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Asked by Alexandra Ivars on May 25, 2024

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A court may decide that a franchisor has wrongfully terminated a franchise if the franchisor's decision was arbitrary.

Wrongfully Terminated

Dismissed from employment for illegal reasons or in ways that breach the terms of the contract or labor laws.

Franchisor

The party in a franchising agreement that grants the franchisee the right to operate a business under its trademark or trade name.

Arbitrary

Based on random choice or personal whim, rather than any reason or system.

  • Recognize the importance of good faith and fair dealing in franchise termination.
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Verified Answer

VJ
Vaishvi JoshiMay 30, 2024
Final Answer :
True
Explanation :
A court can find a franchisor's termination of a franchise agreement to be wrongful if the decision to terminate was made arbitrarily, without a valid business reason, or in violation of the terms of the franchise agreement or applicable laws.

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