Can Checkersrallys automatically debit a franchisee's bank account to cover expenses incurred for maintenance performed by Checkersrallys on behalf of the franchisee?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
9.01 Condition of Franchised Restaurant.You must maintain the Franchised Restaurant's condition and appearance in an attractive and clean manner so that the Franchised Restaurant can be efficiently operated at all times**.** You agree to maintain the Franchised Restaurant's condition and appearance and to make such modifications and additions to its layout, decor, and general theme as we may require at any time and from time to time, including replacement of worn-out or obsolete fixtures, equipment, furniture, signs and utensils, repair of the interior and exterior and appurtenant drive-thru and parking areas, and periodic cleaning and redecorating of the Premises. If at any time the general state of repair, appearance or cleanliness of the Franchised Restaurant or its fixtures, equipment, furniture, signs or utensils, does not meet our standards, we may notify you and specify the action you must take to correct such deficiency. If, within ten (10) days after receiving such notice, you fail or refuse to initiate and thereafter continue in good faith and with due diligence a bona fide program to complete such required maintenance, we have the right (in addition to our rights under Section 14), but not the obligation, to enter the Premises and do such maintenance on your behalf and at your expense. You must promptly reimburse us for such expenses, which we may automatically debit from your bank account in accordance with Section 6.05.
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, under certain conditions, Checkersrallys has the right to debit a franchisee's bank account for maintenance expenses. Specifically, if the franchisee fails to maintain the restaurant to Checkersrallys's standards, Checkersrallys may perform the necessary maintenance themselves.
Checkersrallys will first notify the franchisee of the deficiencies and give them ten days to begin a program to correct the issues. If the franchisee fails to do so, Checkersrallys has the right to enter the premises and perform the maintenance at the franchisee's expense.
In this case, Checkersrallys can automatically debit the franchisee's bank account to cover these expenses, provided the franchisee has signed an electronic payment authorization agreement as described in Section 6.05. This agreement allows Checkersrallys to debit the franchisee's account for royalty fees, rents, advertising deposits, and other amounts owed under the franchise agreement.