Under what circumstances does a Cicis franchisee waive the right to indirect damages against Cicis?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
EXCEPT WITH RESPECT TO ANY CLAIMS, CONTROVERSIES, OR DISPUTES FOR WHICH YOU OWE AN INDEMNITY UNDER THIS AGREEMENT OR OTHERWISE, YOU HEREBY WAIVE, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT TO OR CLAIM OR ANY PUNITIVE, EXEMPLARY, INCIDENTAL, INDIRECT, SPECIAL, CONSEQUENTIAL, OR OTHER DAMAGES (INCLUDING LOSS OF PROFITS) AGAINST US AND OUR AFFILIATES, AND THE OFFICERS, DIRECTORS, SHAREHOLDERS, PARTNERS, AGENTS, REPRESENTATIVES, INDEPENDENT CONTRACTORS, SERVANTS, AND EMPLOYEES OF EACH OF US AND THEM, IN THEIR CORPORATE AND INDIVIDUAL CAPACITIES, ARISING OUT OF ANY CAUSE WHATSOEVER (WHETHER SUCH CAUSE BE BASED IN CONTRACT, NEGLIGENCE, STRICT LIABILITY, OTHER TORT, OR OTHERWISE) AND AGREE THAT IN THE EVENT OF A
DISPUTE, YOU WILL BE LIMITED TO THE RECOVERY OF ANY ACTUAL DAMAGES YOU SUSTAIN. IF ANY OTHER TERM OF THIS AGREEMENT IS FOUND OR DETERMINED TO BE UNCONSCIONABLE OR UNENFORCEABLE FOR ANY REASON, THE FOREGOING PROVISIONS OF WAIVER BY AGREEMENT OF PUNITIVE, EXEMPLARY, INCIDENTAL, INDIRECT, SPECIAL, CONSEQUENTIAL, OR OTHER DAMAGES (INCLUDING LOSS OF PROFITS) WILL CONTINUE IN FULL FORCE AND EFFECT.
Source: Item 22 — CONTRACTS (FDD pages 64–65)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, a franchisee waives the right to claim punitive, exemplary, incidental, indirect, special, consequential, or other damages (including loss of profits) against Cicis and its affiliates. This waiver extends to the officers, directors, shareholders, partners, agents, representatives, independent contractors, servants, and employees of Cicis, both in their corporate and individual capacities.
This waiver applies to any cause of action, whether based in contract, negligence, strict liability, other tort, or otherwise. The agreement specifies that in the event of a dispute, the franchisee's recovery will be limited to actual damages sustained. This means that a franchisee cannot seek additional compensation for things like lost business opportunities or reputational harm, only direct financial losses.
However, this waiver does not apply to claims, controversies, or disputes for which the franchisee owes an indemnity to Cicis under the Franchise Agreement. Indemnification typically involves compensating Cicis for losses or liabilities the company incurs due to the franchisee's actions or breaches of the agreement. Even if any other term of the agreement is found to be unconscionable or unenforceable, the waiver of punitive, exemplary, incidental, indirect, special, consequential, or other damages (including loss of profits) will remain in full effect.
This clause is significant for prospective franchisees as it limits their potential financial recovery in disputes with Cicis. Franchisees should carefully consider the implications of this waiver and consult with legal counsel to understand their rights and obligations under the Franchise Agreement. It is a fairly common practice in franchising for franchisors to limit their liability in this way, but the specific terms can vary.