Does the Beggars Pizza franchise agreement create a fiduciary relationship between the franchisor and franchisee?
Beggars_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisor and Franchisee agree that the Agreement does not create a fiduciary relationship between them, that Franchisee will be an independent contractor, and that nothing in the Agreement is intended to constitute either party an agent, legal representative, subsidiary, joint venturer, joint employer, partner, employee, or servant of the other for any purpose whatsoever.
Franchisee acknowledges and agrees that Franchisor's usual business is offering and selling rights to operate Beggars Pizza® restaurants using the Proprietary Marks and System, developing enhancements to the System, and providing assistance to franchisees, and accordingly, Franchisor's usual business is different from Franchisee's usual business of operating a Beggars Pizza® restaurant.
During the term of the Agreement, Franchisee will hold itself out to the public as an independent contractor operating the Restaurant pursuant to a franchise agreement from Franchisor.
Franchisee must take such action as may be necessary to do so including, without limitation, exhibiting a notice of that fact in a conspicuous place at the Premises, the content of which Franchisor may specify.
Notwithstanding any other provision of the Agreement, Franchisee is solely responsible for all personnel and employment decisions relating to the Restaurant.
Source: Item 22 — CONTRACTS (FDD page 39)
What This Means (2025 FDD)
According to the 2025 Beggars Pizza Franchise Disclosure Document, the franchise agreement explicitly states that it does not create a fiduciary relationship between the franchisor and the franchisee. The agreement specifies that the franchisee operates as an independent contractor. This means that Beggars Pizza and its franchisees are not considered agents, legal representatives, subsidiaries, joint venturers, joint employers, partners, employees, or servants of each other for any purpose.
This independent contractor status is further emphasized by requiring the franchisee to present themselves to the public as an independent entity operating under a franchise agreement with Beggars Pizza. The franchisee is also solely responsible for all personnel and employment decisions related to their Beggars Pizza restaurant.
This arrangement is typical in franchising, where franchisors aim to maintain control over brand standards and operational procedures without assuming the legal liabilities associated with an employer-employee or fiduciary relationship. Prospective Beggars Pizza franchisees should understand that they are entering into a business relationship where they are responsible for their own business decisions and operations, within the framework set by the franchise agreement.