To which court jurisdiction does an Engel & Volkers franchisee irrevocably submit?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
r conflicts of law principles. If, however, any provision of this Agreement would not be enforceable under the laws of New York, and if the franchised ENGEL & VÖLKERS Business is located outside of New York and the provision would be enforceable under the laws of the state in which the franchised ENGEL & VÖLKERS Business is located, then the provision (and only that provision) will be interpreted and construed under the laws of that state. Nothing in this Agreement is intended to invoke the application of any franchise, business opportunity, antitrust, "implied covenant", unfair competition, fiduciary or any other doctrine of law of the State of New York or any other state, which would not otherwise apply. Recipient further agrees that any litigation arising out of or related to this Agreement; any breach of this Agreement; and, all relations and any and all disputes between Recipient on the one hand, and Franchisor on the other hand, whether sounding in contract, tort, or otherwise, will be instituted exclusively in a state or federal court of competent jurisdiction located in New York, NY. Recipient agrees that any dispute as to the venue for this litigation will be submitted to and resolved exclusively by a state or federal court of competent jurisdiction situated in New York, NY. Recipient hereby waives and covenants never to assert or claim that said venue is for any reason improper, inconvenient, prejudicial or otherwise inappropriate (including, without limitation, any claim under the judicial doctrine of forum non conveniens).
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- This Agreement together with the Franchise Agreement constitutes the entire agreement and understanding among the parties hereto with respect to the disclosure of Confidential Information to Recipient and Recipient's non-competition obligations, and shall not be amended except pursuant to a written agreement executed by each of the parties hereto. This Agreement shall be binding upon the parties hereto and their respective heirs, administrators, successors and assigns.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers's 2025 Franchise Disclosure Document, franchisees generally submit to the jurisdiction of courts located in New York, NY for litigation related to the franchise agreement. Specifically, the franchisee irrevocably submits to the jurisdiction of a state or federal court of competent jurisdiction located in New York, NY. Franchisees also agree that any disputes regarding the venue will be resolved exclusively by these courts. This means that if Engel & Volkers and a franchisee have a legal dispute, the case will most likely be heard in New York, regardless of where the franchisee's business is located.
This requirement has significant implications for prospective franchisees. It means that a franchisee based in California, for example, would likely need to travel to New York for any legal proceedings against Engel & Volkers. This could substantially increase the franchisee's legal costs due to travel expenses, local counsel fees, and the inconvenience of being away from their business.
However, there are exceptions. Engel & Volkers retains the right to bring action against a franchisee in any county, state, or federal district court that has jurisdiction for matters concerning monies owed, or involving possession or disposition of the franchised business. This exception appears to benefit Engel & Volkers, allowing them to pursue legal action closer to the franchisee's location in specific circumstances, while the franchisee is generally bound to New York courts.
The franchisee also waives the right to claim that New York is an improper or inconvenient venue. This waiver further solidifies the franchisor's ability to litigate in their preferred location. Prospective franchisees should carefully consider these venue provisions and the potential costs associated with litigating disputes in New York before investing in an Engel & Volkers franchise.