Can an Americas Best Value Inn franchisee use setoff against their payment obligations?
Americas_Best_Value_Inn Franchise · 2025 FDDAnswer from 2025 FDD Document
in Section 4. You shall not alter or close any such account, except with our prior written approval. If we permit you to pay by any other means, we may require payment of an alternative payment fee that is subject to change. We may, at any time, modify the required method of payment by providing you with at least 30 days' prior notice. Your obligation to pay amounts due to us or to any of our designees will not be suspended as a result of any interruption to your business, regardless
Source: Item 23 — RECEIPTS (FDD pages 71–223)
What This Means (2025 FDD)
According to the 2025 Americas Best Value Inn Franchise Disclosure Document, franchisees are explicitly prohibited from using setoff against their payment obligations. The FDD states that the franchisee's obligation to make payments is absolute and unconditional, meaning that franchisees cannot deduct or withhold payments due to any disputes or claims they may have against Americas Best Value Inn.
This no setoff clause is a standard provision in many franchise agreements. It ensures that Americas Best Value Inn receives consistent and timely payments from its franchisees, regardless of any issues that may arise. This provision protects the franchisor's revenue stream and ability to meet its own financial obligations.
For a prospective Americas Best Value Inn franchisee, this means they must resolve any disputes separately without impacting their payment schedule. Failure to comply with payment obligations could result in penalties, legal action, or even termination of the franchise agreement. Therefore, franchisees need to be financially prepared to meet their payment obligations and address any grievances through proper channels without resorting to setoff.