Franchising in Australia

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FRANCHISING IN AUSTRALIA

Table of Contents 1

An Overview Of Franchising In Australia 2

Coca Cola Franchise:- Australian Franchises 2

Benefits to Franchisor 3

Benefits to Franchisee 3

Operation Of a Franchise:- Procedural Requirements 3

Legal Issues in Domestic and International Franchising 4

Restrictive Trade Practices 4

The Legal Relationship 5

(i)Employment

(2)Agency

(3)Public Liability

(4)Misrepresentation of Relationship

Legislation Relevant to Franchise Operations 8

Conclusion 8

Visualizations:- Need for reforms in law for Development

of Franchise in future 8

End Notes 9

A term paper by

Divyang K. Chhaya, Advocate Supreme Court (Submitted at the Law School,

University of Georgia, Athens, GA, USA, 1988 1989 during full time on

campus LLM degree course)

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An Overview of Franchising Process in Australia

Franchising is gaining popularity in international business transactions. Most

franchises begin its operation nationally and than expand gradually to foreign

countries. Fast food operations are the best example of such an expansion. Fast

food franchises have gained acceptance world over i.e. "hotbread kitchens",

"pizzas" etc., other franchises would include motor parts and tuning services,

tires, bookstores, car rentals, motels, debt collecting agencies, hairdressing

saloons, real estate agencies, printing and publishing, income-tax services, home

decorations, ice-cream and soft drinks, tuning and packaging services, transport &

travel agencies etc.

In 1980 the number of franchises in operation in Australia was about 30,000.These

were being run by about 200 local and foreign companies resulting in 15% of the

annual national gross product turnover.

In earlier days the Crown granted exclusive rights and privileges i.e. right of

trade to selected individuals. The very same concept gradually took shape of

franchisor granting exclusive rights in his business to the franchisee. "At Common

law, a franchise is a royal privilege, a grant of the Crown's prerogative,

subsisting in the hands of a subject either by grant or presumption"[1].

The present day franchising transactions involve the grant of rights by a

franchisor to franchisee to adopt and use in the course of his business the name

and style and general method of business operations of the franchisor in return for

continuing back up training, supervision and in many cases, supply of products by

the franchisor. The franchisor can be an existing nationally known business (i.e.

an Oil Company) that wishes to extend the distribution of products manufactured by

it. An established manufacturer or distributor may also seek to transfer his

expensive and wide spread distribution centres by transferring them to

independently owned and operated franchises. He may also be the originator or

importer of a new product (e.g. fast food services) who grants rights to

franchisees to share in the development and promotion of that product or service.

Usually in such a case the franchisor is a pure "service" organization. It does not

supply products but only an established form of business operation or right to

obtain supplies from approved suppliers and to manufacture according to an

approved and "unique" system.

COCA COLA FRANCHISE:- Australian Franchisees

The coca Cola franchised bottling system of distribution is widely spreadthroughout Australia. The product is produced in Australia by local companies who

have obtained bottling franchises from its American parents i.e. COCA COLA EXPORT

CORPORATION & THE COCA COLA COMPANY. The parent Coca Cola Company, incorporated in

the United States of America, is registered in each state of Australia as the

Proprietor of the Trade Mark and its secret formula for concentrates for each of

the beverage products in range. Its Australian counterpart is registered as a

wholly owned subsidy, and has been granted the exclusive right to manufacture and

sell in Australia the COCA COLA range of beverages under its registered trade

marks. The parent company always grants exclusive rights to independent

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bottlers throughout Australia to manufacture and distribute the beverages in

territories allocated to them. The parent company supplies, at a price the main

product i.e. concentrate or beverage base for bottling.

BENEFITS TO FRANCHISOR

The franchisor extends his business goodwill and distributes his own products

through the capital investment of the franchisee. The franchisor earns substantial

returns in terms of fees by way of capital ingoing and the percentage payment

on the turnover of the franchisee, and continuing royalty fees for about 5% of

gross turnover for use of names, trade marks,& secret formulae [2].

Franchisor derives returns from profits on the sale of his products to franchisee

and also from returns on leases or sub-leases to franchisees of real estate owned

or leased by the franchisor. Franchisor also derives returns on equipment

fittings, commission on goods sold to franchisee by persons who have been approved

by the franchisor as an approved supplier, and the supply of credit by the

franchisor to franchisee in respect of the necessary facilities, fittings, products

or money lent to set up and maintain the business operation.

