Franchise Law

Contrary to popular notion, when it comes to the law what you don’t know can hurt you!

The law presumes the parties have read and understood the agreement which they have entered into.
The law will not rescue a party from making a bad bargain in the absence of fraud or overreaching.
Unless a contract’s terms are contrary to stated public policy, they will generally be enforced by a judge or arbitrator.

Read all of the disclosures provided to you. Among other things, they should inform you about:

The backgrounds of the franchisor and its key people
The nature of past litigation within the system
Initial fees, continuing costs and projected working capital needs
Contractual obligations of both you and your franchisor
Whether you can rely upon any financial performance information you may have obtained
Whether your territory is protected, and what you may have to do to maintain it
When and how your relationship can be terminated, and what happens if it is terminated
Any restrictions upon you after termination or non-renewal

American franchise law comprises a unique blend of both federal and state laws, rules and regulations. You should seek out and consult with an attorney experienced in franchise law before entering into a franchise relationship.