Franchisor fails by invoking a non-compete clause
Although a non-compete clause is validly formulated in a franchise agreement, a situation may arise that is so diffuse that the franchisor cannot invoke it. See the judgment of the Arnhem-Leeuwarden Court of Appeal of 10 October 2017, ECLI:NL:GHARL:2017:8777.
The Court of Appeal shares the view of the preliminary relief judge who previously ruled that the franchisor could not invoke the non-compete clause. This was because the leased retail property had to make way for housing and the franchisor had terminated the franchise agreement per canceled on January 1, 2012. In anticipation of new business premises to be rented from the franchisor, the franchisee (temporarily) operated a business under his own name. It was uncertain whether the franchisor would still be able to offer (suitable) business premises to continue the collaboration.
If, upon termination of a franchise agreement, a franchisor leaves open whether the post-non-compete clause applies, this ambiguity can under certain circumstances be held against the franchisor.
Ludwig & Van Dam Franchise attorneys, franchise legal advice. Do you want to respond? Go to dolphijn@ludwigvandam.nl .
Other messages
Franchise Closing Sale – Who Gets the Sale Proceeds?
The judgment of the District Court of the Northern Netherlands dated 12 October 2016, ECLI:NL:RBNNE:2016:5061 (Administrator/Expert Group and Rabobank), focused on the question whether the franchisor, together with the bank,
Column Franchise+ – mr. Th.R. Ludwig: “Judge: franchisor’s duty of care comparable to that of a bank”
Various judgments in 2016 made it clear how high the standard of care for a franchisor towards its franchisees is.
Use of the internet and social media: court expands options for franchisees
In principle, the franchisee may not be prohibited from having its own website in order to also or even exclusively sell its products or services via the Internet.
Article in Entrance: “Plan damage”
“Because the municipality undertakes and renovates all sorts of things in the vicinity of my business, I have a disadvantage and I suffer damage. Can I tell those stories?"
Article in Entrance: “Rules of Fragrance”
“I am bothered by the smell that the adjacent catering business produces. Can I do something about this?"
Supermarket letter – 16
1. Buy/Sell Albert Heijn Franchise