Does the All States M.E.D. FDD specify any exceptions to the requirement that the Franchisee Disclosure Questionnaire be signed on the same day as the Franchise Agreement?
All_States_M_E_D Franchise · 2024 FDDAnswer from 2024 FDD Document
ILLINOIS ADDENDUM TO THE DISCLOSURE DOCUMENT
As to franchises governed by the Illinois Franchise Disclosure Act, if any of the terms of the Disclosure Document are inconsistent with the terms below, the terms below control.
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- No statement, questionnaire, or acknowledgment signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
Source: Item 23 — RECEIPTS (FDD pages 44–174)
What This Means (2024 FDD)
The 2024 All States M.E.D. Franchise Disclosure Document includes addenda for several states that address inconsistencies between the standard franchise agreement and state laws. Specifically, the Illinois Addendum states that "No statement, questionnaire, or acknowledgment signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor." This clause supersedes any other term in any document related to the franchise. A similar clause is present in the New York addendum.
This means that in Illinois and New York, any attempt by All States M.E.D. to enforce a questionnaire or acknowledgment that waives a franchisee's rights under state franchise law or disclaims reliance on franchisor statements would be void. This protects franchisees in these states from inadvertently giving up legal rights through such documents.
While the question specifically asks about exceptions to signing the Franchisee Disclosure Questionnaire on the same day as the Franchise Agreement, the FDD excerpts do not directly address this timing. However, the Illinois and New York addenda's provisions regarding waivers and disclaimers are relevant to the enforceability of any statements made in such questionnaires. A prospective franchisee should consult with a legal professional to fully understand their rights and obligations, especially in light of these state-specific addenda.