Does the release required for renewal, assignment, or transfer of a Caring Transitions franchise apply to liabilities arising under the Hawaii Franchise Investment Law?
Caring_Transitions Franchise · 2025 FDDAnswer from 2025 FDD Document
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- The release required as a condition of renewal, assignment, and transfer will not apply to any liability arising under the Hawaii Franchise Investment Law.
HAWAII ADDENDUM TO FRANCHISE AGREEMENT
This addendum, executed and agreed to concurrently with the Franchise Agreement to which it is attached, amends the Franchise Agreement as follows:
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- In recognition of the requirements of the Hawaii Franchise Investment Law, Hawaii Revised Statutes, Title 26, Chapter 482E et seq., the Franchise Agreement is amended as follows:
- (a) The Hawaii Franchise Investment Law provides rights to you concerning nonrenewal, termination and transfer of the Franchise Agreement. If the Franchise Agreement contains a provision that is inconsistent with the Hawaii Franchise Investment Law, the Hawaii Franchise Investment Law will control.
- (b) A general release required as a condition of the renewal, assignment, or transfer of the Franchise Agreement or the franchise granted thereunder shall not apply to any claim or liability arising under the Hawaii Franchise Investment Law.
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- Each provision of this addendum is effective only to the extent that the jurisdictional requirements of the Hawaii Franchise Investment Law are met independently of this addendum. To the extent this addendum is deemed to be inconsistent with any terms or conditions of the Franchise Agreement or any exhibit or attachment thereto, the terms of this addendum shall govern.
Source: Item 22 — CONTRACTS (FDD page 49)
What This Means (2025 FDD)
According to Caring Transitions' 2025 Franchise Disclosure Document, the release required as a condition of renewal, assignment, or transfer of a Caring Transitions franchise will not apply to any liability arising under the Hawaii Franchise Investment Law. This protection is explicitly stated in the Hawaii section of the FDD and is further reinforced by the Hawaii Addendum to the Franchise Agreement.
The Hawaii Addendum specifies that if any provision in the standard Franchise Agreement is inconsistent with the Hawaii Franchise Investment Law, the state law will take precedence. This ensures that franchisees in Hawaii retain their rights and protections under the state's franchise laws, even when signing standard franchise documents.
This provision is beneficial for prospective Caring Transitions franchisees in Hawaii, as it prevents them from inadvertently waiving their rights under the Hawaii Franchise Investment Law through a general release. It provides an added layer of legal protection, ensuring that franchisees can pursue claims related to violations of the Hawaii Franchise Investment Law, regardless of any release they may have signed during renewal, assignment, or transfer of the franchise. This is more protective than some states, such as Maryland, where the release exception only applies to the initial grant of the franchise and not necessarily to renewals or transfers.