Does the Crisp & Green franchise agreement allow franchisees to disclaim reliance on statements made by the franchisor or its 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, franchisees in certain states cannot disclaim reliance on statements made by Crisp & Green or its representatives. Specifically, a statement, questionnaire, or acknowledgment signed by a franchisee cannot waive claims under state franchise law, including fraud in the inducement, or disclaim reliance on statements made by the franchisor, franchise seller, or anyone acting on behalf of the franchisor. This provision overrides any conflicting terms in any document related to the franchise agreement. This protection applies to 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 means that Crisp & Green franchisees in the listed states retain their legal rights to pursue claims based on misrepresentations or fraudulent statements made during the franchise sales process. This is a significant protection for franchisees, as it prevents Crisp & Green from using standard contract language to shield itself from liability for misleading information.
However, it is important to note that these protections are specific to the states listed. Franchisees in other states may not have the same level of protection against disclaimers of reliance. Additionally, the addenda often include stipulations that their provisions are effective only to the extent that they independently meet the jurisdictional requirements of the relevant state laws, without relying on the addendum itself. This means that franchisees need to be aware of the specific franchise laws in their state and how they interact with the franchise agreement.