In which states does the 'No Waiver or Disclaimer of Reliance' provision apply to Craters & Freighters franchisees?
Craters_Freighters 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.
In recognition of the restrictions contained in Section 13.1-564 of the Virginia Retail Franchising Act, the Franchise Disclosure Document for Craters & Freighters Franchise Company for use in the Commonwealth of Virginia shall be amended as follows:
Additional Disclosure. The following statements are added to Item 17.h.
Under 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."
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 behalf of us. This provision supersedes any other term of any document executed in connection with the franchise.
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.
In conformance with section 41 of the Illinois Franchise Disclosure Act, any condition, stipulation or provision purporting to bind any person acquiring any franchise to waive compliance with the Illinois Franchise Disclosure Act or any other law of Illinois is void.
The following language is added to the Franchise Agreement: "All representations requiring prospective franchisees to assent to a release, estoppel or waiver of liability are not intended to nor shall they act as a release, estoppel or waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law."
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 behalf of us. This provision supersedes any other term of any document executed in connection with the franchise.
Source: Item 22 — CONTRACTS (FDD pages 49–50)
What This Means (2025 FDD)
According to the 2025 Craters & Freighters Franchise Disclosure Document, a 'No Waiver or Disclaimer of Reliance' provision applies to franchisees in California, Virginia, Washington, Illinois, Maryland and Minnesota. This provision ensures that no statement, questionnaire, or acknowledgment signed by the franchisee can waive claims under state franchise law, including fraud in the inducement, or disclaim reliance on statements made by Craters & Freighters or its representatives. This protection supersedes any conflicting terms in the franchise agreement.
For a prospective Craters & Freighters franchisee, this means that they retain their rights under state franchise laws, regardless of any agreements signed during the franchise commencement. They can still pursue claims of fraud or misrepresentation based on statements made by the franchisor. This provision aims to protect franchisees from unknowingly waiving their legal rights or being bound by disclaimers that limit their ability to rely on the franchisor's representations.
It is important to note that while the FDD specifies that Illinois law governs the Franchise Agreement, it also states that any provision designating jurisdiction and venue outside of Illinois is void, although arbitration outside of Illinois is permitted. Additionally, the FDD outlines specific statutory rights for franchisees in Minnesota, including termination and non-renewal rights, and prohibits certain requirements such as litigation outside Minnesota or waivers of jury trials. In Maryland, specific revisions are made to termination clauses and forum selection to align with the Maryland Franchise Registration and Disclosure Law.
Therefore, prospective franchisees should carefully review the specific addenda and modifications applicable to their state of operation to fully understand their rights and obligations under the Craters & Freighters franchise agreement.