Are representations or promises outside of the Baya Bar Multi-Unit Development Agreement enforceable?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
e goodwill of the Marks or System, or disrupt or jeopardize our business or that of our franchisees. |
| Section in Multi | |||
|---|---|---|---|
| Unit Development | |||
| Provision | Agreement | Summary | |
| r. | Non-competition covenants after the franchise is terminated or expires | Section 8.3.2 | For 24 months after the termination of the Franchise Agreement, you may not: divert, or attempt to divert, customers of any Baya Bar outlet (including yours) to any competitor, participate in any capacity, including, but not limited to as an owner, investor, officer, director, employee or agent, in any competing business within five (5) miles of your former Baya Bar outlet location or any other Baya Bar outlet location (franchised or company owned); do any act that could damage the goodwill of the Marks or System, or disrupt or jeopardize our business or that of our franchisees. |
| s. | Modification of the agreement | Section 11.4 | No oral modifications. No amendment of the provisions will be binding upon either party unless the amendment has been made in writing and executed by all interested parties. |
| t. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 43–52)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, the enforceability of representations or promises made outside the Multi-Unit Development Agreement is limited. The document states that only the terms within the Multi-Unit Development Agreement and other related written agreements are binding, subject to applicable state law. This means that any verbal promises or representations not included in these written documents may not be legally enforceable. However, the FDD clarifies that this does not disclaim express representations made within the Franchise Disclosure Document itself.
This clause is known as an integration or merger clause, and it is a common feature in franchise agreements. It aims to ensure that all binding terms are clearly documented in writing, preventing disputes based on informal or undocumented promises. For a prospective Baya Bar multi-unit developer, this means it is crucial to ensure that all important terms and conditions are included in the written agreements.
It is important for potential Baya Bar franchisees to understand that any promises or assurances made by the franchisor or its representatives during discussions should be confirmed in writing within the Multi-Unit Development Agreement to be considered legally binding. This protects both the franchisor and the franchisee by providing clarity and certainty regarding their respective obligations and rights. If there are any discrepancies between verbal promises and the written agreement, the written agreement will likely take precedence.
Therefore, a prospective Baya Bar franchisee should carefully review the Multi-Unit Development Agreement and related documents with legal counsel to ensure that all agreed-upon terms are accurately reflected. They should also seek clarification on any points of concern and request that any additional representations or promises be formally incorporated into the written agreement to avoid potential disputes in the future.