Does the Illinois Rider to the Checkers Franchise Agreement address fraud in the inducement?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
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- No disclaimer, questionnaire, clause, or statement signed by a franchisee in connection with the commencement of the franchise relationship shall be construed or interpreted as waiving any claim of fraud in the inducement, whether common law or statutory, or as
Checkers/Rally's April 2025
disclaiming reliance on or the right to rely upon any statement made or information provided by any franchisor, broker or other person acting on behalf of the franchisor that was a material inducement to a franchisee's investment. This provision supersedes any other or inconsistent term of any document executed in connection with the franchise.
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, the Illinois Rider to the Franchise Agreement specifically addresses fraud in the inducement. It states that no disclaimer, questionnaire, clause, or statement signed by a franchisee can be interpreted as waiving any claim of fraud in the inducement, whether based on common law or statutes. This also means a franchisee cannot be seen as disclaiming reliance on statements or information from Checkers, its brokers, or representatives if that information materially induced the franchisee's investment.
This provision in the Illinois Rider is designed to protect franchisees by ensuring they retain their rights to pursue claims of fraud if they believe they were misled into investing in the franchise. It prevents Checkers from using standard contract language to shield itself from liability for fraudulent statements or omissions made during the franchise sales process. The rider emphasizes that this protection supersedes any other conflicting terms in any document related to the franchise agreement.
For a prospective Checkers franchisee in Illinois, this is a significant safeguard. It means that even if they sign documents containing waivers or disclaimers, those clauses will not prevent them from bringing a fraud claim if they believe Checkers misrepresented important information that influenced their decision to invest. This rider strengthens the franchisee's legal position and ensures that Checkers is accountable for the accuracy and truthfulness of the information provided to potential franchisees.
It is common for franchise agreements to contain various waivers and disclaimers, so this Illinois Rider provides an added layer of protection specific to franchisees operating in Illinois. Franchisees should still carefully review all documents and seek legal advice, but this provision offers reassurance that their right to claim fraud is preserved under Illinois law.