Regarding a Hardees franchise, can a disclaimer signed by a franchisee waive a claim of fraud in the inducement?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
any class action suits.
10. The second sentence of Section 28.E. is deleted and replaced with the following sentence:
Therefore, Franchisee agrees that, in the event of a breach or threatened breach of any of the terms of this Agreement by Franchisee, HR shall be entitled to seek injunctive relief (both preliminary and permanent) restraining that breach and/or to specific performance.
- 11. The provisions of this Addendum will be effective only to the extent that the jurisdictional requirements of the Minnesota Franchise Act and the Rules and Regulation promulgated thereunder are met independently of this Addendum.
- 12. Any capitalized terms that are not defined in this Addendum shall have the meaning given them in the Franchise Agreement.
- 13. No disclaimer, questionnaire, clause, or statement signed by a franchisee in connection with the commencement of the franchise relationship shall be construed or interpreted as waiving any claim of fraud in the inducement, whether common law or statutory, or as disclaiming reliance on or the right to rely upon any statement made or information provided by any franchisor, broker or other person acting on behalf of the franchisor that was a material inducement to a franchisee's investment. This provision supersedes any other or inconsistent term of any document executed in connection with the franchise.
- 14. Except as expressly modified by this Addendum, the Franchise Agreement remains unmodified and in full force and effect.
[Signatures on following page.]
HR: HARDEE'S RESTAURANTS LLC
Print Name: Danell Caron Vice President, Legal Print Name:
ADDENDUM TO THE HARDEE'S RESTAURANT FRANCHISE DISCLOSURE DOCUMENT REQUIRED FOR NORTH DAKOTA FRANCHISEES
Items 5 and 7, Additional Disclosures. The following statement is added to Items 5 and 7:
Franchisor will defer collection of the Initial Franchise Fees until all initial obligations owed to franchisee under the franchise agreement or other documents have been fulfilled by the franchisor and the franchisee has commenced doing business pursuant to the franchise agreement.
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 71–84)
What This Means (2025 FDD)
According to Hardees's 2025 Franchise Disclosure Document, the answer regarding the ability to waive a claim of fraud in the inducement depends on the state where the franchise is located. For franchisees in Minnesota, North Dakota, and South Dakota, disclaimers, questionnaires, clauses, or statements signed by a franchisee cannot be interpreted as waiving any claim of fraud in the inducement. This protection applies whether the claim is based on common law or statutory grounds. It also ensures that franchisees cannot disclaim reliance on statements or information provided by Hardees, its brokers, or other representatives if that information was a material factor in the franchisee's decision to invest. These provisions override any conflicting terms in any document related to the franchise agreement.
For California franchisees, the FDD includes an addendum to both the Franchise Agreement and the Development Agreement that requires the franchisee to expressly waive any and all rights granted under Section 1542 of the California Civil Code. This section states that "A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release which if known by him must have materially affected his settlement with the debtor."
For Illinois franchisees, Illinois law governs the Franchise Agreement, and any provision designating jurisdiction or venue outside of Illinois is void, although arbitration may occur outside of Illinois. The FDD does not explicitly address the waiver of fraud claims for Illinois franchisees. Prospective franchisees should seek clarification from Hardees regarding the enforceability of waivers related to fraud in the inducement under Illinois law.