According to the Degree Wellness agreement, how is the language of the agreement to be construed?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
- 17.18 Independent Provisions. The provisions of this Agreement are deemed to be severable. In other words, the parties agree that each provision of this Agreement will be construed as independent of any other provision of this Agreement.
- 17.19 Exercise of Discretion. Whenever this Agreement gives Degree Wellness discretion to take an action or make a decision, Degree Wellness will be allowed to take or make (or refrain from taking or making) that action or decision based on its business judgment. Even if Degree Wellness has numerous motives for a particular action or decision and/or there are other reasonable and/or arguably preferable alternatives to a particular action or decision, so long as at least one motive is a reasonable business justification, the action or decision will not be subject to challenge for abuse of discretion. IF THE EXERCISE OF DEGREE WELLNESS'S DISCRETION AS TO ANY MATTER IS CHALLENGED, THE PARTIES EXPRESSLY DIRECT THE TRIER OF FACT THAT DEGREE WELLNESS'S RELIANCE ON A BUSINESS REASON IN THE EXERCISE OF ITS DISCRETION IS TO BE VIEWED AS A REASONABLE AND PROPER EXERCISE OF DEGREE WELLNESS'S DISCRETION, WITHOUT REGARD TO WHETHER OTHER REASONS FOR ITS DECISION MAY EXIST AND WITHOUT REGARD TO WHETHER THE TRIER OF FACT WOULD INDEPENDENTLY ACCORD THE SAME WEIGHT TO THE BUSINESS REASON.
Source: Item 23 — Receipts (FDD pages 66–257)
What This Means (2025 FDD)
According to the 2025 Degree Wellness Franchise Disclosure Document, the provisions of the agreement are deemed to be severable, meaning each provision will be construed as independent of any other provision. Additionally, whenever the agreement gives Degree Wellness discretion to take an action or make a decision, Degree Wellness is allowed to take or make (or refrain from taking or making) that action or decision based on its business judgment.
Even if Degree Wellness has numerous motives for a particular action or decision, and/or there are other reasonable and/or arguably preferable alternatives to a particular action or decision, as long as at least one motive is a reasonable business justification, the action or decision will not be subject to challenge for abuse of discretion. If the exercise of Degree Wellness's discretion as to any matter is challenged, the parties expressly direct the trier of fact that Degree Wellness's reliance on a business reason in the exercise of its discretion is to be viewed as a reasonable and proper exercise of Degree Wellness's discretion, without regard to whether other reasons for its decision may exist and without regard to whether the trier of fact would independently accord the same weight to the business reason.
This means that if a franchisee challenges a decision made by Degree Wellness, the decision will likely be upheld as long as Degree Wellness can demonstrate a reasonable business justification for it. This clause favors Degree Wellness in potential disputes, giving them considerable leeway in their decision-making process. Prospective franchisees should carefully consider this clause and understand that challenging Degree Wellness's decisions may be difficult, even if there appear to be other reasonable alternatives.