Does the Focus CFO agreement create a fiduciary relationship between Focus CFO and the franchisee?
Focus_Cfo Franchise · 2025 FDDAnswer from 2025 FDD Document
- 8.3. This Agreement does not create a fiduciary relationship between the parties and nothing in this Agreement is intended to make either party a general or special agent, legal representative, subsidiary, joint venture, partner, employee or servant of the other for any purpose.
- 8.4. Franchisee acknowledges and agrees that, under this Agreement, Franchisee is and will be an independent contractor. Franchisee is not an employee of Focus CFO for any purpose, most particularly with respect to any mandated or other employee benefits or insurance coverage, tax, or contributions, or requirements pertaining to withholdings, levied of fixed, by any city, state, or federal governmental agency.
Source: Item 23 — Receipts (FDD pages 37–126)
What This Means (2025 FDD)
According to the 2025 Focus CFO Franchise Disclosure Document, the franchise agreement does not establish a fiduciary relationship between Focus CFO and its franchisees. The agreement explicitly states that nothing within it is intended to create a general or special agency, legal representation, subsidiary, joint venture, partnership, employee, or servant relationship between the parties. This clarification is crucial for prospective franchisees to understand their legal standing and responsibilities.
This independent contractor status means that Focus CFO franchisees are responsible for their own federal, state, and local tax obligations, including estimated tax payments and self-employment taxes. Focus CFO will issue a Form 1099 to franchisees at the end of each year, reflecting their gross compensation without any deductions for taxes. Franchisees, as independent contractors, are not entitled to typical employee benefits or insurance coverage from Focus CFO.
Focus CFO emphasizes the independent nature of the franchisee's role, ensuring that franchisees understand they are not employees of Focus CFO for any purpose, especially concerning mandated employee benefits, insurance, tax withholdings, or contributions. This delineation protects Focus CFO from potential liabilities associated with employer-employee relationships and places the onus on the franchisee to manage their own business operations and compliance matters.