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Diana, Gina, and Earl of Florida incorporate their computer technical support business as Fast Aid, LLC. This LLC was a franchise. The franchiser with the same name has the main office in Delaware. Diana contracts with Gina to respond to Fast Aid’s customer service calls on a commission basis. 20% of the gross proceeds going to the franchiser and 20% of the proceeds going to The Florida franchise. What are the advantages and disadvantages to Fast Aid of classifying Gina as an independent contractor rather than as an employee member? Earl obtains a loan from First National Bank and signs a promissory note for repayment of the amount without indicating that he is doing so solely on behalf of Fast Aid. Fast Aid does not make enough profit its first year to make payments on the loan. Charging default, the bank files a suit against Earl, for the unpaid amount. Earl responds that he was acting on behalf of Fast Aid LLC. Will the bank succeed against Earl? Why or why not? Will the bank succeed against the Florida franchise and or the Delaware franchise of the same name. The franchise agreement has a right to cure provision. The franchiser terminates the franchise and demands possession of the premises. Diana and Gina demands the right to cure the default.

The promissory note had the logo and name of the franchise of that of Fast Aid, LLC. There was no address. Earl Agent was how Earl signed the note. The franchise agreement has a right to cure clause in the agreement.

Who is responsible on the note. What liability does the Florida, and the Delaware Company have. Does any of the parties have personal liability?

What must the Delaware company do to get possession of the premises in Florida, it is stating that the Florida company breached its contract and thereby could take over possession of the premises and the business.. The Florida company says that there is a right to cure clause in the contract. Does the Delaware company because of a breach of the contract deny the right for the Florida the right to cure? Where must suit be brought?

Learning Activity #2

What are the two primary advantages of a franchise and why?

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