For Bee Organized franchisees in Hawaii, can a statement signed at the commencement of the franchise relationship disclaim reliance on statements made by the franchisor or their representatives?
Bee_Organized Franchise · 2025 FDDAnswer from 2025 FDD Document
The Hawaii Franchise Investment Law provides rights to the franchisee concerning non-renewal, termination and transfer of the Franchise Agreement. If this subarticle contains a provision that is inconsistent with the Hawaii Franchise Investment Law, the Hawaii Franchise Investment Law will control.
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- Each provision of this amendment shall be effective only to the extent, with respect to such provision, that the jurisdictional requirements of the Hawaii Franchise Investment Law are met independently without reference to this amendment.
- 4**.** No statement, questionnaire or acknowledgement 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 23 — RECEIPTS (FDD pages 54–218)
What This Means (2025 FDD)
According to Bee Organized's 2025 Franchise Disclosure Document, Hawaii franchise law protects franchisees from unintentionally waiving their rights. Specifically, any statement, questionnaire, or acknowledgement signed by a Bee Organized franchisee at the start of their franchise relationship cannot disclaim reliance on statements made by Bee Organized or its representatives. This protection extends to claims under Hawaii's franchise law, including those related to fraud in the inducement.
This provision ensures that Bee Organized franchisees in Hawaii cannot inadvertently forfeit their right to pursue legal action based on misrepresentations made during the franchise sales process. It aims to prevent franchisors from using standard contract language to shield themselves from liability for misleading statements. This protection is particularly important for prospective franchisees who may rely on the franchisor's representations when making their investment decision.
The FDD states clearly that this provision supersedes any other term in any document executed in connection with the Bee Organized franchise. This means that even if other parts of the franchise agreement seem to contradict this protection, the Hawaii Franchise Investment Law will take precedence, safeguarding the franchisee's right to rely on the franchisor's statements.
Bee Organized provides this disclosure as part of an amendment to the Franchise Disclosure Document specifically for Hawaii, acknowledging the state's franchise investment law. This amendment ensures that the franchise agreement complies with Hawaii law and protects the rights of franchisees operating in that state.