How does the Chesters Franchise Agreement modify the governing law as stated in Section 27 of the agreement?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
The "Summary" section of Item 17(w) in the Franchise Disclosure Document is amended to read as follows:
Except for federal law, North Dakota law applies.
RHODE ISLAND
The "Summary" section of Item 17(w) in the Franchise Disclosure Document is amended to read as follows:
Except for federal law and except as required by the Rhode Island Franchise Investment Act, Alabama law governs.
- Governing Law. Section 27 of the Agreement is amended by adding the following language at the end:
HOWEVER, THE GOVERNING CHOICE OF LAW SHALL NOT BE CONSIDERED A WAIVER OF ANY RIGHT CONFERRED UPON YOU BY THE PROVISIONS OF ARTICLE 33 OF THE GENERAL BUSINESS LAW OF THE STATE OF NEW YORK.
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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.
Except to the extent governed by United States federal law, this Agreement, the license, and all claims arising from or relating to the relationship between you and us shall be governed, interpreted, and construed under the laws of the State of Alabama, without reference to principles of conflicts of law. However, if the laws of the state where the Restaurant is located require interpretation and construction of this Agreement pursuant to the laws of that state, then this Agreement shall be deemed modified to comply with the applicable provision of that state law regarding such interpretation and construction.
Source: Item 23 — **RECEIPTS (FDD pages 48–197)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, Section 27 of the Franchise Agreement, concerning governing law, is modified by state-specific addenda. For Illinois franchisees, Section 27 is amended to specify that the choice of law will not waive any rights conferred by Article 33 of the General Business Law of the State of New York.
For franchisees in North Dakota, Item 17(w) is amended to state that, except for federal law, North Dakota law applies. Similarly, for Rhode Island franchisees, Item 17(w) is amended to specify that Alabama law governs, except for federal law and as required by the Rhode Island Franchise Investment Act.
For franchisees in Washington, the Washington Addendum modifies the Franchise Agreement, and in the event of a conflict of laws, the provisions of the Washington Franchise Investment Protection Act will prevail. Furthermore, if the laws of the state where the restaurant is located require interpretation and construction of the agreement pursuant to the laws of that state, the agreement will be modified to comply with the applicable provision of that state law regarding such interpretation and construction. These modifications ensure that franchisees' rights are protected under their respective state laws, despite the general governing law provision in the agreement.