International Law

Canadian Quiznos Franchisee Association

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One of my standard recommendations when looking for a franchise is to contact the independent franchisee association.

However, the formation of independent franchisee associations can be fraught with danger and legal actions. Consider the attempt to form a Canadian Quiznos franchisee association, as reported by the Court of Appeal in Ontario.

"In 2006, Quizno's franchisees across the country became restless because they were unsatisfied with the prices being charged by Quizno's suppliers. 

Under their franchise agreements they are required to purchase supplies from designated or approved suppliers.  About one hundred of them joined a newly-formed association called Denver Subs Canadian Franchisee Association ("Denver Subs").  Mr. Talbot-Kelly became the acting president of that Association. 

As the temporary leader of Denver Subs, Mr. Talbot-Kelly took certain positions and made certain demands that irritated Quizno's. 

In the same period - May, 2006 - two Ontario Quizno's franchisees commenced an intended class proceeding ("the Class Action") on behalf of all Quizno's Canadian franchisees seeking damages for alleged breach of contract, breach of duty of fair dealing and price fixing. 

All of this was too much for Quizno's, apparently.  They commenced this action claiming a declaration that the ADMA had been terminated and seeking damages against KDL, Mr. Kileel and Mr. Talbot-Kelly. 

In essence, Quizno's alleges that Mr. Talbot-Kelly, in his capacity as acting president of Denver Subs, acted in a manner that was contrary to Quizno's interests and in breach of many of the provisions of the ADMA, and that KDL is vicariously responsible for this conduct."

Consider that the in Ontario, the law which applies to this contract, franchisees are guaranteed the freedom to associate. Yet, when Mr. Talbot-Kelly attempts to organize the franchisees, look for alternative suppliers, Quiznos claims that he has breached his franchise agreement because he has acted contrary "to the interests of Quiznos"

Ontario needs SLAPP legislation to prevent this absurd interventions into the formation of independent franchisee associations.

Full post as published by Misleading Advertising Law on October 01, 2008 (boomark / email).