Which state's laws govern the Buildingstars Franchise Agreement?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
- H.
Governing Law and Jurisdiction.
FRANCHISEE acknowledges that this Agreement was accepted in the State of Missouri.
Except to the extent that this Agreement or any particular dispute is governed by the U.S.
Trademark Act of 1946 (Lanham Act, 115 U.S.C. 1051), this Agreement will be governed, to the extent permissible, by the laws of the State of Missouri (without reference to its conflict of laws principles).
If, however, any provision of this Agreement would not be enforceable under the laws of Missouri, and if the Business is located outside of Missouri and the provision would be enforceable under the laws of the state in which the Business is located, then the provision in question (and only that provision) will be interpreted and construed under the laws of the state where the Business is located.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
According to Buildingstars's 2025 Franchise Disclosure Document, the franchise agreement is generally governed by the laws of Missouri. The FDD specifies that the agreement was accepted in Missouri, and, to the extent permissible, Missouri law will apply without regard to its conflict of laws principles. This means that Missouri law will be used to interpret and enforce the agreement.
However, there is an exception to this rule. If any provision of the Buildingstars agreement is unenforceable under Missouri law, and the franchisee's business is located outside of Missouri, the laws of the state where the business is located will govern that specific provision, but only that provision. This ensures that franchisees operating in different states are not subject to unenforceable terms due to conflicts with local laws.
This clause is fairly typical in franchise agreements, as franchisors often choose a specific state's laws to govern the agreement for consistency. However, the exception for provisions unenforceable in Missouri but enforceable in the franchisee's state provides a degree of protection for the franchisee, ensuring compliance with local regulations. Prospective Buildingstars franchisees should be aware of this clause and understand how it may affect the interpretation and enforcement of their franchise agreement, especially if they are operating outside of Missouri.