What is the effect of the Washington Franchise Investment Protection Act on exemplary and punitive damages for a Chesters franchise?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
WASHINGTON ADDENDUM TO FRANCHISE DISCLOSURE DOCUMENT, THE FRANCHISE AGREEMENT, FRANCHISE REPRESENTATIONS, AND RELATED AGREEMENTS
The provisions of this Addendum form an integral part of, are incorporated into, and modify the Franchise Disclosure Document, the franchise agreement, and all related agreements regardless of anything to the contrary contained therein. This Addendum applies if: (a) the offer to sell a franchise is accepted in Washington; (b) the purchaser of the franchise is a resident of Washington; and/or (c) the franchised business that is the subject of the sale is to be located or operated, wholly or partly, in Washington.
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- Conflict of Laws.
In the event of a conflict of laws, the provisions of the Washington Franchise Investment Protection Act, chapter 19.100 RCW will prevail.
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- Franchisee Bill of Rights. RCW 19.100.180 may supersede provisions in the franchise agreement or related agreements concerning your relationship with the franchisor, including in the areas of termination and renewal of your franchise.
There may also be court decisions that supersede the franchise agreement or related agreements concerning your relationship with the franchisor.
Franchise agreement provisions, including those summarized in Item 17 of the Franchise Disclosure Document, are subject to state law.
Site of Arbitration, Mediation, and/or Litigation.
In any arbitration or mediation involving a franchise purchased in Washington, the arbitration or mediation site will be either in the state of Washington, or in a place mutually agreed upon at the time of the arbitration or mediation, or as determined by the arbitrator or mediator at the time of arbitration or mediation.
In addition, if litigation is not precluded by the franchise agreement, a franchisee may bring an action or proceeding arising out of or in connection with the sale of franchises, or a violation of the Washington Franchise Investment Protection Act, in Washington.
General Release.
A release or waiver of rights in the franchise agreement or related agreements purporting to bind the franchisee to waive compliance with any provision under the Washington Franchise Investment Protection Act or any rules or orders thereunder is void except when executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel, in accordance with RCW 19.100.220(2).
In addition, any such release or waiver executed in connection with a renewal or transfer of a franchise is likewise void except as provided for in RCW 19.100.220(2).
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- Statute of Limitations and Waiver of Jury Trial.
Provisions contained in the franchise agreement or related agreements that unreasonably restrict or limit the statute of limitations period for claims under the Washington Franchise Investment Protection Act, or rights or remedies under the Act such as a right to a jury trial, may not be enforceable.
Source: Item 23 — **RECEIPTS (FDD pages 48–197)
What This Means (2025 FDD)
Based on the 2025 Chesters Franchise Disclosure Document, the Washington Franchise Investment Protection Act (WFIPA) includes several provisions that impact franchise agreements and related rights. Specifically, any release or waiver of rights that requires a franchisee to waive compliance with the WFIPA is void unless it meets certain conditions. These conditions include the release being part of a negotiated settlement after the franchise agreement is already in effect, and both parties being represented by independent legal counsel, as stipulated in RCW 19.100.220(2). This protection extends to releases or waivers executed during franchise renewals or transfers, ensuring franchisees cannot inadvertently forfeit their rights under the WFIPA.
Additionally, the WFIPA addresses limitations on legal claims. Provisions in the franchise agreement or related documents that unreasonably restrict the statute of limitations for claims under the WFIPA, or that limit rights or remedies available under the Act, such as the right to a jury trial, may not be enforceable. This ensures that Chesters franchisees in Washington have a fair opportunity to pursue legal remedies for violations of the WFIPA, without facing unduly restrictive contractual limitations.
In the event of a conflict of laws, the provisions of the Washington Franchise Investment Protection Act, chapter 19.100 RCW will prevail. RCW 19.100.180 may supersede provisions in the franchise agreement or related agreements concerning your relationship with the franchisor, including in the areas of termination and renewal of your franchise. There may also be court decisions that supersede the franchise agreement or related agreements concerning your relationship with the franchisor. Franchise agreement provisions, including those summarized in Item 17 of the Franchise Disclosure Document, are subject to state law.
While the FDD excerpt clarifies conditions under which franchisees' rights are protected and waivers are voided, it does not explicitly address the effect of the Washington Franchise Investment Protection Act on exemplary and punitive damages for a Chesters franchise. A prospective franchisee should seek clarification from Chesters regarding the availability of exemplary or punitive damages under the WFIPA and how the franchise agreement addresses these types of damages in the context of Washington law.