What are the potential consequences if Chesters repurchases a franchisee's business without good cause in Washington?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
Certain Buy-Back Provisions.
Provisions in franchise agreements or related agreements that permit the franchisor to repurchase the franchisee's business for any reason during the term of the franchise agreement without the franchisee's consent are unlawful pursuant to RCW 19.100.180(2)(j), unless the franchise is terminated for good cause.
Source: Item 23 — **RECEIPTS (FDD pages 48–197)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, if the franchise agreement allows Chesters to repurchase a franchisee's business during the term for any reason without the franchisee's consent, such provisions are unlawful in Washington, unless the franchise is terminated for good cause. This is based on RCW 19.100.180(2)(j).
This means that Chesters cannot arbitrarily repurchase a franchise in Washington without a legitimate reason that constitutes 'good cause.' If Chesters attempts to do so, the franchisee may have legal recourse under the Washington Franchise Investment Protection Act.
This protection ensures that Chesters franchisees in Washington are not subject to unfair or capricious buy-backs of their businesses, providing a more stable and predictable business environment. Franchisees should ensure they understand what constitutes 'good cause' for termination under Washington law to protect their investment.