Under what conditions can Checkersrallys waive an obligation of the franchisee?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
, statute or otherwise and regardless of the relief sought) shall be construed under the laws of the State of Florida, provided the foregoing shall not constitute a waiver of your rights under any applicable franchise law of another state that does not conflict with Florida law. In the event of any conflict of law, Florida law will prevail, without regard to the application of Florida conflict of law principles. However, if any provision of this Agreement would not be enforceable under Florida law, and if the Development Area is predominantly located outside of Florida and such provision would be enforceable under the laws of the state in which the Development Area is predominantly located, then such provision shall be construed under the laws of that state. Nothing in this Section is intended to subject this Agreement to any franchise or similar law, rule or regulation of the State of Florida to which it otherwise would not be subject.
10.09 Successors and Assigns. This agreement is binding on the parties hereto and their respective executors, administrators, heirs, assigns and successors in interest. This agreement is fully transferable by us, whether by operation of law or otherwise, and shall inure to the benefit of any transferee or other legal successor to our interest herein.
10.10 Limitations on Damages. EXCEPT WITH RESPECT TO YOUR OBLIGATION TO INDEMNIFY US FOR THIRD PARTY CLAIMS UNDER SECTION 5.02, AND EXCEPT WITH RESPECT TO THE CONFIDENTIAL INFORMATION IN SECTION 6.01, FRANCHISOR AND FRANCHISEE (AND ITS OWNERS) EACH WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT TO OR CLAIM FOR ANY PUNITIVE OR EXEMPLARY DAMAGES AGAINST THE OTHER. YOU AND EACH OF YOUR OWNERS WAIVE TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE RIGHT TO RECOVER CONSEQUENTIAL, SPECIAL AND INCIDENTAL DAMAGES FOR ANY CLAIM DIRECTLY OR INDIRECTLY ARISING FROM OR RELATING TO THIS AGREEMENT.
You agree that, for our System to function properly, we should not be burdened with the costs of litigating system-wide disputes.
Source: Item 23 — RECEIPTS (FDD pages 92–384)
What This Means (2025 FDD)
According to the 2025 Checkersrallys FDD, there are specific conditions and limitations regarding the waiver of franchisee obligations, particularly concerning liability and initial fees. The FDD stipulates that no disclaimer, questionnaire, clause, or statement signed by a franchisee can waive claims of fraud in the inducement, whether based on common law or statutory grounds. This ensures that franchisees cannot inadvertently waive their right to pursue legal action if they believe they were fraudulently induced into investing in the franchise. This provision is designed to protect franchisees from overreaching by the franchisor.
Furthermore, the FDD includes addenda for specific states like Maryland, Illinois, and California, which provide additional protections. For instance, in Maryland, acknowledgments or representations by the franchisee cannot act as a waiver of liability under the Maryland Franchise Registration and Disclosure Law. Similarly, California law voids any waiver of rights under the Franchise Investment Law or the Franchise Relations Act. These state-specific provisions highlight the importance of understanding the legal landscape in the franchisee's particular state.
Regarding initial fees, Checkersrallys will defer the franchisee's payment of initial fees under the Franchise Agreement until all pre-opening obligations have been satisfied and the franchisee commences business. This deferral is also applicable to development fees under the Development Agreement, ensuring that franchisees are not required to pay fees until Checkersrallys has fulfilled its pre-opening responsibilities. This policy is explicitly mentioned in addenda for Illinois and Virginia, and generally applies to all franchisees, providing a financial safeguard for new franchisees. However, franchisees and their owners waive, to the fullest extent permitted by law, any right to or claim for any punitive or exemplary damages against Checkersrallys, except with respect to the obligation to indemnify Checkersrallys for third party claims and confidential information.