What state's law governs the Cd One Price Cleaners Franchise Agreement?
Cd_One_Price_Cleaners Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in franchise or other agreement | Summary |
|---|---|---|
| p. Death or disability | 12.5 of Franchise Agreement | Must transfer to approved transferee within 6 |
| of franchisee | months. | |
| q. Non-competition covenants during the term of the franchise | 15.2 of Franchise Agreement | No diverting Store business or customer to, owning interest in, performing services for, or otherwise associating with Competitive Business anywhere, and no performing acts prejudicial to goodwill. “Competitive Business” means business that offers dry cleaning, finished laundry services, other cleaning services, alterations, repair/restoration and similar services, including providing these services to another CD Store. |
| r. Non-competition | 15.3 of Franchise Agreement | For 2 years, no owning interest in, performing |
| covenants after | services for, or otherwise associating with | |
| the franchise is | Competitive Business operating at Site, within 10 | |
| terminated or | miles of Site, or within 5 miles of any other CD | |
| expires | Store. | |
| s. Modification of the agreement | 21 of Franchise Agreement, 8 of PUD Addendum and 13 of Development Rights Agreement | Modifications only by written agreement of parties, but we may change Manual and Operating Plans and the methods of calculating and paying the Customer Acquisition Payments and/or Technology Fee under the PUD Addendum. |
| t. Integration/ merger clause | 21 of Franchise Agreement and 13 of Development Rights Agreement | Only terms of Development Rights Agreement or Franchise Agreement (including the Manual and Operating Plans) are binding (subject to state law). Any other representations or promises made outside of the disclosure document and those agreements may not be enforceable. |
| u. Dispute resolution | 23.2 of Franchise Agreement | We and you must arbitrate all disputes at a |
| by arbitration or | and 13 of Development | location the arbitrator chooses within 10 miles of |
| mediation | Rights Agreement | our then existing principal business address. |
| v. Choice of forum | 23.3 of Franchise Agreement and 13 of Development Rights Agreement | Subject to arbitration obligation and state law, litigation generally must be in Illinois. |
| w. Choice of law | 23.1 of Franchise Agreement | Except for Federal Arbitration Act and other |
| and 13 of Development | federal law, Illinois law applies (subject to state | |
| Rights Agreement | law). |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 56–62)
What This Means (2025 FDD)
According to the 2025 FDD, the laws of Illinois govern the Cd One Price Cleaners Franchise Agreement. Specifically, except for the Federal Arbitration Act and other federal laws, Illinois law applies to the Franchise Agreement and Development Rights Agreement, although this is subject to state law. This means that the interpretation and enforcement of the franchise agreement will generally be based on Illinois legal principles.
This "choice of law" provision is a standard clause in franchise agreements. It aims to provide clarity and predictability regarding which jurisdiction's laws will be applied in the event of a dispute. However, the phrase "subject to state law" suggests that certain state-specific regulations or statutes where the franchise is located could potentially override Illinois law in some instances.
For a prospective Cd One Price Cleaners franchisee, this means that understanding Illinois franchise law is crucial. However, they should also be aware of any specific laws in their own state that might affect the franchise relationship. Consulting with a legal professional familiar with franchise law in both Illinois and the franchisee's state is advisable to fully understand their rights and obligations.