Under the Anago subfranchise agreement, are members, managers, shareholders, directors, officers, employees, and agents of the Franchisor and its affiliates personally liable in any action between the Franchisor and Subfranchisor?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
The parties agree that this Agreement does not create a fiduciary relationship between them. Subfranchisor is an independent contractor, and nothing in this Agreement is intended to constitute
either party a legal representative, subsidiary, joint venture, partner, employee, affiliate or servant of the other party for any purpose. The parties agree that nothing in this Agreement authorizes either party to make any contract, agreement, warranty or representation on the other party's behalf, or to incur any debt or other obligation in the other party's name. Neither party will assume liability for, or be liable under this Agreement as a result of, any action, or by reason of any act or omission of the other party or any claim or judgment from any act or omission of the other party. Franchisor has no control over the terms of employment of Subfranchisor's employees or of their activities or control over the day-to-day operations of the Subfranchise Business. Neither Subfranchisor nor its employees are bound by any rules, regulation or policies applicable to Franchisor's employees. Subfranchisor is free to exercise Subfranchisor's own independent business judgment in determining the methods to be used in performing Subfranchisor's duties under this Agreement, including those related to the hours of operation and the location of Subfranchisor's office.
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
Based on the 2025 Anago Franchise Disclosure Document, the subfranchise agreement specifies that neither party will assume liability for the actions or omissions of the other party. Specifically, Anago will not be liable for any action, act, or omission of the subfranchisor. Similarly, the subfranchisor will not be liable for any action, act, or omission of Anago. This also extends to any claim or judgment resulting from any act or omission of the other party. This indicates that Anago's members, managers, shareholders, directors, officers, employees, and agents are not personally liable in any action between Anago and the subfranchisor.
Furthermore, the agreement explicitly states that the subfranchisor is an independent contractor and that the agreement does not establish a fiduciary relationship or any form of partnership, joint venture, or agency between the parties. This reinforces the separation of liabilities between Anago and the subfranchisor. The subfranchisor has the autonomy to exercise their own independent business judgment in performing their duties under the agreement, including determining hours of operation and office location, without being bound by Anago's internal rules or policies.
To further protect Anago, the subfranchisor is required to maintain insurance policies that cover both the subfranchisor and Anago, including their respective officers, directors, partners, and employees, against any loss, liability, personal injury, death, or property damage arising from the subfranchisor's obligations under the agreement. These policies must name Anago as an additional insured and provide Anago with notice of any premium defaults or policy changes. This insurance requirement ensures that Anago is protected from potential liabilities arising from the subfranchisor's operations.