Does the Body20 franchise agreement require the franchisee to defend the Indemnified Parties against claims of negligence?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
subject to Section 11.3 (Willful Misconduct or Gross Negligence). An Indemnified Party need not seek recovery from any insurer or other third party, or otherwise mitigate its Losses, in order to maintain and recover fully a claim against you, and you agree that a failure to pursue a recovery or mitigate a Loss will not reduce or alter the amounts that an Indemnified Party may recover from you under this Section 11. Your obligations in this Section 11 will survive the expiration or termination of this Agreement.
11.3 Willful Misconduct or Gross Negligence. Despite Section 11.1, you have no obligation to indemnify or hold harmless an Indemnified Party for, and we will reimburse you for, any Losses (including costs of defending any Proceeding under Section 11.2) to the extent they are determined in a final, unappealable ruling issued by a court or arbitrator with competent jurisdiction to have been caused solely and directly by the Indemnified Party's willful misconduct or gross negligence, so long as the claim to wh
Source: Item 23 — RECEIPT (FDD pages 74–251)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, the franchise agreement does not require the franchisee to indemnify or hold harmless an Indemnified Party for losses caused solely and directly by the Indemnified Party's willful misconduct or gross negligence.
However, this protection does not extend to claims based on vicarious liability, such as agency, apparent agency, employment, or failure to compel compliance with the agreement. The franchisee is still obligated to defend Body20 and other Indemnified Parties under Section 11.2 of the franchise agreement, even in cases involving the Indemnified Party's negligence.
This means that while Body20 franchisees are shielded from covering losses directly resulting from the franchisor's gross negligence or willful misconduct, they may still be required to provide a defense in legal proceedings, unless a final, unappealable ruling from a competent court or arbitrator determines the losses were solely and directly caused by the Indemnified Party's actions. This obligation survives the expiration or termination of the Franchise Agreement.