Entitlement to goodwill compensation for franchisee established – mr. AW Dolphijn – dated December 30, 2021
On December 22, 2021, the District Court of Rotterdam ruled for the first time, as far as is known, that a franchisee is entitled to a goodwill compensation, as referred to in the Franchise Act. The ruling has not (yet) been published.
The Franchise Act stipulates that under certain circumstances a franchisee may be entitled to compensation for goodwill. See Article 7:920 paragraph 1 of the Dutch Civil Code. Although the Franchise Act stipulates that the franchise agreement must contain a goodwill arrangement no later than 1 January 2023, the court ruled that this already applies in the relevant case.
The franchise agreement regarding a service formula had ended after the agreed term had expired. The customer base belonged to the franchisee. However, just before the end of the franchise agreement, the franchisor had informed the franchisee’s customers that the services provided by the franchisor would be continued, that the franchisee’s staff would be taken over and that the entire service would therefore remain unchanged. The former franchisee was not compensated at all by the franchisor. The court deems this contrary to law. An expert will have to determine the size of the goodwill value, for which the franchisor must advance the costs of the expert’s report.
Ludwig & Van Dam lawyers, franchise legal advice.
Do you want to respond? Then email to dolphijn@ludwigvandam.nl
![232court-min](https://www.ludwigvandam.nl/wp-content/uploads/2020/12/232court-min.jpg)
Other messages
Economic headwinds and duty of care: sometimes a difficult relationship
The trade press, as well as the more general media, are full of it: the retail trade is under heavy pressure
Gathering evidence for faulty prognosis
Gathering evidence for faulty prognosis
Exclusion nullification in unsigned franchise contract
On 17 February 2015, the Arnhem-Leeuwarden Court of Appeal assessed a court judgment.
Liability advisor for franchise agreements
When entering into a franchise agreement, the prospective franchisee sometimes engages an advisor to arrange financing, for example.
Financial contribution to the association of franchisees may not be stopped just like that
Financial contribution to the association of franchisees may not be stopped just like that
Seizure of ex-franchisee by franchisor not automatically permitted
Within a franchise relationship, disputes about money claims are unfortunately the order of the day.