What is the maximum aggregate liability of Speedline and its suppliers to a Beggars Pizza franchisee under the software agreement?
Beggars_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
IN ANY CASE THE AGGREGATE AMOUNT OF SPEEDLINE'S AND THE SUPPLIERS' ENTIRE LIABILITY IN CONTRACT, TORT (INCLUDING NEGLIGENCE) OR OTHERWISE UNDER ANY AND ALL PROVISIONS OF THIS AGREEMENT SHALL NOT EXCEED THE AMOUNT OF ALL PAYMENTS MADE BY THE CUSTOMER TO SPEEDLINE UNDER THIS AGREEMENT.
THIS EXCLUSION OF LIABILITY ALSO INCLUDES ANY LIABILITY WHICH MAY ARISE OUT OF THIRD PARTY CLAIMS AGAINST THE CUSTOMER. THE PURPOSE OF THIS PROVISION IS TO LIMIT THE POTENTIAL LIABILITY OF SPEEDLINE AND THE SUPPLIERS ARISING OUT OF THIS AGREEMENT.
Source: Item 23 — RECEIPT (FDD pages 39–192)
What This Means (2025 FDD)
According to Beggars Pizza's 2025 Franchise Disclosure Document, the software agreement with Speedline stipulates a limitation of liability. Specifically, the aggregate amount of Speedline's and its suppliers' liability to a Beggars Pizza franchisee will not exceed the total payments made by the franchisee to Speedline under the agreement. This limitation applies regardless of the legal basis for the claim, whether it's contract, tort (including negligence), or any other provision of the agreement.
This means that a Beggars Pizza franchisee's potential recovery from Speedline and its suppliers for any damages or losses related to the software is capped at the amount they've already paid for the software. This could have significant implications if the franchisee experiences substantial losses due to software malfunctions, errors, or other issues. The franchisee bears the risk of any damages exceeding the amount they've paid for the software.
This type of limitation of liability clause is common in software agreements. It is designed to protect the software vendor from potentially large claims arising from the use of their software. However, prospective Beggars Pizza franchisees should carefully consider the potential risks associated with this limitation, especially if they rely heavily on the Speedline software for their business operations. They may want to explore options for additional insurance coverage or negotiate a different liability cap with Speedline, although the latter may not be feasible.
It is also important to note that this exclusion of liability extends to third-party claims against the franchisee related to the software. This means that if a customer or other third party sues the franchisee due to issues with the Speedline software, Speedline's liability is still limited to the amount the franchisee paid for the software. Beggars Pizza franchisees should consult with legal counsel to fully understand the implications of this clause and how it may affect their business.