Does the Devon Creek Acknowledgement Statement allow a franchisee to disclaim reliance on statements made by the franchisor or their representatives?
Devon_Creek Franchise · 2024 FDDAnswer from 2024 FDD Document
No statement, questionnaire, or acknowledgment signed or agreed to by a franchisee (or developer) 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.
Source: Item 22 — CONTRACTS (FDD page 45)
What This Means (2024 FDD)
According to the 2024 Devon Creek Franchise Disclosure Document, the Acknowledgment Statement does not allow a franchisee to disclaim reliance on statements made by the franchisor or their representatives. Specifically, the Acknowledgment Statement includes a provision that ensures no statement signed by a franchisee can disclaim reliance on any statement made by the franchisor or anyone acting on their behalf. This protects the franchisee from unintentionally waiving their rights to hold Devon Creek accountable for representations made during the franchise sales process.
This provision in the Devon Creek Acknowledgement Statement explicitly prevents franchisees from disclaiming reliance on statements made by the franchisor or its representatives. This means that if a franchisee believes they were misled by information provided by Devon Creek during the franchise sales process, they retain the right to pursue claims based on that reliance, including claims of fraud in the inducement. This aspect of the agreement is designed to protect franchisees and ensure transparency in the franchise relationship.
This type of clause is not uncommon in franchise agreements, as many states have franchise laws that aim to protect franchisees from deceptive practices. By including this provision, Devon Creek is aligning its practices with these protective measures, ensuring that franchisees are not inadvertently waiving their rights. This can provide a level of comfort for prospective franchisees, knowing that they can rely on the information provided by the franchisor without fear of later being barred from raising concerns about its accuracy or truthfulness.