The ultimate benefit to a franchisor of a new product/ system can be to acquireownership of some or all of his franchised outlets. Huge inflow of finances can

enable the franchisor to buy out the franchise or if provided in the franchise

agreement, take the business from franchisee upon termination or default [3].

Franchisor acquisition can be confined to gaining ownership of the real estate on

which franchisees operate. Real estate having been initially financed through

mortgages can be paid off from franchisee's leasehold fees, leaving the franchisor

the ultimate owner of the real estate.

Franchising has proved to be a business for less scrupulous business operators,

with heavy returns flowing in for the franchisor [4].

BENEFITS TO FRANCHISEE

The value of a franchise is simply in the right to become associated with a

successful large scale operation, to be able to represent as a part of and to trade

off the public's acceptance of the belief that their dealings are in fact with

the franchisor. To that extent franchising is a legal form of passing off which can

create some problems for franchisor if franchisee goes bad affecting the general

image of the franchisor.

However, the franchisee of a reputed business receives an already established

goodwill, access to bulk purchasing facilities, ready availability of export

management and product training and frequently, assistance with finance.

Rapid spread of franchising mainly in the United states, Great Britain and Hollandis in fact a social response to shortage of working capital or finding out an exit

by creating small units and linking them together in larger systems with

varying degrees of centralization or decentralization[5].

OPERATION OF A FRANCHISE:- Procedural Requirements

The franchisor limits the franchisee's operations to a defined area. The right to

exercise franchise may be exclusive in that area or non-exclusive.

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The business has to be conducted by the franchisee in terms of franchise agreement

which usually lays down extensive details regarding obligations of parties thereto,

leases and finance arrangements.

Franchise Agreement is usually accompanied by a Manual of Operations which sets out

the methods of operation which franchisee is obliged to follow, i.e. mode of

displaying products, employment, presentation and direction of staff, the

keeping of business records {audit & accounts procedures} etc.

This Manual of Operations is revised from time to time considering developments in

franchise operations. Usually this manual is treated as a confidential property of

the franchisor with the franchisee. The franchisor procures all the necessary

licences and patents. He may enter into contracts with approved suppliers who are

prepared to confirm his standards in return for supplying products to individual

franchisee.

LEGAL ISSUES IN DOMESTIC & INTERNATIONAL FRANCHISING

There exists no general law specifically enacted to cover franchising operations

exclusively, at least not the way it is for technology transfer transactions[6].

Statutory provisions dealing with franchising have been recommended by two Federal

Government Committees i.e. Swanson Committee Report of 1976 and Blunt Committee

Report on Small Business of 1979. Although specific legislation exists in

petroleum franchising which is regulated by the Federal Petroleum Retail Marketing

Franchise Act 1980.

In Victoria, franchising in the real estate industry is dealt with in brief terms

by the Estate Agents Act 1980, Section 43 and the Estate Agents (Franchised Name,

Title and Description) Rules, 1981[7].

Franchising is therefore regulated by the existing laws in general and has not yet

been given a specific legislative recognition in Australia.

Where issues peculiar to franchising are not covered by specific legislation the

parties to a franchise agreement are left to the forethought of themselves and

their legal advisers whereat they largely depend upon their ability to negotiate

satisfactory terms in their contractual dealings. To the extent such specific

practices affect public at large, there may be no judicial recourse in absence of

the extension of the existing legal remedies or even the development of new

remedies.

RESTRICTIVE TRADE PRACTICES

The Trade Practices Act deals with restrictive clauses in a franchise agreement.

Its provisions also extend to restrictive conditions in franchise relationship tocover written oral, express or implied stipulations.

These include restrictions on granting further franchises or trading in the

franchised area by the franchisor, restrictions on the persons with whom a

franchisee can deal, restrictions in leases on the use of the leased premises only

as a franchised outlet, and, generally the controls imposed on day to day franchise

operations.

Controls on prices charged by a franchisee in respect of products supplied by a

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franchisor is prohibited per se by the Resale Price Maintenance provisions of the

Act[8].

Controls of prices of products manufactured by the franchisee himself will not be

subject to the general restraint of trade provisions of the Act.

Any attempt by the franchisor to require a franchisee to obtain goods or services

from a third person could be subject to the per se prohibitions of Section 47(6),

and monopolization by section 46 of the act. The Act extends to restrictive

agreements between franchisor and franchisee[9].

Infringement of above provisions entail penal and civil consequences [10] i.e.,

penalties and right of prejudiced persons to damages and injunction including

rendering of restriction unenforceable.

