UTGB Vol 5.pdf - Robson Hall Faculty of Law

protects individuals, already has an Act in place, it is evidence that Manitoba is
far behind. 7 She concluded her speech with the following remark:
I ... urge government members to join us in supporting Bill 18, which is a very fine,
necessary, important and certainly overdue piece of legislation. 8
Regardless of the fate endured by Bill 18, it is important to note that these three
MLAs recognized the need for franchise legislation in 1992 and, 15 years later,
nothing has been done to fix the problem. The situation in Manitoba has not
improved since 1992, as evidenced in the following cases.
In John Deere Ltd. v. G.A.E.L. Inc., 9 the manufacturer, John Deere Ltd.
("Deere"), improperly terminated a dealership agreement. Although the
Manitoba Court of Queen's Bench found that Deere had every right to
terminate the agreement, the court found that Deere had done so with undue
haste and unreasonably. Changing the locks on the dealership to prevent the
dealer from re entering the premises was not "reasonable termination." Had
franchise legislation been in place, G.A.E.L. could have had protection against
Deere under a good faith and fair dealing provision.
A recent example of a franchisor abusing his power to subdue a franchisee is
Halligan v. Liberty Tax Service Inc. 10 The franchisor in this case unilaterally
withdrew funding from the franchisee's store without notice and caused an
immediate drop in the franchisee's revenue after the franchisee refused to use a
particular name. In one instance, Liberty did not provide software that would
work. Following Mr. Halligan's complaints, a replacement was mailed to him,
even though his franchise location was in the same building as Liberty's head
office. The court further describes Liberty as harassing Mr. Halligan even in the
face of an injunction granted in 2001. The Manitoba Court of Queen's Bench
provides a more detailed description of Liberty's action in its 2006 judgment of
the same case. The Court described Liberty's conduct as malicious, high
handed, and reprehensible. This is following a depiction of Liberty forcing Mr.
Halligan out of business by withdrawing services during the tax season, setting
up competing stores and referring clients away from Mr. Halligan. 11
Both the Winnipeg Free Press and Winnipeg Sun reported on the most recent
franchise scandal in the province. Mr. Hisham Alard arrived to Winnipeg from
Syria in 2004 and was looking for business prospects. He found an
advertisement about a Pizza One franchise in the newspaper. The franchise cost
10
Manitoba, Legislative Assembly, Debates and Proceedings, VoL 82 (9 June 1992) (Hon.
Denis Rocan}, online: Legislative Assembly of Manitoba .
">(.J -
Ibid.
[1994] CarswellMan 323, 96 Man. R. (2d) 106.
[2003] MBQB 174, 36 B.L.R. (3d) 75, 176 Man. R. (2d) 57.
II
Halligan v. Liberty Tax Services Inc., [2006] 8 WWR 97, 202 Man. R. (2d) 268.