UTGB Vol 5.pdf - Robson Hall Faculty of Law

A right of action should also be granted to ensure that parties abide by the
requirements or risk fadng legal action. Lastly, the expansion of the duty of fair
dealing to include reasonable commercial standards ought to be adopted as
well. As stated earlier. including reasonable commercial standards in the
definition of fair dealing provides the concept of fair dealing with the contextual
clarification it requires and is consistent with the standard of good faith already
applied in the Canadian common law. 105
Manitoba's franchise legislation should also grant franchisees the right to
associate, emulating the Ontario and P.E.l. Act as well as the New Brunswick
BilL Since associations may be beneficial to both franchisors and franchisees, a
franchisee's right to associate or join an organization should be protected.
Edward N. Levitt stated:
The association can assist in dispute resolutions between the franchisor and
franchisees, provide a useful feedback mechanism for all sorts of issues the
system, assist the franchisor in dealing with franchisees who operate poorly or contrary
to the interest of everyone h the system, raise the level of commitment of all
franchisees and assist in the introduction of new products and services into the
system. 106
3. Additional Franchise Relationship Issues
Current franchise relationship legislation in Canada only addresses a small
portion of relationship issues. Although extending the duty of fair dealing to
include the performance of the contract may provide more protection to
franchise parties, several areas remain where no protection is issued. These
include contract termination, renewal of contract, transfers and sale of a
franchise by a franchisee.
i. Contract Termination
The issue under this heading is whether Manitoba ought to introduce
termination provisions limiting a franchisor's right to terminate a contract only
to instances where there is good cause. However, prior to discussing whether
some form of legislation should be adopted, it is necessary to consider whether
Manitoba is in need of statutory termination provisions or if the common law
has addressed the issue sufficiently so that no legislation is needed.
Manitoba's Court of Queen's Bench has already addressed the issue of
termination in two instances. In John Deere Ltd. v. G.A.E.L. Inc./ 07 the Court
stated that reasonable notice is required to terminate an agreement and that
termination rights must not be exercised on the basis of questionable and flimsy
105
106
Levitt & Palter, supra note 94.
Edward N. Levitt, "Franchisee Associations," online; Gowlings Resource Centre, .
107
Supra note 9.