Can Better Homes And Gardens Real Estate terminate the franchise without cause?
Better_Homes_And_Gardens_Real_Estate Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Agreement | Summary |
|---|---|---|
| e. Termination by | None | Not applicable |
| us without cause | ||
| Section 7 of the Limited Purpose Office | ||
| Addendum | notice | |
| f. Termination by us with cause | Section 16.2.2 of the Franchise Agreement | We can terminate if you commit a breach, including any one of several listed violations, or if certain events occur; see "g" below. |
| Section 7 of the Limited Purpose Addendum | We can terminate for non-compliance with the addendum or if the Franchise Agreement expires or is terminated. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 63–67)
What This Means (2025 FDD)
According to the 2025 FDD, Better Homes and Gardens Real Estate generally cannot terminate the franchise agreement without cause. The table in Item 17 outlines the conditions under which termination can occur, specifying that Better Homes and Gardens Real Estate can terminate the agreement with cause if the franchisee commits a breach or if certain events occur. These breaches include non-payment of fees, failure to comply with applicable laws, or any other material breach of the Franchise Agreement.
However, the Limited Purpose Office Addendum presents a different scenario. For franchisees operating under this addendum, either party, including Better Homes and Gardens Real Estate, can terminate the agreement upon 30 days' notice. This suggests that for these specific franchise agreements, termination without cause is permissible, contrasting with the general franchise agreement terms.
Prospective franchisees should carefully review the specific addenda applicable to their franchise agreement to understand the exact termination conditions. It is important to note the distinction between the standard franchise agreement, which requires cause for termination, and the Limited Purpose Office Addendum, which allows for termination by either party with 30 days' notice. Understanding these nuances is crucial for assessing the stability and potential risks associated with the franchise agreement.