Can Franchisee Sue Franchisor
Can you sue your franchisor? Yes, one of the most common causes of litigation cases is when one party thinks the other isn’t doing what they agreed to do. A franchisee may sue the franchisor claiming the franchisor was not able to give the support they agreed upon.
The franchisor, on the other hand, may sue the franchisee for failure to run the business under the franchise agreement's terms and conditions or failing to pay royalties or current fees.
Litigation may also occur when either party thinks the other is doing something unexpected that’s harmful to the business. You know that you can sue your franchisor, but the process involved is not only stressful but also expensive. How can you avoid ending up in a lawsuit?
Do Your Research
Conduct a thorough research of the franchise opportunity you are interested in. Assess all disclosure documents presented by the franchisor. If they have any litigation history, take note of it and talk to both sides if they’re willing. Call their current franchisees and ask them about their experience with the franchisor.
Get Everything in Writing
Good franchise companies will give you a compliance questionnaire that you need to sign before you’re accepted as a franchisee. The questionnaire asks you if anyone promised you something that differs from the contract you’re about to sign. If there is, don’t sign the franchise agreement unless that promise is in writing. This way, you don’t have to sue your franchisor over whether any promise existed or not.
Success isn’t guaranteed. If you get into a franchise where almost everyone else is achieving success except you, take time to think about things before you consider litigation. A lot of people who fail to get what they want look for someone else at fault. Be responsible and ask for help. Follow the advice of your franchisor.