If Endless Summer Sweets chooses to cure a franchisee's default, is it liable to the franchisee?
Endless_Summer_Sweets Franchise · 2024 FDDAnswer from 2024 FDD Document
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- No Liability. By executing this Rider, Franchisor does not assume any liability with respect to the Leased Premises or any obligation as Tenant under the Lease.
Source: Item 23 — RECEIPTS (FDD pages 39–125)
What This Means (2024 FDD)
According to the 2024 Endless Summer Sweets Franchise Disclosure Document, Endless Summer Sweets does not assume liability with respect to the leased premises or any obligation as the tenant under the lease by executing the lease rider.
Specifically, if a franchisee (tenant) defaults on their lease agreement, the landlord must provide Endless Summer Sweets with a copy of the default notice. Endless Summer Sweets then has the option, but not the obligation, to cure the default within ten days after the period in which the franchisee could cure the default has expired. This means Endless Summer Sweets can step in to resolve the default, such as by paying overdue rent, to prevent eviction and keep the franchise location operational.
However, the FDD explicitly states that by providing this option, Endless Summer Sweets does not take on any of the franchisee's liabilities or obligations related to the leased property. This protects Endless Summer Sweets from being held responsible for the franchisee's debts or other lease-related issues. This clause clarifies that Endless Summer Sweets's involvement is solely to protect its brand and network, not to assume the franchisee's financial burdens.