Judge: Protect franchisee against supermarket organization (Coop) as lessor
Does the franchisee need legal protection from supermarket franchisor Coop? The District Court of Rotterdam ruled on 9 February 2018, ECLI:NL:RBROT:2018:1151, that this is the case.
In the event of (premature) termination of the franchise agreement, the rental agreement does not also end automatically. Franchisors often stipulate in their contracts with the franchisee that the duration of the franchise agreement and the lease agreement run synchronously. That provision is in principle invalid.
If a supermarket entrepreneur rents the business space from the franchisor, then the entrepreneur is very dependent on the franchisor. Fortunately, the law has rent protection rules. For example, if the franchise agreement ends, the rental agreement does not also end.
Together with a franchisee, Coop had asked the court for permission to link the duration of the franchise agreement to the duration of the rental agreement. The court makes it clear that the franchisee does not have such a social position compared to Coop. The franchisee requires legal rent protection towards Coop.
It is not the first time that if the franchise agreement ends, the supermarket entrepreneur can operate another formula, despite still renting from the old supermarket organization.
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
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.
Termination of franchise agreement in case of changes in leased retail space – September 27, 2019 – mr. AW Dolphin
Termination of a franchise agreement in light of a substantial change in the leased retail space.
Article De Nationale Franchisegids: “Distribution of (potential) customers prohibited?” – September 17, 2019 – mr. AW Dolphin
Within many franchise organizations, agreements are made about the recruitment of (potential) customers in a certain area.
District protection no protection against termination due to urgent own use – dated September 17, 2019 – mr. AW Dolphin
As a landlord, can the franchisor terminate the lease for urgent own use, in the sense of district protection, while this would be excluded on the basis of the franchise agreement.
Unreasonable compensation at the end of the franchise agreement – dated September 17, 2019 – mr. AW Dolphin
Some franchise agreements stipulate that the franchisee always owes the franchisor a minimum of a certain amount of costs upon termination of the franchise agreement.