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Franchisor's Involvement In Real Estate - How Does A Franchise Or Franchisee Relationship Develop?



"Real Estate Service" means acquiring, creating, managing, holding, protecting, defending, licensing, enforcing, retaining, preserving, promoting, repairing and undertake such other related duties and privileges as may be required in connection with the Real Estate Assets under each Franchise Agreement, in each instance in accordance with the provisions of this Agreement (subject to the exclusions set out below) and in each case as agreed upon by the Franchisor and the Agent or Broker. For the purposes of this Agreement, the term "Franchise" means a single business or a transaction rather than a series of businesses or transactions. Each Franchisor and each of its respective Representatives, agents and their respective affiliates may separately and individually perform and participate in all or any of the activities, functions and events concerning the Real Estate Assets; provided that: (a) there are no violatements of Franchisor's rights under the Franchise Agreement; and (b) the Franchisor and each of its Affiliates do not and will not cause or have any indirect or incidental damage to, or losses, profits, revenue, loss, or expenses in connection with any Real Estate Service performed by them. In addition, the foregoing is intended to protect against any breach of the representations and warranties of Franchisor, which may include but are not limited to, fiduciary duty, indemnity, litigation support, advertising and publicity relating to Real Estate Services. In the event of any violation of the foregoing, then the liability of the franchisor and its respective Affiliates for damages, penalties and costs or other damages, including legal fees, to which the franchisor is liable, and any other damages or liabilities incurred, whether in respect of negligence or any breach of warranty or agreement is hereby waived, provided that no breach of the obligations listed above or any default or neglect on the part of the Franchisor or its Affiliates or any breach or defect in the Real Estate contract or any default or defect in the performance of any of the Real Estate services shall in any way limit or affect the rights of the Franchisor or its affiliates under the franchises.


All the above mentioned aspects are clearly designed to prevent the possibility of abuse by the franchisor and their affiliates and to minimize the possibility of fraudulent claims in the event of fraud or breach of contract by the franchisor or its affiliates. As such, it is clear that the Franchisor has a legitimate interest in ensuring that the Serra Mesa real estate services they are providing are above reproach and that the above warranties and obligations are enforcing sufficiently to protect their interests. Therefore, it can be concluded that, to protect and ensure maximum profitability and overall value added to the franchise, the franchisor must ensure that the Real Estate agents' performance and actions conform to acceptable industry standards and the Franchise Agreement. This does not mean however that the Franchisor has an absolute or perpetual right to micromanage or control the Real Estate agents or that they are able to dictate when and how the Real Estate services are performed. It is also important to note that the Franchise Agreement is considered to be a legally binding contract between the Franchisee and the franchisor, so in the event that a breach occurs, the Franchisor must bear the cost of repair. You may want also to look for land for sale in San Diego County! Get more info here: https://www.britannica.com/topic/real-property

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