Many disputes between franchisors and franchisees occur due to the lack of communication between the parties or differing expectations. Where franchise problems or conflict occurs, it is advisable that the parties first seek to resolve the dispute among themselves and if able having a lawyer or trusted advisor available to guide you through the process. Where disputes cannot be resolved informally between the parties, the Franchising Code of Conduct (Code) provides that parties to a franchise agreement are required to first trigger mediation before going to court over the dispute.

The dispute resolution provisions of the Code clearly sets out the procedure which must be followed including formal written notice outlining the nature of the dispute, the desired outcome of the dispute, and a timeframe within which it should occur. Should the dispute progress to a point where mediation is required, it is advisable to then engage a specialist franchising solicitor to assist in your preparations for mediation or to enter into direct negotiations with the franchisor to settle the dispute.

Figures from the Office of Mediation Adviser indicate that up to 75 percent of mediations result in a settlement, which means that both parties are satisfied with the result and in many cases are prepared to continue the franchise relationship. If the dispute is not resolved through the mediation process, you may then need to consider taking further action against the franchisor through the court system.