Can Canine Dimensions conduct an investigation to determine accrued obligations before a franchise transfer?
Canine_Dimensions Franchise · 2025 FDDAnswer from 2025 FDD Document
In consideration of the mutual covenants and conditions contained in this Mutual General Release and in the Franchise Agreement, and other good and valuable consideration, receipt of which is hereby acknowledged by each of the parties, the parties agree as follows:
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- Canine Dimensions and Franchisee do hereby mutually release and forever discharge each other and each other's heirs, successors, representatives, assigns, agents, employees, officers, and directors ("Designees"), and each of them, of and from any claims, debts, liabilities, demands, obligations, costs, expenses, actions, and causes of action of every nature, character, and description known or unknown, vested or contingent, which each party now owns or holds, or has at any time heretofore owned or held, or may at any time own or hold against the other party hereto, arising prior to and including the date of this Mutual General Release Agreement; provided, however, that this release shall exclude claims arising from assertion of any continuing rights reserved in this Mutual General Release Agreement.
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- This release shall not apply to any claims which the Franchisee may have arising under (a) the California Franchise Investment Law or the California Franchise Relations Act; (b) the Hawaii Franchise Investment Law; (c) the Maryland Franchise Registration and Disclosure Law; (d) the Minnesota Franchise Act; (e) the New York Franchise Investment Law; (f) the North Dakota Franchise Investment Law; or (g) the Washington Franchise Investment Protection Act, RCW 19.100, and the rules adopted thereunder. This release shall exclude claims arising from Franchisee's failure to pay any amounts due Canine Dimensions in the ordinary course of business. The parties expressly agree that this Mutual General Release Agreement will not apply to any claims Canine Dimensions may have under any Promissory Notes ancillary to the Franchise Agreement, or that pertain to other payment arrangements that the parties may have agreed upon.
Source: Item 22 — CONTRACTS (FDD page 36)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, the excerpts provided do not explicitly state whether Canine Dimensions can conduct an investigation to determine accrued obligations before a franchise transfer. However, the document does include a "Mutual General Release Agreement" that is used when a franchisee desires to transfer their franchise.
According to the agreement, Canine Dimensions conditions its consent to such transfer on the execution of this Mutual General Release Agreement by the franchisee. The agreement includes a mutual release where Canine Dimensions and the franchisee release each other from claims, debts, liabilities, demands, obligations, costs, expenses, actions, and causes of action. This release covers items of every nature, character, and description known or unknown, vested or contingent, which each party now owns or holds, or has at any time owned or held against the other party, arising prior to and including the date of the Mutual General Release Agreement.
However, this release does not apply to any claims which the franchisee may have arising under specific state franchise laws, such as those in California, Hawaii, Maryland, Minnesota, New York, North Dakota, or Washington. Additionally, the release excludes claims arising from the franchisee's failure to pay any amounts due Canine Dimensions in the ordinary course of business. The agreement also specifies that it will not apply to any claims Canine Dimensions may have under any Promissory Notes ancillary to the Franchise Agreement, or that pertain to other payment arrangements that the parties may have agreed upon.
To fully understand Canine Dimensions's rights and procedures regarding investigations into accrued obligations before a franchise transfer, a prospective franchisee should ask the franchisor directly about this process, including what specific steps Canine Dimensions takes to assess financial obligations and what recourse a franchisee has if they disagree with the franchisor's assessment.