Under what conditions does Minnesota Franchise Law apply to Counselor Realty franchisees?
Counselor_Realty Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section(s) in Franchise or Other Agreement | Summary |
|---|---|---|
| j. Assignment of contract by franchisor | Section 9.4 | Counselor may transfer its interest in Franchise Agreement by notice to you |
| k. "Transfer" by franchisee -- definition | Section 9.1 | Includes transfer of your interest in Franchise Agreement, the Office, Business or Business assets, or an interest in your business entity or your owners |
| l. Franchisor approval of transfer by franchisee | Section 9.1 | Counselor has the right to consent to all transfers (other than a transfer of less than a majority interest in your business entity or your owners) and will consent if Counselor deems transferee qualified and conditions specified in Franchise Agreement are satisfied |
| m. Conditions for franchisor approval of transfer | Sections 9.1, 9.2 | Transferee qualifies; payment of transfer fee; payment of all amounts owing; renovation to then-current System standards; execution of guaranty by buyer's shareholders or owners |
| n. Franchisor's right of | Section 9.6 | Counselor has the right of first |
| first refusal to acquire | refusal to match any offer for your | |
| franchisee's business | Business | |
| o. Franchisor's option to | Not applicable | Not applicable |
| purchase franchisee's | ||
| business | ||
| p. Death or disability of franchisee | Section 9.3 | Decedent's (or disabled person's) executor, heir, successor or legal representative must apply for Counselor's consent to transfer within 60 days after death or incapacity, and comply with transfer provisions of Franchise Agreement |
| q. Non-competition covenants during the term of the franchise | Section 7.2 | No direct or indirect involvement in any different or competing real estate brokerage service business within 50 miles of Office; no solicitation of agents, employees or independent |
| Provision | Section(s) in Franchise or Other Agreement | Summary contractors of Counselor or any of Counselor's franchisees |
| r. Non-competition covenants after the franchise is terminated or expires | 7.2 | No solicitation of agents, employees or independent contractors of Counselor or any of Counselor's franchisees for 24- months post-termination |
| s. Modification of the agreement | Section 13.2 | No modifications generally but Franchise Policy Guidelines and licensed Marks subject to change by Counselor |
| t. Integration/merger clause | Section 13.1 | Only the terms of the Franchise Agreement are binding on Counselor |
| u. Dispute resolution by arbitration or mediation | Section 10.1 | Most disputes are resolved by individual binding arbitration conducted in Minneapolis, Minnesota |
| v. Choice of forum | Not applicable | Not applicable |
| w. Choice of law | Section 13.2 | Minnesota law applies (except Minnesota Franchises Law applies only to franchisees whose principal place of business is located in Minnesota and to whom Minnesota Franchise Act applies by its own terms) |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 25–29)
What This Means (2025 FDD)
According to Counselor Realty's 2025 Franchise Disclosure Document, Minnesota law generally applies to the franchise agreement. However, the Minnesota Franchise Law specifically applies only to Counselor Realty franchisees whose primary business location is within Minnesota and to whom the Minnesota Franchise Act applies based on its own terms. This means that while the franchise agreement itself is governed by Minnesota law, the additional protections and regulations of the Minnesota Franchise Act only extend to franchisees operating primarily within the state, subject to the specific provisions of that Act.
For a prospective Counselor Realty franchisee, this distinction is important. If you are planning to operate your franchise outside of Minnesota, the Minnesota Franchise Act will likely not apply to your franchise relationship. This could affect your rights and protections as a franchisee, particularly regarding dispute resolution, termination, and renewal.
It is advisable for potential franchisees to consult with legal counsel to fully understand the implications of this choice of law provision, especially if they are considering establishing a Counselor Realty franchise in Minnesota. Understanding which laws govern the franchise relationship is crucial for protecting your investment and ensuring compliance.