Good Faith in Franchise Relations. Barn-Chestnut, Inc (BCI), ...

[D2AR0N]

Good Faith in Franchise Relations. Barn-Chestnut, Inc (BCI), entered into a franchise agreement with Grocers Development Corp (GDC) for a Convenient Food Mart for as long as

Question 2

Legal obligations in an agency run from agent to principal, not principal to agent.
 a. True
  b. False
  Indicate whether the statement is true or false

[jackie]

Answer to Question 1

Good faith in franchise relations
The Supreme Court of Appeals of West Virginia held, among other things, that an offer to renew the lease or franchise was not required by the implied obligation of good faith, fair dealing, and commercial reasonableness. The court acknowledged that there is imposed upon both parties to a business transaction an obligation of good faith in its performance or enforcement. The court pointed out, however, that the implied covenant of good faith and fair dealing cannot give contracting parties rights which are inconsistent with those set out in the contract. In this case, the agreements have expired.    The implied covenant of good faith and fair dealing does not give contracting parties rights which are contrary to those set out in the contract, and since the parties did not incorporate express renewal provisions in the original agreements,    a lessor/franchisor is not required by an implied obligation of good faith, fair dealing and commercial reasonableness to offer a renewal of either agreement to a lessee/franchisee.

Answer to Question 2

FALSE