If a Cicis franchisee is subject to franchise registration or disclosure laws, can they disclaim reliance on statements made by a franchise seller acting on behalf of the franchisor?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
The following provision applies if you or the franchise granted hereby are subject to the franchise registration or disclosure laws of Illinois, Indiana, Maryland or Virginia: 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. No delay, waiver, omission, or forbearance to exercise any right, option, duty, or power arising out of any breach or default by a party will constitute a waiver of the right to enforce any such right, option, duty, or power, or as to a subsequent breach or default. Acceptance by us of any payments after their due date will not be deemed a waiver of any preceding breach of your or your related parties' obligations however those obligations arise.
Source: Item 22 — CONTRACTS (FDD pages 64–65)
What This Means (2025 FDD)
According to the 2025 Cicis Franchise Disclosure Document, if a franchisee is subject to franchise registration or disclosure laws in Illinois, Indiana, Maryland, or Virginia, they cannot disclaim reliance on statements made by Cicis, its franchise sellers, or anyone acting on its behalf. This protection extends to claims under applicable state franchise laws, including fraud in the inducement.
This provision ensures that franchisees in these specific states retain their legal rights and recourse, preventing Cicis from enforcing any agreement that would waive their ability to claim they relied on misrepresentations during the franchise sales process. This is particularly important because the franchise sales process often involves various communications and representations that may influence a franchisee's decision.
This clause supersedes any other conflicting terms in any document executed in connection with the franchise, reinforcing its importance. Additionally, any delay or failure by Cicis to exercise its rights does not constitute a waiver of those rights, nor does accepting late payments from the franchisee waive Cicis's right to address prior breaches of obligations.