Does the Chesters FDD allow statements signed by a franchisee to waive claims of fraud in the inducement?

According to the 2025 Chesters Franchise Disclosure Document, certain provisions address the waiver of claims, including fraud in the inducement, particularly concerning state franchise laws. For franchisees subject to franchise registration/disclosure laws in specific states, including California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, or Wisconsin, no statement signed by a franchisee can waive claims under applicable state franchise law, including fraud in the inducement. This also means franchisees in those states cannot disclaim reliance on statements made by Chesters, its franchise sellers, or anyone acting on their behalf.

This provision is designed to protect franchisees in states with franchise laws from inadvertently waiving their rights through signed documents at the commencement of the franchise relationship. It ensures that franchisees in these states retain their ability to pursue claims of fraud in the inducement, which is a significant protection. The FDD explicitly states that this provision supersedes any other conflicting terms in any document executed in connection with the franchise, reinforcing its importance.

For prospective Chesters franchisees, this means that if their franchise is subject to the franchise laws of the specified states, they cannot waive their right to bring a claim of fraud in the inducement, regardless of what any statement, questionnaire, or acknowledgment they sign might say. This offers a degree of security, ensuring that franchisees can hold Chesters accountable for any misrepresentations made during the franchise sales process. Franchisees should still carefully review all documents and seek legal counsel to fully understand their rights and obligations, but this provision provides an additional layer of protection against potential overreach by the franchisor.