Does the Beauty Bungalows release apply regardless of the possibility of later discovered claims or facts?
Beauty_Bungalows Franchise · 2025 FDDAnswer from 2025 FDD Document
"A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially effected his settlement with the debtor."
In making this voluntary express waiver, Franchisee [and Owner each] acknowledges that Claims or facts in addition to or different from those which are now known or believed to exist with respect to the matters mentioned herein may later be discovered and that it is the intention of Franchisee [and Owner, respectively] to hereby fully and forever settle and release any and all matters, regardless of the possibility of later discovered Claims or facts. This Release is and shall be and remain a full, complete and unconditional general release. Franchisee [and Owner each] acknowledges and agrees that the foregoing waiver of Section 1542 is an essential, integral and material term of this Release.
Source: Item 23 — RECEIPTS (FDD pages 48–177)
What This Means (2025 FDD)
According to Beauty Bungalows' 2025 Franchise Disclosure Document, the general release is intended to cover all claims, even those that are unknown or discovered later. The franchisee and owner acknowledge that new claims or facts may emerge that differ from what is currently known. However, it is their intention to settle and release all matters fully, regardless of any later discoveries. This release is designed to be a complete and unconditional general release.
Specifically, the franchisee and owner waive their rights under Section 1542 of the Civil Code of the State of California, as well as any other similar statutes or common law principles. Section 1542 states that a general release does not extend to claims that the creditor does not know or suspect to exist at the time of executing the release, which, if known, would have materially affected the settlement with the debtor. By signing the release, the franchisee and owner are intentionally giving up their rights to make such claims in the future.
This waiver is considered an essential and integral part of the release agreement. This means that Beauty Bungalows wants to ensure that once the release is signed, all potential claims are settled, providing a clean break for both parties. However, this release does not apply to claims arising under the Washington Franchise Investment Protection Act, RCW 19.100, and the rules adopted thereunder.