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Franchisees must be given a fair go |
In a recent Federal Court case a franchisor which supplied training and materials for making bread and related products in the home was taken to court by the Australian Competition and Consumer Commission ("ACCC") for its behaviour towards its franchisees. |
The franchisor refused to deliver franchise products to the franchisees, produced and distributed advertising and promotional material which omitted the names of the franchisees and their franchised business, sold and offered to sell its products in the territory of the franchisees and in areas proximate to their territories and behaved in a "hostile and pugnacious manner". |
The franchisor's conduct was found by the Court to have been a devised plan intended to cause the franchisees to terminate or not renew their franchise agreements. |
The Court found an overwhelming case of unreasonable, unfair, bullying and thuggish behaviour in relation to each franchisee that amounted to unconscionable conduct by the franchisor for the purposes of the Trade Practices Act. |
