Under what conditions is a Care Plus Medical Ucc franchisee NOT obligated to indemnify an Indemnitee?
Care_Plus_Medical_Ucc Franchise · 2024 FDDAnswer from 2024 FDD Document
- 16.1 Indemnity. Franchisee shall indemnify and defend (with counsel reasonably acceptable to Care Plus Medical UCC) Care Plus Medical UCC, its parent entities, subsidiaries and affiliates, and their respective owners, directors, officers, employees, agents, successors and assignees (collectively, "Indemnitees") against all Losses in any Action by or against Care Plus Medical UCC and/or any Indemnitee directly or indirectly related to, or alleged to arise out of, the operation of the Business. Notwithstanding the foregoing, Franchisee shall not be obligated to indemnify an Indemnitee from Actions arising as a result of any Indemnitee's intentional misconduct or negligence. Any delay or failure by an Indemnitee to notify Franchisee of an Action shall not relieve Franchisee of its indemnity obligation except to the extent (if any) that such delay or failure materially prejudices Franchisee. Franchisee shall not settle an Action without the consent of the Indemnitee. This indemnity will continue in effect after this Agreement ends.
Source: Item 22 — CONTRACTS (FDD page 41)
What This Means (2024 FDD)
According to Care Plus Medical Ucc's 2024 Franchise Disclosure Document, a franchisee is generally required to indemnify Care Plus Medical Ucc and its related parties (Indemnitees) against losses from actions related to the operation of the franchise business. However, this obligation has specific limitations.
The franchisee is not required to indemnify an Indemnitee if the actions arise from the Indemnitee's intentional misconduct or negligence. This means that if Care Plus Medical Ucc or its related parties are directly responsible for losses due to their own deliberate or careless actions, the franchisee is not responsible for covering those losses.
Additionally, any delay or failure by an Indemnitee to notify the franchisee of an action that could lead to a claim does not automatically relieve the franchisee of their indemnification obligation. The franchisee is only relieved of this obligation if the delay or failure to notify them materially prejudices their ability to defend against the action. This means the franchisee must demonstrate that the delay in notification significantly harmed their defense. The franchisee is not allowed to settle any action without the Indemnitee's consent, and the indemnification obligation continues even after the franchise agreement ends.