Under Washington law, what is the limitation on transfer fees for a Christian Brothers Automotive franchise?
Christian_Brothers_Automotive Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Nonsolicitation Agreements. RCW 49.62.060 prohibits a franchisor from restricting, restraining, or prohibiting a franchisee from (i) soliciting or hiring any employee of a franchisee of the same franchisor or (ii) soliciting or hiring any employee of the franchisor. As a result, any such provisions contained in the franchise agreement or elsewhere are void and unenforceable in Washington.
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- Questionnaires and Acknowledgments. 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.
Source: Item 22 — CONTRACTS (FDD page 76)
What This Means (2025 FDD)
The 2025 Christian Brothers Automotive Franchise Disclosure Document states that certain provisions within the franchise agreement that might limit a franchisee's rights are void and unenforceable in Washington state.
Specifically, Washington law, under RCW 49.62.060, prevents Christian Brothers Automotive from restricting or prohibiting a franchisee from soliciting or hiring employees of either another franchisee within the Christian Brothers Automotive system or employees of the franchisor itself. This means that any clause in the franchise agreement that attempts to prevent a franchisee from hiring within the system is not enforceable in Washington.
Additionally, any statement, questionnaire, or acknowledgment signed by a franchisee at the start of their franchise relationship cannot waive claims under Washington franchise law, including claims of fraud, or disclaim reliance on statements made by Christian Brothers Automotive or its representatives. This ensures that franchisees in Washington retain their legal rights and protections despite any agreements they may have signed.
The FDD emphasizes that this provision overrides any conflicting terms in any document related to the franchise, reinforcing the priority of Washington state law in protecting franchisees' rights.