Is a general release or waiver of rights always binding for a Bumper Man franchisee?
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.
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- General Release.
A release or waiver of rights in the franchise agreement or related agreements purporting to bind the franchisee to waive compliance with any provision under the Washington Franchise Investment Protection Act or any rules or orders thereunder is void except when executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel, in accordance with RCW 19.100.220(2).
In addition, any such release or waiver executed in connection with a renewal or transfer of a franchise is likewise void except as provided for in RCW 19.100.220(2).
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."
You must sign a general release if you transfer your franchise. California Corporations Code §31512 voids a waiver of your rights under the Franchise Investment Law (California Corporations Code §§31000 through 31516). Business and Professions Code §20010 voids a waiver of your rights under the Franchise Relations Act (Business and Professions Code §§20000 through 20043).
Source: Item 22 — CONTRACTS (FDD page 45)
What This Means (2025 FDD)
According to the 2025 Bumper Man FDD, a general release or waiver of rights is not always binding, particularly in certain states and under specific circumstances. For franchisees subject to franchise registration/disclosure laws in California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, or Wisconsin, any statement, questionnaire, or acknowledgment signed in connection with the franchise relationship cannot 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 takes precedence over any conflicting terms in any document executed in connection with the franchise.
In Washington, a release or waiver of rights in the franchise agreement is void if it requires the franchisee to waive compliance with any provision under the Washington Franchise Investment Protection Act, unless it is executed pursuant to a negotiated settlement after the agreement is in effect and both parties are represented by independent counsel. This also applies to releases or waivers executed in connection with a renewal or transfer of a franchise, with the same exception for negotiated settlements with independent counsel.
For California franchisees, the FDD acknowledges California Civil Code Section 1542, which states that a general release does not extend to claims that the releasing party is unaware of at the time of signing the release, and that would have materially affected their settlement had they been known. Furthermore, California Corporations Code §31512 voids a waiver of rights under the Franchise Investment Law, and Business and Professions Code §20010 voids a waiver of rights under the Franchise Relations Act. Therefore, Bumper Man franchisees need to be aware of the specific state laws that may impact the enforceability of any general release or waiver of rights they sign.