Franchising

Franchise Agreement: Arbitration Clauses

Every franchise is governed by a contract between the licensor; the franchisor; a licensee; and the franchisee. These contracts are called Franchise Agreements. With franchise businesses accounting for 40% of all retail sales in Canada through 78,000 franchise units, mediation and arbitration clauses are becoming increasingly prevalent. While these franchise agreements may offer significant advantages in some disputes, they may be inappropriate or even increase the complexity, time and cost in other scenarios. Here’s what you need to know about arbitration to determine if it is an appropriate franchise agreement for your business.

Franchise arbitration is one of many clauses that can provide advantages during in-court litigation proceedings. An arbitration clause is a stipulation in your franchise agreement that requires the parties to resolve their disputes through arbitration, outside of court. The outcome of a dispute is decided by one or more persons (“arbitrators”, “arbiters” or “arbitral tribunal”), which renders the “arbitral award”. An arbitral award is legally binding on both sides and enforceable in the courts. A significant advantage of arbitration is the choice of arbitrator and the opportunity to specify that the arbitrator must be experienced in arbitrating franchise disputes.

However, disputes over the arbitration clause or agreement, especially over the enforceability of certain provisions or the choice of arbitrator, can prove costly and time consuming. In these cases, the complications often negate the expected advantages of these franchise agreements, since they are designed to be a quick resolution of a dispute. Law Works Waterloo specializes in franchise law and offers a variety of solutions to franchise disputes.

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franchise mediation in Guelph.

Franchise Agreements: Mediation Clauses

Franchise agreements are the ticket to a fair and healthy relationship between franchisee and franchisor. Without a proper franchise agreement, either party may be treated unfairly if a dispute arises. There are a variety of stipulations that can be included in franchise agreements to ensure disputes are resolved in an efficient and fair manner. Mediation and arbitration are two effective tactics that repeatedly provide amicable solutions. While these clauses often provide substantial benefits over litigation of disputes, there are situations where they may be inappropriate or counterproductive, increasing the complexity, time and cost of diffusing the situation. As a franchisee, it’s up to you to stay informed about the fine print of your contract, which includes understanding the different tactics involves in dispute resolution. To give you a head start, here is what you need to know about mediation.

Including mediation clauses in franchise agreements can provide a wide range of benefits to both parties, and can be very effective during the early stages of disputes to encourage a timely and cost-effective resolution. Particularly, mediation offers the greatest advantages for disputes between franchisors and existing franchisees when there is a mutual interest in preserving the franchise relationship.

With that being said, mediation is most effective when it is voluntary, and agreed to by both parties. In the absence of a mediation clause in franchise agreements, parties may agree to mediate without having to comply with a specific aspect of the franchise agreement. Additionally, a mediation clause can act as an obstacle to a franchisor who would rather proceed immediately to court instead of considering mediation. If you have any other questions, Law Works Guelph specializes in franchise law and can help guide you through the intricacies of your franchise agreements to help achieve a resolution.

Franchise agreement for Tim Horton's top franchises in Canada

Franchise Agreements: The Top 5 Franchises in Canada

If you are thinking about purchasing a franchise, it’s important to ensure you thoroughly understand the franchise agreement prior to making a decision. A franchise agreement is a legally binding contract which details the franchisors terms and conditions for the franchisee. Canada is home to many top franchises, so it’s important to evaluate your options.

To help with your decision-making process, here are 5 of the top franchises in Canada:

Tim Hortons

A Canadian coffeehouse favourite, Tim Hortons was founded in 1964 in Hamilton, Ontario and has grown into the largest quick service restaurant chain in Canada with over 3,600 stores nationwide. The franchise is headquartered in Oakville but restaurants can now be found in the United States, the United Kingdom, Ireland, and the United Arab Emirates.

Mr. Sub

This popular sandwich shop was actually founded in Toronto’s Yorkville neighbourhood in 1968 and has grown to include 317 units.

Second Cup

Though Second Cup has not grown as large as Tim Hortons, the niche coffee chain has certainly established a following. Headquartered in Mississauga, Second Cup was founded in 1975 and now has over 360 store locations.

Pizza Pizza

For many Canadians, Pizza Pizza has grown into somewhat of a Friday night tradition. The chain was founded in 1967 in Toronto and now has over 700 units spread throughout Quebec, Ontario, Nova Scotia, and Western Canada.

Canadian Tire

Founded in 1922, Canadian Tire is the only retail franchise to make the list. With over 350 locations, the brand has certainly become a “go-to” for various automotive items, home goods, and sport and leisure products.

If you have questions about your franchise agreement or have become involved in a franchise dispute, contact Law Works in Mississauga.

 

Franchise business agreement opens business to customers.

