In Maryland, what does the acknowledgement provision in the Southern Steer Franchise Agreement state regarding reliance on statements made by the franchisor?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
If the franchise is located in or if franchisee is a resident of Maryland, then the designated acknowledgement provision in the Franchise Agreement will be amended as follows:
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 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to the 2025 Southern Steer Franchise Disclosure Document, if a franchise is located in Maryland or the franchisee is a resident of Maryland, the acknowledgement provision in the Franchise Agreement is amended to protect the franchisee. Specifically, no statement, questionnaire, or acknowledgement signed by the franchisee can waive claims under Maryland franchise law, including claims of fraud in the inducement.
More importantly, the amendment ensures that franchisees in Maryland cannot disclaim reliance on statements made by Southern Steer, its franchise sellers, or anyone acting on its behalf. This means that if Southern Steer makes representations during the franchise sales process, the franchisee's ability to hold Southern Steer accountable for those statements is protected under Maryland law, regardless of any contradictory language in the franchise agreement.
This provision is significant because it supersedes any other term in any document executed in connection with the franchise. This offers additional protection to franchisees in Maryland, ensuring that they cannot inadvertently waive their rights or disclaim reliance on statements made by Southern Steer during the franchise sales process. This type of protection is not universally included in franchise agreements and is specific to Maryland due to its franchise laws.