Who assumes the defense of a Proceeding and at whose cost and expense for Bhc?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
- (c) For the indemnification to be effective, each indemnified party ("Indemnified Party") will give the indemnifying party ("Indemnifying Party") reasonable notice of each claim or loss for which the Indemnified Party demands indemnity and defense, except that failure to provide such notice will not release the Indemnifying Party from any obligations hereunder except to the extent that the Indemnifying Party is materially prejudiced by such failure.
The Indemnifying Party will assume, at its sole cost and expense, the defense of such Proceeding through legal counsel reasonably acceptable to the Indemnified Party, except that the Indemnified Party may at its option and expense select and be represented by separate counsel.
The Indemnifying Party will have control over the Proceeding, including the right to settle; provided, however, the Indemnifying Party will not, absent the written consent of the Indemnified Party, consent to the entry of any judgment or enter into any settlement that: (i) provides for any admission of liability on the part of the Indemnified Party or relief other than the payment of monetary damages for which the Indemnifying Party will be solely liable; or (ii) adversely affects the rights of the Indemnified Party under this Agreement, or (iii) does not release the Indemnified
Party from all Proceedings and "Losses" (as defined in section 16.2(d) below) in respect thereof. In no
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, the Indemnifying Party assumes the defense of a Proceeding at its sole cost and expense. The Indemnifying Party will manage the defense through legal counsel reasonably acceptable to the Indemnified Party. However, the Indemnified Party has the option to select and be represented by separate counsel, but at their own expense.
Bhc's obligation to defend the franchisee arises from third-party proceedings resulting from Bhc's intentional misfeasance, gross negligence, or material breach of its obligations under the franchise agreement. However, this is with the exception if the proceeding is caused by the franchisee's intentional misfeasance, gross negligence, or material breach of the agreement.
The Indemnifying Party has control over the legal proceeding, including the right to settle. However, the Indemnifying Party cannot enter into any judgment or settlement without the Indemnified Party's written consent if it includes an admission of liability, adversely affects the Indemnified Party's rights, or does not release the Indemnified Party from all proceedings and losses.