Recommendations by the franchisor in general terms are permitted – dated March 6, 2020 – mr. AW Dolphin
The Amsterdam Court of Appeal ruled on January 21, 2020,
ECLI:NL:GHAMS:2020:116, which is the information provided by a franchisor
about increasing turnover, cost savings, more clientele and customer loyalty
is too general in nature to invoke acquisition fraud or error
make it succeed. There is no question of deception by the franchisor and the
The (prospective) franchisee cannot be blamed by the franchisor for this
wrong leg.
In that context, it has also been ruled that a potential franchisee is allowed
be expected to know that the franchise formula is focused on business
as revenue increase and cost savings, but that concrete results of
depend on many circumstances, such as, for example, the manner
on which the franchisee conducts his business.
It is true that, if the franchisor has concrete information about
turnover forecasts and the like, he acts unlawfully if he does so
information is incorrect and he knows this, or his carelessness leads to
which led to errors. The court refers to the judgment
HR 24-02-2017, ECLI:NL:HR:2017:311 regarding Street One. In this case it is
however, such concrete information is not provided by the franchisor
provided. That is also stated in the agreement in so many words, it said
court of justice.
The boundary between praise in general terms and
on the other hand, culpable deception and misrepresentation,
remains a tricky issue.
mr. AW Dolphijn – franchise lawyer
Ludwig & Van Dam Franchise attorneys, franchise legal advice. Want
you respond?
Go to dolphijn@ludwigvandam.nl
Other messages
Non-compete clause too broad? – January 12, 2016 – mr. RCWL Albers
Non-compete clause too broad?
Non-compete clause too broad?
Franchisors have usually invested heavily in the development of their formula.
Article in Entrance: “How do I break it open?” (The fine print of a contract) – mr. AW Dolphin – January 2016
Article in Entrance: "How do I break it open?" (The fine print of a contract)
Franchisors take note: accountability for forecast issued – December 28, 2015 – mr. AW Dolphin
Franchisors beware: accountability for issued forecast
Key to the rental property
Key to the rental property
No special duty of care franchisor
No special duty of care franchisor