When is a waiver of exemplary or punitive damages void for a Basecamp Fitness franchise?
Basecamp_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
RCW 19.100.190 permits franchisees to seek treble damages under certain circumstances.
Accordingly, provisions contained in the franchise agreement or elsewhere requiring franchisees to waive exemplary, punitive, or similar damages are void, except when executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel, in accordance with RCW 19.100.220(2).
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 51–55)
What This Means (2025 FDD)
According to Basecamp Fitness's 2025 Franchise Disclosure Document, a waiver of exemplary, punitive, or similar damages is generally void, but there's an exception. RCW 19.100.190 permits franchisees to seek treble damages under certain circumstances. However, such a waiver is permissible if it's part of a negotiated settlement reached after the franchise agreement is already in effect. Additionally, both parties, the franchisee and Basecamp Fitness, must be represented by independent legal counsel during these negotiations, as stipulated by RCW 19.100.220(2).
This means that Basecamp Fitness cannot include a clause in the initial franchise agreement that forces a franchisee to waive their right to seek exemplary or punitive damages. This protects the franchisee from being coerced into giving up potential legal rights from the outset.
The exception allows for flexibility in resolving disputes later on. If a disagreement arises after the franchise agreement is signed, and both Basecamp Fitness and the franchisee, with the advice of their own lawyers, agree to a settlement that includes waiving such damages, then the waiver becomes valid. This ensures that any waiver is the result of informed negotiation and not a pre-determined condition of the franchise agreement.
This provision aims to balance the interests of both parties, preventing Basecamp Fitness from using its potentially stronger bargaining position at the beginning of the relationship to limit the franchisee's future legal options, while still allowing for mutually agreed-upon resolutions to specific disputes that may arise during the franchise term.