Author’s Note:
This article is part of an occasional series on liability issues facing the private security industry. Two previous articles in the series addressed negligence claims for failure to protect a plaintiff against third-party attacks, specifically, the duty element of those claims. These articles analyzed the duty owed by security guard companies and property owners or managers, respectively. Continuing the theme, this article will analyze the duty owed by franchisors. For the sake of efficiency, it will not rehash some general information on negligence claims and the types of duty that were explained in previous articles.
Under certain circumstances, franchisors will owe a duty to protect their franchisees from third-party attacks. This can apply regardless of whether they hire security guards.
As previous articles have explained, the duty to prevent third-party attacks can come in four varieties: (1) the parties are in a special relationship and the harm is foreseeable; (2) an employee is in imminent danger and this is known to the employer; (3) a principal fails to warn its agent of unreasonable risk of harm involved in the agency; and (4) a party voluntarily assumes a duty to protect another from third party acts.[1] For franchisors, the most relevant type is the fourth: voluntary undertaking.
In voluntary undertaking cases, the scope of the duty depends on the extent of the undertaking.[2] Accordingly, franchisors will be responsible for protecting franchises’ employees to the extent they undertake to control the stores’ security operations.[3] Control can be evidenced through the parties’ franchise agreement or their actions.
In Illinois, there is no settled test for determining whether a franchisor has asserted enough control to establish a duty to protect. That said, courts are more likely to find a duty where the franchisor developed mandatory security measures for its franchises and a system to enforce them. A chronological review of the prominent case law will illustrate the point:
Martin v. McDonald’s Corporation (First District 1991) – Defendant assumed a duty
Martin occupies one end of the spectrum, where the franchisor exerted significant control over its franchise’s security. Here, Laura Martin, an employee at a McDonald’s in Oak Forest, was shot and killed by a gunman who broke into the store after closing.[4] The gunman gained entry through the back door, which an employee left unlocked while closing for the day.[5] Among others, Martin’s estate sued the McDonald’s Corporation (“McDonald’s Corp”) for wrongful death.[6]
McDonald’s Corp was the franchisor, but not the owner of the Oak Forest restaurant.[7] Nonetheless, it managed the restaurant’s security. This was done through mandatory safety protocols designed to protect franchises from armed intruders.[8] McDonald’s Corp’s regional security manager, an executive with the corporate office, enforced the protocols through periodic store inspections.[9] The security manager covering the Oak Forest store testified that his job included follow-up inspections to make sure franchises were abiding by the protocols.[10]
The security manager visited the Oak Forest location once, about a month before the shooting. He instructed the store manager on the mandatory security measures, in particular, the closing procedures.[11] These prohibited employees from opening the back door and advised that all trash and grease should be taken out the side door by one employee, with another monitoring her.[12] The purpose was to prevent an unauthorized person from entering the restaurant.[13] The security manager did not conduct a follow-up inspection.[14]
The First District affirmed judgment for Martin’s estate. Specifically, the Court held that McDonald’s Corp voluntarily assumed a duty to protect the Oak Forest employees from third-party attacks.[15] This arose from the security system McDonald’s Corp created for its franchises. Most notably, the corporate office imposed mandatory security protocols, which were enforced by a corporate executive, charged with inspecting franchises to determine whether they were following the protocols.[16] Further, according to the regional security manager, he was also supposed to conduct follow-up inspections on whether security protocols were being followed.[17]
Despite these requirements, McDonald’s Corp breached its duty by failing to conduct the follow-ups prior to the attack on Martin.[18]
Decker v. Domino’s Pizza (Fifth District 1994) – Defendant assumed a duty
In Decker, the Fifth District confronted circumstances similar to those in Martin – a franchisor that imposed mandatory security protocols on its franchises.
The case began with an armed robbery at a Domino’s franchise in downstate North Alton. Plaintiff Eric Decker was working the night shift, when the robber snuck up, hit him on the head and pistol-whipped him repeatedly.[19] The encounter left Decker in the hospital for three days with injuries to his head and hands.[20] Decker sued Domino’s for failing to protect him from the attack.
