Does the Fly Fitness agreement include a waiver of punitive damages by the developer?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
- 10.7 Waiver of Certain Damages.
Developer hereby waives, to the fullest extent permitted by law, any right to or claim for any punitive, exemplary, incidental, indirect, special, consequential, or other damages (including, without limitation, loss of profits) against Franchisor, its affiliates, and their respective officers, directors, shareholders, partners, agents, representatives, independent contractors, servants, and employees, in their corporate and individual capacities, arising out of any cause whatsoever.
Each of
- Developer agrees that in the event of a dispute, Developer shall be limited to the recovery of any actual damages sustained.
- 10.8 Limitations of Claims. Any and all claims by Developer arising out of or relating to this Agreement or the relationship among the parties will be barred unless a proceeding for relief is commenced within one (1) year from the date on which Developer knew or should have known of the facts giving rise to such claims.
Source: Item 23 — RECEIPT (FDD pages 45–182)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, the agreement includes a waiver of certain damages. Specifically, the developer waives, to the fullest extent permitted by law, any right to or claim for any punitive, exemplary, incidental, indirect, special, consequential, or other damages (including, without limitation, loss of profits) against Fly Fitness, its affiliates, and their respective officers, directors, shareholders, partners, agents, representatives, independent contractors, servants, and employees, in their corporate and individual capacities, arising out of any cause whatsoever.
This means that if a dispute arises between the developer and Fly Fitness, the developer is limited to recovering only actual damages sustained. They cannot seek additional damages such as punitive or exemplary damages, which are intended to punish the franchisor for misconduct. This waiver is intended to benefit Fly Fitness by limiting their potential liability in case of disputes with developers.
This type of waiver is relatively common in franchise agreements. It is important for prospective Fly Fitness developers to understand the implications of this waiver and to consider seeking legal advice to fully understand their rights and obligations under the agreement. The agreement also states that any claims by the developer must be commenced within one year from the date they knew or should have known of the facts giving rise to such claims.