What costs and expenses is a City Wide franchisee liable for if City Wide enforces the agreement?
City_Wide Franchise · 2025 FDDAnswer from 2025 FDD Document
- 23.3 Responsibility of Costs.
If CITY WIDE secures any declaration, injunction or order of specific performance pursuant to the preceding paragraph, or if any provision of this Agreement is enforced at any time by CITY WIDE, or if any amounts due from Franchisee to CITY WIDE are, at any time, collected by or through an attorney at law or collection agency, Franchisee will be liable to CITY WIDE for all costs and expenses of enforcement and collection including, but not limited to, court costs, reasonable attorneys' fees, and reasonable accountants' fees.
- 14.8 Right to Enter and Operate.
In addition to CITY WIDE's right to terminate this Agreement, and not in lieu of such right or any other rights against Franchisee, if Franchisee has not cured a default under this Agreement within the time allotted by CITY WIDE after receipt of the Notice to Cure from CITY WIDE, CITY WIDE may, at its option, enter the premises of the Franchised Business and exercise complete authority with respect to its operation until such time as CITY WIDE determines that Franchisee's default has been cured and that there is compliance with the requirements of this Agreement.
Franchisee specifically agrees that a Representative (as defined in Section 16) of CITY WIDE may take over, control, and operate the business, and that Franchisee will pay CITY WIDE a service fee of not less than Three Hundred Dollars ($300) per day plus all travel expenses, room and board and other expenses reasonably incurred by such Representative so long as it will be required by the Representative to enforce compliance.
Franchisee further agrees that if, as herein provided, CITY WIDE temporarily operates for Franchisee the business franchised herein, Franchisee will indemnify and hold harmless CITY WIDE and any Representative of CITY WIDE who may act hereunder, respecting any and all acts and omissions which CITY WIDE may perform, or fail to perform as regards the interests of Franchisee or third parties.
Applicable Law and Attorney's Fees.
This Agreement will be governed by and construed in accordance with the laws of the State of Kansas.
Any action brought to enforce this Agreement, or any right granted in this Agreement will be brought in accordance with the dispute resolution provisions contained in the most current form of the Franchise Agreement between the Parties.
Should either party institute or participate in a legal or equitable proceeding against the other seeking to enforce or interpret this Agreement, the non-prevailing party in the proceeding will pay the prevailing party's costs (whether by final judgment or out of court settlement), expert and professional fees, and attorney's fees, including reimbursement of in-house counsel expenses at a reasonable rate comparable to fees generally charged in the legal community for outside counsel, and all costs and fees on appeal.
Said obligation of the non-prevailing party will be deemed to accrue on the date of commencement of such proceedings.
Source: Item 22 — CONTRACTS (FDD page 65)
What This Means (2025 FDD)
According to City Wide's 2025 Franchise Disclosure Document, a franchisee may incur various costs and expenses if City Wide enforces the franchise agreement. If City Wide secures an order of specific performance or enforces any provision of the agreement, the franchisee is liable for all costs and expenses of enforcement and collection. These costs include, but are not limited to, court costs, reasonable attorneys' fees, and reasonable accountants' fees.
In the event City Wide needs to take over operations of the franchised business due to the franchisee's default, the franchisee will be responsible for a service fee of not less than $300 per day. This fee covers the time a City Wide representative spends managing the business, plus all travel expenses, room and board, and other expenses reasonably incurred by the representative to enforce compliance with the franchise agreement. The franchisee must also indemnify and hold harmless City Wide and its representatives for any acts or omissions during the period City Wide operates the business.
Additionally, if legal action is initiated to enforce or interpret the agreement, the non-prevailing party will be responsible for paying the prevailing party's costs. These costs encompass expert and professional fees, attorney's fees (including reimbursement for in-house counsel expenses), and all costs and fees associated with appeals. This obligation accrues from the commencement date of such proceedings. Franchisees should be aware of these potential financial responsibilities when entering into a franchise agreement with City Wide.