Does the 1 800 Packouts General Release cover claims that are unknown at the time of the release?
1_800_Packouts Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Release by Franchisee, Transferee, and Guarantors. Franchisee and Transferee (on behalf of themselves and their parents, subsidiaries, and affiliates and their respective past and present officers, directors, shareholders, managers, members, agents, and employees, in their corporate and individual capacities), and Guarantors (on behalf of themselves and their respective heirs, representatives, successors and assigns) (collectively, the "Releasors") freely and without any influence forever release (i) Franchisor, (ii) Franchisor's past and present officers, directors, shareholders, managers, members, agents, and employees, in their corporate and individual capacities, and (iii) Franchisor's parent, subsidiaries, and affiliates and their respective past and present officers, directors, shareholders, managers, members, agents, and employees, in their corporate and individual capacities (collectively, the "Released Parties"), from any and all claims, debts, demands, liabilities, suits, judgments, and causes of action of whatever kind or nature, whether known or unknown, vested or contingent, suspected or unsuspected (collectively, "Claims"), which any Releasor ever owned or held, now owns or holds, or may in the future own or hold, including, without limitation, claims arising under federal, state, and local laws, rules, and ordinances and claims arising out of, or relating to, the Franchise Agreement and all other agreements between any Releasor and Franchisor or Franchisor's parent, subsidiaries, or affiliates, arising out of, or relating to any act, omission or event occurring on or before the date of this Release, unless prohibited by applicable law.
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- Risk of Changed Facts. Franchisee, Transferee, and Guarantors understand that the facts in respect of which the release in Section 1 is given may turn out to be different from the facts now known or believed by them to be true.
Franchisee, Transferee, and Guarantors hereby accept and assume the risk of the facts turning out to be different and agree that the release in Section 1 shall nevertheless be effective in all respects and not subject to termination or rescission by virtue of any such difference in facts.
Source: Item 23 — RECEIPT (FDD pages 67–238)
What This Means (2025 FDD)
According to 1 800 Packouts' 2025 Franchise Disclosure Document, the General Release covers both known and unknown claims. As a condition of transferring the Franchise Agreement or executing a successor Franchise Agreement, the franchisee, transferee, and guarantors release 1 800 Packouts from all claims and causes of action, "whether known or unknown, vested or contingent, suspected or unsuspected". This release extends to claims arising under federal, state, and local laws, rules, and ordinances, as well as those relating to the Franchise Agreement and other agreements between the parties. The release applies to any act, omission, or event occurring on or before the date of the release, unless prohibited by applicable law.
The 1 800 Packouts' FDD emphasizes that the releasors understand that the facts underlying the release may turn out to be different from what they currently know or believe to be true. Despite this possibility, the releasors agree that the release remains effective and is not subject to termination or rescission due to any such differences in facts. This clause underscores the comprehensive nature of the release, indicating that it is intended to cover unforeseen or unanticipated issues that may arise in the future.
However, the release does not apply to claims arising under the Washington Franchise Investment Protection Act, chapter 19.100 RCW, or the rules adopted thereunder. Furthermore, for franchisees in Maryland and New York, the release has additional limitations. In Maryland, any general release signed as a condition to transfer or renewal will not apply to claims arising under the Maryland Franchise Registration and Disclosure Law. Similarly, in New York, the release is subject to the rights and causes of action arising from the provisions of Article 33 of the General Business Law of the State of New York, ensuring compliance with the non-waiver provisions of GBL 687 and 687.5.