Does the General Release in the All States M.E.D. Franchise Agreement release the Releasee from expenses?
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 All States M.E.D.'s 2024 Franchise Disclosure Document, the General Release does release the Releasee from expenses. The agreement specifies that the franchisee releases the Released Parties from any and all claims, actions, causes of action, contractual rights, demands, damages, costs, loss of services, expenses, and compensation. This release extends to any claims the franchisee could assert against the Released Parties up to and including the date of the release.
This means that upon signing the General Release, an All States M.E.D. franchisee waives their right to pursue legal action against the franchisor and related parties for a wide range of issues, including expenses. This could include disputes over fees, costs associated with operating the franchise, or any other financial claims. The franchisee is essentially giving up their ability to seek compensation from All States M.E.D. for these matters.
However, the FDD also notes some exceptions to this general release. For example, the release does not apply to liabilities arising under specific state franchise laws such as the California Franchise Investment Law, the California Franchise Relations Act, and similar laws in Indiana, Maryland, Michigan, Minnesota, North Dakota, Rhode Island, and Washington. Additionally, in North Dakota, any requirement that the franchisee pay all costs and expenses incurred by the franchisor in enforcing the agreement is void, and the prevailing party is entitled to recover costs and expenses, including attorney's fees.
Prospective All States M.E.D. franchisees should carefully consider the implications of the General Release and consult with an attorney to understand their rights and obligations. They should also be aware of the specific state laws that may provide additional protections or exceptions to the release. It is important to fully understand what claims are being waived and what rights are being retained before signing the release.