What law governs the provisions of the Chesters franchise agreement, including those summarized in Item 17?
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.
VIRGINIA
Additional Disclosure. The following statements are added to Item 17.h.
In recognition of the restrictions contained in Section 13.1-564 of the Virginia Retail Franchising Act, the Franchise Disclosure Document for CHESTER'S INTERNATIONAL, LLC, an Alabama limited liability company, for use in the Commonwealth of Virginia shall be amended as follows:
Under Section 13.1-564 of the Virginia Retail Franchising Act, it is unlawful for a franchisor to cancel a franchise without reasonable cause. If any grounds for default or termination stated in the franchise agreement does not constitute "reasonable cause," as that term may be defined in the Virginia Retail Franchising Act or the laws of Virginia, that provision may not be enforceable.
WASHINGTON
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.
- 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.
Source: Item 23 — **RECEIPTS (FDD pages 48–197)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, the franchise agreement's governing law, including provisions in Item 17, is subject to state-specific regulations. For North Dakota franchisees, North Dakota law applies, except for federal law. In Rhode Island, the franchise agreement is governed by Alabama law, except for federal law and as required by the Rhode Island Franchise Investment Act. For franchisees in Washington, the Washington Franchise Investment Protection Act (chapter 19.100 RCW) takes precedence in case of conflicting laws.
For California franchisees, the agreement requires application of Alabama laws, but this might not be enforceable under California law. Additionally, California Business and Professions Code Sections 20000 through 20043 provide rights to franchisees concerning transfer, termination, or nonrenewal of a franchise, and if the agreement contains a provision inconsistent with this law, the law will control. For franchisees in New York, the choice of law should not be considered a waiver of any right conferred upon the franchisor or the franchisee by Article 33 of the General Business Law of the State of New York.
These stipulations mean that the governing law of the Chesters franchise agreement can vary significantly depending on the franchisee's location. Prospective franchisees should be aware that certain provisions in the franchise agreement may be superseded or modified by state laws, offering additional protections or imposing different requirements than what is initially outlined in the agreement. It is important for franchisees to understand the specific legal landscape of their state to ensure compliance and protect their rights.