Is the Bhc Franchisor responsible for delays in leasehold improvement or losses resulting from the restaurant design?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
on or warranty of the quality of any goods or services provided by architects, contractors, or any other persons or entities which Franchisor may refer to Master Franchisee, including any warranty as to merchantability or fitness for any particular purpose. Franchisor is not responsible for delays in the leasehold improvement, equipping or decoration of the Franchised BHC Restaurant or for any loss resulting from the Franchised BHC Restaurant design or leasehold improvement since Franchisor has no control over the landlord or developer and numerous leasehold improvement-related problems which could occur, consequently delaying the opening of the Franchised BHC Restaurant. Franchisor must approve in writing any and all changes in the Franchised BHC Restaurant plans prior to leasehold improvement of the Franchised BHC Restaurant or the implementation of such changes.
- (f) Franchisor must have access to the Franchised BHC Restaurant while work is in progress. Franchisor may make video records of leasehold improvement in process and may require such reasonable alterations to or modifications in the leasehold improvement of the Franchised BHC Restaurant that Franchisor deems necessary. Master Franchisee's failure to promptly commence and diligently complete the design, leasehold improvement, inventorying, equipping, and opening of the Franchised BHC Restaurant will be a material breach of this Agreement. Before the Franchised BHC Restaurant opens to retail customers and before final inspections by any governmental agency, Franchisor will visit the site of Franchised BHC Restaurant for three (3) on-site visits and complete a final "walk through" inspection of the BHC Restaurant and issue a written consent to open. Any deficiencies noted by Franchisor as a result of this inspection must be corrected by Master Franchisee within 30 days or this Agreement may be terminated without any liability to Franchisor. Master Franchisee shall be responsible for such inspection fee of USD$600, all accommodation, transportation, meals, daily allowances, and other costs and expenses for the Franchisor's personnel in connection with such visits on site but up to three times per Franchised BHC Restaurant only.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, Bhc is not responsible for delays in the leasehold improvement, equipping, or decoration of the franchised restaurant. Additionally, Bhc is not responsible for any losses resulting from the restaurant design or leasehold improvements. This is because Bhc has no control over the landlord or developer and because numerous leasehold improvement-related problems could occur, potentially delaying the opening of the franchisee's Bhc restaurant.
However, Bhc does require written approval of any changes to the restaurant plans before leasehold improvements or implementation of changes. Bhc also requires access to the restaurant during the work in progress and may make video records of the leasehold improvement process. Bhc may also require reasonable alterations or modifications to the leasehold improvements that it deems necessary.
It is the franchisee's sole responsibility to diligently construct, equip, and prepare the restaurant for opening. The franchisee is also responsible for obtaining all necessary zoning classifications, permits, clearances, and certificates of occupancy. The franchisee must use licensed general contractors, designers, vendors, and architects accepted by Bhc before performing any leasehold improvement work.