Is Brown obligated by any agreements, representations or warranties made by a Browns Chicken franchisee?
Browns_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
oodwill and brand consistency. Brown has not authorized or empowered Franchisee to use the Marks except as provided by this Agreement, and Franchisee shall not employ any Mark in signing any contract, check, purchase agreement, negotiable instrument or other legal obligation without the prior written consent of Brown or employ any Mark in a manner that may result in liability of Brown for any indebtedness or obligation of Franchisee. Neither Brown nor Franchisee shall make any agreements, representations or warranties in the name of or in behalf of the other (except such agreements as Brown shall make on behalf of Franchisee in developing the Store, if any), and neither Brown nor Franchisee shall be obligated by any agreements, representations or warranties made by the other, nor shall Brown be obligated for any damages to any person or property directly or indirectly arising out
of the operation of the Store or Franchisee's business conducted hereunder, whether caused by Franchisee's negligence or willful action or failure to act. Brown shall have no liability for any sales, use, excise, income, property or other taxes levied upon Franchisee, the Store or its assets, or in connection with the sales made or business conducted by the Store.
Franchisee will, and hereby does, indemnify and defend Brown and its Affiliates and their respective officers, directors, owners, agents, representatives, employees, successors and assigns, from and against all losses, costs, liabilities, damages, claims, and expenses of every kind, including allegations of negligence by Brown and its Affiliates and their officers, employees, and agents, to the fullest extent permitted by Applicable Law, and including reasonable attorneys' fees, arising out of, resulting from or related to: (i) the unauthorized use of the Trademarks;
Source: Item 22 — Contracts (FDD page 43)
What This Means (2025 FDD)
According to the 2025 Browns Chicken Franchise Disclosure Document, Browns Chicken is generally not obligated by any agreements, representations, or warranties made by its franchisees. The franchise agreement explicitly states that neither Browns Chicken nor the franchisee can make agreements, representations, or warranties on behalf of the other, with a specific exception. Browns Chicken may make agreements on behalf of the franchisee when developing the store. Browns Chicken is also not liable for damages arising from the franchisee's operation of the store, regardless of whether such damages are due to the franchisee's negligence, willful actions, or failure to act. Additionally, Browns Chicken is not responsible for any taxes levied upon the franchisee, the store, or its assets.
This section of the franchise agreement serves to clearly define the relationship between Browns Chicken and its franchisees as that of independent contractors. This is a common arrangement in franchising, designed to protect the franchisor from liabilities arising from the franchisee's business operations. The franchisee is responsible for conspicuously identifying themselves as the owner of the store operating under a franchise granted by Browns Chicken. This includes placing notices of independent ownership on forms, business cards, stationery, advertising, and other materials as required by Browns Chicken.
For a prospective Browns Chicken franchisee, this means that they are solely responsible for all aspects of their store's operation, including any liabilities, debts, or obligations incurred. They cannot rely on Browns Chicken to cover any losses or damages resulting from their business activities. It is crucial for franchisees to understand that they must manage their business responsibly and ensure they have adequate insurance coverage to protect themselves against potential risks. Franchisees should also ensure that all their dealings with customers and suppliers clearly indicate their independent ownership to avoid any confusion or potential liability for Browns Chicken.
However, Browns Chicken does agree to indemnify Franchisee against and to reimburse Franchisee for any obligations or liability for damages attributable to agreements, representations or warranties of Brown (except such agreements as Brown shall make on behalf of Franchisee in developing the Store, if any), or caused by the negligence or willful action of Brown, and for costs reasonably incurred by Franchisee in the defense of any such claim brought against it or in any action in which Franchisee is named as a party, provided that Brown shall have the right to participate in and, to the extent Brown deems necessary, to control, any litigation or proceeding which might result in liability of or expense to Franchisee subject to such indemnification. Brown's indemnification shall not apply in the event Franchisee contributed to the harm.