Want to get rid of your franchise agreement in the meantime?
Franchise agreements are usually concluded for a longer period of time. Many franchisors also use a standard franchise agreement and it is often a considerable undertaking to adjust this standard in consultation with all franchisees. Such adjustments are periodically necessary in view of changing market conditions. All kinds of changes can also occur with individual franchisees. Interim changes can also lead to a franchisee wanting to get rid of the rest of the term of the franchise agreement.
How do you break open a franchise agreement? Most franchise agreements have a term agreed for a certain period of time and this term cannot usually be shortened in the interim without the franchisor’s consent. In a number of cases, however, the law does offer opportunities for the franchisee to terminate the franchise agreement prematurely. An important category of possibilities is the situation in which the franchisor has done something wrong, or is doing something wrong, as a result of which the unaltered continuation of the cooperation cannot be maintained. Not every franchisor error will allow the franchisee to complete the entire franchise agreement. The error must be sufficiently serious.
An illustrative case has arisen in this respect where the franchise agreement prescribed certain formalities to be observed in order to arrive at a certain change. For example, it was stipulated that the franchisees’ association had to be given the opportunity to give advice before the franchisor could make a certain change. Because the franchisor ignored this right to advice, the intended change could not be implemented, but there was no reason for the franchisee to disregard all obligations under the franchise agreement.
Breaking open a franchise agreement in the meantime does not always have to mean the end of the collaboration, but can also mean, for example, that parts of the franchise agreement are changed (for the individual franchisee).
In any case, it is certainly not always impossible to break open a franchise agreement. However, this is a legally thorny issue that requires proper guidance and advice.
mr. AW Dolphijn – franchise lawyer
Ludwig & Van Dam Franchise attorneys, franchise legal advice. Do you want to respond? Go to: dolphijn@ludwigvandam.nl
![219contracts-min](https://www.ludwigvandam.nl/wp-content/uploads/2020/12/219contracts-min.jpg)
Other messages
Legal split at franchise and the bankruptcy pauliana
The Supreme Court recently made interesting rulings (ECLI:NL:HR:2013:2122 and ECLI:NL:HR:2013:2133 ) in a matter of legal unbundling, which is also important for the franchise practice.
The exclusive purchase clause before the court, competition
By judgment in summary proceedings of 26 November 2013, the preliminary relief judge of the District Court of Rotterdam
Services towards a new franchise model
Services towards a new franchise model
Looking back at The National Franchise Congress
Looking back at The National Franchise Congress
Excusable infringement of territory exclusivity
The District Court of Rotterdam recently ruled on a matter concerning infringement of the agreed district exclusivity.
Newsletter current affairs in employment law – Mr J. Sterk and Mr I. van Efferen
Modernization of the Sickness Benefits Act as of 1 January 2014