J.C., Inc., had a franchise agreement with McDonaldàCorporation to operate McDonaldàrestaurants in
Lancaster, Ohio. The agreement required J.C. to make monthly payments to McDonaldàof certain
percentages of the gross sales. If any payment was more than 30 days late, McDonaldàhad the right to
terminate the franchise. The agreement also stated that even if McDonaldàaccepted a late payment,
that would not ïnstitute a waiver of any subsequent breach.
cDonaldàsometimes accepted J.C.Êlate payments, but when J.C. defaulted on the payments in July 2010, McDonaldàgave notice of 30 days
to comply or surrender possession of the restaurants. J.C. missed the deadline. McDonaldàdemanded
that J.C. vacate the restaurants, but J.C. refused. McDonaldàfiles a lawsuit alleging that J.C. had violated
the franchise agreement. J.C claimed that McDonaldàhad breached the implied covenant of good faith
and fair dealing.
Q1: Which party should prevail and why?
Q2: What are the differences between general partners and limited partners in a limited
partnership?

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