In the event of a widespread technology shutdown, is Big Apple Bagels or the franchisee liable for losses?
Big_Apple_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
- waiver, approval or consent to Franchisee, or by reason of any neglect, delay or denial of any request therefor.
- iii. Neither Franchisor nor Franchisee shall be liable for loss or damage or deemed to be in breach of this Agreement if its failure to perform its obligations results from: (1) compliance with any law, ruling, order, regulation, requirement or instruction of any federal, state, or municipal government or any department or agency thereof; (2) acts of God; (3) fires, strikes, embargoes, war, or riot; (4) pandemic or health emergencies resulting in widespread shut-downs of businesses, travel, and/or other activities, whether or not mandated by any governmental agencies or occurring based on general population response; (5) widespread breach or shutdown of technology or of other infrastructure that substantially affects the ability of commerce to be conducted in its normal course, or (6) any other similar event or cause. Any delay resulting from any of said causes shall extend performance accordingly or excuse performance, in whole or in part, as may be reasonable.
In addition, upon the occurrence of the events described in the paragraph immediately above, the Franchisor's performance of its obligations relating to activities that contemplate face-to-face contact, on-site presence, and/or travel will be considered adequately fulfilled if the Franchisor substitutes or modifies the activities in a manner that does not involve such face-to-face contact, on-site presence, and/or travel. Such excuse of literal performance applies to, but is not limited to, Franchisor's training of Franchisees and onsite assistance upon Franchisee's store opening.
Source: Item 22 — CONTRACTS (FDD pages 86–87)
What This Means (2025 FDD)
According to Big Apple Bagels' 2025 Franchise Disclosure Document, neither Big Apple Bagels nor the franchisee will be held liable for losses or be considered in breach of the agreement if a failure to perform obligations results from a widespread breach or shutdown of technology or other infrastructure that substantially affects the ability of commerce to be conducted in its normal course. This clause also extends to compliance with laws, acts of God, fires, strikes, embargoes, war, riot, pandemic or health emergencies resulting in widespread shut-downs of businesses, travel, and/or other activities.
This means that if a widespread technology shutdown occurs, impacting the ability to conduct business as usual, neither Big Apple Bagels nor the franchisee can be held responsible for non-performance of their contractual duties. The agreement considers such events as circumstances that excuse performance, either wholly or partially, depending on what is reasonable. This protection extends to various other force majeure events, providing a broad safety net for both parties.
Furthermore, Big Apple Bagels' obligations involving face-to-face contact, on-site presence, or travel will be adequately fulfilled if they substitute or modify activities to avoid such contact. This specifically applies to franchisee training and on-site assistance during store openings, allowing Big Apple Bagels to adapt and continue supporting franchisees even when traditional methods are not feasible. This demonstrates a flexible approach to unforeseen disruptions, ensuring continued support and adaptation during challenging times.