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  1. #1
    Join Date
    Jun 2012
    Posts
    1

    Default If a Franchise Goes Out of Business Can You Sue the Franchisor

    My question involves business law in the state of: Oregon

    I have a very strong case for breach of contract (before the company went out of business) and negligence. The parent company is not offering to make things right.

    After installing an inferior product and installing it incorrectly so that it failed, this contracting company has shut its doors. I don't know what their status is legally. I know the owner still has a contractor's number but gave up all rights to the company and its assets, including all contracts and paperwork.

    The company was an LLC, so doubt I can sue the owner, but can I sue the company who I called to do business with and whose name (but not address or other info) is on the contract, and who now has my contract and check receipts?

    thanks in advance

  2. #2
    Join Date
    Sep 2011
    Location
    OH10
    Posts
    17,019

    Default Re: If a Franchise Goes Out of Business Can You Sue the Franchisor

    Read your contract. Generally, the franchisee is actually a purchase/reseller and your contract will dictate what warranty the manufacturer is liable for, if any.

  3. #3
    Join Date
    Sep 2005
    Location
    Behind a Desk
    Posts
    98,846

    Default Re: If a Franchise Goes Out of Business Can You Sue the Franchisor

    Generally speaking, the franchisor will not be liable. The franchisee's business is independent.

    If the matter is one of inferior products obtained from the franchisor, there may be some liability based upon the manufacturer's responsibility for the materials.

    If you are indicating that you contacted the franchisor and were referred to the local affiliate, you can read your contract with the franchisor to see what it says about its liability for referrals gone wrong.

    Depending upon the details, it's possible that the consumer protection laws of your state are somehow implicated - but as we have essentially none of the facts we're not in a position to analyze that for you.

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