Does the Bumper Man General Release apply to claims arising out of fraud?
Bumper_Man Franchise · 2025 FDDAnswer from 2025 FDD Document
The following provision applies only to franchisees and franchises that are subject to the state franchise registration/disclosure laws in California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, or Wisconsin:
No statement, questionnaire, or acknowledgement signed or agreed to by you 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 us, any franchise seller, or any other person acting on our behalf. This provision supersedes any other term of any document executed in connection with the franchise.
CALIFORNIA
Acknowledgment of Releases under California Law. Each Party granting a release acknowledges a familiarity with Section 1542 of the Civil Code of the State of California, which provides as follows:
"A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party."
MARYLAND
b. Any provision requiring you to sign a general release of claims against us, including upon execution of the Franchise Agreement or a successor franchise
agreement or transfer, does not release any claim you may have under the Maryland Franchise Registration and Disclosure Law.
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- For the sake of clarity, the last sentence of the Franchisee Disclosure Questionnaire attached as Exhibit H to the Disclosure Document is amended as follows:
"All representations requiring prospective franchisees to assent to a release, estoppel or waiver of liability are not intended to nor shall they act as a release, estoppel or waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law."
Source: Item 22 — CONTRACTS (FDD page 45)
What This Means (2025 FDD)
According to the 2025 Bumper Man Franchise Disclosure Document, the General Release typically includes all claims, but there are exceptions in certain states regarding claims of fraud. Specifically, for franchisees in California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, or Wisconsin, no statement signed by the franchisee can waive claims under applicable state franchise law, including fraud in the inducement, or disclaim reliance on statements made by Bumper Man or its representatives. This provision overrides any conflicting terms in other documents.
For California franchisees, the release acknowledges Section 1542 of the California Civil Code, which states that a general release does not cover claims unknown or unsuspected at the time of signing that would have materially affected the settlement. This means that if a franchisee is unaware of a fraud claim when signing the release, the release may not apply to that claim.
In Maryland, any provision requiring a general release of claims against Bumper Man does not release any claim under the Maryland Franchise Registration and Disclosure Law. Furthermore, the Franchisee Disclosure Questionnaire does not act as a release, estoppel, or waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law. Therefore, franchisees need to be aware of the specific laws in their state and how they interact with the general release.
It is important for prospective Bumper Man franchisees to consult with a legal professional to fully understand the implications of the General Release and how it applies to their specific circumstances, especially concerning potential claims of fraud. Franchisees should pay close attention to the state-specific addenda and understand their rights under state franchise laws.