Does Del Taco have to approve a relocation of the restaurant if it is damaged?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
- 13.2.4 If Franchisee at any time without the written consent of Del Taco ceases to operate or otherwise abandons the Restaurant for three (3) consecutive business days, or loses the right to possession of the Restaurant, or otherwise forfeits the right to do or transact business in the jurisdiction where the Restaurant is located; provided, however, that if, through no fault of Franchisee, the premises are damaged or destroyed by an event such that repairs or reconstruction cannot be completed within ninety (90) days thereafter, then Franchisee shall have thirty (30) days after such event in which to apply for Del Taco's approval to relocate and/or reconstruct the Restaurant, which approval shall not be unreasonably withheld;
Source: Item 22 — CONTRACTS (FDD pages 58–59)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, if a Del Taco restaurant is damaged or destroyed through no fault of the franchisee, and repairs or reconstruction cannot be completed within 90 days, the franchisee has 30 days after the event to apply for Del Taco's approval to relocate and/or reconstruct the restaurant. Del Taco's approval for relocation cannot be unreasonably withheld.
This clause protects the franchisee from being forced to close their business permanently due to unforeseen circumstances like a fire or natural disaster. It also ensures that Del Taco maintains some control over the brand's presence and location, as they have the right to approve or disapprove the relocation site. The franchisee must act quickly, applying for approval within 30 days of the event that caused the damage.
It is important to note that while Del Taco's approval cannot be unreasonably withheld, the franchisee still needs to obtain their approval. This means the franchisee should be prepared to present a solid case for the new location, demonstrating its suitability for a Del Taco restaurant. Franchisees should communicate proactively with Del Taco and provide all necessary documentation to support their relocation request.
This requirement for franchisor approval of relocation is standard practice in the franchise industry, as it allows the franchisor to maintain brand consistency and ensure that the new location meets their standards for success. Franchisees should carefully review the franchise agreement and any related addenda to fully understand their rights and obligations in the event of damage or destruction to their restaurant.