Does the waiver and release in the Bonchon Franchise Agreement apply to claims arising under the Maryland Franchise Registration and Disclosure Law?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
The following provisions will supersede anything to the contrary in the Franchise Disclosure Document or Franchise Agreement and will apply to all franchises offered and sold under the laws of the State of Maryland:
ITEM 12 TERRITORY
The following sentence is added at the end of the paragraph in Item 12 concerning our reservation of territorial rights which begins "Under the terms of the Franchise Agreement, you waive and release any claims, demands or damages arising from or related to any of the activities described above":
"These waivers and releases are not intended to nor will they act as a release, estoppel or waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law. These waivers and releases will not apply to claims arising under the Maryland Franchise Registration and Disclosure Law."
ITEM 17. RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION
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- The general release required as a condition of renewal, sale, and/or assignment/transfer shall not apply to any liability under the Maryland Franchise Registration and Disclosure Law.
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- The laws of the State of Maryland may supersede the Franchise Agreement, including the areas of termination and renewal of the Franchise.
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- A franchisee may sue in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law. Any claims arising under the Maryland Franchise Registration and Disclosure Laws must be brought within three years after the grant of the Franchise.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, the waivers and releases within the standard Franchise Agreement do not apply to claims arising under the Maryland Franchise Registration and Disclosure Law. This protection is specifically outlined in the Maryland Addendum to both the Disclosure Document and the Franchise Agreement.
The Maryland Addendum explicitly states that waivers and releases contained in several sections of the Franchise Agreement, such as those related to territorial rights, general releases required for renewal, sale, or transfer, and rights Bonchon reserves, are not intended to act as a release, estoppel, or waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law. This ensures that franchisees in Maryland retain their rights and protections under Maryland law, regardless of any general waiver clauses in the standard agreement.
Furthermore, the addendum clarifies that any claims arising under the Maryland Franchise Registration and Disclosure Laws must be brought within three years after the grant of the Franchise. This provision reinforces the franchisee's right to sue in Maryland for claims related to franchise law, and it sets a specific statute of limitations for such claims.
In essence, Bonchon franchisees in Maryland receive additional legal protections through the Maryland Addendum, which overrides conflicting provisions in the standard Franchise Agreement. This ensures that franchisees maintain their rights under Maryland franchise law and have recourse for any violations, without being hindered by standard waiver clauses.