Petroleum Retail Marketing Franchise Act 1980

No. 139 of 1980

An Act relating to franchise agreements concerning the retail marketing of motor fuel

[Assented to 19 September 1980]

BE IT ENACTED by the Queen, and the Senate and the House of Representatives of the Commonwealth of Australia, as follows:

PART I—PRELIMINARY

Short title

1. This Act may be cited as the Petroleum Retail Marketing Franchise Act 1980.

Commencement

2. This Act shall come into operation on the day on which it receives the Royal Assent.

Interpretation

3. (1) In this Act, unless the contrary intention appears—

“agreement”, means any agreement, arrangement or understanding—

(a) whether formal or informal or partly formal and partly informal;

(b) whether written or oral or partly written and partly oral; and

“child”, in relation to a person, includes an adopted child, a step-child or an ex-nuptial child of that person;

“commencement”, in relation to an agreement, means the day on which the agreement comes into effect;

“contravention”, in relation to a provision of this Act or any other law, includes a failure to comply with that provision;

“corporation” means—

(a) a body corporate that is a foreign corporation;

(b) a body corporate that is a trading corporation formed within the limits of the Commonwealth;

(d) a body corporate that is related to a body corporate of a kind referred to in paragraph (a), (b) or (c);

“director”, in relation to a body corporate, includes any person occupying or acting in the position of director of the body corporate, by whatever name called and whether or not validly appointed to occupy or duly authorized to act in the position;

“foreign corporation” means a foreign corporation within the meaning of paragraph 51(xx) of the Constitution, and includes a body corporate that is incorporated in an external Territory;

“franchise agreement” means an agreement containing—

(a) provisions, whether express or implied, under or by virtue of which a corporation (in this Act referred to as the “franchisor”) authorizes, permits or requires a person, being another party to the agreement (in this Act referred to as the “franchisee”), to use, in connection with the retail sale of motor fuel by that person at the premises to which the agreement relates, a mark identifying, commonly associated with, or controlled by, that corporation or a related corporation;

(b) provisions, whether express or implied, under or by virtue of which a corporation (in this Act referred to as the “franchisor”) grants a right to, or otherwise authorizes or permits, a person, being another party to the agreement (in this Act referred to as the “franchisee”), to possess, occupy or use the premises to which the agreement relates in connection with the retail sale of motor fuel by that person at those premises; or

(i) a corporation (in this Act referred to as the “franchisor”) is entitled or required to supply motor fuel to a person, being another party to the agreement (in this Act referred to as the “franchisee”), for retail sale by that person at the premises to which the agreement relates; or

(ii) a person (in this Act referred to as the “franchisee”) agrees with a corporation (in this Act referred to as the “franchisor”) to acquire motor fuel from another person (whether a party to the agreement or not) for retail sale by the first-mentioned person at the premises to which the agreement relates;

“franchisee” means a party to a franchise agreement, being the person referred to as the franchisee in paragraph (a) or (b) or sub-paragraph (c) (i) or (ii), as the case may be, of the definition of “franchise agreement”;

“franchisor” means a party to a franchise agreement, being the corporation referred to as the franchisor in paragraph (a) or (b) or sub-paragraph (c) (i) or (ii), as the case may be, of the definition of “franchise agreement”;

“interim franchise agreement” means a franchise agreement to which sub-section 13 (3) applies that is entered into for a term not exceeding one year;

“lease” includes a sub-lease;

“mark” includes a symbol, design, colour, device, brand, heading, label, ticket, name, signature, word, letter or numeral, or any combination of the foregoing;

“marketing premises” means premises to which a franchise agreement relates, being the premises referred to in paragraph (a) or (b) or sub-paragraph (c)(i) or (ii), as the case may be, of the definition of “franchise agreement”;

“motor fuel” means petrol or diesel fuel to be used in propelling road vehicles;

“officer”, in relation to a body corporate, includes—

(a) a director or secretary of the body corporate;

(b) a receiver and manager of the whole or any part of the property of the body corporate appointed under a power contained in any instrument; or.

“parent”, in relation to a person, means a person of whom that person is a child;

“person with prescribed experience” means a person who, for a period amounting, or for periods amounting in the aggregate, to not less than one year during the period of 6 years preceding the relevant time, was a franchisee in relation to a franchise agreement or franchise agreements (whether or not all or any of the provisions of this Act apply to the agreement or agreements), where the agreement, or each of the agreements, as the case may be, was not terminated by reason of a ground referred to in any of paragraphs 16(2)(a) to (j) (inclusive) or any other breach of the agreement by the person;

“provision”, in relation to an agreement, means any matter forming part of the agreement, and includes a covenant;

“road vehicle” means a vehicle designed solely or principally for transporting persons, goods or animals by road;

“share”, in relation to a body corporate, means a share in the capital of the body corporate, and includes stock;

“trading corporation” means a trading corporation within the meaning of paragraph 51(xx) of the Constitution.

(2) Except so far as the contrary intention appears, a reference in this Act to an agreement shall be read as including a reference to a proposed agreement, an agreement as requested or proposed to be renewed, or a terminated or expired agreement and, in relation to such an agreement, a reference in this Act to a party to the agreement shall be read as a reference to a person who would be a party to the agreement if the agreement were in effect.

(3) Unless the contrary intention appears, a reference in this Act, except in sub-section 6(6), to the time when an agreement is entered into shall, in the case of an agreement that does not commence on the day on which it is entered into, be read as a reference to the day on which it commences.

(4) A reference in this Act to renewal, in relation to a franchise agreement, shall be read as a reference to entering into a new franchise agreement, where the provisions of the new agreement are the same as those of the first-mentioned agreement or do not differ substantially from the provisions of the first-mentioned agreement except in any one or more of the following respects:

(a) an amount payable by the franchisee under the new agreement is greater or less than the amount that was payable by the franchisee under the corresponding provision of the first-mentioned agreement;

(b) the term of the new agreement is longer or shorter than the term of the first-mentioned agreement;

(c) a provision of the new agreement (other than a provision relating to an amount payable by the franchisee or the term of the agreement) differs, with the consent of the franchisee, from the corresponding provision of the first-mentioned agreement;

(d) a provision of the new agreement differs from the corresponding provision of the first-mentioned agreement and the difference results solely from the operation of a provision of this Act or is designed to make the new agreement conform with a provision of this Act.

(5) A reference in this Act, except in sub-section 6(8), to retail sale by a person shall not be read as including retail sale by that person as servant or agent of another person.

(6) A reference in this Act to a member of the immediate family of a franchisee shall be read as a reference to the spouse, or a parent, child, brother, sister, half-brother or half-sister, of the franchisee.

(7) A reference in this Act to a company controlled by a franchisee shall be read as a reference to a company controlled by all or any of the following:

(a) the franchisee;

(b) the members of the immediate family of the franchisee.

(8) Where a franchise agreement is one of 2 or more franchise agreements to which this Act applies by virtue of paragraph 6(1)(b), those agreements shall, for the purposes of this Act, be deemed to be related to each other.

(9) In this Act—

(a) a reference to an agreement shall be read as including a reference to a lease of, or a licence in respect of, premises, and shall be so read notwithstanding the express references in this Act to such leases or licences;

(b) a reference to making or entering into an agreement, in relation to such a lease or licence, shall be read as a reference to granting or taking the lease or licence; and

(c) a reference to a party to an agreement, in relation to such a lease or licence, shall be read as including a reference to any person bound by, or entitled to the benefit of, any provision contained in the lease or licence.

(10) The express references in this Act to entering into an agreement by way of renewal shall not be taken to imply that other references to entering into an agreement do not include references to entering into an agreement by way of renewal.

