UTGB Vol 5.pdf - Robson Hall Faculty of Law

126 Underneath the Golden Boy
franchisee while the franchisee pleads that these defaults are non..
existent, are not sufficient to justify the termination of the franchise
agreement or that the franchisor has improperly terminated same.
These examples demonstrate the need to provide for particular mechanisms and
means in order to deal with issues encountered in franchisor/franchisee
disputes. 155
Due to the importance of ADR to both franchisors and franchisees, it is
necessary to determine how Manitoba will address the subject in its franchise
legislation. The questions facing Manitoba with regard to ADR are twofold.
First, what should be disclosed to the franchisee in pre..contract documents
Second, should ADR be mandatory Prior to addressing either issue, it may be
helpful to consider how the various legislated Canadian jurisdictions and the
UFA deal with ADR.
1. Dispute Resolution Provisions in Canada and the ULCC
i.Ontario
Ontario addresses the issue of ADR in s. 5 of the Regulations Made Under the
Arthur Wishart Act (Franchise Disclosure), 2000. 156 The section requires that
where a franchisor will use an internal or external ADR process, a disclosure
document shall include a description of the mediation or other ADR process
and the circumstances when the process may be invoked. Furthermore, as per s.
5(2), every disclosure document shall state:
Mediation is a voluntary process to resolve disputes with the assistance of an
independent third party. Any party may propose mediation or other dispute resolution
process in regard to a dispute under the franchise agreement, and the process may be
used to resolve the dispute if agreed by all parties.
In other words, Ontario requires a franchisor who chooses to use ADR to
disclose all elements to the franchisee in the disclosure document. Franchise
legislation in Manitoba should adopt a similar provision to ensure that
franchisees are aware of what action a franchisor may or may not pursue.
In Toronto Truck Centre Ltd. v. Volvo Trucks Canada Inc./ 57 an agreement
included a dispute resolution process that provided for binding mediation of any
dispute, including a dispute for termination of the agreement. The
manufacturer purported to terminate the agreement without notice, and the
dealer applied for an interlocutory order compelling the manufacturer to submit
to mediation and to continue the dealership until completion of the mediation.
The court held that the order should be granted, since the dear intent of the
155
Ibid.at 7-12.
156
O.REG 581/00.
157
(1998), 163 D.L.R. (4h) 740 (Ont. Ct. Gen. Div).