Does the Aw franchise agreement allow franchisees to waive claims of fraud in the inducement under applicable state franchise law?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
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 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, the franchise agreement does not allow franchisees to waive claims of fraud in the inducement under applicable state franchise law. Specifically, the FDD states that no statement, questionnaire, or acknowledgment signed by a franchisee can waive such claims. This protection extends to disclaiming reliance on statements made by Aw or anyone acting on their behalf. This provision takes precedence over any conflicting terms in any document related to the franchise agreement.
This safeguard ensures that franchisees retain their legal rights to pursue claims of fraud, even if they have signed documents that might suggest otherwise. This is particularly relevant in the context of franchise sales, where prospective franchisees rely on information provided by the franchisor to make informed decisions. By preventing the waiver of fraud claims, Aw aims to maintain transparency and accountability in its franchise operations.
However, it is important to note that this protection primarily addresses the waiver of claims at the commencement of the franchise relationship. The FDD also includes a state addendum for Illinois, which further reinforces these protections under Illinois law. Franchisees should consult with legal counsel to fully understand their rights and obligations under the franchise agreement and applicable state laws, especially concerning actions they may take during the franchise term.