Franchisors should defend their corporations from lawsuits and legal responsibility. Indemnity and Maintain Innocent Clauses in Franchise Agreements, whereas they might not at all times maintain up are no less than a method to assist with this together with different methods.

In my franchise agreements for my firm, I addressed this subject by barely modified our maintain innocent clauses in our franchise agreements. Under is a duplicate of one of many early renditions of the clauses we utilized in our franchise agreements;

Franchisee agrees to defend at their very own price and to indemnify and maintain Franchisor, its associates and its predecessor, sister or co-branding corporations, their shareholders, administrators, officers, members, staff, brokers and their spouses, innocent from and in opposition to any and all loss, prices, bills (together with attorneys’ charges), damages and liabilities arising out of your negligence, failure to take care of or restore, breach of contract or different civil unsuitable, ensuing straight or not directly from or pertaining to the use, situation, equipping, upkeep or operation of your automobile wash truck/unit, together with the preparation and sale of any services or products made or bought out of your cellular automobile wash unit.

Such loss, claims, prices, bills, damages and liabilities will embrace, with out limitation, these arising from latent or different defects within the vehicles, models and tools, whether or not or not discoverable by Franchisor, and people arising from the loss of life or damage to any particular person or arising from injury to your or our property, our brokers or staff, or any third particular person, agency or company, whether or not or not such losses, claims, prices, bills, damages or liabilities have been truly or allegedly precipitated wholly or partly via our lively or passive negligence or any of our brokers or staff or resulted from any strict legal responsibility imposed on Franchisor or any of our staff.

Franchisee will indemnify and maintain Franchisor and its associates and its predecessor, sister or co-branding corporations free and innocent from and in opposition to any and all cheap attorneys’ charges, liabilities, bills, claims, calls for, actions or causes of motion which can be incurred by or threatened in opposition to Franchisor or its associates and arising out of:

  • (i) the Franchisee’s operation of the Franchised Enterprise
  • (ii) any transaction between Franchisee and any third celebration 
  • (iii) Franchisee’s improper use of the Marks

All franchise in firm needs to be involved with this and it will be very sensible and sensible to contact a educated and skilled franchise legal professional to be sure to are protected in your franchise agreements. I hope you’ll handle this in 2006.