Under the Checkers franchise agreement, is Checkers liable for agreements made by the franchisee with third parties?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
5.01 Independent Contractors. Neither this Agreement nor the dealings of the parties pursuant to this Agreement shall create any fiduciary relationship or any other relationship of trust or confidence. Franchisor and Area Franchisee, as between themselves, are and shall be independent contractors.
Nothing contained in this Agreement, or arising from the conduct of the parties hereunder, is intended to make either party a general or special agent, joint venturer, partner or employee of the other for any purpose whatsoever. You must conspicuously identify yourself in all dealings with customers, lessors, contractors, suppliers, public officials, personnel and others as the owner of development rights granted hereunder and must place such other notices of independent ownership on such forms, business cards, stationery, advertising and other materials as we require at any time and from time to time.
Source: Item 23 — RECEIPTS (FDD pages 92–384)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, Checkers franchisees are independent contractors. The franchise agreement explicitly states that nothing within the agreement should be interpreted as creating a general or special agency, joint venture, partnership, or employer-employee relationship between Checkers and the franchisee.
As an independent contractor, the franchisee is responsible for conspicuously identifying themselves as the owner of the franchise rights in all dealings with third parties. This includes interactions with customers, lessors, contractors, suppliers, public officials, and personnel. Franchisees must also include notices of independent ownership on forms, business cards, stationery, advertising, and other materials as required by Checkers.
This clear delineation of independent contractor status means that Checkers is generally not liable for the franchisee's agreements or actions with these third parties. The franchisee is responsible for their own business operations and obligations, and must ensure that their independent ownership is clear to all parties they interact with. This is a common arrangement in franchising, where franchisees operate their businesses independently while adhering to the franchisor's system and standards.