Procedural Requirements for Termination of a Franchise (Part B)

Stating the Reasons for Termination

In some states, the termination notice must contain the reasons for termination of a franchise. This forces the franchisor to state their position at the time of notification, which may prevent the admission of arbitrary evidence in a formal court proceeding.

Incurable Breaches

Sometimes a breach of the franchise relationship cannot be cured within the statutory period. Some examples of breaches include:

• a failure to attain minimum sales requirements;
• misuse of the franchisor's trademark;
• damage to the franchisor's good will;
• insolvency; and
• bankruptcy.

In a case where a breach cannot be cured within the required amount of time, a court may issue an injunction to prevent the termination of a franchise. A franchisee's reasonable steps to rectify the breach may be deemed adequate to avoid termination.

In previous cases, courts have determined that a cure period was not required for the termination of a franchise. For example, after a franchisee in Minnesota had damaged the good will of a franchisor, the Supreme Court of Minnesota held that the opportunity to cure would have been a "futile gesture". In that case, the franchisor terminated the relationship upon notice, with immediate effect.

In California and Illinois, courts have determined that no cure period is required when the franchisee commits a crime.

How can a New York franchise lawyer help?

If you plan to terminate a franchise in New York, New Jersey or elsewhere, you will first have to interpret that particular state's procedural requirements. A New York franchise lawyer can help you to interpret these requirements, and make sure that you don't violate New York franchise law. A New York franchise lawyer can help you submit your notice of termination, as well as any paperwork necessary to the termination process.

If the termination proceedings are challenged, your lawyer can represent your interests in a formal court of law.

Contacting a New York Franchise Lawyer

If you are an entrepreneur who is interested in franchising your business there is a lot you need to know, including the significance of evaluating your trademark and how to approach the preparation of your Franchise Disclosure Document. For a limited time, get New York franchise lawyer Charles N. Internicola, Esq's franchise law report to determine whether your business is right for franchising. Contact us today at 1-800-976-4904 for more information about Mr. Internicola's franchise law services in New York and how he assists entrepreneurs franchise their business nationwide.

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