What is the condition for determining the applicable law for the Benjamin Franklin Plumbing agreement?
Benjamin_Franklin_Plumbing Franchise · 2025 FDDAnswer from 2025 FDD Document
This Agreement and the relationship between Franchisor and Franchisee and the Owners is governed by the laws of the State of Maryland, except that if a provision of this Agreement would not be enforceable under the laws of Maryland, and if the Franchised Business is located outside of Maryland and the provision would be enforceable under the laws of the state in which the Franchised Business is located, then that provision will be governed by the laws of the state in which the Franchised Business is located. In the event of any conflict of law question, the laws applicable under this Section will prevail, without regard to the application of Maryland conflict-of-law rules. This Section 23.1 is not intended to subject this Agreement or our relationship with you to any Maryland statute or regulation that would not apply by its own terms without considering this Section.
Source: Item 23 — RECEIPTS (FDD pages 88–312)
What This Means (2025 FDD)
According to the 2025 FDD, the Benjamin Franklin Plumbing agreement and the relationship between the franchisor and franchisee is generally governed by the laws of Maryland. However, there is an exception: if any provision of the agreement is unenforceable under Maryland law, and the franchised business is located outside of Maryland, the law of the state where the business is located will govern that specific provision, but only if it is enforceable in that state.
This means that while Maryland law is the default, the laws of the state where the Benjamin Franklin Plumbing franchise operates could take precedence if a specific part of the agreement isn't valid in Maryland but is valid in the franchisee's state. This ensures that as much of the agreement as possible is upheld and enforceable, adapting to the legal landscape of the franchisee's location.
It's important to note that this clause aims to apply the most relevant and enforceable law without automatically subjecting the entire agreement to statutes or regulations that wouldn't otherwise apply. This approach is fairly common in franchising to balance uniformity with local legal requirements.