How might RCW 19.100.180(1) limit or supersede provisions in the Carvel franchise agreement regarding the franchisor's business judgment?

According to Carvel's 2025 Franchise Disclosure Document, provisions in the franchise agreement that allow Carvel to use its discretion based on reasonable business judgment may be limited by Washington state law. Specifically, RCW 19.100.180(1) requires that all parties involved in the franchise agreement, including Carvel and the franchisee, must deal with each other in good faith. This means that even if the franchise agreement grants Carvel certain discretionary powers, those powers cannot be exercised in a way that violates the implied covenant of good faith and fair dealing.

For a prospective Carvel franchisee in Washington, this addendum provides an additional layer of protection. It means that Carvel cannot make decisions based solely on its own business judgment if those decisions are detrimental to the franchisee and not made in good faith. This could apply to various aspects of the franchise operation, such as marketing strategies, supply chain management, or enforcement of brand standards. The franchisee can argue that Carvel's decision, while perhaps justifiable on a purely business basis, violates the good faith requirement under Washington law.

This clause does not eliminate Carvel's ability to make business decisions, but it does require that those decisions be made with consideration for the franchisee's interests and in a manner that is fair and reasonable. Franchisees should be aware of this protection and consult with an attorney if they believe Carvel is acting in bad faith or abusing its discretionary powers in a way that harms their business. This addendum serves as a reminder that franchise agreements are subject to state laws designed to protect franchisees from unfair practices.