For Del Taco franchisees in Maryland, what is the effect of any statement, questionnaire, or acknowledgment signed in connection with the commencement of the franchise relationship regarding waiving claims under state franchise law?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 17: RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION]
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 (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 in connection with the franchise.
MARYLAND
In recognition of the requirements of the Maryland Franchise Registration and Disclosure Law, the Disclosure Document, Franchise Agreement and Development Agreement shall be modified as follows:
Item 17 of the Disclosure Document provides for termination upon bankruptcy. This provision may not be enforceable under Federal Bankruptcy Law (11 U.S.C.A Sec. 101 et seq.).
Item 17 of the Disclosure Document is amended to state "The general release required as a condition of renewal, sale, and/or assignment/transfer shall not apply to any liability under the Maryland Franchise Registration and Disclosure Law."
Item 17 of the Disclosure Document is amended to state "Any claim arising under the Maryland Franchise and Disclosure Law must be brought within 3 years after the grant of the franchise."
Item 17(v) of the Disclosure Document is amended to state "A Franchisee may bring a lawsuit in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law."
In recognition of the requirements of the Maryland Franchise Registration and Disclosure Law, the Franchise Agreement shall be modified as follows:
A Franchisee may bring a lawsuit in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law.
The parties amend Section 20 of the Development Agreement by adding the following sentence: "This section shall not abrogate or reduce any rights of the Developer as provided for under the Maryland Franchise Registration and Disclosure Law, including the right to submit matters to the jurisdiction of the courts of Maryland." Any risk factor warnings included on the cover page of the Franchisor's Franchise Disclosure Document inconsistent with the Maryland Franchise Registration and Disclosure Law shall not apply to Maryland franchisees.
[Item 17: RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION]
Payment of the Initial Franchise Fee and other initial fees owing to us under the Franchise Agreement and Development Agreement are hereby deferred and will be payable upon completion of Franchisor's pre-opening obligations for your Restaurant (or your first Restaurant as to the Development Agreement).
The general release required as a condition of renewal, sale, and/or assignment/transfer shall not apply to any liability under the Maryland Franchise Registration and Disclosure Law.
Any provision contained in the Section 17.1 of the Franchise Agreement that requires the Franchisee to assent to a release, estoppel, or waiver of liability is not intended to nor shall it act as a release estoppel or waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law.
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 (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 in connection with the franchise.
{See the last page of this Exhibit F for your Signature.}
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 42–46)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, any statement, questionnaire, or acknowledgment signed by a franchisee in Maryland at the start of their franchise relationship cannot waive claims under Maryland franchise law. This includes claims related to fraud in the inducement. This protection is explicitly designed to uphold the franchisee's rights under the Maryland Franchise Registration and Disclosure Law.
Specifically, the FDD states that the general release required for renewal, sale, or transfer of the franchise does not apply to liabilities arising under the Maryland Franchise Registration and Disclosure Law. Furthermore, any provision requiring a franchisee to release, waive, or be estopped from liability will not act as such a release, estoppel, or waiver regarding the Maryland Franchise Registration and Disclosure Law.
Additionally, the FDD clarifies that a Del Taco franchisee in Maryland has the right to bring a lawsuit in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law. Any risk factor warnings in Del Taco's Franchise Disclosure Document that conflict with Maryland Franchise Registration and Disclosure Law will not apply to Maryland franchisees. These stipulations ensure that Maryland franchisees retain their legal rights and protections under state law, regardless of any standard agreements or releases.