Prior to the night in question, Domino’s involvement in franchises’ security had been extensive. It established a “protective services department,” a division within the corporation that managed security-related issues.[21] The department distributed literature to the stores outlining safety and robbery prevention measures employees were to follow.[22] Domino’s had also created a “standards committee,” staffed by both corporate and franchise representatives, to analyze crime data and determine the best crime prevention systems.[23] The committee ordered stores to install a specific cash management system and hold money in time-delay safes.[24] All of these security protocols were mandatory.[25] To this end, Domino’s sent “franchise consultants” to each store to make sure they were following the protocols.[26] The consultants also evaluated the stores on how well they performed in safety-related areas.[27]
Based on these factors, the Fifth District held that Domino’s “undertook [a duty] to provide a security program that would deter robbery and protect employees from harm in the event of a robbery.”[28] The Court also found there was sufficient evidence to support the trial court’s conclusion that Domino’s did not perform this duty in a non-negligent manner and, thus, affirmed the jury’s verdict for the plaintiff.[29]
At bottom, Decker did little more than reinforce the standards articulated in Martin. For one, the franchisors in both cases exhibited the same basic traits. They managed security directly from within the corporation, implemented mandatory safety rules and enforced them through onsite inspections. Still, while Decker and Martin showed that tight control over security would equal a franchisor duty, neither case spoke to how a court might treat a franchisor with less involvement.
Castro v. Brown’s Chicken & Pasta (First District 2000) – Defendant did not assume a duty
Six years after Decker came Castro – a case where the franchisor was far less active in its franchises’ security. Castro was a wrongful death suit by the estate of Michael Castro, a teenage employee murdered in Palatine’s infamous Brown’s Chicken Massacre. On the night of January 8, 1993, Castro and six other employees were closing the Palatine Brown’s, when they were shot and killed by two assailants.[30][31] The killers gained access by ordering a meal shortly before closing and lingering in the restaurant after closing.[32]
Castro’s estate sued Brown’s Chicken, Inc., the Palatine restaurant’s franchisor, arguing it failed to provide security at that location.[33] At a general level, the estate’s argument followed the Martin Court’s reasoning – namely, that Brown’s voluntarily undertook a duty to provide security because it assumed control over the franchise and its security procedures.[34] As support, the estate pointed to a yearly memorandum Brown’s sent to all store owners warning of increased crime during the holiday season and generic provisions of the Palatine franchise agreement allowing Brown’s to terminate if worker safety were jeopardized.[35]
Nonetheless, the First District found the franchisor had not voluntarily undertaken a duty to provide security. Central to the Court’s reasoning was that Brown’s left its franchises to manage themselves.[36] Unlike Martin and Decker, Brown’s did not implement mandatory security procedures or develop a follow-up system to ensure the franchises were abiding by them.[37] Nor did it appoint a corporate staff member to oversee security for its franchises. Instead, supervision fell to the director of franchise services, who only inspected the stores for food safety and “slip-and-fall hazards,” not crime prevention.[38] As such, Brown’s did not assume control over the Palatine franchise’s security and did not voluntarily undertake a duty to provide security for the restaurant.
Castro advances the standard for control expressed in Martin because it presents a contrast – a case where the franchisor applied a light touch to its franchises’ security. But by comparison, the touch was so light that it left a wide gap between the control necessary to impose a duty and the deference necessary to avoid one. Consider that, in Castro, Brown’s only contribution to its franchises’ security was a memo about general increases in crime. There were no mandatory procedures, training courses or onsite inspections. In fact, the record contained no evidence of any consistent communication between Brown’s and its franchises about security. So while Castro helped determine factors in a franchisor’s duty, it left much to be added.
Chelkova v. Southland Corporation (First District 2002) – Defendant did not assume a duty
Chelkova offered the closer case needed to sharpen the duty standard. There, Ekaterina Chelkova, an employee working the late shift at a River Forest 7-Eleven, was sexually assaulted by a store customer. She sued the franchisor, Southland Corporation (d/b/a 7-Eleven) for failing to protect her from the assault.[39]
Southland took a more active role in its franchises’ security than Brown’s in Castro. For example, in addition to providing franchises with a safety manual, Southland offered store employees training on rape and robbery prevention.[40] The corporation also employed “field consultants” who visited franchises and, unlike the onsite inspectors in Castro, addressed security. Southland even recommended a security system, which it offered to install and pay for.[41]
All that said, none of Southland’s security measures were mandatory. Indeed, the franchises were not required to adopt any of the procedures in the safety manual or implement the recommended security system.[42] In a similar vein, Southland did not monitor franchises to ensure they complied with its safety measures. The field consultants were only there to consult on security issues, not enforce security mandates.[43] At bottom, as the River Forest franchise owner testified, franchises were left to manage the store as they saw fit.[44]
The First District held that Southland did not assume a duty to protect Chelkova. Mainly, despite the corporation’s thorough interest in its franchises’ security, none of its security measures were mandatory.[45] In particular, Southland did not enforce the recommendations through follow-ups by corporate personnel.[46] Nor did its franchise agreements impose a penalty on franchises if they failed to implement the security measures.[47]
Here, on the surface, Southland took many of the same steps as McDonald’s Corp in Martin and Domino’s in Decker. All three introduced specific security protocols to their franchises through safety manuals and other recommendations. Each also provided training on security procedures and sent consultants to the stores to review their implementation. But in Chelkova, the protocols were not mandatory or otherwise enforced. As the Chelkova Court explained, unlike Domino’s in Decker, Southland did not take any “affirmative action to ensure compliance with its security standards.”[48] This explains why McDonald’s Corp and Domino’s had a duty Southland lacked.
