What costs of enforcement is a Checkers franchisee responsible for, as outlined in the franchise agreement?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
10.04 Costs of Enforcement. If we file a claim in a judicial or arbitration proceeding for amounts you or any of your Owners owe us or any of our Affiliates, or if we enforce this Agreement in a judicial or arbitration proceeding, and we prevail in any such proceeding, you agree to reimburse us for all of our costs and expenses, including reasonable accounting, paralegal, expert witness and attorneys' fees. If we are required to engage legal counsel in connection with your failure to comply with this Agreement, you must reimburse us for any attorneys' fees, costs and expenses we incur.
Source: Item 23 — RECEIPTS (FDD pages 92–384)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, a franchisee may be responsible for certain costs of enforcement. If Checkers files a claim against a franchisee in a judicial or arbitration proceeding for amounts the franchisee or their owners owe to Checkers or its affiliates, and Checkers prevails, the franchisee must reimburse Checkers for all costs and expenses. These costs include reasonable accounting, paralegal, expert witness, and attorneys' fees.
This means that if a Checkers franchisee breaches the franchise agreement and Checkers has to take legal action to enforce the agreement or recover owed amounts, the franchisee could be liable for Checkers' legal and related costs. This could include not only attorney fees but also the costs of expert witnesses, which can be substantial depending on the complexity of the case.
It is important for prospective Checkers franchisees to understand this provision, as enforcement costs can be significant and could add a substantial financial burden if a dispute arises. Franchisees should ensure they fully comply with the franchise agreement to minimize the risk of such a situation. Franchisees should also consult with a legal professional to fully understand their obligations and potential liabilities under the franchise agreement.