Are Browns Chicken franchisees and Brown considered independent contractors?
Browns_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
The parties acknowledge and agree that Brown and Franchisee are independent contractors, and that this Agreement does not create a fiduciary relationship between them. Franchisee shall conspicuously identify itself on the Premises of the Store and in all dealings with customers and suppliers as the owner of the Store under a Franchise granted from Brown and shall place such notices of independent ownership on such forms, business cards, stationery, advertising and other materials as Brown may require from time to time. Franchisee acknowledges that Brown's training, guidance, advice and assistance, Franchisee's obligations under this Agreement and the standards, specifications, policies and procedures required by Brown hereunder and in the Operating Manual are imposed not for the purpose of exercising control over Franchisee, but rather for the limited purpose of protecting the Marks and confidential information, goodwill 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.
Source: Item 22 — Contracts (FDD page 43)
What This Means (2025 FDD)
According to Browns Chicken's 2025 Franchise Disclosure Document, Browns Chicken and its franchisees are considered independent contractors. The agreement explicitly states that the franchise agreement does not establish a fiduciary relationship between Browns Chicken and the franchisee.
Browns Chicken franchisees are required to clearly identify themselves as the owners of their stores, operating under a franchise granted by Browns Chicken, in all interactions with customers and suppliers. This includes displaying notices of independent ownership on the premises, as well as on business cards, stationery, advertising, and other materials as required by Browns Chicken.
The FDD clarifies that Browns Chicken's training, guidance, advice, and the standards and procedures outlined in the operating manual are designed to protect the Browns Chicken brand, trademarks, confidential information, and goodwill, rather than to exert control over the franchisee's day-to-day operations. Franchisees are not authorized to use Browns Chicken's trademarks in contracts or legal obligations without prior written consent, ensuring that Browns Chicken is not liable for the franchisee's debts or obligations. Browns Chicken is also not responsible for any taxes levied on the franchisee or the store.
This independent contractor relationship means that franchisees are responsible for their own business decisions and operations, while adhering to the standards and guidelines set by Browns Chicken to maintain brand consistency and quality. Prospective franchisees should understand that they will be operating their Browns Chicken franchise as independent business owners, responsible for their own financial and legal obligations.