In the event of conflicting laws, which law prevails for a Big O Tires franchise?
Big_O_Tires Franchise · 2025 FDDAnswer from 2025 FDD Document
The United States Federal Arbitration Act shall govern all questions about the enforceability of Sections 29.02 and 29.03 and the confirmation of any arbitration awards pursuant to such procedures, and no arbitration issues are to be resolved pursuant to any other statutes, regulations or common law.
Otherwise, except to the extent governed by the United States Trademark Act of 1946 (Lanham Act, 15 U.S.C.
Sections 1051 et seq.) or other United States federal law, this Agreement shall be interpreted under the laws of the State of Colorado U.S.A. and any dispute between the parties shall be governed by and determined in accordance with the internal substantive laws, and not the laws of conflict, of the State of Colorado U.S.A., which laws shall prevail in the event of any conflict of law.
Notwithstanding the foregoing, the parties agree that the Colorado Consumer Protection Act (COLO.
REV.
STAT.
ANN.
Sections 6-1-101, et seq.) shall not apply to this Agreement or any disputes between the parties.
Source: Item 23 — RECEIPTS (FDD pages 102–535)
What This Means (2025 FDD)
According to the 2025 Big O Tires Franchise Disclosure Document, the laws of the State of Colorado govern the interpretation of the franchise agreement. In the event of a dispute between Big O Tires and a franchisee, the internal substantive laws of Colorado, rather than its conflict of law rules, will be used to resolve the matter. This means that if there is a conflict between Colorado law and the law of the state where the franchisee's store is located, Colorado law will take precedence.
However, there are exceptions to this rule. The United States Federal Arbitration Act governs all questions about the enforceability of arbitration agreements and the confirmation of arbitration awards. Additionally, the United States Trademark Act of 1946 (Lanham Act) or other United States federal law will take precedence to the extent they govern the agreement. The FDD also specifies that the Colorado Consumer Protection Act will not apply to the agreement or any disputes between the parties.
This clause is important for prospective Big O Tires franchisees because it establishes the legal framework under which the franchise agreement will be interpreted and any disputes will be resolved. Franchisees should be aware that they may be subject to Colorado law even if their business is located in another state. It is advisable to consult with a legal professional to understand the implications of this governing law provision and how it may affect their rights and obligations under the franchise agreement.