The Act exempts from its terms restrictions upon employees {Section 52(a)}, Sub-

Contractors Agents {Section 52(b)}, Partners {Section 51(2) (d)}, or Subsidiaries

{Section 48(8) & 47(12)}, Purchaser {Section 51(2)(e)} and by licensor in respect

of the standards of goods subject to a Patent or trade Mark license {Section

51(3)(a) & (c)}[11].

However, these exempting provisions are too narrowly worded and do not take into

account all business interests deserving of protection[12].

It could be said that the provisions of the exemptions in Section 51(3)(c) could be

extended in respect of the quality of services supplied pursuant to a registered

user agreement under Part IX of the Trade Marks Act, in respect of a service mark

registered in accordance with Trade Marks Act as amended in 1978. However, failure

to amend section 51(3)(c) to cover contracts on services after that amending Act

was possibly a legislative oversight. The U.S. Anti Trust law is more flexible than

Australian[13].

THE LEGAL RELATIONSHIP

Employment

The employer, under the provisions of Trade Practices Act, section 84, is liable

for contractual and tortuous and even certain criminal acts of an employee. The

employer is liable to comply with labour law and industrial determinations

dealing with wages, holidays, pay, sickness leave, annual leave, workers

compensation, insurance and comply with income tax and payroll tax legislation.

However, an employee in Australia is exempted from the provisions of the Act [14].

It came to be accepted in franchise relationship that requisite control over an

employee included not necessarily the actual control but the right to control [15].

The courts will look to the substance of conduct and not its form [16].

Mere expression of intent in a franchise agreement will not preclude the court from

scrutinizing the actual deed [17].

Therefore, the franchise agreement is not liable to be classified as one of

employment agreements. Mainly because franchise controls relate to maintenance of

quality and standards of performance of franchise operation rather than the

manner of carrying out each particular facet of its business.

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Under the Australian law, if the franchisee chooses to pursue his rights to

manufacture, distribute or sell a franchised product or service, then he may be

subject to extensive legal controls as to how he does it.

Some agreements impose a condition of minimum quantum of sales on franchisee [18].

At least one court has accorded judicial approval under American law also to such a

clause[19]. In United states, a leading drafting text on franchise documents has

cautioned that where a franchise involves a mere license to sell a single product

there is also the legal danger that the franchise agreement will be considered a

contract of employment[20].

Agency

Matters pertaining to Agency deal with authority rather than control. Ordinarily an

employee is an agent. But agency extends beyond employment which includes an

independent contracting situation where the contractor is empowered to act on

behalf of the principal. At times the principal's authority is implied where he

controls an independent contractor as to treat him as his own, or where a

contractor may be held out to the public to represent the principal. Ordinarily

contractual terms and manner of its performance are relevant considerations for

determining the relation of agent and principal.

However, no amount of contractual terms between the franchisor and the franchisee

will be able to qualify any holding out to the public of a franchisee as an agent.

The general principle of looking at substance rather than form of the relationship

will be applicable to determinations of agency[21].

In absence of contractual provisions to the contrary, the principal will be liable

to reimburse the agent for expenses incurred in the course of his authority and to

indemnify him against liability arising out of the reasonable performance of the

agency. Agent has a right to take an account and a lien against goods of the

principal for the moneys due. The principal will be liable for contractual and

tortuous acts and even some criminal acts of the agent in the course of the agency.

The agency relationship will prevent the application of Trade Practices Act to

certain controls on Agent.

However, there is little scope for agency relationship in a franchise agreement by

way of express or implied authority.

Most franchise agreements deny any express or implied agency. The controls on

franchisee are generally on quality and standards. These controls alone are not

enough to attract agency provisions. Clauses denying agency relation in a franchise

agreement are more pertinent than similar clauses seeking to deny employment.

Employment is generally a question of actual or potential control, agency is a

matter of intention to authorize. An express qualification in a formal agreement

would generally prevent any holding of an express agency and would also make it

difficult to imply a general agency as compared with an agency for particularcircumstances.

Ostensible Agency is also difficult to infer because of the close appearance of

franchisee as a part of the franchisor's organization. Therefore, on account of

consequences of an agency by holding out, situation will usually be limited to

questions of liability of the franchisor/principal for contractual and tortuous

acts of the franchisee/agent in course of carrying on of the franchise[22].

