Is the exclusion of consequential damages for Aira Fitness applicable in actions based on contract or tort?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
(b) **Exclusion of Consequential Damages.
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS LEASE, FRANCHISOR'S AFFILIATE SHALL NOT, UNDER ANY CIRCUMSTANCES, BE LIABLE TO FRANCHISEE OR ANY THIRD PARTY, FOR CONSEQUENTIAL, INCIDENTAL, SPECIAL OR EXEMPLARY DAMAGES ARISING OUT OF OR RELATED TO THE TRANSACTION CONTEMPLATED HEREUNDER, WHETHER IN AN ACTION BASED ON CONTRACT, TORT (INCLUDING**
NEGLIGENCE OR STRICT LIABILITY) OR ANY OTHER LEGAL THEORY, INCLUDING, BUT NOT LIMITED TO, LOSS OF ANTICIPATED PROFITS, OR BENEFITS OF USE OR LOSS OF BUSINESS, REGARDLESS OF WHETHER SUCH LOSSES ARE CONSTRUED TO BE CONSEQUENTIAL, INCIDENTAL, SPECIAL OR EXEMPLARY DAMAGES, AND EVEN IF FRANCHISOR'S AFFILIATE IS APPRISED OF THE LIKELIHOOD OF SUCH DAMAGES OCCURRING.
IT IS EXPRESSLY UNDERSTOOD AND AGREED THAT EACH AND EVERY PROVISION OF THIS AGREEMENT WHICH PROVIDES FOR A LIMITATION OF LIABILITY, DISCLAIMER OF WARRANTIES OR EXCLUSION OF DAMAGES, IS INTENDED BY THE PARTIES TO BE SEVERABLE FROM ANY OTHER PROVISION AND IS A SEPARABLE AND INDEPENDENT ELEMENT OF RISK ALLOCATION AND IS INTENDED TO BE ENFORCED AS SUCH. THE PARTIES ALSO AGREE THAT, REGARDLESS OF THE FAILURE OF ANY SOLE OR EXCLUSIVE REMEDY APPLICABLE TO THE POD, FRANCHISEE WILL NOT BE ENTITLED TO ANY CONSEQUENTIAL DAMAGES OF WHATSOEVER KIND OR NATURE. THE PARTIES INTEND THE EXCLUSION OF CONSEQUENTIAL DAMAGES AS AN INDEPENDENT AGREEMENT APART FROM ANY SOLE AND EXCLUSIVE REMEDY APPLICABLE TO THE POD.
Source: Item 23 — **RECEIPTS (FDD pages 59–254)
What This Means (2025 FDD)
According to Aira Fitness's 2025 Franchise Disclosure Document, the exclusion of consequential damages applies to actions based on contract, tort, or any other legal theory. Specifically, Franchisor's Affiliate will not be liable to the franchisee or any third party for consequential, incidental, special, or exemplary damages arising out of or related to the transaction. This exclusion applies regardless of the legal theory under which the action is brought, including contract, tort (such as negligence or strict liability), or any other legal basis.
This means that if an Aira Fitness franchisee experiences losses such as loss of anticipated profits, benefits of use, or loss of business due to an action by Franchisor's Affiliate, they will not be able to recover consequential damages from Franchisor's Affiliate. This exclusion applies even if Franchisor's Affiliate was aware of the possibility of such damages occurring.
The FDD emphasizes that each provision limiting liability, disclaiming warranties, or excluding damages is severable and represents an independent element of risk allocation. Even if a sole or exclusive remedy applicable to the Pod fails, the franchisee will not be entitled to any consequential damages. The exclusion of consequential damages is intended as an independent agreement, separate from any sole and exclusive remedy related to the Equipment. This clause is designed to limit the financial exposure of Franchisor's Affiliate and allocate the risk of certain types of losses to the franchisee.
Prospective Aira Fitness franchisees should carefully consider the implications of this exclusion, as it could significantly limit their ability to recover losses in certain situations. It is advisable to seek legal counsel to fully understand the scope and impact of this provision.