Convenience chain 7-Eleven must pay $595,000 to a franchisee after the Victoria Supreme Court found the franchisor had made misleading statements about the term of a franchise agreement.
The retailer was found to have breached the Australian Consumer Law in its pre-purchase dealings with Yong Li and Zhe Wang who bought the 7-Eleven Heathmont store in 2015.
The couple believed the franchise agreement was for 10 years because of information in a number of documents provided by 7-Eleven; in fact the agreement was for a six-year lease with the option for the franchisor to extend the agreement to 10 years.
Lawyerly reported that Victoria Supreme Court Justice Peter Riordan said the franchisor’s conduct could lead someone to form an “erroneous assumption” about the length of the lease, and that the false information induced Wang and Li to sign the agreement.
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