Partial indebtedness of entrance fees due to lack of turnover and non-delivery of contractual performance by the franchisor
Court of Rotterdam
The franchisee rightly invokes unforeseen circumstances due to the lack of turnover and successfully claims moderation of the entrance fee due. The fact that no turnover has been realized within the framework of the franchise agreement, which moreover allows settlement of the entrance fee in connection with future turnover, is, in the opinion of the court, a circumstance that entails that the franchisee rightly invokes (partial) ) innocence. In addition, the franchisor has not provided any significant services. In addition to offering the franchise formula, only general printed matter, business cards, billboards and a general introduction were provided. Thus, the obligation of advice and assistance in accordance with the franchisor’s duty of care has apparently not been complied with. The court eventually halves the contractually due entrance fee.
NB: The fact that the court recognizes the lack of turnover as an unforeseen circumstance may also mean a new entry in the event of unrealized forecasts by franchisees. The ruling once again emphasizes the far-reaching duty of care of franchisors with regard to the actual ability to achieve reasonably expected turnovers, whether or not laid down in financial forecasts. If this core obligation from the franchise relationship is not met, the franchisee can invoke various grounds in relation to an action for damages against the franchisor.
Mr Th.R. Ludwig – Franchise lawyer
Ludwig & Van Dam Franchise attorneys, franchise legal advice Would you like to respond? Mail to ludwig@ludwigvandam.nl
![](https://ludwigvandam.megaconcept.nl/wp-content/uploads/2020/12/232court-min-400x222.jpg)
Other messages
Attorneys Ludwig & Van Dam look back on transition process C1000
Attorneys Ludwig & Van Dam look back on transition process C1000
Court of Appeal upholds misrepresentation and wrongful conduct in the event of an unsatisfactory prognosis
The franchisee claimed annulment of the franchise agreement on the grounds of error, because the franchisor allegedly presented an unsatisfactory prognosis.
Directors’ Liability Concerning Franchising: Deception or Collaboration Plan
Directors' Liability Concerning Franchising: Deception or Collaboration Plan
Jumbo completes the C1000 conversion operation in more than 1100 days
Jumbo completes the C1000 conversion operation in more than 1100 days
Secretly another franchisee? Explanation contra proferentem
On March 4, 2015, the Court of Appeal of The Hague issued a judgment on whether the franchisee should have been changed.
A property owner and Plus have agreed that Plus will rent a supermarket location, but may only use it as a supermarket, stating ‘Plus Market’ in parentheses.
A property owner and Plus have agreed that Plus will rent a supermarket location, but may only use it as a supermarket, stating 'Plus Market' in parentheses.