UTGB Vol 5.pdf - Robson Hall Faculty of Law

96 Underneath the Golden Boy
in Emerald is in accordance with the purpose of establishing franchise
legislation. Mr. Dillon suggests that to fix the problem of having such onerous
provisions, Ontario and the ULCC could adopt the substantial compliance
standard of the Alberta Act. Doing so, Mr. Dillon argues, would remove
franchising from the category of absolute liability. 48
In conclusion, since the primary purpose of establishing franchise legislation is
to protect franchisees and to help in making the decision to purchase a
franchise, the ULCC provisions should be adopted. In doing so, the franchisee
will not only be provided with all material facts but also with an extensive list of
standard information as required by the regulations. A "substantial compliance"
provision should make such onerous provisions more manageable for
franchisors, allowing them to err in providing disclosure documents while still
providing the franchisee with all necessary information.
2. Additional Disclosure Categories
The Manitoba Law Reform Commission is considering further expanding the
disclosure requirements by adding new provisions. The following are provisions
that could be added to Manitoba's regulations if and when they are adopted.
(1) When Prince Edward Island introduced franchise legislation in 2006, it did
not adopt the UFA "as is." Instead, a few points were modified. For instance,
P.E.I. is the only jurisdiction that allows disclosure documents to be delivered
electronically. Incidentally, Manitoba should adopt a similar provision, since so
much business is done electronically today. Similarly, Manitoba should consider
other effects the Internet may have on franchises. For instance, a franchisee
should be aware if and how a franchisor may compete with them through the
use of a website. This provision may be added to the regulations under a section
pertaining to the franchisor's policies and practices regarding territory. Clearly
setting this out in the regulations will prevent any litigation arising out of
encroachment issues. Furthermore, the franchisee will know exactly what the
franchisor may and may not do through the Internet.
(2) The inclusion of a franchisor's arbitration or mediation results with former
franchisees should be another addition to Manitoba's legislation. As stated in
the Law Reform Commission's Report, "A review of court decisions is unlikely
to provide an accurate representation of franchise disputes, however. Some
19
franchise agreements require arbitration and do not reach the courts.w If the
current ULCC Regulation made under the Uniform Franchises Act requires that a
franchisor disclose the results of previous litigation under s. 3(c) and (d), and
following the Commission's statement, it may be useful to also disclose the
result of mediation/arbitration for the franchisee to get a clear picture of the
48
Dillon, supra note 42 at 34.
49
Manitoba Law Reform Commission, supra note 14 at 15.