Is a Del Taco franchisee authorized to make contracts on Del Taco's behalf?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
- 16.1.2 No Agency.
Franchisee shall not act or attempt to act or represent itself, directly or by implication, as an agent of Del Taco.
It is understood and agreed that nothing in this Agreement authorizes Franchisee to make any contract, agreement, warranty, or representation on Del Taco's behalf, or to incur any debt or other obligation in Del Taco's name; and that Del Taco shall in no event assume liability for, or be deemed liable hereunder as a result of, any such action; nor shall Del Taco be liable by reason of any act or omission by Franchisee in Franchisee's conduct of the Restaurant or for any claim or judgment arising therefrom against Franchisee or Del Taco.
Franchisee shall not have the authority, express or implied, to bind or obligate Del Taco in any way.
- 16.1.3 Indemnification.
Franchisee shall, to the fullest extent permissible under applicable law, indemnify and hold Del Taco and its affiliates, and each of Del Taco's respective officers, directors, employees, and agents harmless against any and all claims, obligations, and damages arising directly or indirectly from, as a result of, or in connection with this Agreement, the Restaurant, Franchisee's operation of the Restaurant, Franchisee and its employees' actions and inaction, or Franchisee's breach of this Agreement, including those alleged to be caused by Del Taco's negligence, as well as the costs, including attorneys' fees, costs, and expenses (and interest on such fees, costs, and expenses), of defending against them, unless (and then only to the extent that) the claims, obligations, and damages are determined to be caused solely by Del Taco's gross negligence or willful misconduct according to a final, unappealable ruling issued by a court or arbitrator with competent jurisdiction.
Source: Item 22 — CONTRACTS (FDD pages 58–59)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, franchisees are explicitly prohibited from acting as agents of Del Taco or entering into contracts on Del Taco's behalf. The franchise agreement specifies that nothing within it authorizes the franchisee to make any contract, agreement, warranty, or representation for Del Taco, or to incur any debt or obligation in Del Taco's name. This is a standard provision in franchise agreements to protect the franchisor from liabilities incurred by franchisees.
This lack of authority extends to all aspects of the franchisee's operations. Del Taco will not assume liability for any actions taken by the franchisee, nor will Del Taco be liable for any act or omission by the franchisee in the operation of the restaurant or for any claim or judgment arising from it. The franchisee does not have the authority, either expressed or implied, to bind or obligate Del Taco in any way.
Furthermore, the franchisee is required to indemnify Del Taco against any claims, obligations, and damages arising from the franchise agreement, the restaurant's operation, or the franchisee's actions, unless such claims are directly caused by Del Taco's gross negligence or willful misconduct. This indemnification clause reinforces the franchisee's independent contractor status and responsibility for their own business operations.