Is Buildingstars obligated to hire attorneys or commence litigation to collect from delinquent customers?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
b. Collections. FRANCHISEE must pay for all reasonable attorneys' fees, court costs, expenses, and out-of-pocket costs incurred to enforce collection from Customers. If a Customer is delinquent in payment, FRANCHISEE is responsible for any and all collection activities. BUILDINGSTARS is not obligated to hire attorneys, commence litigation, or do any acts (other than to send scheduled statements) in order to enforce payment of accounts by Customers. The only collection activities BUILDINGSTARS is required to provide are ongoing phone contact and reminder notices both mailed and faxed to delinquent Customers on a monthly basis for such time as BUILDINGSTARS deems appropriate.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
According to Buildingstars' 2025 Franchise Disclosure Document, Buildingstars is not obligated to hire attorneys or commence litigation to collect from delinquent customers. The franchisee is responsible for all collection activities related to delinquent customer payments. Buildingstars' only required collection activities are ongoing phone contact and monthly reminder notices, which are both mailed and faxed to delinquent customers for as long as Buildingstars deems appropriate.
Buildingstars does provide billing and collection services on behalf of the franchisee. This includes billing customers on a scheduled basis, accepting payments, collecting accounts receivable, and maintaining revenue records. Buildingstars will also provide customer-imprinted invoices, envelopes, and postage. Additionally, Buildingstars is authorized to collect cash and other forms of payment, endorse checks, sign liens, and take other necessary actions to carry out the terms of the agreement.
However, Buildingstars is not responsible if a customer fails to pay, and they are not required to take any further action beyond the phone contact and reminder notices mentioned above. The franchisee bears the responsibility for any and all collection activities if a customer's payment becomes delinquent. Franchisees must pay for all reasonable attorneys' fees, court costs, expenses, and out-of-pocket costs incurred to enforce collection from customers.