(11) A reference in a provision of this Act to a court shall be read as a reference to a court that, by virtue of section 26, has jurisdiction in matters arising under that provision.

(12) A reference in this Act to the retail sale in bulk of motor fuel shall be read as a reference to the retail sale of motor fuel, where that motor fuel is not delivered, at the premises at which it is sold, into a part of a road vehicle in which motor fuel for the propulsion of that vehicle is stored.

Related bodies corporate

4. (1) Where a body corporate—

(a) is the holding company of another body corporate;

(b) is a subsidiary of another body corporate; or

that first-mentioned body corporate and that other body corporate shall, for the purposes of this Act, be deemed to be related to each other.

(2) For the purposes of this section, a body corporate shall, subject to sub-section (4), be deemed to be a subsidiary of another body corporate if—

(a) that other body corporate—

(i) controls the composition of the board of directors of the first-mentioned body corporate;

(ii) is in a position to cast, or control the casting of, more than one-half of the maximum number of votes that might be cast at a general meeting of the first-mentioned body corporate; or

(iii) holds more than one-half of the issued share capital of the first-mentioned body corporate (excluding any part of that issued share capital that carries no right to participate beyond a specified amount in a distribution of either profits or capital);

(b) the first-mentioned body corporate is a subsidiary of any body corporate that is that other body corporate’s subsidiary (including a body corporate that is that other body corporate’s subsidiary by another application or other applications of this paragraph).

(3) Without limiting by implication the circumstances in which the composition of a body corporate’s board of directors is to be taken to be controlled by another body corporate, the composition of a body corporate’s board of directors shall be taken to be controlled by another body corporate if that other body corporate, by the exercise of some power exercisable by it with or without the consent or concurrence of any other person, can appoint or remove all or a majority of the directors, and for the purposes of this provision that other body corporate shall be deemed to have power to make such an appointment if—

(a) a person cannot be appointed as a director without the exercise in his favour by that other body corporate of such a power; or

(b) a person’s appointment as a director follows necessarily from his being an officer of that other body corporate.

(4) In determining whether a body corporate is a subsidiary of another body corporate—

(a) any shares held or power exercisable by that other body corporate in a fiduciary capacity shall be treated as not held or exercisable by it;

(b) subject to paragraphs (c) and (d), any shares held or power exercisable—

(i) by a nominee for that other body corporate (except where that other body corporate is concerned only in a fiduciary capacity); or

(ii) by, or by a nominee for, a subsidiary of that other body corporate, not being a subsidiary that is concerned only in a fiduciary capacity,

shall be treated as held or exercisable by that other body corporate;

(c) any shares held or power exercisable by any person by virtue of the provisions of any debentures of the first-mentioned body corporate, or of a trust deed for securing any issue of such debentures, shall be disregarded; and

(d) any shares held or power exercisable by, or by a nominee for, that other body corporate or its subsidiary (not being held or exercisable as mentioned in paragraph (c)) shall be treated as not held or exercisable by that other body corporate if the ordinary business of that other body corporate or its subsidiary, as the case may be, includes the lending of money and the shares are held or the power is exercisable only by way of security given for the purposes of a transaction entered into in the ordinary course of business in connection with the lending of money, not being a transaction entered into with an associate of the other body corporate or its subsidiary.

(5) A reference in this section to the holding company of a body corporate shall be read as a reference to a body corporate of which that other body corporate is a subsidiary.

(6) In this section, “debenture” includes debenture stock, bonds, notes and any other document evidencing or acknowledging indebtedness of a body corporate in respect of money that is or may be deposited with or lent to the body corporate, whether constituting a charge on property of the body corporate or not.

Associates

5. (1) For the purposes of this Act, the following persons are associates of a person:

(a) a partner of the person;

(b) where the person is a body corporate—

(i) an officer of the body corporate;

(ii) a body corporate that is related to the first-mentioned body corporate; or

(iii) an officer of a body corporate that is related to the first-mentioned body corporate;

(d) a body corporate whose directors are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the person or, where the person is a body corporate, of the directors of the person;

(e) a body corporate in accordance with the directions, instructions or wishes of which, or of the directors of which, the person is accustomed or under an obligation, whether formal or informal, to act;

(f) a body corporate in which the person holds a substantial interest;

(g) a person in concert with whom the person is acting, or proposes to act, in respect of the matter to which the relevant provision of this Act relates;

(h) a person with whom the person is, or proposes to be, associated, whether formally or informally, in any other way in respect of the matter to which the relevant provision of this Act relates;

(j) if the person has entered into, or proposes to enter into, a transaction or has done, or proposes to do, any other act or thing, with a view to becoming an associate of a person as mentioned in paragraph (g) or (h)—that last-mentioned person;

(k) a person who is, by virtue of paragraph (g), (h) or (j), an associate of any other person who is an associate of the person by virtue of any of those paragraphs or by virtue of another application or other applications of this paragraph.

(2) A person shall not be taken to be an associate of another person by virtue of paragraph (1)(g), (h) or (j) by reason only that the person—

(a) furnishes advice to, or acts on behalf of, that other person in a professional capacity;

(b) is a party to a franchise agreement to which that other person is a party; or

(c) is a party to an agreement under which that other person, being a franchisor, sells its interest in, or grants a lease of, the marketing premises to the person.

(3) For the purposes of this section, a person shall be taken to hold a substantial interest in a body corporate if the person, alone or together with any associate or associates of the person, is in. a position to control not less than 15% of the voting power in the body corporate or holds interests in not less than 15% of the issued shares in the body corporate.

(4) Where—

(a) a person holds a substantial interest in a body corporate (including a substantial interest held by that person by another application or other applications of this sub-section); and

(b) that body corporate is in a position to control all or any of the voting power in another body corporate or holds interests in all or any of the issued shares in another body corporate,

that person shall be taken to be in a position to control so much of the voting power in the other body corporate as the first-mentioned body corporate is in a position to control or to hold the interests in the issued shares in the other body corporate that the first-mentioned body corporate holds, as the case may be.

(5) A reference in this section to control of the voting power in a body corporate shall be read as a reference to contol that is direct or indirect, including control that is exercisable as a result of, by means of, in breach of, or by revocation of, trusts, agreements or practices, whether or not having legal or equitable force and whether or not based on legal or equitable rights.

Application of Act

6. (1) This Act does not apply in relation to a franchise agreement unless—

(a) it contains provisions of the kinds referred to in paragraphs (a) and (b), and of the kind referred to in paragraph (c)(i) or (ii), of the definition of “franchise agreement” in sub-section 3(1); or

(b) it is one of 2 or more franchise agreements that together contain provisions of the kinds referred to in paragraphs (a) and (b), and of the kind referred to in paragraph (c)(i) or (ii), of that definition, where—

(i) the franchisees in relation to those agreements are the same person or are connected with each other; and

(ii) the franchisors in relation to those agreements are the same corporation or are related to each other.

(2) Subject to sub-section (1), the provisions of sections 10, 17 and 20, sub-sections 22(1), (2) and (5), sections 23, 24, 25, 26 and 27 and, to the extent necessary for the application of those provisions by virtue of this sub-section, this Part, extend to a franchise agreement in effect immediately before the commencement of this Act.

(3) Subject to sub-section (1), sub-section 19 (1) extends to the failure or refusal to renew a franchise agreement in effect immediately before the commencement of this Act.

(4) The provisions of sub-section 17(1) extend to circumstances or an event constituting a ground referred to in that sub-section that occurred before the commencement of this Act if the circumstances or event would, in accordance with the provisions of the franchise agreement concerned, have entitled the franchisor to terminate or refuse to renew the agreement.

