Under what circumstances is SCH's liability limited to $100.00 as liquidated damages for Crowne Plaza?
Crowne_Plaza Franchise · 2025 FDDAnswer from 2025 FDD Document
--------------|-----------------------------------------------------------------------------------------------------------|--| | | performance of this Agreement with respect to the services and deliverables as defined herein and shall | | | | have the authority to execute written modifications or additions to this contract pursuant to Section 15. | |
10. Taxes.
Any and all taxes, except income taxes of SCH, imposed or assessed by reason of this contract or its performance, including but not limited to sales or use taxes, shall be paid by Client. Client and SCH specifically agree that SCH is not an employee of Client. In the event foreign, federal, state or local taxes are assessed on the Services and SCH has paid for such taxes, C
Source: Item 23 — Receipts (FDD pages 100–424)
What This Means (2025 FDD)
According to the 2025 FDD, SCH's (likely a service provider) liability related to services for Crowne Plaza is limited to $100.00 as liquidated damages under specific conditions. This limitation applies if a court deems the initial limitation of liability for special or consequential damages unenforceable. The agreement stipulates that because of the difficulty in predicting potential damages, SCH's total liability will be capped at $100.00, which is considered liquidated damages rather than a penalty.
This provision means that even if SCH's actions or omissions cause significant financial harm to a Crowne Plaza franchisee, SCH's financial responsibility is limited to this nominal amount under certain circumstances. This could leave the franchisee bearing the brunt of any substantial losses resulting from SCH's errors or negligence, especially if the initial waiver of liability is upheld.
Such limitations of liability are common in many service agreements to protect the service provider from potentially large payouts. However, the $100.00 cap is notably low and could be a point of concern for franchisees. Franchisees should carefully consider this limitation and potentially seek legal advice to understand their rights and remedies in case of disputes involving SCH's services. They might also want to explore options for insurance coverage to mitigate potential losses that exceed this liability cap.