If provisions in the Bonchon franchise disclosure document or franchise agreement are inconsistent with Washington's Franchise Investment Protection Act, which provisions prevail?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
Notwithstanding anything to the contrary set forth in the Franchise Agreement, the following provisions will supersede and apply:
If any of the provisions in the franchise disclosure document or franchise agreement are inconsistent with the relationship provisions of RCW 19.100.180 or other requirements of the Washington Franchise Investment Protection Act, the provisions of the Act will prevail over the inconsistent provisions of the franchise disclosure document and franchise agreement with regard to any franchise sold in Washington.
In any arbitration or mediation involving a franchise purchased in Washington, the arbitration or mediation site will be either in the state of Washington, or in a place mutually agreed upon at the time of the arbitration or mediation, or as determined by the arbitrator or mediator at the time of arbitration or mediation.
In addition, if litigation is not precluded by the franchise agreement, a franchisee may bring an action or proceeding arising out of or in connection with the sale of franchises, or a violation of the Washington Franchise Investment Protection Act, in Washington.
A release or waiver of rights executed by a Franchisee will not include rights under the Washington Franchise Protection Act or any rule or order thereunder except when executed pursuant to a negotiated settlement after the Franchise Agreement is in effect and where the parties are represented by independent counsel.
Provisions such as those which unreasonably restrict or limit the statute of limitations period for claims under the Act, and rights or remedies under the Act such as a right to a jury trial, may not be enforceable.
The state of Washington has a statute, RCW 19.100.180 which may supersede the Franchise Agreement in your relationship with the Franchisor including the areas of termination and renewal of your franchise.
There may also be court decisions which may supersede the Franchise Agreement in your relationship with the Franchisor including the areas of termination and renewal of your franchise.
In the event of a conflict of laws, the provisions of the Washington Franchise Investment Protection Act, Chapter 19.100 RCW will prevail.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, the Washington Addendum to the Franchise Agreement addresses inconsistencies between the franchise agreement and the Washington Franchise Investment Protection Act. Specifically, if any provisions within the franchise disclosure document or the franchise agreement are inconsistent with the relationship provisions of RCW 19.100.180 or other requirements of the Washington Franchise Investment Protection Act, the provisions of the Act will take precedence. This ensures that Bonchon franchises sold in Washington adhere to Washington law.
This addendum is crucial for prospective Bonchon franchisees in Washington because it clarifies that state law supersedes conflicting terms in the franchise agreement. This protection extends to various aspects of the franchise relationship, including termination and renewal, as governed by RCW 19.100.180. The addendum also addresses dispute resolution, stipulating that arbitration or mediation sites must be in Washington or a mutually agreed-upon location. Franchisees are also permitted to bring actions in Washington if litigation is not precluded by the franchise agreement, especially for issues related to the sale of franchises or violations of the Washington Franchise Investment Protection Act.
Furthermore, the Washington Addendum protects franchisees by ensuring that waivers of rights do not include rights under the Washington Franchise Protection Act unless executed under specific conditions, such as a negotiated settlement with independent counsel. Certain provisions that unreasonably restrict the statute of limitations or rights under the Act, like the right to a jury trial, may not be enforceable. This safeguards the franchisee's ability to pursue legal remedies under state law, regardless of conflicting terms in the franchise agreement.
In the event of any conflict of laws, the provisions of the Washington Franchise Investment Protection Act, Chapter 19.100 RCW, will prevail. This ensures that Bonchon franchisees in Washington are governed by the protections afforded under state law, providing a more secure and predictable business environment. This addendum reflects a commitment to compliance with Washington's franchise regulations, offering franchisees a degree of legal certainty and protection.