33 FLAVORS OF FLORIDA, INC., APPELLANT,
v.
KENNETH A. LARSEN AND DOROTHY A. LARSEN, HIS WIFE, APPELLEES
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33 Flavors of Florida sold an ice cream franchise to the Larsens using misrepresentations made before a new statute prohibiting franchise misrepresentation took effect. The court affirmed that once the statute became effective, the franchisor had a duty to disclose or correct the prior misrepresentations, even though they predated the statute's enactment.
Once a statute prohibiting franchise misrepresentation becomes effective, a franchisor has a duty to disclose or correct prior misrepresentations that continue to serve as inducement to a prospective franchisee when a binding contract remains outstanding. This does not constitute an impermissible retroactive application of the statute.
[1] A seller of a franchise has a duty to disclose or rectify prior misrepresentations made to induce a prospective franchisee when a binding contract is still pending after…
[2] A statute regulating franchise sales may be applied to prior misrepresentations if the contract for the franchise is consummated after the statute's effective date.
Previewing 2 of 5 headnotes on this case. FLexlaw’s editorially structured points of law — every proposition, pinpointed — are reserved for members.
Join FLexlaw to unlock all legal intelligence“It is unlawful, when selling or establishing a franchise or distributorship, for any person: Intentionally to misrepresent the prospects or chances for success of a proposed o.r existing franchise or distributorship”
Establishes the statutory prohibition against franchise misrepresentation that became effective May 24, 1971.
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Join FLexlaw to unlock all legal intelligence33 Flavors' agents began negotiations with the Larsens in January 1971 and made certain representations about the franchise. A binding contract was ex…
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McNULTY, Chief Judge.
We affirm the judgment appealed from herein in all respects but we touch briefly on the one point meriting discussion.
Section 817.416, F.S.1971, provides in relevant part as follows:
(2) Declarations.—
(a) It is unlawful, when selling or establishing a franchise or distributorship, for any person:
1. Intentionally to misrepresent the prospects or chances for success of a proposed o.r existing franchise or distributorship ;
(3) Civil Provisions. — Any person, who shows in a civil court of law a violation of this section may receive a judgment for all moneys invested in such franchise or distributorship. Upon such a showing, the court may award any person bringing said action reasonable attorney’s fees and shall award such person reasonable costs incurred in bringing the action, and execution shall thereupon issue.
Appellant’s agents sold an ice cream franchise to the Larsens. Negotiations began sometime in January 1971 and were consummated by a binding contract on July 6, 1971. The aforesaid statute became effective in the interim on May 24, 1971 and, in the present posture of the case, it must be taken that certain representations were made by appellant’s agent prior to the effective date of the statute which, if made after, would be in violation thereof. The underlying issue before us, then, is whether, after the effective date of the statute, the prior misrepresentations should have been disclosed. We think so.
Obviously, this regulated business practice became so prevalent and resulted in so much evil that the legislature found it necessary to proscribe it. Public policy would require, therefore, that when as here the evil continues from its making as an inducement to the prospective franchisee, and a binding contract is still in the offing at the time such evil is expressly proscribed by statute, the courts should impose the duty on the maker to disclose or “make right” the evil. To do so is neither retrospective application of a statute nor a construction thereof impairing a contractual obligation.
The judgment appealed from should be, and it is hereby affirmed.
HOBSON and GRIMES, JJ., concur.
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33 Flavors OF Fla., Inc. v. Larsen, 317 So. 2d 767 (Fla. 1975)…Certiorari denied. 308 So. 2d 591. ADKINS, C. J., and ROBERTS, BOYD, OVERTON and ENGLAND, JJ., concur.…
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Goodman v. Miami Crane Serv., Inc., 43 Fla. Supp. 102 (Dade Cty. Cir. Ct. 1975)…ust be applied and is controlling. Goodfriend v. Druck, Fla. 1975, 289 So. 2d 710; Summerlin v. Tramill, Fla. 1973, 290 So. 2d 53; Donovan v. Environs Palm Beach, Fla. App. 1975, 309 So. 2d 561; 33 Flavors of Florida, Inc. v. Larsen, Fla. App. 1975, 308 So. 2d 591; R & R Lounge, Inc. v. Wynne, Fla. App. 1973, 286 So. 2d 13; Seaboard Coast Line R. Co. v. Campbell, Fla. App. 1973, 285 So. 2d 62; Ingerson v. State Farm Mut. Auto Ins. Co., Fla. App. 1973, 272 So. 2d 862. In each of these cases, a statutory amendm…
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Larsen v. Bresler's 33 Flavors, Inc., 308 So. 2d 592 (Fla. 2d DCA 1975)…[*593] PER CURIAM. This appeal has become moot in view of this court’s opinion in 33 Flavors of Florida, Inc. v. Larsen, 308 So. 2d 591, filed February 5, 1975. The appeal is, therefore, dismissed. McNULTY, C. J., and HOBSON and GRIMES, JJ., concur.…