Who assumes the risk of loss or damage to the Medical Equipment at a C3 Wellness Spa Practice?

According to C3 Wellness Spa's 2024 Franchise Disclosure Document, the Practice (the franchisee) assumes the risk of loss or damage to the Medical Equipment. This means that once the Medical Equipment is in the franchisee's possession, the franchisee is responsible for any loss or damage, regardless of the cause.

The FDD specifies that the franchisee's responsibility extends to any cause, including but not limited to casualty, collision, upset, fire, theft, malicious mischief, vandalism, graffiti, glass breakage, and mysterious disappearance. This broad language places a significant burden on the franchisee to protect the Medical Equipment from a wide range of potential hazards.

To mitigate this risk, C3 Wellness Spa requires the franchisee to maintain insurance coverage for the full value of the Medical Equipment. This insurance must also cover liability for bodily injury, including death, and property damage arising out of the ownership, maintenance, use, and operation of the Medical Equipment. The franchisor, referred to as Manager in the FDD, must be named as an additional insured on these policies, and the policies must include a waiver of subrogation in favor of the Manager. This ensures that the franchisor is protected in case of any claims related to the Medical Equipment. The franchisee must provide proof of this insurance coverage to the Manager upon request and ensure the Manager receives 30 days' notice of any policy changes or cancellations.