UTGB Vol 5.pdf - Robson Hall Faculty of Law

Pizza Ltd., 18 demonstrated that franchisees were in dire need of protection. A
new committee was formed and given the name Franchise Sector Working
Team ("FSWT''). The FSWT delivered its report in 1995. Although the report
was not conclusive on several issues, the members of the FSWT agreed that
disclosure from franchisors to potential franchisees before a franchise was
purchased was necessary. Three years after this report, the Ontario government
published a consultation paper on proposed franchise disclosure legislation. This
led to the introduction of Bill 93, which died on the order paper and was
subsequently reintroduced as Bill33. The latter passed its first reading in 1999
and received royal assent 8 June 2000. 19 This process sparked much legislative
debate in support of franchise legislation.
The need for franchise legislation was directly addressed during Ontario's
Legislative Assembly meeting of 17 May 2000, while Bill33 received its second
reading. 20 In describing the nature of the franchisor franchisee relationship,
Tony Martin, MPP for Sault Ste Marie, spoke of the fear that is generated when
franchisees deal with franchisors. This fear may be created when franchisees are
forced to sign contracts of adhesion, restricting their ability to manage their
business. Mr. Martin proceeded to tell a number of stories where franchisees
had been abused by franchisors.
The most shocking story Mr. Martin told was about Mary Carlucci, a grocery
store owner. In the 10 years as owner, she was able to turn her store into a very
successful business, a vast improvement from what it used to be. One day, she
received a phone call from the parent company to say that there was going to be
a marketing meeting at the local hotel. While she was gone at the supposed
marketing meeting, the parent company moved in and changed the locks, took
over the cash registers and told family members who were there to go home.
Ms. Carlucci no longer owns the store. 21
Claudette Boyer, MPP for Ottaw Venyer, speaking in support ofBill33, stated
that the Bill should only be seen as the first step in regulating franchises. She
further stated:
We really cannot deny the fact that legislation in this field is desperately needed. After
hearing testimonials of people who lost their life savings and went through many
18
(1995), 23 B.L.R. (2d) 59, [1995] O.J. No. 936 (Ont. Ct. Gen. Div.).
19
Edward N. Levitt, "Ontario Franchise Legislation/' online: Gowlings Resource Centre
.
20
Ontario, Legislative Assembly, Debates and Proceedings, No. 60A (17 May 2000) at 3087
(Hen. Gary Carr), online: Legislative Assembly of Ontario .
21
Ibid.