Which state's laws govern the Amerispec Inspection Services agreement?
Amerispec_Inspection_Services Franchise · 2025 FDDAnswer from 2025 FDD Document
TCB AMERISPEC, LLC
ADDENDUM TO FRANCHISE DISCLOSURE DOCUMENT FOR THE STATE OF NORTH DAKOTA
The following information applies to franchises and Franchisees subject to North Dakota statutes and regulations. Item numbers correspond to those in the main body.
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- Item 17. Item 17 is amended to read as follows:
- A. Any provision of the Franchise Agreement requiring the Franchisee to sign a release in a format designated by AmeriSpec is unenforceable.
- B. The prevailing party in any enforcement action is entitled to recover all costs and expenses including attorneys' fees.
- C. Any provision of the Franchise Agreement requiring you to consent to waiver of exemplary and punitive damages is unenforceable under Section 51-19-09 of the North Dakota Franchise Investment Law.
- D. Any provision of the Franchise Agreement requiring you to consent to liquidated damages is hereby made null and void pursuant to Section 51-19-09 of the North Dakota Franchise Investment Law.
- E. Arbitration and mediation proceedings will be conducted at a site agreeable to all parties.
- F. The venue of any litigation arising out of the franchise relationship between you and AmeriSpec will be within the state of North Dakota.
- G. The North Dakota Securities Commissioner has held that requiring franchisees to consent to waiver of a trial by jury unfair, unjust or inequitable within the intent of Section 51-19-09 of the North Dakota Franchise Investment Law.
- H. Notwithstanding anything in the Disclosure Document, covenants not to compete may be subject to Section 9-08-06 of the North Dakota Century Code and unenforceable in the state of North Dakota if contrary to Section 9-08-06.
Source: Item 23 — Receipts (FDD pages 47–172)
What This Means (2025 FDD)
Based on the 2025 Amerispec Inspection Services Franchise Disclosure Document, the standard agreement does not specify which state's laws govern the agreement. However, there is an addendum for the state of North Dakota that modifies some of the terms of the standard agreement to comply with North Dakota law.
Specifically, for franchisees in North Dakota, the addendum states that the venue for any litigation arising from the franchise relationship between the franchisee and Amerispec Inspection Services will be within the state of North Dakota. Additionally, certain provisions of the Franchise Agreement, such as those requiring the franchisee to waive exemplary and punitive damages or consent to liquidated damages, are made null and void in North Dakota due to conflicts with the North Dakota Franchise Investment Law.
Prospective franchisees outside of North Dakota should inquire with Amerispec Inspection Services to determine which state's laws govern the franchise agreement in their specific location. This is a crucial aspect to understand, as it dictates the legal framework within which the franchise relationship operates and where any disputes would be resolved.