What is the time limitation exception for claims by Better Blend for indemnity under Article 16?
Better_Blend Franchise · 2024 FDDAnswer from 2024 FDD Document
- 17.4 Time Limitation. Any arbitration or other legal action arising from or related to this Agreement must be instituted within two years from the date of the conduct or event that forms the basis of the arbitration or other legal action.
The foregoing time limit does not apply to claims (i) by BBF related to non-payment of Royalty Fees and other amounts owed by Franchisee, (ii) for indemnity under Article 16, or (iii) related to unauthorized use of Confidential Information or the Marks.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2024 FDD)
According to Better Blend's 2024 Franchise Disclosure Document, there is generally a time limitation of two years for legal actions related to the franchise agreement. However, this limitation does not apply to claims by Better Blend related to indemnity under Article 16 of the agreement.
This means that Better Blend is not subject to the two-year limitation for claims where they seek indemnification from the franchisee. Indemnification typically involves the franchisee compensating Better Blend for losses or damages resulting from the franchisee's actions or the operation of their business.
For a prospective franchisee, this signifies that while they have a defined period to bring claims against Better Blend, the franchisor has an extended or unlimited time frame to pursue indemnity claims against them. This could create a long-term risk for franchisees, as they may be liable for unforeseen issues arising years after the initial event. Franchisees should carefully review Article 16 and understand the circumstances under which they might be required to indemnify Better Blend.