Can Cream waive rights due to custom or practice at variance with the Franchise Agreement?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 23: RECEIPTS]
B. WAIVER OF OBLIGATIONS.
We and you may by written instrument unilaterally waive or reduce any obligation of or restriction upon the other under this Agreement, effective upon delivery of written notice to the other or another effective date stated in the notice of waiver. Any waiver granted will be without prejudice to any other rights we or you have, will be subject to continuing review, and may be revoked at any time and for any reason effective upon delivery of 10 days' prior written notice.
No right, power, or option you or we are provided under this Agreement will be impaired or waived because of any custom or practice at variance with this Agreement's terms or your or our failure, refusal, or neglect to exercise any right under this Agreement or to insist upon the other's compliance with this Agreement, including any System Standard; our waiver of or failure to exercise any right, power, or option, whether of the same, similar, or different nature, with other Jeni's Ice Creams Scoop Shops; the existence of area development agreements for other Jeni's Ice Creams Scoop Shops which contain provisions different from those contained in this Agreement; or our acceptance of any payments due from you after any breach of this Agreement. No special or restrictive legend or endorsement on any check or similar item given to us will be a waiver, compromise, settlement, or accord and satisfaction. We are authorized to remove any legend or endorsement, which then will have no effect.
The following provision applies if you or the franchise granted hereby are subject to the franchise registration or disclosure laws in Illinois, Indiana, Maryland, Michigan, Minnesota, Virginia, or Wisconsin: 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 (1) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (2) 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 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, neither Cream nor the franchisee will waive or impair any right, power, or option reserved in the Franchise Agreement due to custom or practice that differs from the agreement's terms. This includes instances of failure, refusal, or neglect to exercise rights under the agreement or to insist on compliance with System Standards. This also applies to Cream's waiver or failure to exercise rights with other Jeni's Ice Creams Scoop Shops, the existence of different provisions in other franchise agreements, or Cream's acceptance of payments after a breach of the agreement.
This provision protects Cream from inadvertently waiving its rights if it doesn't strictly enforce every term of the agreement. It also ensures that franchisees cannot claim a waiver of Cream’s rights based on past practices or inconsistencies. The clause regarding special or restrictive legends on checks further reinforces Cream's position by allowing them to remove such legends without it constituting a waiver or compromise.
Furthermore, Cream and the franchisee can unilaterally waive or reduce any obligation or restriction upon the other under the agreement via written instrument, effective upon delivery of written notice. Any waiver granted will be without prejudice to any other rights, subject to continuing review, and may be revoked at any time for any reason with 10 days' prior written notice. This provides a mechanism for temporary adjustments to the agreement while preserving the long-term enforceability of its original terms.
However, if the franchise is subject to registration laws in Illinois, Indiana, Maryland, Michigan, Minnesota, Virginia, or Wisconsin, no statement signed by the franchisee can waive claims under applicable state franchise law, including fraud in the inducement, or disclaim reliance on statements made by Cream or its representatives. This provision supersedes any other term in the franchise agreement, providing additional protection to franchisees in those states.