Can a Care Plus Medical Ucc franchisee offset or deduct payments owed to Care Plus Medical Ucc?
Care_Plus_Medical_Ucc Franchise · 2024 FDDAnswer from 2024 FDD Document
- (g) Obligations Independent; No Set-Off. The obligations of Franchisee to pay to Care Plus Medical UCC any fees or amounts described in this Agreement are not dependent on Care Plus Medical UCC's performance and are independent covenants by Franchisee. Franchisee shall make all such payments without offset or deduction.
Source: Item 22 — CONTRACTS (FDD page 41)
What This Means (2024 FDD)
According to Care Plus Medical Ucc's 2024 Franchise Disclosure Document, franchisees are required to make all payments to Care Plus Medical Ucc without any deductions or offsets. This means a franchisee cannot reduce the amount they owe to Care Plus Medical Ucc by deducting any expenses, costs, or other financial obligations they believe Care Plus Medical Ucc owes them.
This requirement is fairly standard in franchising. Franchisors typically want to ensure a consistent and predictable revenue stream from royalties and other fees. Allowing franchisees to offset payments could create accounting complexities and disputes, potentially impacting the franchisor's financial stability.
The franchise agreement specifies that the franchisee's obligation to pay fees is an independent covenant, meaning it is not contingent on Care Plus Medical Ucc's performance. Therefore, even if a franchisee believes Care Plus Medical Ucc is not fulfilling its obligations, the franchisee is still required to make all payments as agreed upon in the franchise agreement.