What conditions must be met for a release or waiver of rights to be valid for a Chicken Guy franchise?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
s contain liquidated damages clauses. Under California Civil Code Section 1671, certain liquidated damages clauses are unenforceable.
You must sign a general release upon execution of the franchise and development agreements, if you transfer the rights granted under those agreements and if you renew your franchise under the franchise agreement. These provisions may not be enforceable under California law. California Corporations Code Section 31512 voids a waiver of your rights under the Franchise Investment Law (California Corporations Code Sections 31000 through 31516). Business and Professions Code Section 21000 voids a waiver of your rights under the Franchise Relations Act (Business and Professions Code Sections 20000 through 20043).
To obtain a liquor license in California, you must apply in-person with the State of California Department of Alcoholic Beverage Control, at your district office ("Department"). The Department will conduct an investigation, and you are responsible for posting a public notice and furnishing any additional notices or information requested by the Department. An application for a liquor license in California can take from 55 to 175 days or more to be approved, depending on the circumstances. For more information, please visit https://www.abc.ca.gov/ or call the Department at 916.419.2500.
5. Item 22, Additional Disclosure. The following statements are added to Item 22:
No statement, questionnaire, or acknowledgement signed or agreed to by you 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 us, any franchise seller, or any other person acting on our behalf. This provision supersedes any other term of any document executed in connection with the franchise.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 40–46)
What This Means (2025 FDD)
According to the 2025 Chicken Guy FDD, the validity of releases or waivers of rights is subject to specific state laws, particularly in California, Maryland, and Minnesota. In California, while Chicken Guy requires franchisees to sign a general release upon execution of franchise and development agreements, transfer of rights, and franchise renewal, these provisions may not be enforceable under California law. Specifically, California Corporations Code Section 31512 voids waivers of rights under the Franchise Investment Law, and Business and Professions Code Section 20000 voids waivers under the Franchise Relations Act. This means that even if a franchisee signs a release, certain rights under California franchise laws cannot be waived. Prospective franchisees in California should be aware that these protections exist despite any contractual requirements to the contrary.
In Maryland, the Maryland Franchise Registration and Disclosure Law prohibits Chicken Guy from requiring a prospective franchisee to assent to any release, estoppel, or waiver of liability as a condition of purchasing a franchise. Furthermore, 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 statements made by Chicken Guy or its representatives. This provision supersedes any conflicting terms in franchise documents, providing strong protection for franchisees against unknowingly waiving their rights.
For franchises governed by Minnesota law, Chicken Guy cannot require a franchisee to assent to a release, assignment, novation, or waiver that would relieve any person from liability imposed by Minnesota Statute §§ 80C.01 - 80C.22. This ensures that franchisees in Minnesota retain their statutory rights and protections, regardless of any agreements they may sign. Prospective Chicken Guy franchisees should consult with legal counsel to understand the full scope of their rights and the implications of any release or waiver they are asked to sign, keeping in mind the specific protections afforded by state laws in California, Maryland, and Minnesota.