Which state's law governs the Market Reservation Agreement for Epcon Communities?

According to the 2025 Epcon Communities Franchise Disclosure Document, the Market Hold Agreement is governed by Illinois law when an addendum is in place for the state of Illinois. Specifically, the addendum states that Illinois law governs the Market Hold Agreement, overriding any conflicting terms in the original agreement. This addendum is in conformance with the Illinois Franchise Disclosure Act, which voids any provision designating jurisdiction and venue outside of Illinois, although arbitration outside the state is permitted. Additionally, the addendum ensures that franchisees cannot waive compliance with the Illinois Franchise Disclosure Act or any other Illinois law.

For a prospective Epcon Communities franchisee in Illinois, this means that any legal disputes related to the Market Hold Agreement will be subject to Illinois law, providing a level of protection under the state's franchise regulations. The franchisee's rights upon termination and non-renewal are protected by sections 19 and 20 of the Illinois Franchise Disclosure Act. This ensures that the franchisee's legal recourse and venue for disputes are within Illinois, which can be beneficial in terms of convenience and familiarity with local laws.

However, it's important to note that this addendum applies specifically to the Market Hold Agreement and only in Illinois. For other agreements or in other states, different governing laws may apply. For instance, the standard Market Hold Agreement states that it shall be interpreted, construed, and governed by the local laws of the State of Ohio, without application of its conflicts of laws principles. Therefore, franchisees should carefully review all agreements and any state-specific addenda to understand which laws govern their specific situation. Franchisees should also consult with legal counsel to fully understand their rights and obligations under these agreements.