Hi there,
New here and looking for some advice. I've had a franchise for 5 years and feel that I am no longer getting anything close to value for money from the agreement. The contract I signed stated that I would need to give two months notice in writing to terminate the contract, as well as terminating the business telephone line, and not continuing to trade in the same territory for six months. This all seems reasonable enough.
It now appears that I am not the only franchisee who is unsatisfied with the franchise, and the franchisor has produced a 'franchise closure policy' which states, amaong other things, that we have to provide the franchisor with contact details of all our clients, written proof of the termination of the lease of premises used, a copy of a letter sent to all clients advising them of the nearest alternative franchise and various other clauses that basically make the franchise agreement very difficult to get out of.
What I would like to know is whether this 'franchise closure policy' would be legally binding as none of it was mentioned in the original agreement that I signed?
Hope someone can help,
Many thanks
Harry
Harry
It would appear from what you have written that the franchisor may be seeking to vary the terms of your original agreement without negotiation with you, a franchisee. You will need to go back to your original agreement and examine whether it contains any clause(s) allowing varations such as this - some do. Others will state that any significant changes to the agreement will be applied after a suitable period of negotiation and / or warning. If the Franchise Closure Policy was not a feature of the original agreement I am confident your legal advisor could successfully argue that it is inoperable. Most, if not all, franchisors would opt for a clean break with any dissatisfied franchisee in order to preserve the goodwill generated after five years. Advise your franchisor that you are taking legal advice (even if it is just the Citizens Advice Bureau) but also make it clear that you wish a clean break if that is what you really want. Is there a clause stipulating a "buy back" or option to sell?
Hope this is of some help
JT