Under what conditions can Carls Jr. charge a franchisee expenses related to a relocation request?
Carls_Jr Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee shall immediately resolve any customer complaints regarding the quality of food or beverages, service and/or cleanliness of the Franchised Restaurant or any similar complaints. When any customer complaints cannot be immediately resolved, Franchisee shall use best efforts to resolve the customer complaints as soon as practical and shall, whenever feasible, give the customer the benefit of the doubt. If CJR, in its sole discretion, determines that its intervention is necessary or desirable to protect the System or the goodwill associated with the System, or if CJR, in its sole discretion, believes that Franchisee has failed adequately to address or resolve any customer complaints, CJR may, without Franchisee's consent, resolve any complaints and charge Franchisee an amount sufficient to cover CJR's reasonable costs and expenses in resolving the customer complaints, which amount Franchisee shall pay CJR immediately on demand.
Source: Item 22 — CONTRACTS (FDD pages 75–76)
What This Means (2025 FDD)
Based on the 2025 Carls Jr. Franchise Disclosure Document, if a customer lodges a complaint regarding the quality of food or beverages, the service, or the cleanliness of the franchised restaurant, the franchisee is expected to resolve it immediately. If immediate resolution is not possible, the franchisee should exert their best efforts to resolve the complaint as soon as practical, often giving the customer the benefit of the doubt.
However, if Carls Jr., in its sole discretion, determines that intervention is necessary to protect the System or its associated goodwill, or if Carls Jr. believes the franchisee has failed to adequately address or resolve the complaint, Carls Jr. may step in to resolve the complaint without the franchisee's consent.
In such cases, Carls Jr. can charge the franchisee an amount sufficient to cover Carls Jr.'s reasonable costs and expenses incurred in resolving the customer complaints. The franchisee is then obligated to pay this amount to Carls Jr. immediately upon demand. This policy underscores the importance of franchisees maintaining high standards of customer service and restaurant operations to avoid intervention from Carls Jr. and the associated costs.