In the Buildingstars franchise agreement, what condition triggers the calculation of the maximum aggregate liability amount?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
- E. BUILDINGSTARS MAXIMUM AGGREGATE LIABILITY AND THE MAXIMUM AGGREGATE LIABILITY OF ANY OF BUILDINGSTARS'S OFFICERS, OWNERS, DIRECTORS, MEMBERS, MANAGERS, EMPLOYEES, AFFILIATES, PARENTS OR SUBSIDIARIES RELATED TO ANY AND ALL CLAIMS RELATING TO OR ARISING FROM THIS AGREEMENT OR THE FRANCHISE RELATIONSHIP SET FORTH IN THIS AGREEMENT SHALL BE COLLECTIVELY LIMITED TO THE AMOUNT FRANCHISEE PAID TO BUILDINGSTARS WITHIN THE PRIOR 12 MONTHS IMMEDIATELY BEFORE WRITTEN NOTICE OF ANY PROPER CLAIM IS RECEIVED BY BUILDINGSTARS.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
According to Buildingstars's 2025 Franchise Disclosure Document, the maximum aggregate liability is calculated when Buildingstars receives written notice of a proper claim. The maximum aggregate liability of Buildingstars, its officers, owners, directors, members, managers, employees, affiliates, parents, or subsidiaries for claims relating to the franchise agreement is limited to the amount the franchisee paid to Buildingstars within the 12 months immediately before Buildingstars receives written notice of the claim.
This means that if a Buildingstars franchisee has a dispute and seeks damages, the total amount they can potentially recover from Buildingstars and related parties is capped. This cap is based on the payments the franchisee made to Buildingstars in the year leading up to the claim.
This limitation of liability is a significant factor for prospective franchisees to consider. It defines the financial risk Buildingstars is willing to assume and could impact a franchisee's ability to recover losses in case of disputes or damages. Franchisees should carefully evaluate this clause and consider seeking legal advice to understand its implications fully.