Are Crave franchisees responsible for indemnifying Crave for acts, errors, or omissions related to the operation of motor vehicles used in the Franchised Business?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
- 15.1.5 Acts, errors, or omissions of you, any of your affiliates and any of the Principals and the officers, directors, shareholders, partners, agents, representatives, independent contractors and employees of you and your affiliates in connection with the establishment and operation of the Franchised Business, including, but not limited to, any acts, errors or omissions of any of the foregoing in the operation of any motor vehicle. The parties understand and agree that we cannot and do not exercise control over the manner of operation of any motor vehicles used by, or on behalf of, you or any employee, agent or independent contractor of yours and that the safe operation of any motor vehicle is, therefore, entirely your responsibility.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, franchisees are responsible for indemnifying Crave for acts, errors, or omissions related to the operation of motor vehicles used in the Franchised Business. Specifically, the franchisee must indemnify Crave for acts, errors, or omissions of the franchisee, their affiliates, principals, and their respective officers, directors, shareholders, partners, agents, representatives, independent contractors, and employees. This indemnification extends to any acts, errors, or omissions related to the operation of any motor vehicle in connection with the establishment and operation of the franchised business.
The FDD clarifies that Crave does not exercise control over the operation of motor vehicles used by the franchisee or their personnel. The safe operation of any motor vehicle is entirely the franchisee's responsibility. This allocation of responsibility underscores the importance of franchisees maintaining adequate insurance coverage and implementing safety protocols for any vehicle-related activities within their business.
This requirement means that if a franchisee's employee, while operating a vehicle for the Crave business, causes an accident due to negligence, the franchisee would be responsible for covering Crave's losses resulting from any claims or lawsuits. This could include legal fees, settlement costs, and other related expenses. Prospective franchisees should carefully consider this obligation and ensure they have sufficient insurance and risk management practices in place to mitigate potential liabilities.