Is the exclusion of consequential damages intended as an independent agreement apart from any sole and exclusive remedy applicable to the Pod for Aira Fitness franchisees?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
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 is intended as an independent agreement, regardless of any sole or exclusive remedy applicable to the Pod. The agreement specifies that even if a remedy related to the Pod fails, the franchisee will not be entitled to any consequential damages. This is a key element of risk allocation between Aira Fitness's affiliate and the franchisee.
This means that Aira Fitness franchisees are restricted from claiming consequential, incidental, special, or exemplary damages from the Franchisor's Affiliate. This exclusion applies to any action based on contract, tort (including negligence or strict liability), or any other legal theory. The exclusion covers potential losses such as loss of anticipated profits, benefits of use, or loss of business, irrespective of whether these losses are categorized as consequential, incidental, special, or exemplary damages. This limitation applies even if the Franchisor's Affiliate was aware of the possibility of such damages.
The FDD emphasizes that each provision limiting liability, disclaiming warranties, or excluding damages is severable and independently enforceable. This underscores the intent to strictly limit the affiliate's liability, irrespective of other provisions in the lease agreement. For a prospective Aira Fitness franchisee, this means understanding that their potential recourse against the Franchisor's Affiliate is significantly limited, and they bear the risk of consequential losses.
This type of clause is relatively common in franchise agreements, as franchisors often seek to limit their financial exposure. However, franchisees should carefully consider the implications and potentially seek legal counsel to fully understand the risks involved. It is crucial for franchisees to assess their insurance coverage and business continuity plans in light of these limitations.