What is the effect of a general release required as a condition of assignment/transfer for C12 Group franchises in Maryland?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
The provisions hereof shall not apply to any liability arising with respect to the franchise laws under the Maryland Franchise Registration and Disclosure Law.
Any claim arising under the Maryland Franchise Registration and Disclosure Law must be brought within three (3) years after the grant of the franchise.
No statement, questionnaire, or acknowledgment signed or agreed to by a franchisee 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 any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to the 2025 FDD, C12 Group requires franchisees to execute a general release of the company as a condition of transfer. However, for franchisees in Maryland, this general release does not apply to liabilities arising from violations of the Maryland Franchise Registration and Disclosure Law.
Specifically, the FDD states that the release will not affect any liability arising with respect to the franchise laws under the Maryland Franchise Registration and Disclosure Law. This means that even if a franchisee signs a general release, they still retain the right to pursue claims against C12 Group for violations of Maryland's franchise laws.
The FDD also specifies that any claim arising under the Maryland Franchise Registration and Disclosure Law must be brought within three years after the grant of the franchise. Additionally, no statement, questionnaire, or acknowledgment signed by a franchisee can waive claims under any applicable state franchise law, including fraud in the inducement, or disclaim reliance on statements made by C12 Group or its representatives. This provision supersedes any other term in documents related to the franchise agreement, further protecting the franchisee's rights under Maryland law.