In Michigan, what constitutes 'good cause' for Deer Solution to terminate a franchise agreement?
Deer_Solution Franchise · 2025 FDDAnswer from 2025 FDD Document
Amendments to the Deer Solution Franchise Disclosure Document
THE STATE OF MICHIGAN PROHIBITS CERTAIN UNFAIR PROVISIONS THAT ARE SOMETIMES IN FRANCHISE DOCUMENTS.
IF ANY OF THE FOLLOWING PROVISIONS ARE IN THESE FRANCHISE DOCUMENTS, THE PROVISIONS ARE VOID AND CANNOT BE ENFORCED AGAINST YOU.
- C.
A provision that permits us to terminate a franchise before the expiration of this term except for good cause.
Good cause shall include, but is not limited to:
(i) The failure of the proposed transferee to meet our then current reasonable qualifications or standards.
(ii) The fact that the proposed transferee is our or Sub-franchisor's competitor.
(iii) The unwillingness of the proposed transferee to agree in writing to comply with all lawful obligations.
(iv) Your or proposed transferee's failure to pay us any sums or to cure any default in the Franchise Agreement existing at the time of the proposed transfer.
Source: Item 23 — RECEIPTS (FDD pages 55–246)
What This Means (2025 FDD)
According to Deer Solution's 2025 Franchise Disclosure Document, the Michigan FDD Amendment states that a provision permitting Deer Solution to terminate a franchise before the expiration of its term is void and cannot be enforced against the franchisee, except for good cause. The FDD specifies examples of what constitutes 'good cause'.
'Good cause' includes situations related to the transfer of the franchise. Specifically, good cause exists if the proposed transferee does not meet Deer Solution's current reasonable qualifications or standards, if the proposed transferee is a competitor of Deer Solution or its sub-franchisor, or if the proposed transferee is unwilling to agree in writing to comply with all lawful obligations. Additionally, failure of the franchisee or proposed transferee to pay any sums due to Deer Solution or to cure any default in the Franchise Agreement at the time of the proposed transfer also constitutes good cause.
This amendment clarifies the rights of Deer Solution franchisees in Michigan, ensuring that they cannot be terminated without a legitimate reason. It provides a degree of protection to franchisees against arbitrary termination. A prospective franchisee should carefully consider these provisions and seek legal counsel to fully understand their rights and obligations under Michigan law.