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H0383aaS.......................................................by EDUCATION
FRANCHISE AGREEMENTS - Amends existing law to provide that any condition,
stipulation or provision in any franchise agreement is void under certain
circumstances; to provide that any condition, stipulation or provision in a
franchise agreement, to the extent it purports to assert or has the effect
of asserting the choice of law, is enforceable; to provide application to
certain franchise agreements; and to define the term "franchise
agreement."
03/21 House intro - 1st rdg - to printing
03/24 Rpt prt - to Bus
03/26 Rpt out - rec d/p - to 2nd rdg
2nd rdg - to 3rd rdg
03/27 3rd rdg - PASSED - 68-1-1
AYES -- Andersen, Barraclough, Barrett, Bauer, Bedke, Bell, Bieter,
Black, Block, Boe, Bolz, Bradford, Campbell, Cannon, Clark, Collins,
Crow, Cuddy, Deal, Denney, Douglas, Eberle, Edmunson, Ellsworth,
Eskridge, Field(18), Field(23), Gagner, Garrett, Harwood,
Henbest(Bray), Jaquet, Kellogg, Lake, Langford, Langhorst, Martinez,
McGeachin, McKague, Meyer, Miller, Mitchell, Moyle, Nacarrato,
Nielsen, Raybould, Ridinger, Ring, Ringo, Roberts, Robison, Rydalch,
Sali, Sayler, Schaefer, Shepherd, Shirley, Skippen, Smith(30),
Smith(24), Smylie, Snodgrass, Stevenson, Tilman, Trail, Wills, Wood,
Mr. Speaker
NAYS -- Kulczyk
Absent and excused -- Jones
Floor Sponsor - Block
Title apvd - to Senate
03/28 Senate intro - 1st rdg - to Com/HuRes
04/16 Rpt out - to 14th Ord
04/21 Rpt out amen - to 1st rdg as amen
04/22 1st rdg - to 2nd rdg as amen
04/23 2nd rdg - to 3rd rdg as amen
04/24 3rd rdg as amen - PASSED - 31-0-4
AYES -- Andreason, Bailey, Brandt, Bunderson, Burtenshaw, Calabretta,
Cameron, Compton, Darrington, Davis, Gannon, Geddes, Goedde, Hill,
Ingram, Kennedy, Little, Lodge, Malepeai, McKenzie, McWilliams, Noh,
Pearce, Richardson, Schroeder, Sorensen, Stegner, Stennett, Sweet,
Werk, Williams
NAYS -- None
Absent and excused -- Burkett, Keough, Marley, Noble
Floor Sponsors - Cameron & Compton
Title apvd - to House
04/25 House concurred in Senate amens - to engros
04/28 Rpt engros - 1st rdg - to 2nd rdg as amen
04/29 2nd rdg - to 3rd rdg as amen
04/30 3rd rdg as amen - PASSED - 67-2-1
AYES -- Andersen(Guyon), Barraclough(Schanz), Barrett, Bauer, Bedke,
Bell, Bieter, Black, Block, Boe, Bolz, Bradford, Campbell, Cannon,
Collins, Crow, Cuddy, Deal, Denney, Douglas, Eberle, Edmunson,
Ellsworth, Eskridge, Field(18), Field(23), Gagner, Garrett, Harwood,
Henbest, Jaquet, Jones(Jones), Kellogg, Lake, Langford, Langhorst,
Martinez(Echohawk), McGeachin, McKague, Meyer, Miller, Mitchell,
Moyle, Nielsen, Raybould, Ridinger, Ring, Ringo, Roberts, Robison,
Rydalch, Sali, Sayler, Schaefer, Shepherd(Buell), Shirley, Skippen,
Smith(30), Smith(24), Smylie, Snodgrass, Stevenson, Tilman, Trail,
Wills, Wood, Mr. Speaker
NAYS -- Clark, Kulczyk
Absent and excused -- Naccarato(Riggs)
Floor Sponsor - Block
Title apvd - to enrol
05/01 Rpt enrol - Sp signed - Pres signed
05/02 To Governor
05/12 Governor signed
Session Law Chapter 378
Effective: 07/01/03
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-seventh Legislature First Regular Session - 2003
