What is the effect of a City Publications franchisee failing to pursue a remedy or mitigate a loss?

Based on the 2025 City Publications Franchise Disclosure Document, if either City Publications or the franchisee is required to enforce the franchise agreement through a judicial or arbitration proceeding, the prevailing party is entitled to reimbursement for their costs. These costs include reasonable accounting and legal fees incurred during the proceeding. This encourages both parties to adhere to the agreement and seek resolution through formal channels when necessary.

This provision means that a City Publications franchisee who wins a legal dispute against the franchisor can recover the expenses incurred during the process, such as lawyer fees and accounting costs. Conversely, if the franchisor wins, the franchisee would be responsible for covering those costs for the franchisor. This creates a financial incentive for both parties to act reasonably and responsibly in their dealings with each other and during any dispute resolution processes.

For a prospective City Publications franchisee, this clause highlights the importance of understanding the franchise agreement and adhering to its terms. It also underscores the need to carefully consider the potential costs of legal action and to explore all available options for resolving disputes before resorting to litigation or arbitration. Furthermore, it may be prudent to maintain adequate insurance coverage to protect against potential legal expenses.