No violation of standstill obligation
The Northern Netherlands District Court ruled in a judgment dated February 21, 2024, ECLI:NL:RBNNE:2024:548, that – despite the fact that the legal standstill period of at least 4 weeks had not been observed – the franchisee had no reasonable interest invoking the statutory regulations.
According to the franchisor, the parties had been in contact for months about the prospective franchisee opening a franchise location. According to the franchisor, the intended franchisee could not wait until he could sign the franchise agreement, had had all kinds of information for some time, had ample opportunity to ask questions (he did so) and was aware of ( his rights regarding) the legal standstill period.
In the court’s opinion, the prospective franchisee rightly argues that the standstill period regulation has been included in the law to protect him as a prospective franchisee. The prospective franchisee does not argue that he would have acted or decided differently if the franchisor had observed the statutory cooling-off period. For example, the prospective franchisee does not take the position that – if the draft of the franchise agreement had been provided to him four weeks before concluding the franchise agreement – he would have asked the franchisor further questions, sought advice and/or consulted with the franchisor and ultimately (for whatever reason) would not have signed the franchise agreement or would have concluded the franchise agreement under different conditions. The court takes into account that the prospective franchisee, even after 4 weeks had passed after signing the deed, did not make any comments on its contents and continued to implement the agreement.
Because of the foregoing, the court agrees with the franchisor that it should be assumed that the prospective franchisee has not been harmed in any respectable interest by prematurely signing the deed. The prospective franchisee’s appeal for annulment of the agreement due to failure to observe the statutory cooling-off period (as referred to in Article 7:913 paragraph 2 under a of the Dutch Civil Code and Article 7:914 of the Dutch Civil Code) is therefore, in the opinion of the court, standards of reasonableness and fairness unacceptable.
Ludwig & Van Dam lawyers, franchise legal advice.
Do you want to respond? Then email to dolphijn@ludwigvandam.nl
Other messages
Article Franchiseplus: “Franchisors participate in franchisees” – dated June 3, 2020 – mr. AW Dolphin
Franchisors are increasingly participating in the franchisee's business. There are several benefits for both the franchisee and the franchisor.
Article The National Franchise Guide – “Corona discount on rent” – dated June 2, 2020 – mr. AW Dolphin
If a rental property is obliged to be closed due to corona, there may be a right to a rent reduction, according to the Northern Netherlands court.
Article Franchise+ – Franchisees enjoy the same protection as employees and commercial agents with regard to a non-competition clause – dated 7 May 2020 – mr. RCWL Albers
It often happens that, especially by franchisees, the validity of a post-contractual non-compete clause is considered too lightly.
The support agreement for the Retail sector in this Corona crisis – dated 15 April 2020 – mr. K. Bastian
On April 10, 2020, the Ministry of Economic Affairs, together with a number of landlords, retailers and banks, reached a support agreement.
Court rules that corona crisis does not constitute force majeure – dated April 10, 2020 – mr. AW Dolphin
If payment cannot be made due to a decrease in income, then there is not always a force majeure situation.
Important information for directors of franchisees associations: Online meetings and decision-making in times of corona – dated April 10, 2020 – mr. J. Strong
Emergency law provisions for legally valid decisions without physically meeting within the association structure.