Canadian courts are willing to expand protections to the most vulnerable in franchising.
Very well-respected franchise journalist Janet Sparks reports at Bluemaumau.org: Revolutionary Decision against Dunkin’ Donuts Awards Owners $16 Million.
MONTREAL – In a harshly-worded ruling in favor of franchisees, a judge chided Dunkin’ Brands Canada Ltd for its incompetence, negligence, and lack of support to store owners. He then ordered the international sub-franchisor to pay the 21 former franchise owners, operating 32 Dunkin’ stores, C$16.4 million (US$16M) plus legal fees.
The lawyer for the franchisees is absolutely correct in emphasizing the need for persistence by franchisees:
Frédéric Gilbert of Fasken Martineau, who represented the franchisees, said the Tingley decision will have major repercussions on how franchisees are protected and how franchisors’ responsibilities are defined. “Justice Tingley has issued a rigorous judgment that has all the makings of a landmark franchising case in Canada. This decision will become a reference tool for setting the basic guidelines governing contractual relations between parties,” stated Gilbert.
Gilbert believes that the determination and solidarity of the group of franchisees suing Dunkin’ played a key role in this legal action. “These people courageously overcame the many negative repercussions of what has been a very long saga. They valiantly confronted the countless financial and human pressures that are often seen in battles pitting David against Goliath. Even at their weakest moment they never gave up the fight, which is all to their credit.”
While being appealed, this decision may become a landmark in franchising.
- Superior Court of Québec’s Justice Daniel H. Tingley’s decision: Bertico Inc. v. Dunkin’ Brands Canada Ltd.
- Globe and Mail article: Court rules in favour of Dunkin’ Donuts franchisees
- Canadian Lawyer Magazine article: Judge takes a bite out of Dunkin’ Donuts