Unfair Terms In Franchise Agreements

3. THE TYPES OF TERMS THAT MAY BE UNFAIR Among the types of terms that may be unfair, this is one party, but not the other party: with this ACCC focus, it is important that franchisees check and verify their default standard franchise agreements to ensure full compliance, unless they have already done so. Particular emphasis should be made on the regime applicable to unfair contract terms between undertakings under the ACL. However, to date, there have been no cases where such types of unfair terms have been taken into account in the Australian Consumer Act. One day, a court may have to decide whether the casacade restrictions are unfair and can be overturned or unenforceable. For a franchisee, it is certainly difficult to understand the duration and extent of a post-abortion time limit, and it could be argued that this in itself makes the clause unfair. The ACCC recently accepted a binding undertaking by physiotherapy franchisor Back in Motion Physiotherapy Pty Ltd to change the trade restriction and “buy-back” clauses in its standard franchise agreements, which the ACCC found unfair. According to the ACL, a court may find that a term of a contract is unfair and therefore unenforceable (called “void”). If the court finds that a clause is “null and void”, it can take a number of injunctions, including: it is also important for franchisees to be aware if their franchisor complies with the code and that certain provisions of their franchise agreement have the potential to be unfair and unenforceable. If you take the time to consider it, franchisees can run their business with more certainty.

It is important to note that the regime applicable to unfair contracts only applies to contracts concluded or renewed on or after 12 November 2016. It does not apply to a franchise agreement concluded before that date. Secondly, unfair terms apply only to standard contracts. Franchise agreements usually have very little room for negotiation and are therefore generally considered a standard contract. In the event of a dispute, a franchise agreement is considered a standard contract, unless another party demonstrates otherwise. The following examples are not exhaustive, but are intended to illustrate the types of terms that may be considered unfair by the ACL and may therefore be annulled. Prior to attacking its enforceable commitment, the majority of franchise agreements entered into by Back in Motion Physiotherapy contained a trade restriction clause that prevented franchisees from working or participating for a period of 12 months after leaving the network for a competing physiotherapy practice. . . .