What effect does a statement, questionnaire, or acknowledgment signed by a Budget franchisee have on claims under state franchise law in Washington?
Budget 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.
The undersigned acknowledges receipt of this Rider."
4. Deletion of Paragraphs.
- a. Representations. Section 14.2(b) of the License Agreement is hereby deleted.
- b. Representation. Section 14.22 of the License Agreement is hereby deleted.
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- The Acknowledgement of the License Agreement does not apply to Washington franchisees, and Washington franchisees should not sign the Acknowledgement.
Source: Item 23 — RECEIPTS (FDD pages 80–426)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, a statement, questionnaire, or acknowledgment signed by a Budget franchisee in Washington, in connection with starting the franchise, does not waive claims under Washington franchise law. This includes claims of fraud in the inducement. It also means a franchisee cannot disclaim reliance on statements made by Budget or anyone acting on its behalf. This protection supersedes any other conflicting terms in any document related to the franchise agreement.
This provision is designed to protect franchisees in Washington from inadvertently giving up their legal rights during the initial stages of the franchise relationship. Franchise agreements often contain numerous documents and acknowledgments, and this clause ensures that franchisees retain their ability to pursue legal claims under state franchise law, regardless of what they may have signed at the outset.
Furthermore, the 2025 Budget FDD states that the Acknowledgment of the License Agreement does not apply to Washington franchisees, and Washington franchisees should not sign the Acknowledgement.
In addition to the above protections, the FDD states that Washington law will prevail in the event of a conflict of laws. The Washington Franchise Investment Protection Act may supersede the franchise agreement regarding termination and renewal. Also, a release or waiver of rights executed by a franchisee may not include rights under the Washington Franchise Investment Protection Act unless it is part of a negotiated settlement with independent counsel after the agreement is in effect. Provisions that unreasonably restrict the statute of limitations or rights to a jury trial may not be enforceable.