For Chick Fil A franchisees in Virginia, does the integration/merger clause in the Franchise Agreement supersede applicable state law as outlined in Exhibit G?
Chick_Fil_A Franchise · 2025 FDDAnswer from 2025 FDD Document
No statement, questionnaire, or acknowledgment signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
Each provision of this Addendum to the Franchise Disclosure Document shall be effective only to the extent, with respect to such provision, that the jurisdictional and other requirements of the Virginia Retail Franchising Act, §§13.1-557 et seq. of the Code of Virginia, are met independently without reference to this Addendum to the Franchise Disclosure Document. This Addendum shall have no force or effect if such jurisdictional or other requirements are not met.
Item 17 of the Franchise Disclosure Document is supplemented by adding the following at the end:
Pursuant to 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.
Source: Item 23 — Receipts (FDD pages 103–600)
What This Means (2025 FDD)
According to Chick Fil A's 2025 Franchise Disclosure Document, the integration/merger clause in the Franchise Agreement does not supersede applicable state law for franchisees in Virginia. Specifically, a new Section 28.19 is added to the Franchise Agreement, stating that no statement, questionnaire, or acknowledgment signed by a franchisee can waive claims under state franchise law, including fraud in the inducement, or disclaim reliance on franchisor statements. This provision explicitly supersedes any other conflicting term in any document related to the franchise. This ensures that franchisees retain their rights and protections under Virginia law, regardless of any agreements they may sign during the commencement of the franchise relationship.
Furthermore, the Virginia Addendum to the Franchise Disclosure Document reinforces this protection. It states that each provision of the addendum is effective only to the extent that it meets the jurisdictional and other requirements of the Virginia Retail Franchising Act, §§13.1-557 et seq. of the Code of Virginia, independently of the addendum itself. This means that if any part of the addendum does not comply with Virginia law, it will not be enforced. This ensures that the state's franchise laws take precedence over any potentially conflicting terms in the franchise agreement or related documents.
Chick Fil A's approach in Virginia reflects a commitment to complying with state-specific franchise regulations. This is further emphasized by the acknowledgment that it is unlawful for a franchisor to cancel a franchise without reasonable cause, as defined by the Virginia Retail Franchising Act. If any termination grounds in the franchise agreement do not meet this standard of "reasonable cause" under Virginia law, those provisions may not be enforceable. This provides an additional layer of protection for Chick Fil A franchisees in Virginia, ensuring that their franchise cannot be terminated without proper justification under state law.