CHAPTER 1. Civil Liability [31300. - 31306.]

Cal. Corporations Code - CORP 1.
in effect

Cal. Corporations Code - CORP § 31300. Section 31300.

(a) Any person who offers or sells a franchise in violation of Section 31101, 31110, 31119, 31200, or 31202, or in violation of any provision of this division that provides an exemption from the provisions of Chapter 2 (commencing with Section 31110) of Part 2 or any portions of Part 2, shall be liable to the franchisee or subfranchisor, who may sue for damages caused thereby, and if the violation is willful, the franchisee may also sue for rescission, unless, in the case of a violation of Section 31200 or 31202, the defendant proves that the plaintiff knew the facts concerning the untruth or omission, or that the defendant exercised reasonable care and did not know, or, if they had exercised reasonable care, would not have known, of the untruth or omission. (b) (1) Any franchise broker who offers or sells a franchise in violation of Part 7 (commencing with Section 31520) or Chapter 1 (commencing with Section 31200) of Part 3 shall be liable to the franchisee, who may sue for damages caused thereby. (2) Any franchise broker who offers or sells a franchise in violation of Part 7 (commencing with Section 31520) or Chapter 1 (commencing with Section 31200) of Part 3 shall be liable to the franchisor, who may sue for damages or may assert claims of indemnity against the franchise broker caused by the violation, including, but not limited to, indemnity for any damages awarded in connection with rescission awarded to the franchisee.

Cal. Corporations Code - CORP § 31301. Section 31301.

Any person who violates Section 31201 shall be liable to any person (not knowing or having cause to believe that such statement was false or misleading) who, while relying upon such statement shall have purchased a franchise, for damages, unless the defendant proves that the plaintiff knew the facts concerning the untruth or omission or that the defendant exercised reasonable care and did not know, (or if he had exercised reasonable care would not have known) of the untruth or omission.

Cal. Corporations Code - CORP § 31302. Section 31302.

Every person who directly or indirectly controls a person liable under Section 31300 or 31301, every partner in a firm so liable, every principal executive officer or director of a corporation so liable, every person occupying a similar status or performing similar functions, every employee of a person so liable who materially aids in the act or transaction constituting the violation, are also liable jointly and severally with and to the same extent as such person, unless the other person who is so liable had no knowledge of or reasonable grounds to believe in the existence of the facts by reason of which the liability is alleged to exist.

Cal. Corporations Code - CORP § 31302.5. Section 31302.5.

(a) Any person who violates Section 31220 may be sued in the superior court in the county in which the defendant resides or where a franchise affected by the violation does business, for temporary and permanent injunctive relief and for damages, if any, and the costs of suit, including reasonable attorneys’ fees. A plaintiff shall not be required to allege or prove that actual damages have been suffered in order to obtain injunctive relief. (b) No action shall be maintained to enforce any liability created under Section 31220 unless brought before the expiration of two years after the violation upon which it is based or the expiration of one year after the discovery by the plaintiff of the facts constituting such violation, whichever occurs first.

Cal. Corporations Code - CORP § 31303. Section 31303.

No action shall be maintained to enforce any liability created under Section 31300 unless brought before the expiration of four years after the act or transaction constituting the violation, the expiration of one year after the discovery by the plaintiff of the fact constituting the violation, or 90 days after delivery to the franchisee of a written notice disclosing any violation of Section 31110 or 31200, which notice shall be approved as to form by the commissioner, whichever shall first expire.

Cal. Corporations Code - CORP § 31304. Section 31304.

No action shall be maintained to enforce any liability created under Section 31301 unless brought before the expiration of two years after the violation upon which it is based, expiration of one year after the discovery by the plaintiff of the facts constituting such violation, or 90 days after delivery to the franchisee of a written notice disclosing any violation of Section 31201 or 31202 which notice shall be approved as to form by the commissioner, whichever shall first expire.

Cal. Corporations Code - CORP § 31306. Section 31306.

Nothing in this chapter shall limit any liability which may exist by virtue of any other statute or under common law if this law were not in effect.
Source: CA Legislative Counsel Bulk DataURL: https://downloads.leginfo.legislature.ca.gov/pubinfo_2025.zipFetched: 6/27/2026

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