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 383
BY EDUCATION COMMITTEE
1 AN ACT
2 RELATING TO FRANCHISE AGREEMENTS; AMENDING SECTION 29-110, IDAHO CODE, TO PRO-
3 VIDE THAT ANY CONDITION, STIPULATION OR PROVISION IN ANY FRANCHISE AGREE-
4 MENT IS VOID UNDER CERTAIN CIRCUMSTANCES, TO PROVIDE APPLICATION TO ANY
5 FRANCHISE AGREEMENT, TO PROVIDE FOR NO LIMITATION ON THE SCOPE OF EFFECT
6 ON THE LIMITATIONS ON THE RIGHT TO SUE AND TO DEFINE THE TERM "FRANCHISE
7 AGREEMENT."
8 Be It Enacted by the Legislature of the State of Idaho:
9 SECTION 1. That Section 29-110, Idaho Code, be, and the same is hereby
10 amended to read as follows:
11 29-110. LIMITATIONS ON RIGHT TO SUE -- FRANCHISE AGREEMENTS. (1) Every
12 stipulation or condition in a contract, by which any party thereto is
13 restricted from enforcing his rights under the contract by the usual proceed-
14 ings in the ordinary tribunals, or which limits the time within which he may
15 thus enforce his rights, is void.
16 (2) Any condition, stipulation or provision in any franchise agreement is
17 void to the extent it purports to waive, or has the effect of waiving, compli-
18 ance with this section. This subsection shall apply to any franchise agreement
19 entered into or renewed on and after July 1, 2003, by any person who at the
20 time of entering into or renewing such franchise agreement was a resident of
21 this state, or incorporated or organized under the laws of this state, regard-
22 less of any choice of law provision that otherwise may apply to such franchise
23 agreement.
24 (3) The provisions of subsection (2) of this section shall not limit the
25 scope of effect of subsection (1) of this section to all contracts.
26 (4) As used in this section "franchise agreement" means a written con-
27 tract or agreement by which:
28 (a) A person ("franchisee") is granted the right to engage in the busi-
29 ness of offering, selling or distributing goods or services under a mar-
30 keting plan or system prescribed in substantial part by a third party
31 ("franchisor");
32 (b) The operation of the franchisee's business pursuant to such plan or
33 system is substantially associated with the franchisor's trademark, ser-
34 vice mark, trade name, logotype, advertising or other commercial symbol
35 designating the franchisor of such plan or system; and
36 (c) The franchisee is required to pay the franchisor one thousand dollars
37 ($1,000) or more for the right to transact business pursuant to the plan
38 or system. Such payments shall not include amounts paid:
39 (i) As a reasonable service charge to the issuer of a credit card
40 by an establishment accepting or honoring the credit card; or
41 (ii) For the purchase of goods at a bona fide wholesale price.
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-seventh Legislature First Regular Session - 2003
Moved by Davis
Seconded by Cameron
IN THE SENATE
SENATE AMENDMENT TO H.B. NO. 383
1 AMENDMENT TO SECTION 1
2 On page 1 of the printed bill, delete lines 11 through 41 and insert:
3 "29-110. LIMITATIONS ON RIGHT TO SUE -- FRANCHISE AGREEMENT. (1) Every
4 stipulation or condition in a contract, by which any party thereto is
5 restricted from enforcing his rights under the contract by the usual proceed-
6 ings in the ordinary tribunals, or which limits the time within which he may
7 thus enforce his rights, is void.
8 (2) Any condition, stipulation or provision in a franchise agreement is
9 void to the extent it purports to waive, or has the effect of waiving venue
10 or jurisdiction of the state of Idaho's court system. Any condition, stipula-
11 tion or provision in a franchise agreement, to the extent it purports to
12 assert, or has the effect of asserting the choice of law is enforceable. This
13 subsection shall apply to any franchise agreement entered into or renewed on
14 or after July 1, 2003, by any person who at the time of entering into or
15 renewing such franchise agreement was a resident of this state or incorporated
16 or organized under the laws of this state.
17 (3) As used in this section "franchise agreement" means a written con-
18 tract or agreement by which:
19 (a) A person ("franchisee") is granted the right to engage in the busi-
20 ness of offering, selling or distributing goods or services under a mar-
21 keting plan or system prescribed in substantial part by a third party
22 ("franchisor");
23 (b) The operation of the franchisee's business pursuant to such plan or
24 system is substantially associated with the franchisor's trademark, ser-
25 vice mark, trade name, logotype, advertising or other commercial symbol
26 designating the franchisor of such plan or system; and
27 (c) The franchisee is required to pay the franchisor one thousand dollars
28 ($1,000) or more for the right to transact business pursuant to the plan
29 or system. Such payments shall not include amounts paid:
30 (i) As a reasonable service charge to the issuer of a credit card
31 by an establishment accepting or honoring the credit card; or
32 (ii) For the purchase of goods at a bona fide wholesale price.".
