Does the Illinois addendum to the Crisp & Green FDD supersede other terms in documents executed with the franchise?
Crisp_Green Franchise · 2024 FDDAnswer from 2024 FDD Document
Notwithstanding anything to the contrary set forth in the Crisp & Green Franchising LLC Area Development Agreement, the following provisions shall supersede any inconsistent provisions and apply to all Crisp & Green franchises offered and sold in the state of Illinois:
This Illinois Addendum is only applicable if the developer is domiciled in Illinois or if the offer of the franchise is made or accepted in Illinois and the franchise business is or will be located in Illinois.
[Item 23: RECEIPTS]
No statement, questionnaire, or acknowledgement 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 with the franchise.
Each provision of this Addendum shall be effective only to the extent, with respect to such provision, that the jurisdictional requirements of the Illinois Franchise Disclosure Act of 1987 are met independently without reference to this Addendum to the Disclosure Document.
ADDENDUM TO CRISP & GREEN FRANCHISING LLC FRANCHISE DISCLOSURE DOCUMENT REQUIRED BY THE STATE OF ILLINOIS
Item 17 of this Disclosure Document is modified to include the following paragraph:
Sec. 705/4 of the Illinois Franchise Disclosure Act of 1987 provides that "any provision in a franchise/license agreement that designates jurisdiction or venue in a forum outside of Illinois is void."
Although the Franchise Agreement and Area Development Agreement provide that they will be governed by and construed in accordance with the laws of the State of Minnesota, we agree that the laws of the State of Illinois will govern the construction and interpretation of the Franchise Agreement and Area Development Agreement. The provisions of the Franchise Agreement and Area Development Agreement concerning governing law, jurisdiction, and venue shall not constitute a waiver of any right conferred on you by Illinois law.
Although the Franchise Agreement and Area Development Agreement require litigation to be instituted in the state courts located in the federal or state court for city closet where our principal executive office is located, except as you may be restricted by the arbitration provisions of the Franchise Agreement and Area Development Agreement, all litigation must be instituted in a court of competent jurisdiction located in the State of Illinois.
Source: Item 23 — RECEIPTS (FDD pages 66–252)
What This Means (2024 FDD)
According to the 2024 Crisp & Green Franchise Disclosure Document, the Illinois addendum does modify and supersede certain terms in the franchise and area development agreements for franchisees in Illinois. Specifically, the addendum states that certain provisions within these agreements are superseded by the stipulations within the Illinois addendum, especially concerning governing law, jurisdiction, and venue. This ensures that the franchisee retains all rights conferred by Illinois law, regardless of what the standard agreements might state. This addendum is applicable if the developer is domiciled in Illinois or if the offer of the franchise is made or accepted in Illinois and the franchise business is or will be located in Illinois.
For instance, the Illinois addendum modifies Item 17 of the disclosure document, addressing that any provision designating jurisdiction or venue outside of Illinois is void, as per the Illinois Franchise Disclosure Act of 1987. Furthermore, while the standard agreements might specify that Minnesota law governs, the addendum clarifies that Illinois law will govern the construction and interpretation of the agreements for Illinois franchisees. This ensures that Illinois franchisees are protected by their local laws and have the right to litigate within their own state.
Additionally, the Illinois addendum includes a provision that any statement, questionnaire, or acknowledgment signed by the franchisee cannot waive claims under Illinois franchise law, including fraud in the inducement, or disclaim reliance on statements made by Crisp & Green. This provision explicitly supersedes any other conflicting terms in any document executed in connection with the franchise. This is a crucial protection for franchisees, ensuring they cannot inadvertently forfeit their legal rights under Illinois law through standard contractual language.
However, it's important to note that each provision of the addendum is effective only to the extent that the jurisdictional requirements of the Illinois Franchise Disclosure Act of 1987 are met independently, without relying on the addendum itself. This means that the protections afforded by the addendum are contingent on the franchise meeting the legal requirements to be governed by Illinois franchise law in the first place. This condition ensures that the addendum's provisions are applied appropriately and legally.