For a Ledgers franchise in Washington, what is the effect of RCW 19.100.180 on provisions concerning termination of the franchise?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
RCW 19.100.180 may supersede provisions in the franchise agreement or related agreements concerning your relationship with the franchisor, including in the areas of termination and renewal of your franchise.
Provisions in franchise agreements or related agreements that permit the franchisor to repurchase the franchisee's business for any reason during the term of the franchise agreement without the franchisee's consent are unlawful pursuant to RCW 19.100.180(2)(j), unless the franchise is terminated for good cause.
Any provision in the franchise agreement or related agreements that requires the franchisee to purchase or rent any product or service for more than a fair and reasonable price is unlawful under RCW 19.100.180(2)(d).
Provisions in the franchise agreement or related agreements stating that the franchisor may exercise its discretion on the basis of its reasonable business judgment may be limited or superseded by RCW 19.100.180(1), which requires the parties to deal with each other in good faith.
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to Ledgers' 2025 Franchise Disclosure Document, RCW 19.100.180 may supersede provisions in the franchise agreement or related agreements concerning the franchisee's relationship with Ledgers, specifically in areas of termination and renewal. This means that certain terms in the franchise agreement regarding how and when Ledgers can terminate the agreement may not be enforceable if they conflict with Washington state law.
Specifically, provisions in franchise agreements or related agreements that permit Ledgers to repurchase the franchisee's business for any reason during the term of the franchise agreement without the franchisee's consent are unlawful pursuant to RCW 19.100.180(2)(j), unless the franchise is terminated for good cause. Additionally, any provision in the franchise agreement or related agreements that requires the franchisee to purchase or rent any product or service for more than a fair and reasonable price is unlawful under RCW 19.100.180(2)(d).
Furthermore, provisions in the franchise agreement stating that Ledgers may exercise its discretion based on its reasonable business judgment may be limited or superseded by RCW 19.100.180(1), which requires the parties to deal with each other in good faith. Therefore, prospective franchisees in Washington should be aware that Washington state law provides certain protections that may override the standard terms of the Ledgers franchise agreement, particularly concerning termination, renewal, and the franchisor's business practices.