Who is responsible for collection activities if a customer is delinquent in payment to a Buildingstars franchisee?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
- D. Management Services BUILDINGSTARS will provide FRANCHISEE with billing and collection services on its behalf. However, BUILDINGSTARS is not responsible if the Customer fails to pay nor is BUILDINGSTARS required to commence any further action other than as set forth herein if they do not pay. FRANCHISEE is responsible for any and all collection activities if a Customer is delinquent in payment.
- a. Authorization to BUILDINGSTARS. FRANCHISEE hereby authorizes BUILDINGSTARS to bill each Customer on a scheduled basis, accept payments from Customer accounts, collect accounts receivable, and maintain revenue records. BUILDINGSTARS will provide Customer imprinted invoices, envelopes and postage. In addition, BUILDINGSTARS will provide ongoing phone contact and reminder notices, both mailed and faxed to delinquent Customers on a monthly basis.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
According to Buildingstars' 2025 Franchise Disclosure Document, the franchisee is responsible for collection activities if a customer is delinquent in payment. Buildingstars provides billing and collection services on behalf of the franchisee, but Buildingstars is not responsible if the customer fails to pay.
The FDD specifies that Buildingstars is not required to commence any further action beyond what is outlined in the agreement if a customer does not pay. The actions Buildingstars will take include ongoing phone contact and reminder notices, both mailed and faxed, to delinquent customers on a monthly basis.
While Buildingstars provides some initial collection efforts, the franchisee bears the ultimate responsibility for pursuing payment from delinquent customers. This may involve additional collection efforts beyond what Buildingstars provides, such as hiring a collection agency or pursuing legal action. The franchisee is also responsible for paying all reasonable attorneys' fees, court costs, expenses, and out-of-pocket costs incurred to enforce collection from customers.