Under what conditions must a Remax franchisee pay costs and attorneys' fees?
Remax Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee1 | Amount | Due Date | Remarks |
|---|---|---|---|
| Costs and Attorneys' Fees | Will vary under circumstances. | As incurred. | Payable if we engage legal counsel in connection with your failure to comply with the Franchise Agreement. |
Source: Item 5 — INITIAL FEES (FDD pages 29–43)
What This Means (2025 FDD)
According to Remax's 2025 Franchise Disclosure Document, a franchisee may be required to cover Remax's legal costs and attorneys' fees if Remax engages legal counsel due to the franchisee's failure to comply with the Franchise Agreement. The exact amount will vary based on the circumstances. This means that if a Remax franchisee violates the terms of their agreement with Remax, leading Remax to seek legal assistance, the franchisee will be responsible for paying the resulting legal expenses.
This provision is standard in franchise agreements, as it protects the franchisor from bearing legal costs incurred due to a franchisee's non-compliance. For a prospective Remax franchisee, this underscores the importance of fully understanding and adhering to the terms of the Franchise Agreement to avoid potential legal issues and the associated financial burden.
It is important to note that the FDD also lists other fees that a Remax franchisee may incur, such as audit fees if the franchisee fails to furnish reports or understates amounts owed, interest and late charges on overdue amounts, and indemnification if Remax is held liable for claims arising from the franchisee's operations. These fees, along with the potential for covering Remax's legal costs, highlight the financial responsibilities and risks associated with operating a Remax franchise.