What happens if a court finds a restriction in the Buildingstars Franchise Agreement too broad?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
Should any provision of this Agreement be construed or declared invalid, such decision shall not affect the validity of any remaining portion which shall remain in full force and effect as if this Agreement had been executed with such invalid portion eliminated.
If any restriction contained in this Agreement is deemed too broad to be capable of enforcement, a court of competent jurisdiction is hereby authorized to modify or limit such restriction to the extent necessary to permit its enforcement.
All covenants contained in this Agreement, including but not limited to those relating to restrictive covenant, shall be interpreted and applied consistent with the requirements of reasonableness and equity.
Source: Item 23 — RECEIPT (FDD pages 43–217)
What This Means (2025 FDD)
According to Buildingstars's 2025 Franchise Disclosure Document, if a court deems any restriction in the Franchise Agreement too broad to be enforced, the court is authorized to modify or limit the restriction. The modification should be to the extent necessary to allow the restriction to be enforced. This ensures that the agreement remains valid and effective as much as possible, even if certain parts are initially considered too restrictive.
This provision is included to maintain the enforceability of the agreement while adhering to legal standards of reasonableness. It allows a court to adjust overly broad restrictions rather than invalidate them entirely, which could protect Buildingstars's interests while ensuring fairness to the franchisee. The agreement also states that all covenants, including those related to restrictive covenants, will be interpreted and applied consistently with the requirements of reasonableness and equity.
Buildingstars also has the right to reduce the scope of any covenant contained in Sections IX and X, without the franchisee's consent, effective immediately upon receipt by the franchisee of written notice. The franchisee must comply with any covenant as modified. This clause provides Buildingstars with flexibility to adjust restrictions proactively, potentially avoiding disputes and ensuring the restrictions are reasonable and enforceable. This proactive approach can help maintain a balanced relationship between Buildingstars and its franchisees while protecting the brand's interests.