Franchisor liable for errors made by a franchisee? – mr. AW Dolphijn – dated November 23, 2020
A franchise organization of mortgage brokers requested the court to declare that the franchisor is not liable for the fact that a franchisee has committed a serious error, or at least committed fraud with a customer. The District Court of Amsterdam ruled in this case on November 4, 2020, ECLI:NL:RBAMS:2020:5408.
Mortgage brokers are supervised by the AFM and require a licence. The franchisor is the central license holder in this matter and has a collective license (Section 2:105 Wft). The individual franchisees then act under the responsibility of the franchisor. However, the franchisor stated that this does not mean that the franchisor is then in all cases liable for errors made by the franchisee.
The court rules that the franchisor can be liable, in addition to the franchisee, for an error on the part of the franchisee if that error is caused by the affiliated company not complying with the aforementioned licensing obligations and requirements. For example, if a franchisee does not comply with the licensing requirements and third parties suffer damage as a result, this can lead to liability of the franchisor towards that third party.
In this case, the franchisor’s claim to establish that the franchisor was not liable was formulated too broadly.
This ruling provides more guidance on the extent to which a franchisor under a collective license could be liable for errors and fraud by franchisees.
mr. AW Dolphijn – franchise lawyer
Ludwig & Van Dam Franchise attorneys, franchise legal advice. Do you want to respond? Go to dolphijn@ludwigvandam.nl
![232court-min](https://www.ludwigvandam.nl/wp-content/uploads/2020/12/232court-min.jpg)
Other messages
Article Franchise+ – Current state of affairs Franchise Act – dated March 27, 2020 – mr. AW Dolphin
The legislative process regarding the Franchise Act continues despite everything.
Rent reduction and corona crisis – dated 25 March 2020 – mr. Th.R. Ludwig
In this turbulent time for franchisors and franchisees, many are faced with ongoing obligations that have become problematic.
Franchise agreements and the corona crisis – dated March 20, 2020 – mr. AW Dolphin
A time of draconian measures with far-reaching consequences. There is a lot of legal uncertainty, also in franchise relationships.
Recommendations by the franchisor in general terms are permitted – dated March 6, 2020 – mr. AW Dolphin
The boundary between praise in general terms on the one hand and culpable deception and misrepresentation on the other remains a difficult issue.
Article De Nationale Franchise Gids – Know-how decisive for scope of application Franchise Act – dated 5 March 2020 – mr. RCWL Albers
It will have escaped the attention of few in the sector that on 10 February 2010 the legislative proposal for the Franchise Act was submitted to the House of Representatives.
Column Franchise+ – A conflict can be prevented, just communicate well – February 2020 – mr. AW Dolphin
Formula changes are a fascinating topic. It is often the subject of conflicts, but those conflicts can be avoided.