Other relationships include partnership, subsidiary and tenancy. A partnership in

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the usual sense will generally not be able to be considered merely because it might

be said that profits are shared unless the evidence indicates that losses are also

shared, and capital has been contributed[23].

A tenancy relationship will be relevant where a franchise is granted with undefined

rights of occupancy over property of the franchisor.

Public Liability

The existing laws relating to public liability are inadequate to impose liability

on a franchisor who neither manufactures nor supplies the franchised product or

service or any part of it; does not own or lease the franchised premises and is

unable in law to be treated as the master or principal of the franchise. The

question therefore is that should he be responsible for damages to members of

public with respect to a grieveance arising out of the use of franchised product or

services. Factually, franchisor is a little more than a service organization,

having nothing to do with the supply of products distributed by franchisees or

components of products manufactured by franchisees apart from imposing standards to

be applied by approved suppliers to franchisees.

However, in the U.S. the liability has been extended to such a franchisor on the

basis of warranty and guarantee principles[24]. In Australia, the Trade Marks Act

1955 section 74(2)(a) and the accepted requirement of Part IX of the Act exercise

control over the use of trade marks by a registered trade mark user. Franchisee's

liability is dealt with in Part IX of the Trade Practices act, a franchisor might

be sought to be brought into the proceedings pursuant to the provisions of

sections 141, 84(2) and 75 B[25].

Misrepresentation Relationship

In many respects it will be in the interests of the franchisee to represent himself

as closely associated with the Franchisor or even as the franchisor. Such

representations may also be in the interests of the franchisor.

Misrepresentation may occur in advertising by the franchisor as franchisee. It may

occur in the mere presentation of products or system of outlets.

Damage may be caused to the consumer who approaches the franchisee under the

impression that he is in fact dealing with franchisor rather than a separate

business enterprise. Loss may be on account of quality, performance or defective

product/work which the franchisee is not able to ratify[26].

Section 52 of Trade Practices Act deals with misleading and deceptive conduct,

Sections 53 & 141, 84(2) and 75B {false representation and catch-all

provisions}[27]. Heavy penalties for violations of the Act should be a sufficient

warning to not to infringe the local law[28].

Franchisees therefore take special care in advertising signs or letterheads to not

to represent that they are the organization[29].

A franchisee may register a business name which is identical with the recognized

name of a franchisor so long as it refers to the particular locality of the

franchise outlet {with franchisor's consent}. There is no statutory requirement

that a registered user of a trade mark must identify goods or services, the subject

of his use of the trade mark as deriving from him as distinct from the trade mark

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of the proprietor. On the contrary, the legal position is quite opposite[30].

However, the proprietor must maintain control over the use of the trade mark

{Section 74(2)(a)}. Such control will provide direct link between the goods and the

registered pro prietor of the mark which may well provide a sufficient link to

sheet home liability to the registered proprietor {Section 84(2)}[31].

LEGISLATION RELEVANT TO FRANCHISE OPERATIONS

Ordinarily general legislation relating to usual forms of controls should be

applicable to land holding by franchisee and commercial law relating to business

operations. These include local and municipal laws relating to grant of licences

and permits to operate premises and carry on particular business. The provisions of

Part V of the Trade practices Act will always be relevant, especially where a

franchisor is engaged in the supply and promotion of goods and services. However,

international franchises or overseas dealings will be subject to the usual

application of the Banking (Foreign Exchange)Regulations. One form of abuse of

franchise is controlled by state laws on pyramid selling[32].

There are certain areas in which law is settled, namely, statutory controls dealingwith industrial property rights i.e. Patents Act, Section 112,disputes between

franchisor and franchisee, the monopolization provisions of the Trade Practices

Act, Section 46, the possible application of the merger provisions of the Act

{Section 50} in so far they deal with the acquisitions of "assets", franchisee

associations,[33]and harsh and unconscionable contract terms and "economic duress"

in the law of contract[34].

In this area, the Industrial Arbitration Act, 1940 (N.S.W.) and the recent N. S. W.

Contracts Review Act 1980,provide an extension for remedy in that state, as

evidenced by the decision of the Industrial Commission of the N.S.W. involving the

BIG Al's franchise operation[35].

CONCLUSION

VISUALIZATIONS:- Need for reforms in law for development of Franchise in future.

Despite wide and varied franchises in operation in Australia, there is no specific

legislation that covers franchise activity under one roof. The position of

franchisees in particular calls for reform. To ensure the protection of

franchisee's interests is different from merely describing how they can be

protected.

