If the franchisee of a Sonesta Simply Suites is domiciled in Washington, how does that affect the Franchise Agreement?
Sonesta_Simply_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
In the event of a conflict of laws, the provisions of the Washington Franchise Investment Protection Act, chapter 19.100 RCW will prevail.
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. There may also be court decisions that supersede the franchise agreement or related agreements concerning your relationship with the franchisor. Franchise agreement provisions, including those summarized in Item 17 of the Franchise Disclosure Document, are subject to state law.
In any arbitration or mediation involving a franchise purchased in Washington, the arbitration or mediation site will be either in the state of Washington, or in a place mutually agreed upon at the time of the arbitration or mediation, or as determined by the arbitrator or mediator at the time of arbitration or mediation. In addition, if litigation is not precluded by the franchise agreement, a franchisee may bring an action or proceeding arising out of or in connection with the sale of franchises, or a violation of the Washington Franchise Investment Protection Act, in Washington.
A release or waiver of rights in the franchise agreement or related agreements purporting to bind the franchisee to waive compliance with any provision under the Washington Franchise Investment Protection Act or any rules or orders thereunder is void except when executed pursuant to a negotiated settlement after the agreement is in effect and where the parties are represented by independent counsel, in accordance with RCW 19.100.220(2). In addition, any such release or waiver executed in connection with a renewal or transfer of a franchise is likewise void except as provided for in RCW 19.100.220(2).
Provisions contained in the franchise agreement or related agreements that unreasonably restrict or limit the statute of limitations period for claims under the Washington Franchise Investment Protection Act, or rights or remedies under the Act such as a right to a jury trial, may not be enforceable.
Transfer fees are collectable only to the extent that they reflect the franchisor's reasonable estimated or actual costs in effecting a transfer.
The franchisee may terminate the franchise agreement under any grounds permitted under state law.
Source: Item 23 — RECEIPTS (FDD pages 80–246)
What This Means (2025 FDD)
According to the 2025 Sonesta Simply Suites FDD, several provisions address franchisees in Washington state. The Washington Franchise Investment Protection Act and related court decisions may supersede parts of the franchise agreement, especially concerning termination and renewal. This means that certain standard terms in the agreement might not be enforceable if they conflict with Washington law.
In case of legal disputes, any arbitration or mediation must occur in Washington state or another location agreed upon by both parties, or as determined by the arbitrator or mediator. Franchisees can also bring legal action in Washington if it relates to the sale of the franchise or violations of the Washington Franchise Investment Protection Act, assuming litigation isn't precluded by the franchise agreement.
Releases or waivers of rights that require franchisees to waive compliance with the Washington Franchise Investment Protection Act are void unless they meet specific conditions, such as being part of a negotiated settlement with independent legal representation after the agreement is in effect. Additionally, clauses that unreasonably shorten the statute of limitations for claims under the Act or limit rights like a jury trial may not be enforceable. Transfer fees can only cover the franchisor's reasonable costs. The franchisee has the right to terminate the franchise agreement on any grounds permitted by state law.
Prospective Sonesta Simply Suites franchisees in Washington should carefully review these state-specific provisions with legal counsel to understand their rights and obligations under both the franchise agreement and Washington law. They should also be aware that franchise brokers, who represent the franchisor, may be involved in the sales process, and franchisees should independently verify any information provided by these brokers.