Are the rights and remedies in the Card My Yard agreement cumulative or alternative?
Card_My_Yard Franchise · 2025 FDDAnswer from 2025 FDD Document
employees, agents, successors and assigns.
- (5) We may assign our options under this Section XIX.B.to any person or entity without your consent.
- C. Liquidated Damages/Unauthorized Closure Fee. Upon any unauthorized closure of the Card My Yard business by you or any termination of this Agreement in connection with a breach by you, you will be required to promptly pay us liquidated damages in an amount equal to the greater of (a) $6,600 or (b) the total royalties paid by you under this Agreement during the previous 12 months multiplied by two (or if your Card My Yard business has not been open for at least 12 months then your liquidated damages amount will be $6,600). Such amount shall be due and payable to us in one lump sum payment promptly upon our written request. Such liquidated damages are in addition to, and not in lieu of, any other remedies available to us under this Agreement and shall be due and payable
to us regardless of whether we terminate this Agreement or take other remedial actions.
D. Liquidated Damages/Non-Reporting or Under-Reporting Fee. An amount equal to $5,000 per occurrence will be owed for each instance when we document your intentional non-reporting or under-reporting
Source: Item 23 — RECEIPTS (FDD pages 84–259)
What This Means (2025 FDD)
According to Card My Yard's 2025 Franchise Disclosure Document, the remedies available to Card My Yard for franchisee breaches are cumulative. This means that Card My Yard is entitled to pursue all available remedies simultaneously or in any order they choose, rather than being limited to selecting only one remedy.
Specifically, the FDD states that liquidated damages for unauthorized closure or termination due to a franchisee breach are "in addition to, and not in lieu of, any other remedies available to us under this Agreement and shall be due and payable to us regardless of whether we terminate this Agreement or take other remedial actions." This indicates that Card My Yard can pursue liquidated damages while also exercising other rights and remedies outlined in the franchise agreement.
Additionally, the FDD specifies a $5,000 fee for each instance of intentional non-reporting or under-reporting of revenues. In such cases, Card My Yard retains the right to terminate the franchise without allowing the franchisee an opportunity to cure the breach. This further illustrates the cumulative nature of the remedies, as Card My Yard can impose the fee and terminate the agreement simultaneously.
This aspect of the franchise agreement is important for prospective franchisees to understand, as it highlights the broad range of actions Card My Yard can take in response to a franchisee's non-compliance. Franchisees should be aware of all potential consequences of breaching the agreement and ensure they fully understand their obligations.