In Minnesota, what are the exceptions to the 90-day written notice Chem Dry must provide before terminating a franchise?
Chem_Dry Franchise · 2024 FDDAnswer from 2024 FDD Document
Minnesota statute §80C14 provides: It shall be deemed unfair and inequitable for any person to:
- (A) Terminate or cancel a franchise without first giving written notice setting forth all the reasons for the termination or cancellation to the Franchisee at least 90 days in advance of termination or cancellation, and the recipient of a notice fails to correct the reasons stated for cancellation or termination within 60 days within receipt of the notice, except that the notice shall be effective immediately upon receipt where the alleged grounds are:
- (i) Voluntary abandonment of the franchise relationship by the Franchisee;
- (ii) The conviction of the Franchisee of an offense directly related to the business conducted pursuant to the franchise; or
- (iii)Failure to cure a default under the Franchise Agreement which materially impairs the goodwill associated with the Franchisor's trade name, Trademark, service mark, logotype or other commercial symbol after the Franchisee has received written notice to cure of at least 24 hours in advance thereof;
Source: Item 23 — Receipts (FDD pages 68–264)
What This Means (2024 FDD)
According to Chem Dry's 2024 Franchise Disclosure Document, Minnesota statutes generally require Chem Dry to provide a franchisee with 90 days' written notice before terminating a franchise agreement. This notice must detail the reasons for termination, giving the franchisee 60 days to correct the issues. However, there are specific exceptions where the termination notice can be effective immediately upon receipt.
These exceptions include situations where the franchisee voluntarily abandons the franchise, is convicted of an offense directly related to the franchise business, or fails to correct a default under the Franchise Agreement that materially impairs the goodwill associated with Chem Dry's brand. In the case of a default, the franchisee must have received at least 24 hours' advance written notice to cure the default.
These stipulations are important for prospective Chem Dry franchisees in Minnesota to understand, as they outline the circumstances under which their franchise agreement could be terminated without the standard 90-day notice period. Franchisees should pay close attention to these conditions to ensure they are in compliance with the franchise agreement and avoid immediate termination.