What is the impact of the Washington Franchise Investment Protection Act on the Chesters franchise agreement's provisions regarding litigation?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
In the event of a conflict of laws, the provisions of the Washington Franchise Investment Protection Act, chapter 19.100 RCW will prevail.
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.
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).
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)
According to Chesters's 2025 Franchise Disclosure Document, the Washington Franchise Investment Protection Act (WFIPA) significantly impacts the franchise agreement, particularly concerning litigation. The addendum to the franchise agreement specifies that if there is a conflict of laws, the provisions of the WFIPA will take precedence. This means that certain provisions in the standard Chesters franchise agreement may be superseded or deemed unenforceable in Washington state if they conflict with the WFIPA.
Specifically, the FDD states that if litigation is not precluded by the franchise agreement, a franchisee has the right to bring legal action related to the sale of the franchise or violations of the WFIPA within Washington. Moreover, any attempt to enforce a release or waiver of rights that would prevent a franchisee from complying with the WFIPA is void, unless it's part of a negotiated settlement with independent legal representation. Provisions that unreasonably restrict the statute of limitations for claims or rights under the WFIPA, including the right to a jury trial, may also be unenforceable.
These stipulations provide additional protection to Chesters franchisees in Washington, ensuring that they are not bound by franchise agreement terms that contravene state law. Prospective franchisees should be aware of these protections and consult with legal counsel to fully understand their rights under the WFIPA. This also means that Chesters must adhere to Washington law, and the WFIPA, when enforcing the franchise agreement within the state.