What is the effect of representations requiring prospective Ella Cafe franchisees in Maryland to disclaim or acknowledge certain acts, according to the amendment?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
- Any portion of the Franchise Agreement which requires prospective franchisees to disclaim the occurrence and/or acknowledge the non-occurrence of acts would constitute a violation of the Maryland Franchise Registration and Disclosure Law. Any such representations are not intended to nor shall they act as a release, estoppel or waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law.
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- 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 behalf of 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 50)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, any part of the Franchise Agreement that asks potential franchisees in Maryland to deny something happened or admit something didn't happen would break Maryland's franchise laws. These statements won't release, prevent, or waive any responsibility under Maryland's franchise regulations.
In simpler terms, Ella Cafe cannot use the franchise agreement to get franchisees in Maryland to give up their rights or claims under Maryland law. This means that even if a franchisee signs something that seems to waive their rights, it won't be valid if it violates Maryland's franchise regulations. This protects franchisees from unknowingly giving up their legal protections.
Furthermore, no signed statement or questionnaire by a franchisee can waive claims under state franchise law, including fraud, or disclaim reliance on anyone acting for Ella Cafe. This rule overrides any other conflicting terms in any document related to the franchise agreement, reinforcing the protection for franchisees in Maryland.