Does the waiver of punitive damages in the Bft agreement apply to claims based on other torts?

According to Bft's 2025 Franchise Disclosure Document, the waiver of punitive damages extends to claims based on various causes of action. Specifically, the agreement states that the parties waive any right to punitive, exemplary, incidental, indirect, special, or consequential damages against each other. This waiver applies to any cause of action, whether based in contract, negligence, strict liability, other tort, or otherwise.

This means that a Bft franchisee is limited to recovering only actual damages in the event of a dispute with Bft, regardless of the legal basis for the claim. The franchisee cannot claim punitive damages, which are intended to punish the wrongdoer, or other forms of non-compensatory damages. This limitation on potential recovery could be significant in cases where the franchisee believes Bft has acted egregiously or caused substantial harm beyond direct financial losses.

However, the waiver is applicable only "to the fullest extent permitted by law", meaning that certain state franchise laws may override this provision. For example, the agreement includes riders for states like North Dakota and Minnesota that modify or negate the waiver of punitive damages to the extent required by those states' franchise laws. Franchisees should carefully review the state-specific riders to the Bft agreement to understand how these waivers may be limited or unenforceable in their particular jurisdiction.