Most franchise operations are offered on a take it or leave it basis. There exists

no room for negotiations or disclosure of matters relevant to what is being offered

to the franchisee by foreign franchisor.

All provisions of the Estate Agents Act do not apply to the promotion of

franchises. No security of franchise tenure is regulated by law nor is relief

against forfeiture provided.

Trade Practice Act does not deal with problems typical to franchising and is also

not applicable in all the attendant circumstances. All franchising issues also

cannot be brought under the domain of common law. General principles of contract

law will more likely favor enforcement of restrictive written terms of a franchise

agreement.

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The consumer protection provisions in Trade Practices Act are available only to

provide some compensation in respect of an already terminated or irrecoverable

franchise. Benefits in industrial/labor laws are not available to franchisee

because he is not an employee of a franchisor. For the reasons hereinabove stated,

a legislation catering to the very typical needs and problems of franchising needs

to be enacted because franchising is a "new and separate legal phenomenon"[36]

calling for immediate legal response specifically tailored for franchising

operations. Wide and rapid spread of business of franchising also calls for various

legislative controls for greater general public interests.

It would be more appropriate to consider a franchisee as an independent business

entity in law rather than treating him as an employee. Such recognition would also

not preclude the franchisor from laying down terms and conditions germane to

Franchise operations. Franchisee should, in fact be entitled to full disclosure

protection, to termination by the franchisor only for just cause, to renewal on

reasonable terms, to sell the franchise to a reasonable purchaser, a right to early

termination upon just terms, and generally a right to compensation for the "good

will" value of business purchased by him.

The provisions of the Petroleum Retail Marketing Franchise Act 1980 should betreated as a guide for generalizing the law on franchise so that all franchises can

benefit thereby [37].

The law should also specifically spell out the legal rights of public to have

judicial recourse against a franchisor for acts of his franchisees.

This will avoid the problems of solving "employment" or "agency" or "manufacture"

by the franchisor, who can always have his business risks insured. The law ought to

spell out rights, duties, and liabilities of franchisor's and franchisee's action

in business operation and dealings with public.

This could be dealt with by accepting that franchising is indeed a half-way house

situation calling for separate consideration altogether from the usual arm's length

type of business transactions. The franchising operations being very specific in

nature, should be totally exempted from the scope and ambit of Trade Practices Act

provided, however, that there is first of all a comprehensive and adequate

regulation of franchise industry encapsulating matters affecting the rights and

interests of franchisees, public interests and regulation of international

expansion of business in future.

ENDNOTES

1. 2 B1. Comm., 37.

2. Boas & Chain, Big Mac : The Unauthorized Story of McDonald's, p.44.

3. Kroc, Grinding it out - The Making of McDonald's, 1977.

4. The Federal Court of Australia imposed severe financial penalties upon

the operators of franchise systems. Ducret V. Colourshot Pty. Ltd.&

Another, (1981) A.T.P.R. 40-96, and O'Dea V. Casnot Pty. Ltd.(1981)

A.T.P.R. 40-198 See Trade Practices Commission Media Release, Warning;

Franchise Schemes and Other Business Opportunities. 16 March 1979.

5. Toffler, The Third Wave (1980), p. 278-9.

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6. Efforts on development of harmonious law on international transfer of

technology have been made both under the auspices of UNCTAD and the

OECD. They resulted in preparation of the draft code of conduct on the

transfer of technology; and Multialterally Agreed Equitable Principles

and rules for the Control of Restrictive Business Practices of 1980,

there are also OECD Declarations and Recommendations in existence -

[5th June 1985, U.N.Doc. TD/CODE TOT/47].

7. S.R.No. 245 of 1981.

8. Compare Ron Hodgson (Holdings) Pty. Ltd. V. Western Motors

(Distributors) Pty.Ltd.& West Co. Australia Pty. Ltd. (1980) A.T.P.R.

42,084.

9. Compare J.Ah Toy Pty. Ltd. V. Thiess Toyota Pty. Ltd. (1980) A.T.P.R.

42,216.

10. Information Circular No: 20 of 30.6.77 para 2.1; see decisions of the

Trade practices Commission in franchising of Coca Cola (1978) A.T.P.R.

17, 329 and Letz Rent-a- Car(c 7278-9); and Kennedy-Thompson Pty. Ltd.

A.T.P.R.17,011.6 and Ford Motor decision at (1974-7)A.T.P.R. 17,486;and High Court's decision in Transfield Pty. Ltd. V. A.V.W.