(5) Where—

(a) a provision of this Act applies in relation to a franchise agreement; and

(b) the person who is the franchisee enters into an agreement with a corporation that is, or is related to, the franchisor under or by virtue of which the corporation is entitled or required to supply that person with goods, other than motor fuel, for retail sale by that person,

this Act applies in relation to the agreement so entered into as if it were a franchise agreement, and, for the purposes of that application, that person shall be deemed to be the franchisee and the corporation shall be deemed to be the franchisor.

(6) Subject to sub-sections (2), (3) and (4), this Act does not apply in relation to a franchise agreement that was entered into before the commencement of this Act.

(7) For the purposes of sub-paragraph (1)(b)(i), the following persons are connected with a person:

(a) the spouse or a parent or child of the person;

(b) a partner of the person;

(d) where the person is a body corporate—a related body corporate.

(8) This Act does not apply in relation to a franchise agreement if more than 75% of the motor fuel sold by retail at the marketing premises is sold in bulk or sold by the franchisee as servant or agent of the franchisor.

Act to have effect notwithstanding agreements

7. (1) This Act applies notwithstanding any agreement to the contrary and, in particular, but without limiting the generality of the foregoing, a provision in any agreement is void to the extent that it purports to exclude, limit or modify, or is otherwise inconsistent with, the operation of a provision of this Act or any right or remedy based on or arising out of a provision of this Act.

(2) Nothing in this Act shall be taken to affect the operation of an agreement to the extent that the agreement is capable of operating consistently with this Act.

(3) Where—

(a) the proper law of an agreement would, but for a provision that it should be the law of some other country or a provision to the like effect, be the law of any part of Australia; or

(b) an agreement contains a provision that purports to substitute, or has the effect of substituting, provisions of the law of some other country or of a State or Territory for all or any of the provisions of this Act,

this Act applies to the agreement notwithstanding that provision.

Operation of State and Territory laws

8. This Act is not intended to affect the operation of a law of a State or Territory to the extent that that law is capable of operating concurrently with this Act.

PART II—FRANCHISE AGREEMENTS

Franchisor not to impose impossible or unreasonable obligations

9. (1) A corporation shall not enter, as franchisor, into a franchise agreement that contains a provision imposing an obligation on the franchisee that is likely to be impossible or unreasonably onerous to perform at the time when it is required to be performed.

(2) Where a corporation enters into a franchise agreement in contravention of sub-section (1), the provision referred to in that sub-section is void.

(3) Sub-section (1) shall not be taken to affect the operation of the law relating to frustration of contract.

(4) Where a provision of an agreement is rendered void by the operation of sub-section (2), the validity of the agreement is not otherwise affected, but, if that provision is not severable, the franchisee may—

(a) avoid the agreement; or

(b) apply to a court for an order under sub-section (5).

(5) In any proceedings under sub-section (4) in relation to an agreement, the court may make—

(a) an order varying the agreement in such manner as the court considers just and equitable for the purpose of enabling the provisions of the agreement to have effect to the extent that they are not rendered void by the operation of sub-section (2); and

(b) such ancillary or consequential orders as it thinks fit, including orders directing the preparation and execution of documents.

Supply of motor fuel

10. (1) Where a franchise agreement contains provisions of a kind referred to in paragraph (c) of the definition of “franchise agreement” in sub-section 3(1), the succeeding provisions of this section apply in relation to the agreement to the extent that those succeeding provisions are not inconsistent with the operation of an emergency law (including a direction or order given or made under such a law).

(2) The franchisor shall, during the term of the franchise agreement, supply to the franchisee at the marketing premises such quantity of motor fuel as is from time to time reasonably required by the franchisee for retail sale by him at the premises.

(3) In relation to a franchise agreement in effect immediately before the commencement of this Act, the amounts payable by the franchisee in respect of any motor fuel supplied to him by the franchisor under sub-section (2) in excess of the quantity that the franchisor is required to supply to him in accordance with that agreement shall be as are agreed between the franchisor and the franchisee or, failing agreement, as are determined by a court.

(4) Sub-section (2) does not apply during any period in which—

(a) the franchisee fails or refuses to comply with a provision of the franchise agreement relating to payment with respect to motor fuel supplied or to be supplied in pursuance of that sub-section; or

(b) the franchisor is, by reason of a shortage of supplies, an industrial dispute or circumstances beyond its control, unable to supply motor fuel to the franchisee in accordance with that sub-section.

(5) Where paragraph (4) (b) applies, the franchisor shall use its best endeavours to supply motor fuel to its franchisees in such manner as is fair and equitable as between each of its franchisees and as between its franchisees and any other persons to whom it supplies motor fuel, having regard to the respective needs of its franchisees, of those other persons and of the public.

(6) In any proceedings involving a question arising under sub-section (2), if this sub-section is capable of application and the franchisee informs the court that he wishes to rely on this sub-section, the court shall presume, unless the contrary is established, that the quantity of motor fuel reasonably required by the franchisee to be supplied by the franchisor for retail sale in a particular month is equal to the quantity that was supplied by the franchisor in the corresponding month of the preceding year to the franchisee for retail sale, whether or not the franchise agreement concerned was in effect at that time.

(7) In this section, “emergency law” means a law of the Commonwealth or of a State or Territory controlling, directing, restricting or prohibiting the sale, supply, use or consumption of motor fuel during a period of interruption, reduction or cessation of normal supplies of motor fuel, other than a law declared by the regulations not to be an emergency law for the purposes of this section.

Assignment of rights, &c., of franchisee

11. (1) In this section—

“assignment” does not include an equitable assignment;

“interest” includes rights and benefits;

“obligations” includes liabilities and burdens;

“prescribed agreement” means a franchise agreement containing provisions of the kind referred to in paragraph (b) of the definition of “franchise agreement” in sub-section 3(1).

(2) A corporation is not entitled, directly or indirectly, to enforce, or to rely as a defence on, any provision of a franchise agreement or of a related agreement (not being a provision to which sub-section (3) applies) that, would, but for this sub-section, have the effect of—

(a) prohibiting the franchisee in relation to the first-mentioned agreement from assigning the whole or part of his interest under the first-mentioned agreement;

(b) limiting or restricting, or imposing conditions on, his power to make such an assignment; or

(c) requiring him, before making such an assignment, to offer to surrender the whole or part of that interest to the franchisor.

(3) Where a provision of a prescribed agreement has the effect of prohibiting the franchisee from assigning the whole or part of his interest under the agreement without the consent of the franchisor, the franchisor shall not unreasonably withhold its consent and, where its consent is unreasonably withheld, it shall be deemed to have granted its consent.

(4) Where a franchisor withholds consent to an assignment of the whole or part of the interest of the franchisee under a prescribed agreement (being an agreement containing a provision referred to in sub-section (3)) and the proposed assignee is a person who is none of the following:

(a) a person with prescribed experience;

(b) a member of the franchisee’s immediate family;

then, for the purposes of sub-section (3), the consent of the franchisor shall be deemed to be reasonably withheld.

(5) Where a franchisee proposes to make an assignment of the whole of his interest under a prescribed agreement (being an agreement containing a provision referred to in sub-section (3)) to a person who is neither a member of the franchisee’s immediate family nor a company controlled by the franchisee, he shall serve on the franchisor a notice in writing, offering—

(a) to terminate the franchise agreement for an amount of consideration equal to the consideration for the proposed assignment; or

(b) to assign the whole of that interest to such person as the franchisor may nominate, on terms not less favourable to the person nominated than the terms of the proposed assignment.

