Can Ledgers suspend technology and software services as an Interim Remedy?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
8.9. Interim Remedies
If we send you a written notice that you are in default of this Agreement, the Operations Manual, or any other agreement with us, we may elect to immediately impose an interim remedy (the "Interim Remedies"), regardless of whether the default is curable, including the suspension of our obligations under this Agreement. You understand, acknowledge, and agree that our exercise of our right to
impose Interim Remedies will not result in actual or constructive termination or abandonment of this Agreement, and that our right to Interim Remedies is in addition to, and apart from, any other right or remedy we may have in this Agreement. If we exercise the right to Interim Remedies, the exercise will not be a waiver of any breach by you of any term, covenant or condition of this Agreement. You will not be entitled to any compensation, including repayment, reimbursement, refund or offsets, for any fees, charges, expenses or losses you may directly or indirectly incur by reason of our exercise and/or withdrawal of any Interim Remedy. Interim Remedies include:
- (a) we may suspend the provision of all technology and software services provided to you pursuant to this Agreement, including any tax, accounting or bookkeeping software and/or website services; and
- (b) we may suspend our ongoing support, and the performance of all other obligations set forth in Section 3 of this Agreement.
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to Ledgers' 2025 Franchise Disclosure Document, Ledgers has the right to impose Interim Remedies if a franchisee is in default of the Franchise Agreement, Operations Manual, or any other agreement with them. These Interim Remedies can be imposed immediately, regardless of whether the default is curable.
One specific Interim Remedy that Ledgers can take is to suspend the provision of all technology and software services. This includes any tax, accounting, or bookkeeping software, as well as website services that Ledgers provides to the franchisee. Additionally, Ledgers can suspend its ongoing support and the performance of all other obligations outlined in Section 3 of the Franchise Agreement.
The FDD states that the imposition of Interim Remedies by Ledgers does not constitute a termination or abandonment of the agreement, and it does not waive any breach by the franchisee. The franchisee is not entitled to any compensation, repayment, reimbursement, refund, or offsets for any fees, charges, expenses, or losses incurred due to Ledgers' exercise or withdrawal of any Interim Remedy. This means a franchisee could potentially lose access to essential software and support without any financial recourse if Ledgers deems it necessary as an interim measure.
This clause highlights a significant power imbalance in the franchise relationship, where Ledgers can unilaterally suspend essential services, potentially crippling a franchisee's business operations, without any obligation to compensate the franchisee. Prospective franchisees should carefully consider the implications of this clause and seek legal counsel to fully understand their rights and obligations under the agreement.