How is 'Incapacity' determined for the purposes of the Ella Cafe Franchise Agreement?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
"Incapacity" means physical, emotional, or mental injury or illness which would prevent a person from performing the obligations set forth in this Agreement or in any guaranty made part of this Agreement for at least 90 consecutive days and from which the person suffering the incapacity is not likely to recover within 90 days from the date of determination of the incapacity, as determined by a licensed practicing physician upon examination of the person, or if the person refuses to submit to an examination, then such person automatically shall be deemed to be incapacitated as of the date of such refusal.
Source: Item 23 — RECEIPTS (FDD pages 50–181)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, 'Incapacity' is specifically defined within the context of the Franchise Agreement. It refers to a physical, emotional, or mental injury or illness that prevents a person from fulfilling their obligations under the Franchise Agreement or any related guarantee.
For an event to qualify as 'Incapacity' under the agreement, the condition must last for at least 90 consecutive days. Furthermore, a licensed practicing physician must determine that the person suffering from the incapacity is unlikely to recover within 90 days from the date the incapacity is assessed. This determination requires a medical examination by a licensed physician.
Importantly, if the person in question refuses to submit to a medical examination, they will automatically be deemed incapacitated as of the date of their refusal. This clause ensures that a franchisee cannot avoid a determination of incapacity by simply refusing to be examined by a physician. This definition is crucial as it likely triggers certain clauses within the Franchise Agreement related to the operation, transfer, or potential termination of the franchise in cases where the franchisee is unable to manage the business due to prolonged incapacity.