Does the Face Foundrie Franchisor have liability to the Area Developer for decisions or actions taken?
Face_Foundrie Franchise · 2025 FDDAnswer from 2025 FDD Document
to grant or decline to grant Area Developer a right to take or omit an action, except as otherwise expressly and specifically provided in this Agreement, Franchisor may make its decision or exercise its rights, on the basis of the information readily available to Franchisor, and its judgment of what is in its best interests and/or in the best interests of the Franchisor's franchise network, at the time its decision is made, without regard to whether: (i) other reasonable or even arguably preferable alternative decisions could have been made by Franchisor; (ii) the decision or action of Franchisor will promote its financial or other individual interest; (iii) Franchisor's decision or the action it take applies differently to Area Developer and one or more other franchisees or Franchisor's company-owned operations; or (iv) Franchisor's decision or the exercise of its right or discretion is adverse to Area Developer's interests. In the absence of an applicable statute, Franchisor will have no liability to Area Developer for any such decision or action. Franchisor and Area Developer intend that the exercise of Franchisor rights or discretion will not be subject to limitation or review. If applicable law implies a covenant of good faith and fair dealing in this Agreement, Franchisor and Area Developer agree that such covenant shall not imply any rights or obligations that are inconsistent with a fair construction of the terms of this Agreement and that this Agreement grants Franchisor the right to make decisions, take actions and/or refrain from taking actions not inconsistent with Area Developer's rights and obligations hereunder.
14.6 Captions Only for Convenience*.* All captions in this Agreement are intended solely for the convenience of the parties, and none shall be deemed to affect the meaning or construction of any provision hereof.
15. ENTIRE AGREEMENT
Franchisor and Area Developer, and any Principal, each acknowledge and warrant to each other that they wish to have all terms of this business relationship defined solely in and by this written Agreement.
Source: Item 23 — RECEIPTS (FDD pages 74–257)
What This Means (2025 FDD)
According to Face Foundrie's 2025 Franchise Disclosure Document, the franchisor generally has no liability to the Area Developer for decisions or actions taken, unless an applicable statute exists. The agreement specifies that the exercise of the franchisor's rights and discretion will not be subject to limitation or review. Both Face Foundrie and the Area Developer agree that any implied covenant of good faith and fair dealing should not create rights or obligations inconsistent with a fair interpretation of the agreement. The agreement grants Face Foundrie the right to make decisions, take actions, or refrain from taking actions, provided they are consistent with the Area Developer's rights and obligations.
Face Foundrie retains significant rights in how it manages the franchise system. The franchisor can make decisions based on readily available information and its judgment of what is in its best interests or the best interests of the franchise network. This includes decisions that might differ between Area Developers or company-owned operations and decisions that might be adverse to an Area Developer's interests.
This clause emphasizes the importance of a prospective Area Developer carefully considering the scope of Face Foundrie's decision-making authority and reserved rights, as outlined in the Area Development Agreement. The Area Developer should seek legal counsel to fully understand the implications of these provisions and how they might affect their investment and operational autonomy.