(6) Where, without the consent of the franchisor, a franchisee in relation to a prescribed agreement (being an agreement containing a provision referred to in sub-section (3))—

(a) makes an assignment of the whole of his interest under the agreement without first having served on the franchisor a notice under sub-section (5); or

(b) after having served on the franchisor such a notice, but before the expiration of 30 days after service of the notice—makes an assignment of the whole of his interest under the agreement to a person other than a person nominated by the franchisor,

then, for the purposes of sub-section (3), the consent of the franchisor shall be deemed to have been reasonably withheld.

(7) For the purposes of sub-section (3), where a franchisor requires payment or other consideration for its consent to an assignment (other than payment of reasonable administrative and legal costs incurred in the giving of consent), the consent shall be deemed to be unreasonably withheld.

(8) Nothing in this section shall be taken to limit the grounds upon which consent to an assignment may be reasonably withheld.

(9) When a franchisee duly assigns the whole or part of his interest under a prescribed agreement (whether or not the agreement contains a provision referred to in sub-section (3)), the agreement has effect, by force of this sub-section, as if the franchisor, the franchisee and the assignee had agreed—

(a) in the case of an assignment of the whole of that interest—to the immediate assignment to the assignee of all the obligations imposed on the franchisee by the provisions of the agreement, other than obligations transferred by the assignment of that interest; or

(b) in the case of an assignment of part of that interest—to the franchisee and the assignee immediately becoming jointly and severally bound by all those obligations, other than obligations transferred by the assignment of that interest.

(10) Where—

(a) a franchisee duly assigns to a person (in this sub-section referred to as the “assignee”) the whole or part of his interest under a prescribed agreement that is one of 2 or more related agreements (whether or not the prescribed agreement contains a provision referred to in sub-section (3)); and

(b) at or after the time when the assignment is made, the person who is the franchisee in relation to a related agreement (in this sub-section referred to as the “assignor”) duly assigns the whole or part of his interest under that related agreement to the assignee,

that related agreement has effect, by force of this sub-section, as if the corporation that is the franchisor in relation to that related agreement, the assignor and the assignee had agreed—

(c) in the case of an assignment of the whole of the interest under that related agreement—to the immediate assignment to the assignee of all the obligations imposed on the assignor by the provisions of that related agreement; or

(d) in the case of an assignment of part of the interest under that related agreement—to the assignor and the assignee immediately becoming jointly and severally bound by all those obligations.

(11) Where, but for this sub-section, the whole or part of the interest of the franchisee under a franchise agreement would not be capable of assignment by reason of the agreement being a contract of a personal nature, the agreement has effect, by force of this sub-section, as if the franchisor had agreed, at all relevant times, that that interest, or that part of that interest, as the case may be, was capable of assignment.

(12) Where an assignment of obligations under a franchise agreement occurs by virtue of paragraph (9)(a) or (10)(c), then, for the purposes of sections 13, 15 and 17, the franchise agreement as subsisting after the assignment shall not be taken, by reason of the assignment, to be a new agreement.

(13) A reference in this section to obligations, in relation to the assignment of an interest under an agreement, does not include a reference to an obligation the time for the performance of which has arisen before the time when the assignment is made.

(14) Nothing in this section shall be taken to affect the right of a franchisee—

(a) to assign his interest under the franchise agreement by way of mortgage or charge; or

(b) to grant, confer or sublet a lesser interest derived from his interest under the franchise agreement,

or to affect the operation of a provision of the agreement of a kind referred to in sub-section (2) to the extent that it relates to such an assignment or grant.

Addition of further franchisees by novation

12. (1) Where a franchisee, by notice in writing served on the franchisor, requests the consent of the franchisor to a novation of the franchise agreement the sole purpose of which is to join a person or persons specified in the notice as an additional franchisee or additional franchisees, the franchisor shall not unreasonably withhold its consent and, where its consent is unreasonably withheld, it shall be deemed to have granted its consent.

(2) Where a franchisor withholds consent to a proposed novation the sole purpose of which is to join, as franchisee, a person who is none of the following:

(a) a person with prescribed experience;

(b) a member of the franchisee’s immediate family;

then, for the purposes of sub-section (1), the consent of the franchisor shall be deemed to be reasonably withheld.

(3) Where a franchisor requires payment or other consideration for its consent to a proposed novation of the kind referred to in sub-section (1) (other than payment of reasonable administrative and legal costs incurred in the giving of consent), the consent shall be deemed to be unreasonably withheld.

(4) Nothing in this section shall be taken to limit the grounds upon which consent to a proposed novation may be reasonably withheld.

(5) Where, in relation to a franchise agreement, there occurs a novation of the kind referred to in sub-section (1), sections 13, 15 and 17 apply in relation to the new agreement as if it were a continuation, without interruption, of the first-mentioned agreement.

Duration of franchise agreements

13. (1) A corporation shall not enter, as franchisor, into a franchise agreement the term of which does not comply with the requirements of this section.

(2) Subject to sub-section (6), the term of—

(a) a franchise agreement entered into otherwise than by way of renewal, where the franchisee has produced to the franchisor, before entering into the agreement, evidence reasonably sufficient to show that he is a person with prescribed experience; or

(b) a franchise agreement entered into by way of renewal, other than an agreement referred to in sub-section (4),

shall be not less than 3 years.

(3) The term of a franchise agreement, other than an agreement referred to in paragraph (2) (a) or an agreement entered into by way of renewal, shall be one year or less, or 3 years or more.

(4) Subject to sub-sections (5) and (6), where—

(a) a corporation enters, as franchisor, into a franchise agreement by way of renewal; and

(b) the term of the original agreement amounts, or the terms of the original agreement and of any previous renewal amount in the aggregate, to a period of more than 6 years and less than 9 years,

the term of the agreement so entered into shall be a period that is not less than the difference between the period referred to in paragraph (b) and 9 years.

(5) Where the whole or any part of a term of an agreement occurred before the commencement of this Act, that term, or that part of that term, as the case may be, shall be disregarded for the purposes of paragraph (4)(b).

(6) Where—

(a) a corporation proposes to enter, as franchisor, into a franchise agreement;

(b) the marketing premises to which the proposed agreement relates are held by that corporation or a related corporation as lessee under a lease in respect of which the lessor is not a corporation related to the lessee; and

(c) the term of the proposed agreement would, but for this sub-section, be required by sub-section (2) or (4) to extend beyond the expiration of the term of the lease,

the term of the proposed agreement shall be a period expiring immediately before the expiration of the term of the lease.

(7) Where, by reason of the operation of sub-section (6), the term of a franchise agreement entered into by a corporation is less than it would otherwise have been and—

(a) the corporation or a related corporation becomes the owner of the reversion of the marketing premises, whether by merger or otherwise; or

(b) after the expiration of the term of the lease referred to in sub-section (6), the corporation or a related corporation continues to hold the marketing premises as lessee by holding over or otherwise,

then, unless the franchisee serves on the corporation a notice in writing terminating the agreement, the agreement has effect, by force of this sub-section, as if the corporation and the franchisee had agreed to the extension of the term of the franchise agreement for a period expiring—

(c) where paragraph (a) applies—at the expiration of the period that, but for sub-section (6), would have been the minimum term of the agreement provided by sub-section (2) or (4), as the case may be; or

(d) where paragraph (b) applies—

(i) at the expiration of the period referred to in paragraph (c); or

(ii) immediately before the expiration of the period during which the corporation or a related corporation holds the premises or, where there are 2 or more such periods, of the later or latest of those periods,

whichever is the sooner.