33 CORRECTION TO TITLE
34 On page 1 of the printed bill, delete lines 4 through 7 and insert: "MENT
35 IS VOID UNDER CERTAIN CIRCUMSTANCES, TO PROVIDE THAT ANY CONDITION, STIPULA-
36 TION OR PROVISION IN A FRANCHISE AGREEMENT, TO THE EXTENT IT PURPORTS TO
37 ASSERT, OR HAS THE EFFECT OF ASSERTING THE CHOICE OF LAW IS ENFORCEABLE, TO
38 PROVIDE APPLICATION TO CERTAIN FRANCHISE AGREEMENTS AND TO DEFINE THE TERM
39 "FRANCHISE AGREEMENT.".
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-seventh Legislature First Regular Session - 2003
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 383, As Amended in the Senate
BY EDUCATION COMMITTEE
1 AN ACT
2 RELATING TO FRANCHISE AGREEMENTS; AMENDING SECTION 29-110, IDAHO CODE, TO PRO-
3 VIDE THAT ANY CONDITION, STIPULATION OR PROVISION IN ANY FRANCHISE AGREE-
4 MENT IS VOID UNDER CERTAIN CIRCUMSTANCES, TO PROVIDE THAT ANY CONDITION,
5 STIPULATION OR PROVISION IN A FRANCHISE AGREEMENT, TO THE EXTENT IT PUR-
6 PORTS TO ASSERT, OR HAS THE EFFECT OF ASSERTING THE CHOICE OF LAW IS
7 ENFORCEABLE, TO PROVIDE APPLICATION TO CERTAIN FRANCHISE AGREEMENTS AND TO
8 DEFINE THE TERM "FRANCHISE AGREEMENT."
9 Be It Enacted by the Legislature of the State of Idaho:
10 SECTION 1. That Section 29-110, Idaho Code, be, and the same is hereby
11 amended to read as follows:
12 29-110. LIMITATIONS ON RIGHT TO SUE -- FRANCHISE AGREEMENT. (1) Every
13 stipulation or condition in a contract, by which any party thereto is
14 restricted from enforcing his rights under the contract by the usual proceed-
15 ings in the ordinary tribunals, or which limits the time within which he may
16 thus enforce his rights, is void.
17 (2) Any condition, stipulation or provision in a franchise agreement is
18 void to the extent it purports to waive, or has the effect of waiving venue
19 or jurisdiction of the state of Idaho's court system. Any condition, stipula-
20 tion or provision in a franchise agreement, to the extent it purports to
21 assert, or has the effect of asserting the choice of law is enforceable. This
22 subsection shall apply to any franchise agreement entered into or renewed on
23 or after July 1, 2003, by any person who at the time of entering into or
24 renewing such franchise agreement was a resident of this state or incorporated
25 or organized under the laws of this state.
26 (3) As used in this section "franchise agreement" means a written con-
27 tract or agreement by which:
28 (a) A person ("franchisee") is granted the right to engage in the busi-
29 ness of offering, selling or distributing goods or services under a mar-
30 keting plan or system prescribed in substantial part by a third party
31 ("franchisor");
32 (b) The operation of the franchisee's business pursuant to such plan or
33 system is substantially associated with the franchisor's trademark, ser-
34 vice mark, trade name, logotype, advertising or other commercial symbol
35 designating the franchisor of such plan or system; and
36 (c) The franchisee is required to pay the franchisor one thousand dollars
37 ($1,000) or more for the right to transact business pursuant to the plan
38 or system. Such payments shall not include amounts paid:
39 (i) As a reasonable service charge to the issuer of a credit card
40 by an establishment accepting or honoring the credit card; or
41 (ii) For the purchase of goods at a bona fide wholesale price.
STATEMENT OF PURPOSE
RS 13202C2
Most franchise agreements include non-negotiable terms which
control where a dispute must be litigated. Many franchise
agreements adopt provisions forcing Idaho parties to litigate their
disputes in another state. This legislation will allow Idaho
residents to litigate their disputes in Idaho under Idaho law.
FISCAL IMPACT
None.
Contact: Doug Vollmer
(208) 420-5650
Con Paulos
(208) 324-3900
Bill Kyle
(208) 734-5505
J. Walter Sinclair
(208) 387-4248
Rep. Sharon Block
(208) 332-1000
STATEMENT OF PURPOSE/FISCAL NOTE H 383