What liability does the Bhc Franchisor incur when entering the premises after lease expiration or termination?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
Upon the expiration or termination of the Lease, Landlord will cooperate with and assist Franchisor in gaining possession of the Premises and, if the Franchisor Entity does not elect to assume the Lease for the Premises consistent with subparagraphs 3or 4above, Landlord will allow Franchisor to enter the Premises, without being guilty of trespass and without incurring any liability to Landlord except for any damages caused by Franchisor's willful misconduct or gross negligence, to remove all signs and all other items identifying the Premises as a BHC Restaurant and to make such other modifications (such as repainting) as are reasonably necessary to protect the BHC marks and system, and to distinguish the Premises from BHC Restaurants.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, if the Bhc franchisor does not elect to assume the lease after its expiration or termination, the landlord will allow Bhc to enter the premises. Bhc can do so without being considered a trespasser and without incurring liability to the landlord. The exception to this is if Bhc causes damages due to willful misconduct or gross negligence.
Bhc's access is specifically for the purpose of removing signs and other items that identify the location as a Bhc restaurant. Bhc is also permitted to make modifications, such as repainting, to protect the Bhc marks and system and to differentiate the premises from Bhc restaurants. This ensures that the brand is protected even after a franchise location closes.
This clause protects Bhc from liability for simply entering the premises to de-identify it as a former Bhc location. However, it also makes it clear that Bhc is responsible for any damages it causes through its own intentional or grossly negligent actions while on the property. This is a fairly standard provision in franchise agreements to protect the brand's image and prevent consumer confusion after a location ceases operation.