(8) Where—

(a) a franchise agreement containing provisions of the kind referred to in paragraph (b) of the definition of “franchise agreement” in sub-section 3 (1) is extended by virtue of sub-section (7); and

(b) the rate of the rent payable by the franchisor in respect of the period of the extension under the lease of the marketing premises exceeds the rate of the rent that was payable by the franchisor or a related corporation under that lease or another lease of the marketing premises in respect of the corresponding period ending immediately before the commencement of the period of the extension,

the rate of the amounts payable by the franchisee under the agreement in respect of the possession, occupation or use of the marketing premises may, to take account of the increased rate of that rent, be increased to such extent as is agreed upon between the franchisee and the franchisor or, failing agreement, as is determined by a court.

(9) Where the term of an agreement is extended by virtue of sub-section (7), any amount payable by the franchisee under the agreement (other than an amount to which sub-section (8) applies or an amount payable in respect of motor fuel or other stock in trade) and calculated by reference to the full period of the term of the agreement before the extension shall be deemed to be increased by an amount that bears to the first-mentioned amount the same proportion as the period of the extension bears to that full period.

(10) Where a corporation purports to enter into a franchise agreement in contravention of a sub-section of this section, the franchise agreement is not thereby invalidated, but the term of the agreement is—

(a) in the case of a contravention of sub-section (3)—

(i) if the marketing premises are held by that corporation or a related corporation as lessee under a lease in respect of which the lessor is not a corporation related to the lessee and the term of the lease will expire less than 3 years after the commencement of the agreement—a period expiring immediately before the expiration of the term of the lease; or

(ii) if sub-paragraph (a)(i) does not apply—3 years; or

(b) in any other case—the term, or the minimum term, as the case may be, provided by the sub-section contravened.

(11) For the purposes of this section, where a franchise agreement—

(a) is one of 2 or more related franchise agreements; and

(b) does not contain provisions of the kind referred to in paragraph (b) of the definition of “franchise agreement” in sub-section 3(1),

it shall be deemed to commence on the commencement of whichever of those agreements contains provisions of that kind.

Application of Act in relation to interim franchise agreements

14. Where an agreement to which sub-section 13(3) applies is entered into for a term not exceeding one year, sections 11, 12, 16, 17 and 19 do not apply in relation to that agreement.

Disclosure of information by franchisor

15. (1) A corporation shall not enter into a franchise agreement as franchisor unless, not less than 3 business days before the day on which the agreement is entered into, it has supplied to the franchisee a statement made in accordance with such form as is prescribed or, if no form is prescribed, such form as the Minister approves, containing all information in the possession of the franchisor and related corporations, being information relating to the operation or proposed operation of the marketing premises and reasonably likely to influence the decision of the franchisee to enter into the agreement.

(2) A statement referred to in sub-section (1) shall, for the purposes of that sub-section, include information relating to the following matters:

(a) all amounts to be payable by the franchisee to the franchisor under the agreement or, in the case of amounts not fixed by the agreement, the manner in which those amounts are to be calculated or determined;

(b) all goods and services to be required to be accepted by the franchisee under the agreement;

(c) particulars of any finance that is, or is to be, offered to, or required to be accepted by, the franchisee under or in connection with the agreement;

(d) the provisions (if any) of the agreement containing limitations or restrictions relating to—

(i) goods that may be sold, and services that may be provided, by the franchisee; or

(ii) the persons or classes of persons to whom goods may be sold, and services provided, by the franchisee;

(e) the extent to which the franchisee is to be required or, where the franchisee is a body corporate, the extent to which a person or persons specified in the agreement is or are to be required, to engage personally in the operation of the marketing premises;

(f) the provisions (if any) of the agreement relating to training of the franchisee or, where the franchisee is a body corporate, relating to training of a person or persons specified in the agreement;

(g) the rights of the franchisee under the agreement and under this Act relating to the termination and renewal of the agreement;

(h) where the agreement contains a provision of a kind referred to in sub-section 11(3), the rights of the franchisee under this Act to assign the whole or part of his interest under the agreement;

(j) the rights of the franchisee under section 12 with respect to the novation of the agreement;

(k) where, during the period of 3 years immediately preceding the date on which the statement is supplied to the franchisee, the marketing premises have been operated for the retail sale of motor fuel by a person other than the franchisee—particulars of that operation, including the profitability of that operation;

(m) in respect of any premises situated within 2 kilometres of the marketing premises that were, during the year immediately preceding the date on which the statement is supplied to the franchisee, operated by a person other than the franchisee for the retail sale of motor fuel supplied by the franchisor or a related corporation—

(i) the situation of the premises;

(ii) the name under which business was carried on on the premises; and

(iii) whether or not that business was carried on by a franchisee, agent or employee of, or under any other arrangement with, the franchisor or a related corporation;

(n) the total number of franchise agreements to which the franchisor and related corporations, respectively, were parties and which were avoided, terminated, or not renewed, by the franchisees during a specified period of a year that expired not more than 4 months before the date on which the statement is supplied to the franchisee;

(p) the total number of franchise agreements to which the franchisor and related corporations, respectively, were parties and which were terminated, or not renewed, by the franchisor and those corporations during the period referred to in paragraph (n), together with a statement of the reasons for each termination or non-renewal;

(q) any plan or scheme under consideration, or negotiations entered into, by the franchisor or a related corporation for the operation, at any time during the term of the agreement, of premises (other than the marketing premises) for the retail sale of motor fuel, where the operation of those premises could adversely affect, to a material extent, the profitability of the marketing premises;

(r) any proposal, plan or decision made by the Commonwealth or a State or Territory, or a local governing body, concerning the resumption or acquisition of land, the construction, closure or alteration of any road, or any other matter of a town planning nature, that could adversely affect, to a material extent, the profitability of the marketing premises.

(3) The express provisions of sub-section (2) are not intended to imply a limitation of the generality of the description in sub-section (1) of information to be contained in a statement referred to in sub-section (1).

(4) In relation to a franchise agreement entered into by way of renewal of an agreement that was entered into (whether by way of renewal or otherwise) after the commencement of this Act, sub-sections (1) and (2) shall not be taken to require the disclosure of any information unless—

(a) it differs in a material particular or to a material extent from the information supplied by the franchisor to the franchisee in accordance with those sub-sections at the time when the agreement to be renewed was entered into; or

(b) it relates to a matter concerning which, or a period in relation to which, no information was supplied to the franchisee in accordance with those sub-sections at that time.

(5) Where a franchisor enters into a franchise agreement in contravention of sub-section (1), the agreement is voidable at the instance of the franchisee.

(6) An agreement is not voidable under sub-section (5) by reason of the failure by the franchisor to disclose, or the false, misleading or incorrect statement by the franchisor of, any information unless—

(a) the information was material to the operation, including the profitability of the operation, of the marketing premises; and

(b) the franchisee would not have entered into the agreement if the information had been duly and correctly disclosed to him.

(7) An agreement is not voidable under sub-section (5) by reason only that a provision of the agreement is at variance with any part of the statement made in accordance with sub-sections (1) and (2), being a part relating to that provision, if the variation was made at the request in writing of the franchisee.

(8) A franchise agreement entered into by way of renewal of an agreement that was in effect immediately before the commencement of this Act is not voidable under sub-section (5) by reason only of the non-disclosure in the statement made in accordance with sub-sections (1) and (2) of any information required by those sub-sections to be disclosed, if that information was disclosed in writing to the franchisee at any earlier time.

(9) A reference in this section to the renewal of an agreement shall be read as including a reference to the entering into of a franchise agreement immediately following the expiration of an interim franchise agreement, where the parties to both agreements and the marketing premises to which the agreements relate are the same.

(10) This section does not require a franchisor to supply any information to a person by reason only of his becoming a franchisee in relation to the agreement by way of assignment or novation.

