In Anago legal proceedings, is the successful party entitled to recover expenses beyond taxable court costs, such as arbitration fees or bankruptcy proceedings?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
If any legal action or other proceeding is begun for the enforcement of this Agreement, or for an alleged dispute, breach, default or misrepresentation under any provision of this Agreement, the prevailing party is entitled to recover reasonable pre-institution and post-institution attorneys' fees, court costs and all expenses even if not taxable as court costs (including all fees and expenses incident to appellate, bankruptcy and post-judgment proceedings), incurred in the action or proceeding, in addition to any other relief that the party is entitled. Attorneys' fees include paralegal fees, administrative costs, investigative costs, costs of expert witnesses, court reporter fees, sales and use taxes, if any, and all other charges billed by the attorneys to the prevailing party. If, short of filing a legal proceeding or action, We take measures to enforce compliance of Your obligations to pay when due any monies owed under this Agreement or submit when due any reports, information or supporting Records, or for any failure otherwise to comply with this Agreement, You must reimburse Us on demand for all of the costs and expenses (including reasonable attorneys' fees) We incur in doing so.
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, in the event of legal action to enforce the Franchise Agreement, the prevailing party has the right to recover various costs and fees. This includes reasonable attorney's fees incurred before and after the legal action was initiated, standard court costs, and all other expenses, even those not typically taxable as court costs. These additional expenses can include fees and expenses related to appellate, bankruptcy, and post-judgment proceedings.
Attorney's fees that the prevailing party can recover encompass paralegal fees, administrative costs, investigative costs, expert witness costs, court reporter fees, sales and use taxes, and all other charges billed by the attorneys. Furthermore, if Anago takes action to enforce a franchisee's compliance with payment obligations or other requirements without initiating a formal legal proceeding, the franchisee must reimburse Anago for all associated costs and expenses, including reasonable attorney's fees.
This provision is significant for prospective Anago franchisees as it outlines the potential financial responsibilities in case of legal disputes. It broadens the scope of recoverable expenses beyond standard court costs, potentially increasing the financial burden on the losing party. Franchisees should be aware of this clause and its implications for dispute resolution and compliance with the Franchise Agreement.