Bottom Line
While the sample size is small, two factors have proved the difference on whether a franchisor owes a duty to safeguard its franchises: (1) mandatory security measures; and (2) procedures for enforcing them. In Martin and Decker, the franchisors’ securities plans included these features. And the reviewing courts held that those franchisors assumed a duty. Conversely, in Castro and Chelkova, the franchisors’ security plans did not include either mandatory rules or enforcement. And accordingly, neither owed a duty.
More than the others, Chelkova serves as the telltale. There, Southland took an active role in its franchises’ security, offering security manuals, training, and onsite assistance. It even offered to pay for franchises to install an alarm system. In some ways, the franchisors’ security plans in Martin and Decker offered less. But unlike the plan in Chelkova, the security measures in Martin and Decker were mandatory. And the franchisors promised to enforce them.
So effectively, the contrast between Chelkova and the Martin/Decker line isolates the factors establishing franchisor control and, by extension, duty.[49] Southland did not require its security measures, while McDonald’s Corp and Domino’s did. This distinguishes franchisors that voluntarily assume a duty to protect from those that do not.
[1] Blankenship v. Securitas Security Services, 2014 IL App. (1st) 123749, ¶19.
[2] Castro v. Brown’s Chicken, 314 Ill. App. 3d 542, 547 (1st Dist. 2000).
[3] See e.g., Id. at 548.
[4] Martin v. McDonald’s Corp., 213 Ill. App. 3d 487, 489 (1st Dist. 1991).
[5] Id.
[6] Id.
[7] Id. at 490.
[8] Id. at 492.
[9] Id. at 491-492.
[10] Id. at 492.
[11] Id.
[12] Id.
[13] Id.
[14] Id. at 492-493.
[15] Id. at 492.
[16] Id. at 492-493.
[17] Id.
[18] Id. at 493.
[19] Decker v. Domino’s Pizza, Inc., 268 Ill. App. 3d. 521, 523-524 (5th Dist. 1994).
[20] Id. at 524.
[21] Id. at 526.
[22] Id.
[23] Id. at 526-527.
[24] Id. at 527.
[25] Id. at 526-527.
[26] Id. at 527.
[27] Id.
[28] Id.
[29] Id. at 528.
[30] Castro, 314 Ill. App. 3d at 543-544.
[31] The opinion states that no one had been charged with the murders, which at the time (2000), was true. The Brown’s Chicken Massacre remained unsolved for nine years. But in 2002, police got a break when one killer’s former girlfriend told them he confessed the murders to her shortly after they happened. As a result, in 2007 and 2009, respectively, authorities convicted Juan Luna and James Degorski of seven counts of murder. Currently, both are serving life in prison.
[32] Id. at 550.
[33] Id. at 544.
[34] Id. at 544, 550.
[35] Id. at 550-551.
[36] Id. at 549-550.
[37] Id. at 550.
[38] Id.
[39] Chelkova v. Southland Corp., 331 Ill. App. 3d. 716, 718 (1st Dist. 2001).
[40] Id. at 720.
[41] Id.
[42] Id.
[43] Id. at 724.
[44] Id. at 720.
[45] Id. at 723.
[46] Id. at 724.
[47] Id. at 723.
[48] Id. at 724.
[49] See Lawson v. Schmidt Boulder Hill, Inc., 398 Ill. App. 3d 127 (2nd Dist. 2010) (“Martin, Decker, Castro, and Chelkova illustrate that whether a franchisor maintains mandatory security procedures is a crucial factor in determining whether the franchisor has voluntarily undertaken a duty of care toward a franchisee’s employees.”).
Terry Brennan Law 