(11) Where a person becomes a party to a franchise agreement by way of assignment of the whole or part of the interest of the franchisee in the agreement, the reference in sub-section (5) to the franchisee shall be read as, or as including, as the case may be, a reference to that person.

(12) In sub-section (1), “business day”, in relation to entering into a franchise agreement, means a day other than—

(a) a Saturday;

(b) a Sunday; or

Termination of franchise agreements

16. (1) A franchisor may terminate the franchise agreement in accordance with the succeeding provisions of this section, but not otherwise.

(2) A franchisor shall not terminate the franchise agreement except on one or more of the following grounds:

(a) the franchisee is unable, by reason of physical or mental incapacity, to control the operation of the marketing premises;

(b) the franchisee makes a fraudulent misrepresentation in connection with the operation of the marketing premises;

(c) the franchisee performs an act, omits to perform an act, or makes a statement, where the act or omission, or the making of the statement—

(i) constitutes an offence punishable by imprisonment or, in the case of a franchisee being a body corporate, by a fine of $500 or more; and

(ii) in the case of a franchisee being a natural person, tends to show that he is dishonest or is otherwise not of good character;

(d) in connection with the operation of the marketing premises, the franchisee performs an act, omits to perform an act, or makes a statement (other than an act, omission or statement referred to in paragraph (c)), where the act or omission, or the making of the statement, constitutes a serious contravention of a provision of any law;

(e) the franchisee misrepresents the octane rating of, or wilfully adulterates, motor fuel supplied to him under the franchise agreement;

(f) without the consent of the franchisor, the franchisee wilfully passes off motor fuel supplied to him by a person other than the franchisor or a related corporation as being motor fuel supplied to him by the franchisor or a related corporation;

(g) the franchisee fails to operate the marketing premises (otherwise than by reason of an industrial dispute or an interruption, reduction or cessation of the supply of motor fuel or the compliance by the franchisee with an emergency law as defined by sub-section 10(7) or with a direction or order made under such a law)—

(i) for a period exceeding 7 consecutive days; or

(ii) for a lesser period or lesser periods, where the failure to operate the premises during that period or those periods is unreasonable, having regard to the interests of the franchisor, the normal operation of the premises and the reason for the failure;

(h) the franchisee operates the marketing premises in a manner likely to cause injury to persons or property;

(j) the franchisee otherwise commits a breach of a condition of the franchise agreement;

(k) the whole or a substantial part of the marketing premises is destroyed, or is damaged to such an extent as to render the operation of the premises impracticable, except where the franchisor or a related corporation is responsible for the destruction or damage.

(3) The termination of a franchise agreement by the franchisor shall be effected by the franchisor serving on the franchisee notice in writing—

(a) informing the franchisee that the agreement is to be terminated on a specified date, being a date that, subject to sub-section (8), is not earlier than 30 days after the day on which the notice is served; and

(b) setting out full particulars of the ground or grounds, including a statement of the facts relating to each ground, upon which the termination is based.

(4) Where a franchisor serves notice on the franchisee under sub-section (3) terminating the agreement, the franchisee may apply to a court for an order declaring the notice to have had, or to have, no effect.

(5) Where an application is made under sub-section (4), the Court may, by order, either—

(a) declare the notice referred to in that sub-section to have had, or to have, no effect; or

(b) declare that notice to have terminated, or to terminate, the agreement on the date specified in the notice or on such later date as is specified in the order,

and may, in either case, make such ancillary or consequential orders as it thinks fit, including orders directing the preparation and execution of documents.

(6) In any proceedings under sub-section (4), the court shall not declare the notice referred to in that sub-section to have terminated, or to terminate, the franchise agreement unless—

(a) a ground specified in the notice is established by the franchisor to the satisfaction of the court; and

(b) the court is satisfied that the termination of the agreement and any related agreement or agreements is just and equitable, having regard to all the circumstances.

(7) Without limiting the generality of paragraph (6)(b), the circumstances referred to in that paragraph include the conduct of the franchisor and the franchisee after the time when the franchisor became aware of the existence of the circumstances, or the occurrence of the event, constituting the ground referred to in paragraph (6)(a).

(8) A court may permit a franchisor to serve a notice under sub-section (3) specifying a date for the termination of the franchise agreement that is earlier than 30 days after the day on which the notice is served, if the court is satisfied that it is desirable to do so by reason that the continued possession, occupation, use or operation of the marketing premises in question by the franchisee is likely to cause substantial damage to the business, property or reputation of the franchisor.

(9) This section does not prohibit a franchisor from terminating the franchise agreement with the consent in writing of the franchisee given at any time after the commencement of the agreement.

Renewal of franchise agreements

17. (1) Subject to this section, a franchisor shall not fail or refuse to renew the franchise agreement except on one or more of the following grounds:

(a) the existence of circumstances, or the occurrence of an event, of a kind referred to in any of paragraphs 16(2)(a) to (k) (inclusive);

(b) the franchisor proposes, in good faith and in the normal course of business, to vary a provision of the agreement (other than a provision fixing an amount, or the manner of calculating or determining an amount, payable by the franchisee) and the franchisee does not consent to the variation;

(c) in the case of a franchise agreement containing provisions of the kind referred to in paragraph (b) of the definition of “franchise agreement” in sub-section 3(1), the franchisor has, in good faith and in the normal course of business—

(i) entered into an agreement, or negotiations for an agreement, to grant a lease of the marketing premises to a person other than an associate of the franchisor for a use other than the retail sale of motor fuel; or

(ii) entered into an agreement, or negotiations for an agreement, (other than an agreement containing a provision having the effect of prohibiting the use of the marketing premises for the retail sale of motor fuel) to sell its interest in the marketing premises to a person other than an associate of the franchisor.

(2) A franchisor shall not enter into an agreement to sell its interest in the marketing premises to a person other than the franchisee unless—

(a) before entering into the agreement, the franchisor has offered the interest for sale to the franchisee on terms that were no less favourable to the franchisee than the terms of the agreement with that person; or

(b) the agreement was entered into in the following manner, namely, the franchisor offered the interest for sale at a public auction of which at least 30 day’s notice in writing was served on the franchisee, and the franchisor—

(i) sold the interest at the auction to a person other than an associate of the franchisor; or

(ii) sold the interest by private treaty after the auction, to the person (not being an associate of the franchisor) who made the highest bid at the auction, for a price not lower than the amount of that bid and on other terms substantially the same as the terms on which the interest was so offered.

(3) Where the franchisor has entered into an agreement to sell its interest in the marketing premises as described in paragraph (1)(c), the franchisor shall not, before the transfer of the premises in pursuance of the agreement, render unfit for use any fixture on the premises at the expiration of the franchise agreement and not subsequently removed by the franchisor.

(4) Where, before the expiration of a franchise agreement, the franchisor has, in the manner described in paragraph (1)(c), entered into negotiations for an agreement of a kind referred to in that paragraph, the franchisor may, in lieu of renewing the franchise agreement, extend the term of the franchise agreement until—

(a) an agreement of that kind is entered into; or

(b) the expiration of the period of 6 months commencing on the date on which, but for this sub-section, the franchise agreement would expire,

whichever first occurs, or until such earlier time as is agreed upon between the franchisee and the franchisor.

(5) If, at the expiration of the period referred to in paragraph (4)(b), no agreement of a kind referred to in paragraph (1)(c) has been entered into, paragraph (1)(c) ceases to be a ground for failure or refusal to renew the franchise agreement.

