Can a Ledgers franchisee disclaim reliance on statements made by the franchisor?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
No statement, questionnaire, or acknowledgment signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to Ledgers's 2025 Franchise Disclosure Document, a franchisee cannot disclaim reliance on statements made by the franchisor. Specifically, Item 22 states that no agreement signed by the franchisee can waive claims under state franchise law, including fraud, or disclaim reliance on statements made by Ledgers or its representatives. This protection is designed to prevent franchisees from inadvertently giving up their legal rights based on statements made during the franchise sales process. This provision is further reinforced in the New York and Minnesota addenda, ensuring that franchisees in those states retain their rights and protections under state law.
This means that any statement, questionnaire, or acknowledgment signed by a Ledgers franchisee cannot be interpreted as a waiver of their right to bring claims against the franchisor for misrepresentation or fraud. This is particularly important during the initial stages of the franchise relationship when franchisees are making significant investment decisions based on the information provided by Ledgers. The FDD emphasizes that this provision overrides any other conflicting terms in any document related to the franchise agreement, providing a clear safeguard for the franchisee.
For prospective Ledgers franchisees, this clause offers a degree of security, ensuring that they can hold the franchisor accountable for the accuracy and truthfulness of the information provided during the franchise sales process. It aligns with franchise laws in several states, such as New York and Minnesota, which aim to protect franchisees from overreaching franchisors. This non-waiver provision is a beneficial aspect of the Ledgers franchise agreement, as it helps to balance the power dynamic between the franchisor and franchisee and promotes transparency and fair dealing.