What state's laws govern the Carvel franchise agreement?
Carvel Franchise · 2025 FDDAnswer from 2025 FDD Document
This Guaranty is to be construed under and governed by the law of the State of Georgia without regard to Georgia, or any other, choice of law or conflicts of law principles.
If any provision of this Guaranty would not be enforceable under the laws of Georgia, and if the business franchised under the Franchise Agreement is located outside of Georgia and the provision would be enforceable under the laws of the state in which the franchised business is located, then that provision, and only that provision, will be interpreted and construed under the laws of that state.
Source: Item 23 — Receipts (FDD pages 100–353)
What This Means (2025 FDD)
According to the 2025 Carvel FDD, the franchise agreement is generally governed by Georgia law. Specifically, the Guaranty is to be construed under and governed by the law of the State of Georgia, without regard to Georgia, or any other, choice of law or conflicts of law principles. This means that, in most situations, Georgia law will be used to interpret the franchise agreement.
However, there are exceptions to this rule. If the franchised business is located outside of Georgia, and a provision of the Guaranty that is unenforceable under Georgia law would be enforceable under the laws of the state where the business is located, then that specific provision will be interpreted under the laws of that state. This ensures that certain provisions of the agreement can be upheld based on the franchisee's local laws.
Furthermore, the FDD includes addenda for several states, such as Illinois, Indiana, North Dakota, Rhode Island, and Virginia, which stipulate that the franchise agreement will be governed by the laws of those states if there are conflicts with the standard agreement. For example, the Illinois addendum states that Illinois law governs the Franchise Agreement. Similarly, the Rhode Island addendum notes that any provision restricting jurisdiction or venue to a forum outside of Rhode Island or requiring the application of other states' laws is void with respect to claims enforceable under the Rhode Island Franchise Investment Act. These addenda modify the governing law provision to comply with local franchise laws, providing additional protection to franchisees in those states.