Can Chem Dry be held liable for business interruptions experienced by a franchisee?
Chem_Dry Franchise · 2024 FDDAnswer from 2024 FDD Document
irectly or indirectly constitute, suggest, infer or imply that CDI controls any aspect or element of the day-to-day operations of the BUSINESS, which FRANCHISEE alone controls, but only constitute brand standards FRANCHISEE must adhere to when exercising control of the day-to-day operations of the BUSINESS.
-
- CDI does not assume any liability and will not be considered liable in any way for any express or implied agreements, warranties, guarantees or representations, or any debt incurred by FRANCHISEE in the name of or on behalf of CDI, which are not expressly authorized under this Agreement, or for the actions of any other Chem-Dry franchisees. CDI will not be obligated for any damages to any person or property which directly or indirectly arise from or relate to FRANCHISEE'S operation of the BUSINESS.
-
- FRANCHISEE shall conspicuously be identified in a form of notice required by CDI in all dealings with customers, suppliers, public officials and others as the owner of the BUSINESS under a franchise with CDI and shall place such other notices of independent ownership on such forms and other materials as CDI may require from time to time. FRANCHISEE shall not employ any of the Marks in signing any contract or applying for any license or permit or in a manner that may result in CDI's liability for any of FRANCHISEE'S indebtedness or obligations, nor may FRANCHISEE use the Marks in any way not expressly authorized by CDI.
Source: Item 23 — Receipts (FDD pages 68–264)
What This Means (2024 FDD)
According to Chem Dry's 2024 Franchise Disclosure Document, Chem Dry does not assume liability for damages that arise from a franchisee's business operations. The agreement specifies that Chem Dry will not be held responsible for damages to any person or property that directly or indirectly arise from or relate to the franchisee's operation of the Chem Dry business. This indicates that Chem Dry aims to avoid liability for operational issues encountered by franchisees.
Furthermore, the franchise agreement emphasizes that the franchisee has sole control over the day-to-day operations of the business. While Chem Dry establishes brand standards and procedures, these are not intended to imply control over the franchisee's daily activities. The franchisee acknowledges and agrees that they alone will manage all aspects of the business.
This delineation of control and liability suggests that franchisees are responsible for managing their business operations and any associated risks. Prospective franchisees should understand that Chem Dry is not liable for business interruptions or damages resulting from their operational decisions or external factors affecting their business. Franchisees need to secure appropriate insurance and have contingency plans in place to mitigate potential disruptions.