Under what condition will Focalpoint Coaching have no liability to the Franchisee for exercising judgment?
Focalpoint_Coaching Franchise · 2025 FDDAnswer from 2025 FDD Document
Neither Franchisor nor Franchisee will be liable for loss or damage or be in breach of this Agreement if Franchisor's or Franchisee's failure to perform Franchisor's or Franchisee's obligations results from: (1) compliance with the orders, requests, regulations, or recommendations of any federal, state, or municipal government; (2) acts of God; (3) fires, strikes, embargoes, war, acts of terrorism or similar events, or riot; or (4) any other similar event or cause. Any delay resulting from any of these causes will extend performance accordingly or excuse performance, in whole or in part, as may be reasonable, except that these causes will not excuse payments of amounts owed at the time of the occurrence or payment of Royalties or Fund contributions due afterward.
Source: Item 22 — Contracts (FDD pages 56–57)
What This Means (2025 FDD)
According to the 2025 Focalpoint Coaching FDD, neither Focalpoint Coaching nor the franchisee will be held liable for any loss or damage, nor will they be considered in breach of the agreement, if their failure to perform their obligations is a direct result of specific external factors. These factors include compliance with governmental orders, acts of God, fires, strikes, embargoes, war, acts of terrorism, riots, or any other similar events or causes.
This clause essentially protects both Focalpoint Coaching and the franchisee from liabilities arising from circumstances beyond their control. For a prospective franchisee, this means that if unforeseen events disrupt their ability to operate the franchise, they may not be held liable for non-performance, with the exception of payments owed at the time of the event or royalties and fund contributions due afterward.
However, it's important to note that while performance may be excused or extended due to these events, the obligation to make payments for amounts already owed or for ongoing royalties and fund contributions remains. This is a critical distinction, as it means that franchisees must still meet their financial obligations to Focalpoint Coaching even during times of hardship caused by these external factors. This type of clause is relatively standard in franchise agreements, aiming to allocate risk appropriately between the franchisor and franchisee in the face of uncontrollable events.