Settling claims between franchisor and franchisee
It seems so obvious. You have a claim against someone who also receives money from you and you agree that the person who has to pay the highest amount has paid the excess of his own claim to the other. For example, you have a claim against A of € 100.00 and A has a claim against you of € 75.00, then A will pay you an amount of € 25.00. The receivables are then settled.
The law also provides for this possibility. From article 6:127 of the Dutch Civil Code, settlement has been arranged.
The law stipulates that you can invoke set-off. This possibility exists when claims arose from the same legal relationship, which means that claims based on different agreements cannot, in principle, be set off against each other. If you have concluded both a rental agreement and a franchise agreement with your franchisor, this would mean that the claim based on the rental agreement cannot be set off against a claim based on the franchise agreement. Often these two agreements are linked. That link may be more or less explicitly included in the agreements. Settlement of the receivables is possible again when agreements are linked.
It is therefore advisable to check the agreements for the presence of a link before settling receivables. In any case, it is advisable to check whether the settlement of claims is not excluded in the agreement.
In practice, moreover, it often happens that settlement is not announced, but is simply done. This is not the right way and even leads to non-performance. It is important that settlement is explicitly announced. I advise you to record this in writing so that there can be no ambiguity afterwards about the status of the claims.
If you want to offset claims against each other, I can give you the following tips, referring to the above:
– Check in your agreement whether offsetting is not excluded;
– In the case of several agreements, check whether there is a link between the agreements;
– If you are a franchisee, notify your franchisor in writing that you are offsetting;
– If in doubt, you as a franchisee can discuss the possibility of settlement with your franchisor.
Ludwig & Van Dam franchise attorneys, franchise legal advice
Other messages
Column Franchise+ – 50 percent more franchise lawsuits
The 2018 Legal Franchise Statistics published by Ludwig & Van Dam Advocaten shows that there has been a 50% increase in the number of judgments in court cases rendered in 2017 compared to
A closer look at the intention to introduce franchising legislation
On May 23rd, State Secretary Mona Keijzer informed the House of Representatives about the imminent franchise legislation. The National Franchise Guide previously published this article.
Consumer Protection Applies to Franchisee
The consumer enjoys broad protection on the basis of the Civil Code.
Update Franchise Law
On 23 May 2018, the government indicated that it would prepare a legal regulation that creates a framework for four sub-areas of cooperation between franchisors and franchisees that are crucial
On the edge of a franchisee’s exclusive territory
The Court of Appeal of Arnhem-Leeuwarden ruled on 15 May 2018, ECLI:NL:GHARL:2018:4395, on the question whether a franchisor has a branch just over the edge of the exclusively granted protection area.
Can a franchisee cohabit with a competing entrepreneur?
Can a franchisee violate a non-compete clause by cohabiting with someone who runs a competing business? On January 12, 2018, the District Court of Central Netherlands ruled