International Ltd.(1980) 54 A.L.J.R. 323, at 330 (Mason J).

11. See Lahore, "Trade Practices Lectures", Monash University 1977),p.6.

12. The Swanson Committee noted the failure of S. 51 to exempt restrictions

in respect know-how [para 10.70].

13. Susser V. Carvel (1962) 206 F. Supp. 636.

14. Per McCardie J.in Performing Right Society Ltd.V. Mitchell & Booker

Palais de Danse Ltd., [1924] 1 KB 762, 767- 8.

15. Per Dixon J. in Humberstone V. Northern Timber Mills (1949) 79 C.L.R.

389,396.

16. Cam & Sons Pty. Ltd. V. Sargent (1940) 14 A.L.J. 162.

17. A.M.P. Society V. Allan (Privy Council) (1978) 52 A.L.J.R. 407, 409; &

Sykes & Yerbury, Labour Law in Australi, 2nd ed. (1980) para 109.

18. See endnote 17 at p. 411.

19. Murphy V. Holiday Inn's Inc. (1975) 219 S. E. 2d 874, 878; Drexel V.

Union Prescription Centers (1978) 582 F.2d 781.

20. Warrens Forms and Agreements- Business Forms, Vol. 3. p, 1491.

21. Id. Endnote 16.

22. In Billops V. Magness Constructions (1978) 391 A 2d 196 it was held

that there was sufficient evidence of control and of holding out by the

Hilton Corporation for the purposes of submitting factual issues of

both actual and apparent agency to a jury. It was held " It is our

opinion that there are sufficient facts of record which, along with the

reasonable inferences therefrom, show day to day control of the

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business of the Brandwine Hilton Inn by the franchisors so that the

latter's motion for summary judgement should have been denied leaving

the issue of actual agency to be resolved at trial p. 198-9.

23. For definition of partnershipsee section 6(1), Income Tax Assessment

Act.

24. See Kosters V. The Seven Up Co.(1979) 599 F 2d 347, a non manufacturing

franchisor was held responsible on the grounds of a general warranty

for damages suffered as a result of a defective soft drink carton case

supplied to the plaintiff consumer by its franchisee. In City of

Hartford V. Associated Construction Co. (1978)384 A 2d 390 where

liability was held in a demurrer action to be available not by reason

of evidence of actual control or supervision or approval or of public

assumption of such, but of the mere fact of authorized use by the by

the franchisee of the franchisor's trade mark. Iowa Law Review 55,

(1970)P.693 at 706.

25. Walter V. Viney and ors (1982) A.T.P.R. 43, 716 and Division 2A

pursuant to Section 74 A (3) and 74 A (3)(b).

26. Letter to CHOICE, Nov. 1980;and "Consumer in Law- The Agreement That

wasn't", CHOICE, March 1980 27. Hornsby Building Information Centre V.

Sydney Building Information Centre (1978) A.T.P.R. 40-067.

28. Hartnell V. Sharp Corporation of Australia Ltd. (1975) 5 A.L.R. 493.

29. Pengilley, "Distributorships, Franchising......", Aust. Business Law

Review 5 (1977) p. 13.

30. Per Aickin J. in Pioneer Electronics Corp. V. Registrar of Trade Marks

(1978) 52 A.L.J.R. 79, 86. See :- Ryan, " Licensing of Trade Marks " in

transcript papers written for Monash University Seminar on Trade Marks

and Service Marks,16.4.80, pp. 37-8. There should be disclosure of the

registered user as the source of goods.

31. Kerley on Trade Marks, 8th ed., (1960) P. 240.

32. Consumer Protection Act (vic.) Pt. II, Div. 5, Trade Practices Act,

Section 61, also see Shannon, Franchising in Australia, (1982), P.98.

33. Compare Pengilley, "Collusion Bargaining Power in the law of

Contracrt", A.L.J. p. 38.

34. Clarke, "Unequal Bargaining Power in the Law of Contract", A.L.J. 49.

1975, and "Economic Duress", 54, 1980, A.L.J. P. 381.

35. Willaim Burnett & Another V. Big Al's Sandwich Joints Pty. Ltd. &Anor., 982, A.T.P.R.43503; See Terry, "Unconscionable Contracts in New

South Wales: The Contract Review Act, 1980, p. 311.

36. Preface to The Realities of Franchising - A Guide to the Practising

Attorney, (1970).

37. Recommendations of Swanson and Blunt Committees.

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