What is the Engel & Volkers franchisee's obligation regarding reliance on representations?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
26.13 Acknowledgements of Franchisee:
Franchisee represents, warrants and acknowledges the following statements to be true and correct as of the date Franchisee signs this Agreement, and to be binding on Franchisee:
26.13.1 Franchisee has conducted an independent investigation of the business contemplated by this Agreement.
26.13.2 Franchisee represents that, as an inducement to Franchisor's entry into this Agreement, it has made no misrepresentations in obtaining this agreement.
26.13.3 Franchisee is aware of the fact that other present or future franchisees may operate under different forms of agreement(s), and consequently that Franchisor's obligations and rights with respect to its various franchisees may differ materially
in certain circumstances. Any such variances Franchisor determines for other franchisees, do not grant Franchisee any rights or entitle Franchisee to request a similar modification under this Agreement.
26.13.4 No representation or statement has been made by Franchisor or its affiliates (or any of its or their officers, directors, managers, employees, agents or salespersons) regarding Franchisee's anticipated income, earnings and growth of the franchised Business or that of the ENGEL & VÖLKERS System, or the viability of the business opportunity being offered under this Agreement.
26.13.5 Before executing this Agreement, Franchisee has had the opportunity to contact all of Franchisor's existing franchisees.
26.13.6 Franchisee has received from Franchisor a copy of Franchisor's franchise disclosure document, together with a copy of all proposed agreements relating to the sale of the franchise, at least fourteen (14) calendar days before the execution of this Agreement or at least fourteen (14) calendar days before the payment by Franchisee to Franchisor any consideration in connection with the sale or proposed sale of the franchise granted by this Agreement.
26.13.7 Franchisee understands that the franchise relationship is an arms' length, commercial business relationship in which each party acts in its own interest.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, franchisees acknowledge several key points regarding their entry into the franchise agreement. Engel & Volkers requires franchisees to confirm that they have conducted their own independent investigation of the business opportunity. This means franchisees cannot later claim they relied solely on information provided by Engel & Volkers without doing their own due diligence.
Engel & Volkers also requires franchisees to acknowledge that they haven't made any misrepresentations to induce Engel & Volkers into the agreement. Furthermore, franchisees acknowledge that Engel & Volkers makes no guarantees about anticipated income, earnings, or the growth of the franchised business or the Engel & Volkers system as a whole. This protects Engel & Volkers from liability if a franchisee's business underperforms. Franchisees confirm they had the opportunity to contact existing franchisees before signing the agreement, encouraging them to gather firsthand information about the business.
Finally, Engel & Volkers requires franchisees to acknowledge they received the Franchise Disclosure Document (FDD) and all related agreements at least 14 calendar days before signing the agreement or paying any consideration. This 14-day period allows franchisees time to review the documents and seek professional advice. The franchisee also acknowledges that the franchise relationship is an arm's length, commercial business relationship where each party acts in its own interest. This reinforces the independent nature of the franchise and limits potential claims against Engel & Volkers based on reliance.