Are acknowledgements or representations of the Mr. Sandless franchisee which disclaim violations of the Franchise Law intended to act as a release of liability under the Maryland Franchise Registration and Disclosure Law?
Mr_Sandless Franchise · 2025 FDDAnswer from 2025 FDD Document
nchisee is permitted to enter into litigation with the Franchisor in the State of Maryland, regardless of the language in the Franchise Agreement.
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- The franchise agreement is hereby amended to provide that the acknowledgements or representations of the franchisee which disclaim the occurrence and/or acknowledge the non-occurrence of acts that would constitute a violation of the Franchise Law are not intended to nor shall they act as a release, estoppel or waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law.
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- The first sentence of paragarph "E" beginning with "You acknowledge..", under the section titled "Background" of the Franchise Agreement, is hereby deleted in its entirety.
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- Sections 27.1 through 27.5 of the Franchise Agreement are hereby deleted.
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- To the extent of any inconsistencies, Item 5 and Section 10.1 of the Franchise Agreement are hereby amended to further state:
"Based upon Franchisor's financial condition, the Maryland Securities Commissioner has required a financial assurance.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 30–34)
What This Means (2025 FDD)
According to Mr. Sandless's 2025 Franchise Disclosure Document, acknowledgements or representations by a franchisee disclaiming violations of the Franchise Law are not intended to act as a release, estoppel, or waiver of liability under the Maryland Franchise Registration and Disclosure Law. This protection is specifically addressed in amendments to the franchise agreement for franchisees in Maryland. The Franchisee Disclosure Acknowledgment Statement, Schedule F to the Franchise Agreement, is amended to comply with this provision. This ensures that franchisees in Maryland retain their rights and protections under state franchise law, regardless of any disclaimers they may have signed.
This provision is further reinforced by stating that any disclaimer regarding the occurrence or acknowledgment of non-occurrence of acts that would violate the Franchise Law will not act as a release, estoppel, or waiver of liability. Additionally, the general release required for renewal, sale, or transfer of the franchise does not apply to any liability under the Maryland Franchise Registration and Disclosure Law. This means that Mr. Sandless franchisees in Maryland cannot be forced to waive their rights under Maryland franchise law as a condition of purchasing, renewing, selling, or transferring their franchise.
These stipulations are crucial for prospective Mr. Sandless franchisees in Maryland as they ensure that their legal rights under the Maryland Franchise Registration and Disclosure Law are protected. The FDD explicitly states that these amendments have been agreed to by both parties, providing additional assurance. This also aligns with Section 14-226 of the Maryland Franchise Registration and Disclosure Law, which prohibits a franchisor from requiring a prospective franchisee to assent to any release, estoppel, or waiver of liability as a condition of purchasing a franchise.