Franchise Disputes
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Franchisors and franchisees have a special and long term business relationship. Their success depends not only on their own performance but the other’s performance and the collective performances of all other franchisees. Their relationship and the conduct of the business are governed by The Franchise Agreement, The Franchise Code, The Trade Practices Act and the lease. If the parties to the franchise have a dispute the Franchising Code (which is mandatory) makes provision for the dispute to be referred to mediation. Every Franchise Agreement must comply with the Franchising Code and must contain a dispute resolution clause.

(See our link to the OMA’s website and the Australian Competition and Consumer Commission’s website for information on Dispute Resolution Clauses.) www.accc.gov.au  http://www.mediationadviser.com.au

Franchise disputes can arise for many reasons:
- Misrepresentation
- Disputes regarding support in training or advertising
- Supply of product and restrictions on use of other products
- Lease disputes
- Non payment of monies
- Personality issues
- Communication

Franchise Disputes are perfect for Mediation because they generally relate to long term business relationships where both parties benefit from their mutual successes. (See Business Disputes and Business Relationship Disputes above.) Mediation can look at the root cause of disputes. For example, sometimes a franchisee is operating a business for the first time and needs more support to become a better manager and business operator. Often disputes get to Mediation because of lack of communication. Mediation can have a lasting benefit by facilitating improved communication and dispute resolution systems for the future.

The Franchise dispute resolution clause requires parties to first advise each other of a dispute by notice in writing before agreeing how to resolve the dispute. See the attached Notice of Dispute which the OMA recommends. If the parties can’t resolve the problem they must mediate the dispute. Both parties must attend the mediation and try to resolve the dispute. The cost of mediation is to be paid equally by the parties. The parties are required to sign a Mediation Agreement.

Michael is a Panel Mediator for the Office of the Mediation Adviser (OMA) which has a role in appointing mediators for Franchise Disputes. The parties can agree on the appointment of a mediator or ask the OMA to appoint a mediator.

 

Where to now?

Speak to a mediation expert

Often the best way to get the answers you need is to speak to an expert. Click here to contact one of our mediation experts via our contact forms or please call us on +61 3 9947 4541.

Organise an initial consultation

A face-to-face consultation gives you the opportunity to discuss your mediation issue with professionals who deal with and resolve these issues on a daily basis.

It gives you a chance to ask any questions you may have and for a member of our team to gain background and provide you an insight into the issues that you are facing.

For more information please call us on +61 3 9947 4541 or send us an e-mail at info@tiernanmedation.com.au. We are here to help you resolve your problems. Asset Management Melbourne

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