The Specific Complications of Franchise Construction Disputes in Missouri
Jan 21 2025 On Behalf of David M. Duree & Associates, P.C. Construction
Many businesses in Missouri operate as franchises of larger corporations. When a franchise involves a brick-and-mortar location, the franchisee usually must build out their location to the specifications set by the franchisor—an arrangement that may involve various complexities and challenges that lead to legal disputes. Understanding the potential issues that can arise in franchise construction can help franchisees and contractors set up their relationship to minimize the risk of potentially costly and time-consuming disputes.
Top Causes of Franchise Construction Disputes
Some of the most common causes of franchise construction disputes in Missouri include:
- Contractual issues: Ambiguities or inconsistencies in the franchise agreement’s specifications for how the franchisee should build out the franchise location can lead to construction disputes, especially if the franchisor forces the franchisee to make unexpected changes to the construction contract. Similarly, ambiguities or inconsistence in the construction contract between the franchisee and contractor can also lead to disputes between parties, including over issues such as design specifications, completion timelines, and budgets.
- Regulatory issues: Franchisees and contractors may have disputes over local regulatory requirements, including building codes, zoning laws, and permitting issues, especially if contractors have difficulties meeting the franchise requirements under applicable laws and regulations.
- Workmanship issues.
Unique Challenges of Missouri Franchise Construction Disputes
When franchisees and contractors get into disputes over franchise construction contracts, some of the unique complications that may arise as parties navigate the dispute and pursue a settlement or favorable resolution include:
- Jurisdictional issues: Different state laws may apply to a franchise construction dispute, especially if a franchisor gets involved in a construction contract and includes choice-of-law or forum-selection clauses that favor the franchisor’s home state.
- Franchise requirements vs. local rules: Resolving franchise construction disputes may become more challenging when a franchisee and contractor cannot harmonize a franchisor’s branding requirements with state and local building and zoning codes.
- Economic issues: Franchise contract disputes can quickly lead to delays and cost overruns for the franchisee. Depending on the respective sizes of the franchise and community, delays can also adversely affect local economies that depend on the franchise location opening. Furthermore, delays can inflict reputational damage for the franchisee or franchisor in the community or the Missouri market.
How to Prevent Franchise Construction Disputes
Franchisees and contractors can reduce the chances of construction disputes by following best practices, such as:
- Ensuring clarity in contract provisions: Careful contract drafting to negotiate terms that clearly define the parties’ expectations and obligations can minimize the risk of legal disputes. Parties can improve the clarity of their contractual agreements by working with legal counsel experienced in meshing local and state laws and regulations with national franchise standards.
- Conducting due diligence: Franchisees can work with legal counsel and contractors with extensive knowledge of state and local regulations who can assist with due diligence to ensure that proposed construction specifications will comply with applicable laws.
- Proactive communications: Finally, franchisees and contractors can prevent issues from spiraling into legal disputes through proactive communication that can help resolve conflicts.
Contact a Construction Attorney Today
if you’ve found yourself in a franchise construction dispute in Missouri, you need an experienced construction lawyer to advocate for your rights and interests. Contact David M. Duree & Associates, P.C., today for an initial consultation with our legal team to discuss your legal options for seeking a favorable resolution to your franchise construction dispute.