Does the provision regarding franchise sales compliance in the Bft Franchise Disclosure Document supersede other terms in documents executed in connection with the franchise?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
No statement, questionnaire, or acknowledgment 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 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–66)
What This Means (2025 FDD)
According to the 2025 Bft Franchise Disclosure Document, certain provisions related to franchise sales compliance and franchisee rights supersede other terms in documents executed in connection with the franchise, particularly in specific states. For instance, in states like California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, or Wisconsin, no statement signed by a franchisee can waive claims under state franchise law or disclaim reliance on statements made by Bft or its representatives. This specific provision overrides any conflicting terms in other documents.
This means that Bft franchisees in those listed states are protected from unknowingly waiving their rights or disclaiming reliance on information provided by Bft during the franchise sales process. This protection is significant because it ensures that franchisees can pursue legal claims, including fraud in the inducement, even if they have signed documents that appear to limit those rights. The superseding nature of this provision reinforces the importance of state franchise laws in protecting franchisees.
Furthermore, the FDD emphasizes compliance with New York's Franchise Sales Act, specifying that the disclosure document must be provided to prospective franchisees within a defined timeframe before any sale is made. This requirement also supersedes any other conflicting terms, ensuring that Bft adheres to the mandated disclosure period. This underscores Bft's commitment to complying with franchise sales regulations and providing potential franchisees with adequate time to review the FDD before making any commitments.
In summary, Bft's FDD includes provisions designed to protect franchisees' rights and ensure compliance with franchise sales laws, and these provisions are explicitly stated to take precedence over any conflicting terms in other documents. This offers franchisees a degree of assurance that their rights and protections under state and federal laws cannot be inadvertently waived or undermined by other contractual terms.