What constitutes 'good cause' for Chesters to terminate a franchise and repurchase the business in Washington?

According to Chesters's 2025 Franchise Disclosure Document, provisions in franchise agreements that allow Chesters to repurchase a franchisee's business during the term without the franchisee's consent are unlawful in Washington, unless the termination is for "good cause." This is per RCW 19.100.180(2)(j), which is the Revised Code of Washington that addresses franchise investment protection.

This means that Chesters can only repurchase a franchise in Washington without the franchisee's agreement if there is a legitimate, justifiable reason for doing so. The term "good cause" is not specifically defined in this excerpt, but it generally implies a significant breach of the franchise agreement or a failure to meet certain performance standards.

For a prospective Chesters franchisee in Washington, this provision offers some protection against arbitrary or unfair buy-backs by the franchisor. However, it's crucial to understand what specific actions or failures would be considered "good cause" for termination and repurchase. A potential franchisee should seek legal counsel to fully understand their rights and obligations under Washington law and the franchise agreement.