How Franchises Will Be Affected By Ontario’s Changing Workplaces Review

There are new changes happening to Ontario’s employment and labour laws. On May 23rd 2017, the Ontario government released its report to the Changing Workplaces Review. This is one of the most comprehensive and largest changes to the labour laws in the last 30 years. The Review covered broader employment issues to protect workers. They consolidated three acts: the Employment Standards Act, 2000, the Labour Relations Act, 1995 and the Occupational Health and Safety Act into the “Workplace Rights Act.”

Key takeaways to consider for the Changing Workplaces Review:

  • Minimum Wage Increase
  • Overtime and Hours of Work
  • Leaves; personal emergency, bereavement, sick days.
  • Equal Pay
  • Enforcement
  • Specific sector changes to labour relations

The Review has peaked interest among franchisors, as changes to the prevailing legislation could have imposed joint employer status on franchisors for employees of their franchisees. To the relief of the franchisors, the Report does not recommend a franchisor be deemed to be a joint employer with its franchisees. However, it does make recommendations to allow employees of multiple franchises (of the same brand) to bargain centrally with representatives in one geographical area.

Are you a franchise owner? Unsure d how these recommendations may affect your business? Stay informed. Contact Law Works, one of Canada’s leading experts in business disputes, including debtor-creditor rights, class actions, lease agreements, professional negligence, trademark infringement, shareholder disputes, joint ventures, misrepresentations, injunctions, insolvencies and receiverships.

Law Works franchise lawyers are happy to discuss how Ontario’s Changing Workplaces Review may affect your franchise operations.

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3 Tips to Selecting the Right Lawyer for You

There are many steps and processes involved in legal cases and trying to navigate them, on top of daily responsibilities can be overwhelming. Making sure you have the best representative for you and your needs is of key importance. When it comes to selecting a lawyer consider these 3 steps to help make your decision:

Select a Lawyer with Particular Expertise

Selecting a representative who has expertise in the area your case involves will be the best support system because they understand your needs and can best represent you and your case.

Research Potential Lawyers

Your local bar association will provide you some insight, as you will be able to find public records of complaints and disciplinary actions taken. There are also online sites that provide reviews but make sure to check more than one in case of bias.

Check their Website and Arrange Consultations

A lawyer’s or law firm’s website will have specific information on the type of law the attorney practices, as well as reference their years of practice and any achievements. Once you have selected a few top ones, set up consultations to get a feel for their style and take notes to refer back to.

These 3 steps are a brief guideline in how to begin the process of selecting a lawyer but the key is selecting a lawyer with expertise in your particular case. If you require a franchise lawyer in Mississauga than Law Works an expert in Franchise law is the firm for you.

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How To Handle Franchise Disputes

Disputes used to be dangerous for those involved: both individuals fought to defend their honour with a sword or pistol and this type of resolution clearly marked one the winner and the other the untimely loser.

Luckily today, the mitigation of disputes is not life threatening but this does not mean that it goes without potential harm; as any dispute, especially a business one, can impact the livelihood of those involved. Franchise disputes in particular can arise for many reasons: if a franchisee feels they are not receiving value from a franchisor; a franchisee looks at ways of selling products outside the franchise system; when or if a franchise fails.

These are some of the potential disputes that can arise in the franchise system, and despite the sometimes volatile nature of broken trust or economic loss, it is important for both parties to seek resolution over a fight. If a commercial resolution is not possible, nor is mediation, than arbitration or litigation may be the answer.

When dealing with a franchise dispute in Vaughan, Law Works is a business and franchise regional law boutique with expertise in: franchise law, international and ‎domestic business disputes and arbitration in niche industries. In both scenarios of franchise litigation and franchise arbitration, Law Works represents parties through the entire process (initial assessments, drafting pleadings, representing on all steps including final hearing). If you find yourself in a franchise dispute in Vaughan, contact Law Works to ensure you have the most capable experienced team representing you.

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What It’s Like To Be In A Franchise Dispute

Before becoming an owner of a  franchise, I think it is important to know everything I can about possible problems and issues that may arise over time. A friend of mine in the franchise business recently had to deal with a franchise dispute in Mississauga, so I felt it was necessary I learn about what’s involved in case if I ever experience something similar.  

This is what I found out about a franchise dispute in Mississauga:

Franchise agreements are complex, commercial contracts, and because of this, franchise disputes arise frequently. Disputes often arise when a franchisee feels that he/she is of more value than the franchisor is compensating them for, and then chooses to find ways of working or selling the products outside of the system. These issues also arises sometimes if a franchisee fails and feels that part of the failure is due to neglect/lack of support from the franchisor.

In either cases, the ideal solution is a commercial solution rather than a fight in court. If this is the decided action, it is important to have a mediated between both parties.

