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
Other messages
Ludwig & Van Dam attorneys summon Sandd and PostNL on behalf of the Sandd franchisees – dated 9 January 2020 – mr. AW Dolphin
The Association of Franchisees of Sandd (VFS) has today summoned Sandd and PostNL before the court in Arnhem. The VFS believes that Sandd and PostNL are letting the franchisees down hard.
Article The National Franchise Guide: “Why joint and several liability, for example, next to private?” – dated 7 January 2020 – mr. AW Dolphin
Franchisees are often asked to co-sign the franchise agreement in addition to their franchise, for example. Sometimes franchisees refuse to do so and the franchise agreement is not signed.
Ludwig & Van Dam Advocaten assists Sandd franchisees: Franchisees Sandd challenge postal monopoly in court – dated 12 November 2019 – mr. AW Dolphin
The Association of Franchisees of Sandd (VFS) is challenging the decision of State Secretary Mona Keijzer to approve the postal merger between PostNL and Sandd before the court in Rotterdam.
Franchisee trapped by non-compete clause? – dated October 21, 2019 – mr. AW Dolphin
The District Court of East Brabant has ruled that a franchisee was still bound by the non-competition clause in the event of premature termination of the franchise agreement.
Supermarket letter – 26
Supermarket Newsletter No. 26
Link franchise agreement and rental agreement uncertain? – dated October 14, 2019 – mr K. Bastiaans
It is no exception within a franchise relationship that the parties agree that the franchise agreement and the rental agreement are inextricably linked.