Who bears the expense when the Bevaris Alliance Franchisee takes copies of documents for assessing a Claim?
Bevaris_Alliance Franchise · 2024 FDDAnswer from 2024 FDD Document
- 21.4 Liability under this indemnity is conditional on Franchisor discharging the following obligations. If any third party makes a claim, or notifies an intention to make a claim, against Franchisor which may reasonably be considered likely to give rise to a liability under this indemnity (Claim), Franchisor shall:
- (a) as soon as reasonably practicable, give written notice of the Claim to Franchisee, specifying the nature of the Claim in reasonable detail;
- (b) not make any admission of liability, agreement or compromise in relation to the Claim without the prior written consent of Franchisee (such consent not to be unreasonably conditioned, withheld or delayed), provided that Franchisor may settle the Claim (after giving prior written notice of the terms of settlement (to the extent legally possible) to Franchisee, but without obtaining Franchisee's consent) if Franchisor reasonably believes that failure to settle the Claim would be prejudicial to it in any material respect;
- (c) give Franchisee and its professional advisers access at reasonable times (on reasonable prior notice) to its premises and its officers, directors, employees, agents, representatives or advisers, and to any relevant assets, accounts, documents and records within the power or control of Franchisor, so as to enable Franchisee and its professional advisers to examine them and to take copies (at Franchisee's expense) for the purpose of assessing the Claim; and
- (d) subject to Franchisee providing security to Franchisor to Franchisor's reasonable satisfaction against any claim, liability, costs, expenses, damages or losses which may be incurred, take such action as Franchisee may reasonably request to avoid, dispute, compromise or defend the Claim.
Source: Item 23 — RECEIPT (FDD pages 22–88)
What This Means (2024 FDD)
According to the 2024 Bevaris Alliance Franchise Disclosure Document, the franchisee is responsible for the expense of copying documents when assessing a claim. Specifically, if a third party makes a claim against Bevaris Alliance that could lead to liability, Bevaris Alliance must notify the franchisee in writing. The franchisee then has the right to access Bevaris Alliance's premises, officers, documents, and records to assess the claim.
This access allows the franchisee and their professional advisors to examine relevant information and take copies of these documents. However, the FDD clearly states that these copies are to be made "at Franchisee's expense". This means the franchisee will bear the direct costs of copying, such as paper, toner, and equipment usage, or fees paid to a third-party copying service.
This arrangement is fairly typical in franchising, as it ensures the franchisee has the ability to fully investigate any claims that could impact their business or financial obligations, while also ensuring that Bevaris Alliance is not burdened with the costs of the franchisee's due diligence. It is important for prospective franchisees to factor in these potential costs when evaluating the overall financial investment and risks associated with the Bevaris Alliance franchise.