Mandatory transfer of franchise business to franchisor?
On 23 January 2017, the District Court of Amsterdam, ECLI:NL:RBAMS:2017:412 (CoffeeCompany/Dam Spirit BV) rendered a judgment on the question whether a franchisee is obliged to return his franchise company upon termination of the cooperation with the franchisor. delivery to the franchisor.
Before the catering entrepreneur in question entered into cooperation with the franchisor, the catering entrepreneur in question had already rented the catering business space on Dam Square in Amsterdam for some time. A catering permit was also present from the start of the rental.
A cooperation agreement, called a license agreement, was subsequently concluded between the parties, under which the franchisee obtained the right to operate the catering establishment according to a specific formula of the franchisor. It was included in that agreement that upon termination of this agreement, the franchisor was entitled to continue the business itself at the location where the franchisee worked. After the cooperation has ended, the franchisor demands from the former franchisee to offer it the lease rights to the business space in question, or at least to cooperate in substituting the franchisor as tenant.
The court considers that there is no question of a termination situation, but that the cooperation has ended by operation of law due to the passage of time. The court also considers it illogical that the franchisee was prepared to offer the lease rights to the franchisor when the cooperation ended. The court therefore rejects the franchisor’s claim to transfer the franchise company to it.
It follows from this ruling that if the parties wish to make a far-reaching agreement about the transfer of the franchise company at the end of the cooperation, this must be explicitly stated in order to avoid misunderstandings afterwards.
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
Failing to cooperate in checking hygiene requirements of the franchisee
The court in Amsterdam recently ruled in a case where a franchisee did not meet all hygiene requirements.
‘If the employee starts franchising…’. The employer’s duty of care as a franchisor
It will not be easy to assume that a 'normal' employee has given up his employment contract. However, what...
Sale of rental rights supermarket location not allowed
Recently, the Court of Appeal in The Hague has ruled that supermarket organizations have to switch locations for the penny.
Market and location research: more important than you think
Time and time again, the law practice offers a variety of special situations, which with some regularity contribute to the situation at hand.
Market and location research: more important than you think
Market and location research: more important than you think
Jurisdiction of the subdistrict court judge in cases of miscarriage (II)
As indicated earlier on this website, different judges judge in different ways whether they are competent to take cognizance of a dispute in which both prognosis problems