Wisewould Mahony Lawyers specialises in franchising and our lawyers have assisted franchisors and franchisees since well before the introduction of the Franchising Code of Conduct in 1998.

Wisewould Mahony has extensive experience and expertise in advising clients on how best to structure their distribution network, negotiating the terms of distribution and franchise agreements, and in assisting both suppliers and franchisees to resolve disputes.

Of course it is natural to not want to think about the possibility for disputes when entering a business relationship. It’s the same in our personal lives; when contemplating marriage, the prospect of divorce is, for most of us, unthinkable, but it is a fact that 40 per cent of marriages end that way.

As lawyers, we are always looking at the possibility of dispute and litigation. That’s not for our benefit but to protect our clients. In franchising, as with all contracts, disputes are a reality and these can become protracted when there is doubt and uncertainty about each party’s position.

All our distribution and franchise agreements minimise that risk by being written in simple, plain language, clearly setting out each party’s rights and obligations so that both sides know where they stand.

Mediation

If a dispute arises, our team focuses on finding a strategy for the quickest and easiest resolution of the dispute, rather than preparing our clients for litigation.

The first step is for a franchisee to attempt to resolve the dispute directly. If that fails, we contact the franchisor, suggesting realistic commercial solutions. This may involve both sides compromising and sharing the risk. We then suggest a meeting to bring the parties together and either resolve the dispute or discuss exit options.

The franchisee’s best outcome may be exiting the system with a manageable debt, having gained invaluable experience and negotiating for both franchisor and franchisee to release the other from any further claims.

A successful mediation or negotiation generally involves both parties compromising more than they would like, but knowing it was the most sensible, commercial outcome and one that avoided litigation.

The Franchising Code offers franchisors and franchisees the option of mediation. Wisewould Mahony has expertise in advocacy, strategy and negotiation to provide a cost effective mediation solution for clients.

We recently negotiated an early exit for a franchisee in Tasmania, enabling them to continue operating the business under their own name and without any non-compete restraint. The matter was settled without any court action.

The key to mediation is the ability to co-opt the mediator to change the opponent’s perception of risk. It is a fact of life that everybody goes into mediation and litigation believing they have a strong case and that they can win.

But negotiating a resolution with that mindset will almost always fail.

Change the opponent’s perception of their risk and real negotiation is possible, one that is far more favourable to your clients’ interests. Our efforts in mediation focus on the mediator and not the opposition and this approach continues to produce favourable outcomes for our clients.

Talk to either Martin Algie or Robert Toth to see how we can assist you.