Is All Team liable to the USER for damages resulting from credit decisions regarding Customers?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
USER shall not accept any orders from or provide any services to any Customer, without ATFC's express prior written consent or after ATFC's express written refusal in any case where the Customer's creditworthiness is not acceptable to ATFC or the Customer's payment policies or practices violate ATFC's rules and requirements with regard to the payment of invoices, as established by ATFC from time to time. The decision to accept any orders shall at all times be in ATFC's sole discretion, and ATFC shall not be liable to USER for damages or otherwise because of any such credit decisions.
Source: Item 23 — RECEIPT (FDD pages 34–161)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, All Team is not liable to the USER (franchisee) for damages resulting from credit decisions regarding customers. Specifically, the decision to accept any orders is at All Team's sole discretion, and All Team will not be liable to the USER for damages or otherwise because of any such credit decisions. This protects All Team from liability related to decisions about customer creditworthiness.
This means that as an All Team franchisee, you cannot hold All Team responsible for any financial losses you incur due to their credit decisions regarding your customers. While All Team may provide a credit investigation service through a third party, the final decision to extend credit rests with the franchisee. All Team is not responsible for non-payment by the customer or the accuracy of information provided by third parties. Any charges for credit reports may be passed on to the franchisee.
This clause highlights the importance of the franchisee's role in assessing credit risk and making informed decisions about extending credit to customers. It is crucial for franchisees to conduct their own due diligence and not solely rely on the credit investigations provided by All Team or third parties. Franchisees should implement their own credit policies and procedures to minimize the risk of non-payment and potential financial losses. Understanding this allocation of responsibility is essential for prospective franchisees to accurately assess the risks and rewards associated with the All Team franchise opportunity.