(6) For the purposes of sub-section (1), a franchisor shall not be taken to have failed or refused to renew the franchise agreement if the agreement is not renewed by reason only of a stipulation by the franchisor that an amount payable by the franchisee under the franchise agreement as proposed to be renewed (other than an amount payable in respect of motor fuel or other stock in trade) is to exceed, or is to be calculated in such a manner as to exceed, the corresponding amount payable under the existing agreement, where the amount of the excess is reasonable, having regard to the market value, at the time when the agreement is proposed to be renewed, of the interest, goods or services in respect of which the amount is payable.

(7) Notwithstanding anything in the preceding provisions of this section, where—

(a) a franchisor, by notice in writing served on the franchisee not later than 30 days before the expiration of the franchise agreement, offers to renew the agreement; and

(b) after that notice is served, the franchisee fails to serve on the franchisor before—

(i) if that notice is served earlier than 120 days before the expiration of the agreement—the ninetieth day before the expiration of the agreement; or

(ii) in any other case—the expiration of 30 days after receipt of the notice by the franchisee,

a notice in writing accepting the offer of renewal,

the franchisor is not required to renew the agreement.

(8) If a franchisor decides not to renew the franchise agreement, it shall serve on the franchisee, not later than 30 days before the expiration of the agreement, notice in writing of its decision, setting out full particulars of the ground or grounds, including a statement of the facts relating to each ground, upon which the decision is based.

(9) If notice is served on a franchisee under sub-section (8) after the commencement of the period of 90 days before the expiration of the franchise agreement, the term of the agreement shall be deemed to be extended so that it expires at the end of the ninetieth day after receipt of the notice by the franchisee.

(10) Subject to this section, a court shall, on the application of a franchisee, make an order directing the franchisor to renew the franchise agreement unless—

(a) the franchisor has served on the franchisee a notice in accordance with sub-section (8);

(b) a ground specified in the notice is established by the franchisor to the satisfaction of the court; and

(c) except where a ground so established is a ground referred to in paragraph (1)(c), the court is satisfied that it is just and equitable, having regard to all the circumstances, for the agreement and any related agreement or agreements not to be renewed.

(11) Without limiting the generality of paragraph (10)(c), the circumstances referred to in that paragraph include the conduct of the franchisor and the franchisee after the time when the franchisor became aware of the existence of the circumstances, or the occurrence of the event, constituting a ground referred to in paragraph (10)(b) (not being a ground referred to in paragraph (1)(c)).

(12) Where the court makes an order under sub-section (10), it may make—

(a) orders determining any amount, or the manner of calculating any amount, to be payable by the franchisee under the franchise agreement as to be renewed;

(b) orders determining any other provisions of the agreement as to be renewed; and

(c) such ancillary or consequential orders as it thinks fit, including orders directing the preparation and execution of documents.

(13) For the purposes of this section, a franchisor shall not be taken to have failed or refused to renew a franchise agreement by reason only that, in relation to the agreement as renewed, there is substituted for that franchisor a different franchisor, if—

(a) that different franchisor is a corporation related to the first-mentioned franchisor; and

(b) the first-mentioned franchisor has agreed to indemnify the franchisee in respect of any loss or damage resulting from any breach by that different franchisor of its obligations under the franchise agreement as renewed or under this Act.

(14) For the purposes of this section, a franchisor shall not be taken to fail to renew the franchise agreement if the agreement was not renewed with the consent in writing of the franchisee given at any time after the commencement, and before the expiration, of the agreement, being a time, in the case of an agreement in effect immediately before the date of commencement of this Act—

(a) on or after that date; or

(b) where the franchisor has, before that date, in good faith and in the normal course of business, entered into an agreement to grant or dispose of an interest in, or to grant a licence in relation to, the marketing premises—before that date.

(15) Where—

(a) a franchise agreement has, whether before or after the commencement of this Act, been entered into otherwise than by way of renewal;

(b) this section has applied in relation to a renewal, or 2 or more consecutive renewals, of the franchise agreement; and

(i) if the franchise agreement was entered into before the commencement of this Act—so much (if any) of the term of that agreement as occurred after the commencement of this Act; or

(ii) in any other case—the term of the franchise agreement, amount in the aggregate to not less than 9 years,

this section does not require the franchisor to renew the franchise agreement but, if the franchisor renews the franchise agreement, this section has effect as if that renewal were a franchise agreement entered into otherwise than by way of renewal.

(16) This section does not apply in relation to a franchise agreement the term of which is 9 years or more.

Application of sections 15, 16 and 17 to associated agreements

18. (1) Where—

(a) a franchise agreement is one of 2 or more related agreements; and

(b) that franchise agreement is avoided under section 15, terminated under section 16 or not renewed in accordance with section 17,

the related agreement or agreements shall be deemed to be avoided, terminated or not renewed, as the case may be.

(2) Where—

(a) the franchisee in relation to a franchise agreement, and the franchisor in relation to that agreement or a related corporation, are, by virtue of sub-section 6 (5), deemed to be the franchisee and the franchisor, respectively, in relation to another agreement; and

(b) the first-mentioned agreement is avoided under section 15, terminated under section 16 or not renewed in accordance with section 17,

that other agreement shall be deemed to be avoided, terminated, or not renewed, as the case may be.

Franchisee to be offered new franchise after destruction, &c., of premises

19. (1) Subject to sub-section (2), where—

(a) a corporation, being a franchisor, terminates under section 16 or, in accordance with section 17, does not renew, a franchise agreement (being an agreement containing provisions of the kind referred to in paragraph (b) of the definition of “franchise agreement” in sub-section 3 (1)) on the ground that the whole or a substantial part of the marketing premises is destroyed, or is damaged to such an extent as to render the operation of the premises impracticable; and

(b) the premises are rebuilt or restored so as to be suitable for the purpose of the retail sale of motor fuel,

the corporation shall not enter into an agreement with a person other than the former franchisee under which the corporation grants a right to, or otherwise authorizes or permits, that person to possess, occupy or use the premises for that purpose unless, before entering into the agreement with that person, the corporation, by notice in writing served on the former franchisee, has offered to enter into a franchise agreement in relation to the premises with the former franchisee, being an agreement of a kind referred to in paragraph (a), on terms no less favourable to the former franchisee than the terms of the agreement with that person, and the offer has remained open for a period of at least 30 days commencing on the date on which the notice was served.

(2) In any proceedings involving the question whether a corporation has entered into an agreement in contravention of sub-section (1), the corporation shall not be taken to have contravened that sub-section if the corporation establishes to the satisfaction of the court that—

(a) the corporation served on the former franchisee, not less than 30 days before the agreement was entered into, notice in writing—

(i) informing the franchisee of the proposed agreement; and

(ii) setting out full particulars of, together with a statement of the facts relating to, any circumstances or event of a kind referred to in any of paragraphs 16(2)(a) to (j) (inclusive) intended to be relied on by the corporation for the purpose of this sub-section;

(b) during the subsistence of the relevant franchise agreement, circumstances or an event specified in the notice in accordance with sub-paragraph (a)(ii) existed or occurred; and

(c) if the relevant franchise agreement were still subsisting, it would be just and equitable to terminate the agreement on the ground of those circumstances or that event, as the case may be.

PART III—PRICE DISCRIMINATION IN SALES OF MOTOR FUEL TO FRANCHISEES

Price discrimination in sales of motor fuel to franchisees

20. (1) A franchisor shall not, in relation to motor fuel supplied or to be supplied by it, discriminate between its franchisees in relation to—

(a) the amounts payable by the franchisees in respect of the fuel; or

(b) any discounts, allowances, rebates or credits given or allowed to the franchisees in respect of the fuel.

