Does the Crisp & Green franchise agreement allow a franchisee to disclaim reliance on statements made by the franchisor or their representatives?
Crisp_Green Franchise · 2024 FDDAnswer from 2024 FDD Document
The following provision applies only to franchisees and franchises that are subject to the state franchise registration/disclosure laws in California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, or Wisconsin:
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 our behalf. This provision supersedes any other term of any document executed in connection with the franchise.
Source: Item 23 — RECEIPTS (FDD pages 66–252)
What This Means (2024 FDD)
According to the 2024 Crisp & Green Franchise Disclosure Document, in certain states, the franchise agreement does not allow a franchisee to disclaim reliance on statements made by the franchisor or their representatives. Specifically, a statement, questionnaire, or acknowledgment signed by a franchisee at the start of the franchise relationship cannot waive claims under state franchise law, including fraud, or disclaim reliance on statements made by the franchisor, franchise seller, or anyone acting on their behalf. This rule overrides any conflicting terms in other franchise documents for franchisees subject to franchise registration/disclosure laws in California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, or Wisconsin.
This provision is beneficial for prospective Crisp & Green franchisees in the listed states because it protects their right to pursue legal claims based on misrepresentations or fraudulent statements made during the franchise sales process. It ensures that franchisees cannot inadvertently waive their right to hold Crisp & Green accountable for their statements.
However, it is important to note that these protections apply specifically to claims arising under state franchise laws. The FDD addenda also include state-specific modifications and clarifications, such as those for Maryland and Virginia, which address additional legal considerations within those states. Franchisees should carefully review the addenda applicable to their state to understand the full scope of their rights and obligations.
For franchisees outside of the listed states, it is not specified whether similar protections apply, so it would be prudent to consult with a legal professional to understand their rights and potential limitations regarding reliance on franchisor statements.