Does the General Release in the All States M.E.D. Franchise Agreement release the Releasee from compensation?
All_States_M_E_D Franchise · 2024 FDDAnswer from 2024 FDD Document
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- Release- Franchisee and all of Franchisee's guarantors, members, officers, directors, employees, agents, successors, assigns and affiliates fully and finally release and forever discharge Releasee, its past and present agents, employees, officers, directors, members, Franchisees, successors, assigns and affiliates (collectively "Released Parties") from any and all claims, actions, causes of action, contractual rights, demands, damages, costs, loss of services, expenses and compensation which Franchisee could assert against Released Parties or any of them up through and including the date of this Release.
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- THIS IS A SPECIFIC RELEASE GIVING UP ALL RIGHTS WITH RESPECT TO THE TRANSACTIONS OR OCCURRENCES THAT ARE BEING RELEASED UNDER THIS AGREEMENT.
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- California Releasor- You represent and warrant that YOU EXPRESSLY WAIVE ANY AND ALL RIGHTS AND BENEFITS UNDER CALIFORNIA CIVIL CODE §1542, which provides as follows:
A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.
- The above Release shall not apply to any liabilities arising under the California Franchise Investment Law, the California Franchise Relations Act, Indiana Code § 23-2-2.5.1 through 23-2-2.7-7, the Maryland Franchise Registration and Disclosure Law, Michigan
Source: Item 23 — RECEIPTS (FDD pages 44–174)
What This Means (2024 FDD)
According to the 2024 All States M.E.D. Franchise Disclosure Document, the General Release does release the Releasee from compensation. Specifically, the franchisee agrees to release the franchisor from any and all claims, actions, causes of action, contractual rights, demands, damages, costs, loss of services, expenses, and compensation which the franchisee could assert against the franchisor. This release extends to the franchisor's past and present agents, employees, officers, directors, members, franchisees, successors, assigns, and affiliates.
This means that upon signing the release, a franchisee gives up the right to sue All States M.E.D. for any reason covered by the release, including claims for compensation. This is a significant legal commitment, and franchisees should carefully consider its implications. The FDD also specifies that this release is a specific one, giving up all rights with respect to the transactions or occurrences that are being released under the agreement.
However, the release does not apply to liabilities arising under certain state franchise laws, including those in California, Indiana, Maryland, Michigan, Minnesota, North Dakota, Rhode Island, and Washington. Furthermore, the North Dakota Addendum to the Franchise Agreement states that franchisees in North Dakota are not required to sign a general release upon renewal of the franchise agreement. Franchisees should consult with a legal professional to fully understand the scope and implications of the general release in their specific circumstances and jurisdiction.