airfare for two to Sun Diego or up to $750.00, whichever is less. We will pay all of your expenses if you end up coming aboard. If you are married, both spouses must come in together so both parties will receive a full disclosure of information. In addition, if you have an investor that will be backing you financial1y, the investor must be at the presentation in San Diego. . . . . A "Family Tree Video Company" presentation can only be given with the understanding that you are financially in a position (cash strong) to purchase a $69,500.00 business. . . . .Certainly you understand that out of loyalty to our existing 400 FTDV Companies we can't disclose proprietary information to "want to be" competitors.

The above offer becomes actionable by **** whcn hc acts upon it in coming to San Diego, California. This created his acceptance of the offer and provided the consideration needed to bind the contract.

There exits no language within the offer requiring that Fickes be a spouse in order for the reimbursement provisions to apply. The offer simply statcs that if an offeree does have a spouse that spouse must attend. In the alternative the offer states clearly that it is for two people to travel to San Diego and does not place any condition upon whom the second person could or could not be, regardless as to that individual's possible financial stake in the decision making process in purchasing a FAMILY TREE business opportunity. Given the California law on point which states ambiguous provisions within a contract are to be ruled against the drafting party, FAMILY TREE's position that Fickes must have been a spouse or a known investor in the project to obtain reimbursement cannot be sustained.

In reviewing the offer of reimbursement the language is vague and ambiguous as to what, if anything, would be required of an offeree (****) by FAMILY TREE to prove financial viability. The offer does not by example state that an offeree must produce bank statements or a business profit and loss statement in order to obtain reimbursement for his travel expense. To remain silent on thie issue as to what would or would not be required to prove viability other than an oral assertion that the offeree does in fact have such financial viability is a vague and ambiguous condition contained within the reimbursement offer. As explained within this decision, vague and ambiguous terms are held against the drafter which in this case is FAMILY TREE. It is therefore determined that **** would not have had to produce any financial documents which were not requested of him prior to his actual purchase of his airfare in order to obtain reimbursement under this premIse. 1

The next defense raised by FAMILY TREE is that a non compete/non disclosure agreement is a requirement and condition precedent to reimbursement of the travel expense. The only reasonable interpretation of the reimbursement ofIer is one where no such requirement, precedent or subsequent exists. The argument by FAMILY TREE as propounded by Fritzer that, "the guarantee can be whatever he (Fritzer) wants it to be" is not only contrary to California law but is so preposterous as to affect the declarant's credibility. Further, it is acknowledged by all parties that WEST did in fact sign Exhibit 9 which is in fact a non disclosure/non compete agreement.

The argument by FAMILY TREE that Exhibit 9, "may not be enforceable in the state of Florida" is moot. There is certainly no requirement within the reimbursement offer that u non compete/non disclosure agreement needs to be signed at all, much less one that is going to be enforceable in any particular state. In addition, it is noted that the signed agreement is to be interpreted pursuant to California law regardless as to which state the parties claim residency. The document also fails to have a section requiring, "further assurances" which would contractually bind the parties to execute additional documents in the future should FAMILY TREE deem it necessary for protection of any right under the document. This further assurances issue was raised upon direct examination by the Arbitrator for which FAMlLY TREE acknowledged that no such provision within Exhibit 9 existed.

It is beyond the scope of this arbitration to determine whether or not Exhibit 9 is a legally valid and binding agreement between the parties or if based upon the circumstances under whieh it was signed it is in fact a contract of adhesion and thus unenforceable under California law. It will be left to the court system, if neccssary, for the enforceability of such contract to be determined if there is a perceived breach by the parties at some point in the future of the non disclosure/non compete agreement itself

ARBITRATION ORDER AND AWARD

Based upon the foregoing it is hereby determined that **** is entitled to the relief sought by way of reimbursement to him in the amount of $680.00. The offer of reimbursement of airfare is deemed an appropriate offer which was in fact accepted and became a binding enforceahle agreement upon ****'s purchase of the airline fare and actual travel to San Diego, Califomia. There exists no conditions precedent or subsequent associated with this offer in relation to requring disclosure of financial records, the execution of non disclosure/non compete documents or the person accompanying **** must have been his spouse for that ticket to be reimbursed.

**** is therefore determined to be the prevailing party in this arbitration and FAMILY TREE is ordered to pay **** $680.00 in certified funds (money order, official bank check or cashier's check) by no later than September 28,2009.

IT IS SO ORDERED

Dated: 9-1-09                              J.P. MILLER, JR. ESQ.

________________

I It was acknowledged through oral testimony that subsequent to the presentation **** did in fact produce financial records satisfactory to FAMILY TREE of his financial viability.