Does the indemnity agreement for Canopy Lawn Care survive the termination of the agreement?
Canopy_Lawn_Care Franchise · 2025 FDDAnswer from 2025 FDD Document
essor with satisfactory proof of insurance coverage within ten (10) days after mailing of the notice. In addition, Lessor may change the rates charged by Lessor under this Section 11(b) for physical damage waiver and/or commercial automobile liability enrollment upon giving Lessee at least thirty (30) days prior written notice.
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- INDEMNITY: Lessee agrees to defend and indemnify Lessor, Servicer, any other agent of Lessor and their respective successors and assigns from and against any and all losses, damages, liabilities, suits, claims, demands, costs and expenses (including, without limitation, reasonable attorneys' fees and expenses) which Lessor, Servicer, any other agent of Lessor or any of their respective successors or assigns may incur by reason of Lessee's breach or violation of, or failure to observe or perform, any term, provision or covenant of this Agreement, or as a result of any loss, damage, theft or destruction of any Vehicle or related to or arising out of or in connection with the use, operation or condition of any Vehicle.
Source: Item 23 — RECEIPT (FDD pages 55–199)
What This Means (2025 FDD)
According to the 2025 Canopy Lawn Care FDD, the indemnity agreement between the Lessee and Lessor survives any expiration or termination of the agreement. This means that even after the franchise agreement ends, the franchisee's obligation to defend and indemnify the Lessor against losses, damages, liabilities, suits, claims, demands, costs, and expenses continues.
This survival clause has significant implications for a prospective Canopy Lawn Care franchisee. It means that even after the franchise agreement is terminated, whether by expiration or other means, the franchisee could still be held liable for any issues arising from their operation of the franchise during the term of the agreement. This could include legal claims, damages, or other liabilities that occur even years after the franchise has ended.
In practical terms, a former Canopy Lawn Care franchisee needs to maintain records and potentially insurance coverage for an indefinite period after the franchise terminates to protect against potential liabilities. The franchisee should seek legal counsel to understand the full scope of this indemnity obligation and how best to mitigate potential risks after the franchise agreement concludes.
It is also important to note that the agreement specifies that any termination shall not affect the Lessee's obligation to pay all amounts due for periods prior to the effective date of such termination or Lessee's obligation to pay any indemnities under this Agreement. This reinforces the ongoing financial responsibility of the franchisee even after termination.