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Murphy v. Holiday Inns, Inc.

Virginia Supreme Court
216 Va. 490, 219 S.E.2d 874 (1975)



Murphy (plaintiff) sued Holiday Inns, Inc. (Holiday) (defendant) for injuries sustained from falling on a wet floor in a hotel which Murphy contended Holiday owned and operated. Holiday, which did not own the hotel, had a business relationship with the operator of the hotel, Betsy-Len Motor Corporation, pursuant to a franchise contract. The franchise contract enabled Betsy-Len to operate the hotel using Holiday’s system of operation, including the use of Holiday’s trade name, style, furnishings, advertising, etc. In pertinent part, the franchise contract required Betsy-Len to pay license fees, construct the hotel according to Holiday’s specifications, promote the Holiday trade name, refrain from competitive hotel business, make quarterly reports to Holiday, and submit to Holiday’s periodic inspections. The franchise agreement also contained a clause disclaiming an agency relationship. Holiday, contending that it had did not have a principal-agent relationship with Betsy-Len, denied liability. Holiday also filed a motion for summary judgment. The trial court agreed with Holiday, and granted the motion for summary judgment.

Rule of Law


Holding and Reasoning (Knowles, J.)

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