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Franchise Law Archives

Franchisor Cannot Terminate based on Unproven Allegations of Exploitation against Franchisee

court room terminationRecently, in Golden Globe Pizza Inc. v. Domino's Pizza of Canada Ltd., 2015 BCSC 356, the B.C. Supreme Court granted an injunction sought by a franchisee to prevent the franchisor from terminating the franchise agreement based on unproven allegations of exploitation made by employees of the franchisee.

Franchisor's Obligation to Disclose Lease Arrangements to Prospective Franchisees

Lease ArrangementPursuant to section 5(4)(c) of the Arthur Wishart Act (Franchise Disclosure), 2000, S.O. 2000 c. 3 (the "Wishart Act"), the franchise disclosure document that a franchisor provides to a prospective franchisee must contain "copies of all proposed franchise agreements and other agreements relating to the franchise to be signed by the prospective franchisee". The lease (or a sublease or agreement to assign the lease, as the case may be) for the premises from which the franchise will operate is one such agreement that needs to be included in the disclosure document.

Is a Disclosure Document Required if a Franchise is being Assigned by the Franchisee?

business men papers graphsPursuant to subsection 5(1) of the Arthur Wishart Act (Franchise Disclosure), 2000, S.O. 2000 c. 3 (the "Act"), franchisors must provide prospective franchisees with a disclosure document. However, subsection 5(7) of the Act exempts the franchisor from this requirement in the event of a grant of a franchise by a franchisee if the grant "is not effected by or through the franchisor". Subsection 5(8) of the Act clarifies that a grant of a franchise "is not affected by or through a franchisor merely because,

Who is an "Officer" for the Purposes of Preparing a Franchise Disclosure Document in Ontario?

signing-documentsUnder the Arthur Wishart Act (Franchise Disclosure), 2000 (Ontario), franchisors are required to provide prospective franchisees with a disclosure document, which must include a certificate, certifying that the disclosure document: (a) contains no untrue information, representations or statements; and (b) includes every material fact, financial statement, statement and other information required by law. If the franchisor is incorporated, the certificate must be signed and dated by at least two officers or directors (or, if the corporation has only one director or officer, the certificate must be signed and dated by that person).

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