UTGB Vol 5.pdf - Robson Hall Faculty of Law

124 Underneath the Golden Boy
Excellence Series: Franchisee Training Program,, hoping to educate franchisees
entering or already in the business. 148
The first matter to be decided is not what type of a regulatory body Manitoba
needs, but if it needs one. First, Manitoba cannot follow Ontario's argument for
adopting such a body because the same problems have not arisen in the former
due to its smaller size. Whereas in Ontario several franchisees have suffered at
the hands of 3 for 1 Pizza & Wings, there has only been one such case in
Manitoba. 149 Therefore, if there is a need for a regulator in Manitoba, it is
certainly not as imminent as in Ontario.
Second, Manitoba has not had the chance to determine what effect franchise
legislation will have on the franchise community. Given its unique size, perhaps
the issue of improper disclosure will also occur on a relatively small scale and
thus be solved more easily than in Ontario. It may be wise to wait until after
franchise legislation is introduced to assess the true need of a regulator in
Manitoba. Thus, the necessity for a regulator has yet to arise in Manitoba.
Although Manitoba may not need a regulator, it does not mean that the
situation should be ignored until so much abuse takes place that one is needed.
To avoid such a situation, the provincial government may want to prepare an
instructional pamphlet directing franchisees to different resources they can
employ to become better informed prior to purchasing a franchise. This would
be very similar to the CFA's approach of providing its members with the
opportunity to educate themselves. It would then become a franchisor's
responsibility to attach the pamphlet to the disclosure documents. In doing so,
Manitoba would be following the advice of those who oppose the introduction
of a regulatory body while still leaving the possibility of introducing one if need
be.
Overall, it is too premature for Manitoba to adopt a regulatory body to overlook
franchise disclosure. Instead, it should be the Province's aim to educate
franchisees to make well,informed decisions, allowing them to detect
franchisors whose intentions may be ill conceived.
E. Alternative Dispute Resolution
In the franchise industry in particular, the use of Alternative Dispute
Resolution ("ADR") is growing in marked popularity. From a franchisor's
perspective, this is due to the disclosure requirements of franchise legislation,
which requires franchisors to provide details concerning litigation commenced
against them, or pending litigation against them. A disclosure document that
148
Canadian Franchise Association, "Upcoming Events by Region," online: Already in
Franchising, Events Education < http://www.cfa.ca/Page.aspxURL=EventsEducation.
html>.
149
See Paul, supra note 12; Turenne, supra note 12.