Does the 'Covenant Not to Sue' in the Care Plus Medical Ucc General Release have any exceptions?
Care_Plus_Medical_Ucc Franchise · 2024 FDDAnswer from 2024 FDD Document
Minnesota Rules 2860.4400(D) prohibits a franchisor from requiring a franchisee to assent to a general release.
The franchisee cannot consent to the franchisor obtaining injunctive relief. The franchisor may seek injunctive relief. See Minn. Rules 2860.4400J. Also, a court will determine if a bond is required.
The Limitations of Claims section must comply with Minnesota Statutes, Section 80C.17, Subd. 5, and therefore the applicable provision of the Agreement is amended to state "No action may be commenced pursuant to Minnesota Statutes, Section 80C.17 more than three years after the cause of action accrues."
3. Effective Date. This Rider is effective as of the Effective Date.
CARE PLUS MEDICAL UCC, LLC
NEW YORK RIDER TO FRANCHISE AND MULTI-UNIT DEVELOPMENT AGREEMENT
This Rider amends the Franchise and Multi-Unit Development Agreement dated (the "Agreement"), between Care Plus Medical UCC, LLC, a Wyoming Limited Liability Company ("Care Plus Medical UCC") and, a ("Franchisee"). 1. Capitalized terms used but not defined in this Rider have the meanings given Definitions. in the Agreement. 2. Waivers Not Required. would relieve Care Plus Medical UCC New York General Business Law, Article 33. Notwithstanding any provision of the Agreement to the contrary, Franchisee is not required to assent to a release, assignment, novation, waiver or estoppel which or any other person from any duty or liability imposed by 3. Waivers of New York Law Deleted. deleted. Any condition, stipulation, or provision in the Agreement purporting to bind Franchisee to waive compliance by Care Plus Medical UCC with any provision of New York General Business Law, or any rule promulgated thereunder, is hereby 4. Governing Law. Notwithstanding any provision of the Agreement to the contrary, the New York Franchises Law shall govern any claim arising under that law. 5. This Rider is effective as of the Effective Date. Effective Date. Agreed to by: CARE PLUS MEDICAL UCC, LLC
Source: Item 22 — CONTRACTS (FDD page 41)
What This Means (2024 FDD)
According to the 2024 Care Plus Medical Ucc Franchise Disclosure Document, the enforceability and scope of the general release, including any covenant not to sue, can be limited by state laws. Specifically, Minnesota Rules prohibit Care Plus Medical Ucc from requiring a franchisee to agree to a general release. The franchisee also cannot consent to Care Plus Medical Ucc obtaining injunctive relief, although Care Plus Medical Ucc may seek it, subject to a court's determination on whether a bond is required. Furthermore, the Limitations of Claims section must comply with Minnesota Statutes, Section 80C.17, Subd. 5, limiting actions to within three years after the cause of action accrues.
Similarly, the New York Rider to the Franchise and Multi-Unit Development Agreement states that franchisees in New York are not required to assent to a release, assignment, novation, waiver, or estoppel that would relieve Care Plus Medical Ucc from any duty or liability imposed by New York General Business Law, Article 33. Any provision in the agreement that binds the franchisee to waive compliance by Care Plus Medical Ucc with any provision of New York General Business Law, or any rule promulgated under it, is deleted. The New York Franchises Law governs any claim arising under that law, overriding any conflicting provisions in the agreement.
These state-specific riders indicate that the general release and its covenant not to sue are subject to exceptions and limitations based on state laws designed to protect franchisees. Prospective franchisees should carefully review the specific provisions of their franchise agreement and any applicable state riders to understand the full scope and limitations of any general release they may be asked to sign. It is also advisable to seek legal counsel to ensure full comprehension of their rights and obligations under the franchise agreement and relevant state laws.