In Michigan, under what circumstances can Goldfish Swim School refuse a transfer of ownership of a Goldfish Swim School franchise?
Goldfish_Swim_School Franchise · 2025 FDDAnswer from 2025 FDD Document
FOR THE STATE OF MICHIGAN
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- THE STATE OF MICHIGAN PROHIBITS CERTAIN UNFAIR PROVISIONS THAT ARE SOMETIMES IN FRANCHISE DOCUMENTS. IF ANY OF THE FOLLOWING PROVISIONS ARE IN THESE FRANCHISE DOCUMENTS, THE PROVISIONS ARE VOID AND CANNOT BE ENFORCED AGAINST YOU.
- A prohibition of your right to join an association of Franchisees.
- A requirement that you assent to a release, assignment, novation, waiver or estoppel that deprives you of rights and protections provided in this act. This shall not preclude you, after entering into a Franchise Agreement, from settling any and all claims.
- A provision that permits us to terminate a franchise prior to the expiration of this term except for good cause. Good cause shall include your failure to comply with any lawful provision of the Franchise Agreement and to cure the failure after being given written notice of the failure and a reasonable opportunity, which in no event need be more than 30 days, to cure the failure.
- A provision that permits us to refuse to renew a franchise without fairly compensating you by repurchase or other means for the fair market value at the time of expiration of your inventory, supplies, equipment, fixtures and furnishings. Personalized materials that have no value to us and inventory, supplies, equipment, fixtures and furnishings not reasonably required in the conduct of the Franchised Swim School are not subject to compensation. This subsection applies only if: (a) the term of the franchise is less than 5 years, and (b) you are prohibited by the franchise agreement or other agreement from continuing to conduct substantially the same business under another trademark, service mark, trade name, logotype, advertising or other commercial symbol in the same area subsequent to the expiration of the franchise or you do not receive at least 6 months advance notice of our intent not to renew the franchise.
- A provision that permits us to refuse to renew a franchise on terms generally available to other Franchisees of the same class or type under similar circumstances. This section does not require a renewal provision.
Source: Item 22 — CONTRACTS (FDD pages 76–77)
What This Means (2025 FDD)
According to the 2025 Goldfish Swim School Franchise Disclosure Document, the state of Michigan prohibits certain unfair provisions that are sometimes included in franchise documents. These provisions, if present, are considered void and unenforceable against the franchisee.
One such prohibited provision is any requirement that the franchisee assent to a release, assignment, novation, waiver, or estoppel that deprives them of rights and protections provided under Michigan's franchise laws. However, this does not prevent a franchisee from settling claims after entering into a Franchise Agreement.
Another prohibited provision is one that allows Goldfish Swim School to terminate a franchise before its expiration date without good cause. Good cause is defined as the franchisee's failure to comply with any lawful provision of the Franchise Agreement, provided they are given written notice of the failure and a reasonable opportunity (at least 30 days) to correct it.
These stipulations mean that Goldfish Swim School cannot arbitrarily refuse a transfer of ownership if the franchisee is in compliance with the Franchise Agreement and applicable laws. Any attempt to enforce such a refusal based on a prohibited provision would be void under Michigan law.