Who must the general release of claims be in favor of when transferring a Burros Fries franchise?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
You must sign a general release of claims if you renew or transfer your franchise. California Corporations Code §31512 voids a waiver of your rights under the Franchise Investment Law (California Corporations Code §§31 000 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 53)
What This Means (2024 FDD)
According to the 2024 Burros Fries Franchise Disclosure Document, a franchisee must sign a general release of claims when transferring their franchise. This release is required under California law, as stated in the FDD.
This means that as part of the transfer process, a franchisee will be required to waive any existing or potential legal claims they may have against Burros Fries. This is a standard practice in franchising to ensure a clean break between the transferring franchisee and the franchisor.
However, the FDD also notes some important limitations. California Corporations Code §31512 voids any waiver of rights under the Franchise Investment Law (California Corporations Code §§31 000 through 31516), and Business and Professions Code §20010 voids any waiver of rights under the Franchise Relations Act (Business and Professions Code §§20000 through 20043). This suggests that while a general release is required, certain statutory rights under California franchise law cannot be waived by the franchisee.