If a Remax franchisee's agreement is terminated, expires, or the office is abandoned, is the franchisee entitled to a refund of monies previously paid?
Remax Franchise · 2025 FDDAnswer from 2025 FDD Document
Termination of this Agreement by us shall not be an exclusive remedy and shall not in any way affect our rights, or the rights of REMAX, LLC, to receive or collect fees, dues or other amounts required to have been paid by you under this Agreement, to enforce the provisions of this Agreement against you or to sue for damages or to pursue any other legal or equitable remedy for a breach of this Agreement by you.
If you have received any Franchisee Incentives from REMAX Regional and you default in any of your material obligations under this Agreement, including but not limited to your failure to provide proper notice of your intent to renew in accordance with Section 2.E above, REMAX Regional reserves the right to terminate your eligibility for any and all such then-current and future Franchisee Incentives, even if you cure such default. If you fail to cure
any such default within the cure period provided in this Agreement, or if such default cannot be cured, or if you Abandon the Office, REMAX Regional reserves the right to require you on demand to repay any Franchisee Incentives that you received from REMAX Regional prior to such default.
Source: Item 22 — Contracts (FDD pages 108–334)
What This Means (2025 FDD)
Based on the 2025 Remax Franchise Disclosure Document, a franchisee is generally not entitled to a refund of monies previously paid if the franchise agreement is terminated, expires, or the office is abandoned. The FDD states that termination does not affect Remax's right to collect fees and other amounts owed by the franchisee. Moreover, if a franchisee received incentives from Remax Regional and then defaults on their obligations, Remax Regional has the right to demand repayment of those incentives if the default is not cured or if the office is abandoned.
Specifically, Remax retains the right to receive all fees, dues, and other amounts owed by the franchisee, even after termination. This means that any upfront franchise fees, ongoing royalties, marketing contributions, or other payments made to Remax are generally non-refundable. The franchisee remains obligated to pay any outstanding amounts owed to Remax, LLC, or Remax Regional, even after the franchise agreement ends.
Furthermore, the franchisee may face additional financial obligations upon termination or abandonment. For example, the franchisee is responsible for the costs of de-identifying the office to remove Remax branding. They may also be liable for liquidated damages of $500 per day for failure to fulfill certain post-termination obligations, as well as potential legal action for breach of contract or trademark infringement. In addition, the franchisee may be required to pay Remax its "Lost Future Revenue" if the agreement is terminated early or the office is abandoned.
Therefore, a prospective Remax franchisee should carefully consider the financial implications of termination, expiration, or abandonment, as they will likely not receive any refunds of prior payments and may incur additional expenses. It is important to understand the conditions under which Remax can terminate the agreement and the franchisee's obligations upon termination to avoid potential financial liabilities.