Franchising For New Canadians

When to Engage a Franchise Lawyer

[fa icon="calendar"] Mar 25, 2019 3:50:00 PM / by Joseph Adler, Partner, Hoffer Adler LLP

Franchise lawyer engaging with client in office

When you make the decision to purchase a franchise, you would be deciding to make a major investment of your time, money, and effort. An experienced franchise lawyer can help you to clearly understand what’s involved and how you can protect your legal interests.

 


Register with us to learn more about Franchising and how you can become your own boss.


 

If you’re new to franchising, you’ve likely noticed how much information there is to gather, collect, and evaluate. If you have already started conducting your franchise research, you have hopefully:

  • Assessed your strengths, skills, and previous business experience
  • Identified certain franchise categories that match your skills and interests
  • Selected a few franchise systems that you think you’re interested in joining
  • Received a Franchise Disclosure Document from one or more franchisors.

 

Do you have what it takes?


These are just some of the important due diligence and research activities that all potential franchisees need to conduct and complete to ensure you make a wise purchasing decision.

So, at what point does it make sense to engage a franchise lawyer?

Once you have conducted some of this initial research and you’re confident that you are ready to work with a specific franchisor, it’s time to hire a franchise lawyer.


Engage a Franchise Lawyer Early in the Process


While you are considering the purchase of a franchise, it would be helpful to have at least an initial conversation with a franchise lawyer to:

  • Obtain some guidance from the franchise lawyer in conducting the necessary due diligence
  • Avoid making certain mistakes in the early stages of the relationship with the franchisor. For example, many prospective franchisees have paid initial deposits to their franchisors, even before they have met with their franchise lawyers to review and discuss their disclosure documents
  • Discuss the process of becoming a franchisee, to get a heads-up on what to expect while moving along the process


For obvious reasons, you should consult with a franchise lawyer who is independent from the franchisor and you should retain a franchise lawyer before you:


  • Sign a franchise agreement
  • Make any payments to the franchisor or any of its affiliates


Furthermore, you should have an experienced franchise lawyer review the franchisor’s disclosure document, and the franchise agreement and related documents before you sign any agreement or pay the franchisor any money. Signing a franchise agreement or lease, for example, can have critical legal consequences that can prove to be costly to a franchisee. A franchise lawyer can provide important protection and advice to avoid liability and unwanted consequences.

 

 

 


Related Posts:
- Why it's Important for Prospective Franchisees to Consult with a Franchise Lawyer
 

 



Questions to Ask Before Retaining a Lawyer



Here are some questions that you should ask a franchise lawyer before you retain them:

  1. What experience do you have in advising prospective franchisees, entrepreneurs looking to franchise their businesses and existing franchisors?
  2. Is franchise law your principal area of expertise?
  3. Will you do the work yourself or will the work be handled by someone else within your firm? 
  4. Do you communicate clearly when explaining legal issues and legal documentation to your clients? 
  5. What are your billing practices? Will you consider flexible billing arrangements and do you bill regularly so as to not surprise your clients?
  6. How connected are you to the franchising industry and can you introduce the appropriate franchise professionals such as franchise consultants, brokers and accountants familiar with the unique issues involved with franchising?
  7. Do you have access to an experienced litigator within your office who could assist you to defend or launch an action should the need arise? 
  8. Are you a deal-maker or a deal-breaker? 
  9. Do you have interests outside of the law that may make you a better-rounded legal practitioner? 

Engaging a franchise lawyer at the right time in your franchise selection process can help you understand and work through important steps to help you make this important decision. This trusted advice and legal review can be critical to a franchisee’s long-term success.

Topics: Legal First Steps

Joseph Adler, Partner, Hoffer Adler LLP

Written by Joseph Adler, Partner, Hoffer Adler LLP

Joseph Adler is a senior franchise lawyer and serves as legal counsel for Canadian and US and other foreign franchisors doing business in Canada and Canadian franchisors doing business in the US and abroad. He also acts and has acted for franchisees and franchisee associations. Joseph is the immediate past Secretary and General Counsel to the Canadian Franchise Association (CFA) (2011-2015) and a former Director and Executive Member of the CFA’s Board of Directors (2007-2015). Joseph has published frequently and has spoken on various franchising topics at venues organized by the CFA, OBA, ABA Forum on Franchising and International Franchise Association. Recognized by his peers, Joseph is consistently listed as a leading practitioner in franchise law in the International Who's Who of Franchise Lawyers, Legal LEXPERT Directory, Franchise Times as a "Legal Eagle", one of the top franchise lawyers in the US & Canada and The National Post’s Best Lawyers in Canada (Franchising). Joseph Adler can be reached be email at: jadler@hofferadler.com or phone: 416-977-3444.

*By submitting this form I consent to receive electronic information from Prepare For Canada. You can unsubscribe at any time.

New call-to-action

 
Franchising For New Canadians
Facebook Group · 6 members
Join Group
Our latest program is designed to help newcomers to Canada make better informed decisions about franchising in Canada. We aim to connect one-on-one wi...
 
New call-to-action