Does the Engel & Volkers guarantee remain in effect after the license terms?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
- 19.3 Any continuance of business relations between Franchisor and Franchisee after the termination or expiration of this Agreement will not constitute, and may not be construed as, a reinstatement, renewal, extension or continuation of this Agreement unless Franchisee and Franchisor expressly agree in writing to any such renewal, extension or continuation. If Franchisee continues to operate the franchised Business after the termination or expiration of the Term, without any further agreement in writing signed by Franchisor, such continuation will be a violation of Franchisor's rights to the ENGEL & VÖLKERS System and the Trademarks, provided that Franchisee's obligations as set forth in this Agreement and Franchisor's rights will continue to apply until such time that Franchisee ceases operations under the ENGEL & VÖLKERS System and the Trademarks.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
Based on the 2025 Engel & Volkers Franchise Disclosure Document, the terms and conditions after the agreement's termination or expiration are not explicitly detailed regarding the continuation of any guarantees. However, the document does state that if a franchisee continues to operate the franchised business after the term's termination or expiration without a written agreement from the franchisor, it will be considered a violation of Engel & Volkers' rights to their system and trademarks. Despite this, the franchisee's obligations and the franchisor's rights, as outlined in the agreement, will remain applicable until the franchisee ceases operations under the Engel & Volkers system and trademarks.
This implies that certain obligations and rights might extend beyond the formal term of the agreement, particularly if the franchisee continues to operate under the Engel & Volkers brand. However, the specifics of whether guarantees remain in effect are not clearly defined. The FDD mentions that any continuation of business relations without a written agreement will not be construed as a renewal or extension of the agreement unless expressly agreed upon in writing by both parties.
Therefore, it is essential for a prospective franchisee to seek clarification from Engel & Volkers regarding the status of any guarantees post-termination or expiration of the franchise agreement. Understanding whether these guarantees continue to apply, and under what conditions, is crucial for assessing the long-term risks and benefits associated with the franchise. This information would help in making an informed decision about investing in an Engel & Volkers franchise.