Where is litigation generally required to take place for disputes with Beehive Homes?
Beehive_Homes Franchise · 2025 FDDAnswer from 2025 FDD Document
| PROVISION | FRANCHISE AGREEMENT SECTION | SUMMARY |
|---|---|---|
| a. Length of the franchise | Section 5.1 | ten years |
| term | ||
| b. Renewal or extension of | Section 5.2 | additional ten year renewal periods if you |
| the term | are in good standing | |
| c. Requirements for franchisees to renew or extend | Section 5 | three to nine month advance notice, approval by US, and signing by YOU of the current form of franchise agreement, which may have materially different terms and conditions from your initial franchise agreement |
| d. Termination by YOU | Not Applicable | Not Applicable |
| e. Termination by US without | Not Applicable | Not Applicable |
| cause | ||
| f. Termination by US with cause | Section 14 | WE can terminate if YOU commit certain events of default or other breaches of the Franchise Agreement |
| g. "Cause" defined - curable defaults | Section 14.1 | YOU have 30 days to cure: nonpayment of fees, nonperformance of franchise agreement where performance can be completed |
| h. “Cause” defined - non- curable defaults | Section 14.1 | non-curable defaults: bankruptcy (may not be enforceable under federal bankruptcy law), unauthorized transfers, abandonment, trademark misuse |
| i. YOUR obligations on termination/nonrenewal | Section 14.4; 14.5; 14.6 & 14.7 | pay amounts due; sell Home to Franchisor |
| j. Assignment of contract by | Section 13.1 | Assignee reasonably willing and able to |
| US | perform | |
| k. "Transfer" by YOU - | Section 2.20; | includes transfer of contract or assets and |
| defined | 13.2 | change in ownership |
| l. OUR approval of transfer | Section 13.4 | prior written approval but not |
| by YOU | unreasonably withheld | |
| m. Conditions for OUR | Section 13.4 | payment of fees, new franchise |
| approval of transfer | agreement, training | |
| n. OUR right of first refusal | Section 13.6 | WE can match any offer |
| to acquire YOUR business | ||
| o. OUR option to purchase YOUR business | Section 14.5 | WE can purchase YOUR business for the initial cost of the real property and the book value of the personal property upon an Event of Default |
| p. YOUR death or disability | Section 13.3 | transfer must generally be approved within 6 months. Please refer to the state cover page, if any, accompanying this Franchise Disclosure Document for any special provisions applicable to YOUR state |
| q. Non-competition | Section 12.1 | no involvement in competing business |
| covenants during the term of | ||
| the franchise | ||
| r. Non-competition covenants after the franchise is terminated or expires | Section 12.1 | no involvement in competing business for three years. Please refer to the state cover page, if any, accompanying this Franchise Disclosure Document for any special provisions applicable to YOUR state. |
| s. Modification of the | Section 18.14 | only in writing |
| agreement | ||
| t. Integration/merger clause | Section 18.14 | Only the terms of the franchise agreement are binding. Any representations or promises outside of the disclosure document and franchise agreement may not be enforceable. Notwithstanding the foregoing, no provision in any franchise agreement is intended to disclaim the express representations made in this Franchise Disclosure Document. |
| u. Dispute resolution by | Section 16 | all disputes must be arbitrated in Utah |
| arbitration or mediation | ||
| v. Choice of forum | Section 18.2 | litigation generally must be in Utah. Please refer to the state cover page, if any, accompanying this Franchise Disclosure Document for any special provisions applicable to YOUR state (subject to applicable state law). |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 25–27)
What This Means (2025 FDD)
According to Beehive Homes's 2025 Franchise Disclosure Document, litigation generally must occur in Utah. Specifically, Section 18.2 of the franchise agreement dictates this choice of forum. However, the FDD also advises prospective franchisees to refer to any state-specific disclosures attached to the document, as these may contain special provisions applicable to their state that could supersede this requirement, subject to applicable state law. This means that while Beehive Homes generally prefers litigation to take place in Utah, a franchisee's home state laws might have specific regulations that override this clause.
This stipulation is important for potential Beehive Homes franchisees to consider, as litigating in Utah could involve significant travel expenses and legal costs, especially for franchisees located far from Utah. It also means that franchisees would need to become familiar with Utah's legal system. The presence of potentially overriding state-specific disclosures adds a layer of complexity, requiring careful review of those disclosures to understand the full scope of the forum selection clause.
Many franchise agreements contain similar clauses specifying a particular forum for dispute resolution, often the location of the franchisor's headquarters. Franchisees should be aware of this and factor in the potential costs and inconveniences of litigating in a distant forum. It is crucial for prospective Beehive Homes franchisees to consult with a legal professional to fully understand the implications of the forum selection clause and any applicable state-specific exceptions before signing the franchise agreement.