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Automotive Franchises

Experienced and qualified representation in Automotive franchise and commercial disputes

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In automotive industries, franchise and commercial
disputes frequently come up in the following areas:

  • Designated suppliers, cost of inventory and supplier rebates
  • Renovation requirements
  • Minimum sales performance requirements
  • Costs/delays resulting from supply chain shortages; minimum inventory requirements

Who We Help

We advise franchisors and franchisees, including master franchisees, multi-unit franchisees and area developers, about their rights and obligations. We provide representation as litigation and arbitration counsel in franchise and commercial disputes involving court litigation, private arbitration and mediation.


How We Help

We have extensive litigation experience in common areas where
disputes typically come up, including, but not limited to:

  • Territory disputes
  • Restrictions against competition
  • Resales
  • Changes to the franchise system
  • Designated suppliers
  • Approved products
  • Sharing of rebates and discounts from suppliers
  • Rent
  • Terminations
  • Adherence to the operating manual
  • De-identification
  • Customer lists
  • And more.

Additional Automotive Franchise Law Services

We also provide representation in franchise negotiations and franchise sales and transfers, including, among others, drafting:

  • Franchise Disclosure Documents
  • Franchise Agreements
  • Master Franchise Agreements
Copy of DSC03589-A

The Automotive Industry
Segments We Serve

We help automotive franchisors and franchisees in the following sectors, among others:

  • Automotive – Service Centres
  • Automotive – Dealerships

Law Works -
Important Automotive Industry Cases

Noteworthy restaurant franchise court decisions where we acted as counsel include the following:

Non-Compliant Franchise Disclosure Document – Tire/Automotive Retail

Mendoza v. Active Tire & Auto Inc., 2017 ONCA 471

Case Synopsis

This is a frequently cited decision of the Court of Appeal for Ontario, which reversed the decision of the motion judge and granted summary judgment for rescission in favour of the franchisee. There were significant disclosure deficiencies in the franchise disclosure document, including stale-dated financial statements of the franchisor, required signatures of the franchisor’s officers and directors, and piecemeal disclosure. This decision is also the first Court of Appeal decision expressly holding that the test for a franchisor’s compliance with its disclosure obligations under the Arthur Wishart Act (Franchise Disclosure), 2000, is objective; that the focus is on the nature of the deficiency and its impact on the disclosure requirements on a reasonable (not subjective) standard.

Insurance Non-Renewal and Alleged Bad Faith Against Insurer – Car Rental Franchise

2259084 v. Travelers Insurance Company of Canada

Case Synopsis

We represented two rental car operators in a complex insurance dispute involving an injunction application against the insurer, insurance brokerage and former franchisor, as a result of the insurer’s decision not to renew the operators’ fleet rental insurance policies. The case involved extensive evidence about alleged discrimination and bad faith conduct by the insurer and its alleged collusion with the franchisor against the rental car operators.

Related Resources

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2018 Year in Review and Trends for 2019

Authors: Ben Hanuka and Robert Jones, Law Works P.C. 2018 was a busy year in Canadian franchise disputes. Based on the court decisions in 2018, the trend...

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Case highlights lawyers’ duty to expressly formulate key allegations ‎

The court decision in Butera v. Chown Cairns LLP, of May 27, 2016, demonstrates the need for litigation counsel to be careful and precise with the words...

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Court of Appeal denies GM security for costs against Trillium

By Ben Hanuka This decision of the Court of Appeal from September 2016, dealt with a motion by General Motors of Canada Ltd. (“GM”) for security for...

Ben Hanuka Principal of Law Works PC (Ontario), Ben Hanuka PC (Alberta) and Law Works LC (British Columbia)