Is a Carls Jr. franchisee considered an agent, legal representative, partner, subsidiary, joint venturer, or employee of CJR or its affiliates?
Carls_Jr Franchise · 2025 FDDAnswer from 2025 FDD Document
This Agreement does not create a fiduciary or other special relationship between the parties. No agency, employment, or partnership is created or implied by the terms of this Agreement, and Franchisee is not and shall not hold itself out as agent, legal representative, partner, subsidiary, joint venturer or employee of CJR or its affiliates or a joint employer with CJR or its affiliates. Franchisee shall have no right or power to, and shall not, bind or obligate CJR or its affiliates in any way or manner, nor represent that Franchisee has any right to do so. Franchisee shall not issue any press releases without the prior written approval of CJR.
Franchisee is an independent contractor and is solely responsible for all aspects of the development and operation of the Franchised Restaurant, subject only to the conditions and covenants established by this Agreement. Without limiting the generality of the foregoing, Franchisee acknowledges that CJR has no responsibility to ensure that the Franchised Restaurant is developed and operated in compliance with all applicable laws, ordinances and regulations and that CJR shall have no liability in the event the development or operation of the Franchised Restaurant violates any law, ordinance or regulation.
The sole relationship between Franchisee and CJR is a commercial, arms' length business relationship and, except as provided in Section 25, there are no third party beneficiaries to this Agreement. Franchisee's business is, and shall be kept, totally separate and apart from any that may be operated by CJR. In all public records, in relationships with other persons, and on letterheads and business forms, Franchisee shall indicate its independent ownership of the Franchised Restaurant and that Franchisee is solely a franchisee of CJR. Franchisee shall post a sign in a conspicuous location in the Franchised Restaurant which will contain Franchisee's name and state that the Franchised Restaurant is independently owned and operated by Franchisee under a franchise agreement with CJR.
Source: Item 22 — CONTRACTS (FDD pages 75–76)
What This Means (2025 FDD)
According to the 2025 Carls Jr. Franchise Disclosure Document, the franchise agreement explicitly states that the relationship between the franchisee and CJR is not one of agency, employment, or partnership. The franchisee is not considered an agent, legal representative, partner, subsidiary, joint venturer, or employee of CJR or its affiliates. This means that the franchisee operates as an independent contractor.
As an independent contractor, the Carls Jr. franchisee is solely responsible for all aspects of developing and operating their franchised restaurant. This includes ensuring compliance with all applicable laws, ordinances, and regulations. Carls Jr. has no responsibility to ensure such compliance, and the franchisee acknowledges that Carls Jr. will have no liability if the restaurant's development or operation violates any law, ordinance, or regulation.
The agreement emphasizes that the relationship between the franchisee and Carls Jr. is a commercial, arms-length business relationship. The franchisee must indicate their independent ownership of the franchised restaurant in all public records, relationships with other persons, letterheads, and business forms. Additionally, the franchisee is required to post a sign in a conspicuous location within the restaurant stating that it is independently owned and operated under a franchise agreement with Carls Jr.