When it came down to the franchise dispute, it was very important that my friend had contacted Law Works to represent them in their franchise dispute Mississauga. Law Works assisted them with all their questions and needs, and they had a positive experience with the lawyers who communicated with them all of the important details as the process moved along.

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Getting to Know Franchise Law in Ontario and How It Works

Did you know that there are only two provinces in Canada with legislation specifically intended to govern parts of franchising? Ontario and in Prince Edward Island.  In Ontario, it is the Arthur Wishart Act (Franchise Disclosure), administered by the Ontario Ministry of Consumer and Business Services, which legally define business “franchise.” This means, that many franchise agreements between distributors and dealers are protected by the Act’s requirements.  

The Act is intended to provide a franchise agreement, fair dealings and honest business practices between the parties involved. Specifically, this regards the Disclosure Document that franchisors are required to provide to potential franchisees. The Disclosure Document must be accompanied with the proposed franchise agreement in order for the agreement to be valid, including financial statements, and all other material facts. The Disclosure Document must also contain a certificate that states that the Disclosure Document does not contain any misrepresentation.

franchise lawyer Vaughan

As a potential franchisee considering the terms of a new franchise agreement, it could get too complicated for you to handle on your own. Getting a franchise lawyer who can help you understand exactly what you’re getting into and will protect your best interest is very important for protecting such a big investment.  Your attorney can explain what your rights and obligations under the agreement would be, negotiate on your behalf, and help you draft a revised agreement if needed.  

If you’re considering buying a franchise in Vaughan or the Greater Toronto Area, contact the experienced franchise lawyers at Law Works. Where you are connected with a team of franchise support professionals to guide you on your path to owning your own successful franchise.

 

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What To Look For In a Franchise Lawyer

When looking for a lawyer to handle your franchise dispute in Mississauga, there are multiple aspects to look at before making a decision. Primarily, it is important to choose a team that is experienced in this field, as well as expertise in other areas of the law well; demonstrating a well-rounded understanding of the law. Finding a lawyer who has dealt with cases similar to yours will not only give you peace of mind, it will demonstrate an outcome that you will likely reach as well. Secondly, as you will be advised and represented by the team you choose, it is best you can work well with them. You want to choose a lawyer that you will ‘click’ with and share an understanding for your problem and desired solution.

Here are a list of qualities to look for in a lawyer:

  • Strong communication skills: you want to be able to understand what your lawyer is saying! Find a team that clearly explains the process, without stuffing confusing jargon into their explanations.
  • References and rapport: ensure they have experience in this field, and have handled similar cases.
  • Sensitivity: your lawyer should understand the situation you’re in, and the stresses that come with it!

At Law Works, their lawyers will not only help you with your franchise dispute in Mississauga, but they also share the qualities listed above! If you need representation or advice with your franchise dispute. Contact Law Works, they are able to provide everything you are looking for in a franchise lawyer. 

Steps to Resolving Franchise Disputes

There is no such thing as a long-lasting relationship without any disagreements. However, as time passes, things will inevitably change. The original relationship entered into gets altered one way or another, and people involved tend to want different things the other party may not. This is when disagreements can occur. The same idea happens with franchise agreements, and it’s a very common thing. So, don’t let it get you down if you’re experiencing a dispute with your franchisor.

Here are steps you can take to try to resolve your franchise dispute:

Step 1

Let the franchisor know what the incurring problem. Write a summary that is factual, clear and concise. Advise the franchisor how the problem has affected certain aspects of the business and what your proposition to solve the disagreement. This proposal has to be documented in writing, properly dated and provided to the franchisor in this manner.

Step 2

Speak to the franchisor about the issues raised in the written request. Attempt to reach a resolution and written agreement.

Step 3

If you are unable to solve the dispute and reach a mutual agreement with the franchisor, speak with your franchise lawyer about handling the case – some legalities may be too complex with contractual disagreements. Your franchise lawyer will work for your best interests and fight for the best possible resolution that you may be entitled to. Allow your lawyer to carefully examine your franchise agreement and determine the next course of action.

Step 4

At this point, if a resolution has not yet been reached, your lawyer may recommend taking your issues with the franchisor to mediation. This is a mandatory process that is required by the rules of the court.

Step 5

If a resolution is not reach through mediation, your lawyer will determine whether or not arbitration is an appropriate procedure. They will determine the next course of action based on the enforceability of arbitration and the cost with your best interest in mind.

If you haven’t done so already, speak to a franchise lawyer about any disputes you are experiencing. Receive legal advice to help you reach a satisfied resolution you are happy with.

Contact a Franchise Lawyer in Mississauga at Law Works, it never hurts to speak to someone who has real experience in franchise business matters.