How must a Del Taco franchisee present themselves to the public during the term of the franchise agreement?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
thing in this Agreement is intended to constitute either party an agent, legal representative, subsidiary, joint venturer, joint employer, partner, employee, or servant of the other for any purpose whatsoever. For the avoidance of doubt, Del Taco is not the employer or joint employer of Franchisee or Franchisee's employees.
- 16.1.1 Identification as Independent Contractor. At all times during the term of this Agreement and any extensions hereof, Franchisee shall hold itself out to the public as an independent contractor operating the business pursuant to a franchise from Del Taco.
- 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 must present themselves as independent contractors operating under a Del Taco franchise. This means a franchisee cannot act or represent themselves as an agent of Del Taco. The agreement explicitly states that the franchisee lacks the authority to enter into contracts, agreements, warranties, or representations on Del Taco's behalf, nor can they incur debts or obligations in Del Taco's name. Del Taco will not be held liable for any actions or omissions by the franchisee in their restaurant operations or for any claims or judgments arising from those actions.
This distinction is crucial because it clarifies the legal and financial relationship between Del Taco and its franchisees. Franchisees bear the responsibility for their business's operations and are liable for any issues arising from their conduct. This independence extends to day-to-day management, hiring practices, and adherence to legal and regulatory requirements.
The franchisee is also obligated to indemnify and hold Del Taco harmless from 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 further reinforces the franchisee's independent contractor status and their responsibility for managing risks associated with their business. Franchisees also cannot use "Del Taco," "Del," or any other Del Taco names in their entity name.