(2) Sub-section (1) does not apply in relation to a discrimination if—

(a) the discrimination makes only reasonable allowance for differences in the cost or likely cost of raw materials, refining, distribution, sale or delivery resulting from the differing places to which, methods by which or quantities in which the motor fuel is supplied to the franchisees;

(b) the discrimination is constituted by the doing of an act in good faith—

(i) to meet a price or benefit offered by a competitor of the franchisor; or

(ii) to assist a franchisee to meet a price or benefit offered by a competitor of the franchisee; or

(c) the discrimination results only from compliance with a law of a State or Territory fixing the wholesale price, or the maximum wholesale price, of motor fuel.

(3) In any proceedings, the onus of establishing that sub-section (1) does not apply in relation to a discrimination by reason of sub-section (2) is on the person asserting that fact.

(4) This section does not apply in relation to the supply or proposed supply of motor fuel to franchisees for retail sale in bulk.

PART IV—MISCELLANEOUS

Orders

21. (1) A court may, on the application of a franchisee, make one or more of the following orders:

(a) an order restraining the franchisor from engaging in conduct that constitutes or would constitute a contravention of a provision of this Act or the regulations;

(b) an order directing the franchisor to comply with a requirement of a provision of this Act or the regulations;

(c) orders for the purposes of setting aside or restraining the making of any instrument or disposition by or on behalf of, or by direction or in the interests of, the franchisor or an associate of the franchisor, being an instrument or disposition the making of which is in contravention of a provision of this Act or of the regulations or which defeats or prejudices, or is likely to defeat or prejudice, any right or remedy of or available to the franchisee under this Act;

(d) such ancillary or consequential orders as it thinks fit, including orders directing the preparation and execution of documents.

(2) Where in the opinion of the court it is desirable to do so, the court may make an interim order pending determination of an application under sub-section (1).

(3) The court shall not make an order under paragraph (1)(c) that would adversely affect the interests of a bona fide purchaser or other bona fide person interested (not being the franchisor or an associate of the franchisor).

(4) An order under sub-section (1) or (2) may be made subject to such conditions as the court thinks fit.

(5) The court may rescind or vary, or suspend the operation of, an order made under sub-section (1) or (2).

(6) Where an application is made to the court for the making of an order restraining a person from engaging in conduct of a particular kind, being conduct referred to in paragraph (1)(a), the court may—

(a) if it is satisfied that the person has engaged in conduct of that kind— make an order under sub-section (1) restraining the person from engaging in conduct of that kind; or

(b) if in the opinion of the court it is desirable to do so—make an interim order under sub-section (2) restraining the person from engaging in conduct of that kind,

whether or not it appears to the court that the person intends to engage again, or to continue to engage, in conduct of that kind.

(7) Where an application is made to the court for an order restraining a person from engaging in conduct of a particular kind, being conduct referred to in paragraph (1) (a), the court may—

(a) if it appears to the court that, in the event that an order is not made, it is likely that the person will engage in conduct of that kind—make an order under sub-section (1) restraining the person from engaging in conduct of that kind; or

(b) if in the opinion of the court it is desirable to do so—make an interim order under sub-section (2) restraining the person from engaging in conduct of that kind,

whether or not the person has previously engaged in conduct of that kind and whether or not there is an imminent danger of substantial damage to any person if the first-mentioned person engages in conduct of that kind.

(8) In this section—

“franchisee” includes a person who proposes to be, or has been, a franchisee;

“franchisor” includes a person who proposes to be, or has been, a franchisor.

Compensation

22. (1) Where a franchisee suffers loss or damage by reason of the franchisor contravening a provision of this Act or the regulations, the franchisor is liable to compensate the franchisee for the loss or damage.

(2) Without limiting the generality of sub-section (1), but subject to sub-section (3), in assessing any compensation for the purposes of sub-section (1) regard shall be had to any goodwill in respect of the relevant marketing premises attributable to the franchisee.

(3) Where a franchisee avoids the franchise agreement under sub-section 15 (5), the franchisor is liable to pay to the franchisee such amount of compensation as is necessary to put the franchisee in the same position as he would have been in if he had not entered into the agreement.

(4) Without limiting the generality of sub-section (3), where—

(a) the franchisee avoids an agreement under sub-section 15(5);

(b) after 3 days’ notice in writing served on the franchisor stating his intention to do so, the franchisee leaves on the marketing premises any motor fuel or other goods sold to him by the franchisor; and

the amount payable to the franchisee under sub-section (3) includes an amount equal to the sum of all amounts paid by the franchisee to the franchisor in respect of the motor fuel or other goods.

(5) A franchisee may recover compensation under this section by action against the franchisor in a court, commenced at any time within 6 years after the day on which the cause of action arose.

Compensation for acquisition of property

23. (1) Where, but for this section, the operation of a provision of this Act would result in the acquisition of property from a person by another person otherwise than on just terms, there is payable to the person by that other person such reasonable amount of compensation as is agreed upon between those persons or, failing agreement, as is determined by a court.

(2) In sub-section (1), “acquisition of property” and “just terms” have the same respective meanings as in paragraph 51 (xxxi) of the Constitution.

Saving of other rights and remedies

24. (1) Subject to this section, this Act does not affect any right of action or other remedy, whether civil or criminal, in proceedings instituted otherwise than by virtue of this Act.

(2) Any compensation recovered or other remedy given in proceedings instituted by virtue of this Act shall be taken into account in assessing damages or compensation or giving any other remedy in proceedings instituted otherwise than by virtue of this Act and arising out of the same event or transaction.

(3) Any damages or compensation recovered or other remedy given in proceedings instituted otherwise than by virtue of this Act shall be taken into account in assessing compensation or giving any other remedy in proceedings instituted by virtue of this Act and arising out of the same event or transaction.

Degree of proof

25. In any proceedings under this Act in which a franchisor seeks to prove—

(a) the occurrence of an event of a kind referred to in paragraph 16(2)(c); or

(b) the occurrence of an event of a kind referred to in paragraph 16(2)(d), where the occurrence of the event constitutes an offence,

the degree of proof required is the same as that required for the proof of a fact in issue in civil proceedings.

Jurisdiction of courts

26. (1) The Supreme Court of each State is invested with federal jurisdiction, and jurisdiction is conferred on the Federal Court of Australia and, to the extent that the Constitution permits, on the Supreme Court of each Territory, with respect to all matters arising under this Act.

(2) The inferior courts of each State are invested with federal jurisdiction, and jurisdiction is conferred on the inferior courts of each Territory, within the limits as to locality, but notwithstanding any other limits, of their several jurisdictions, with respect to matters arising under sub-sections 10(3) and 13(8).

(3) The inferior courts of each State are invested with federal jurisdiction, and jurisdiction is conferred on the inferior courts of each Territory, within the limits, other than limits as to subject-matter, of their several jurisdictions, with respect to matters arising under sections 22 and 23.

(4) An appeal lies to the Federal Court of Australia from a judgment or order of a court of a State or Territory exercising jurisdiction under this Act.

(5) An appeal lies to the High Court, with special leave of the High Court, from a judgment or order referred to in sub-section (4).

(6) Except as provided in sub-section (4) or (5), no appeal lies from a judgment or order referred to in sub-section (4).

(7) A reference in sub-section (2) to an inferior court shall be read as a reference to—

(a) a County Court, District Court or Local Court; or

(b) a court of summary jurisdiction exercising civil jurisdiction.

(8) A reference in sub-section (3) to an inferior court shall be read as a reference to a court referred to in paragraph (7)(a) or (b), being a court having jurisdiction in actions for the recovery of debts up to an amount not less than the amount of compensation claimed.

Service

27. (1) For the purposes of this Act, a document may be served—

(a) on a natural person—

(i) by delivering it to the person personally; or

(ii) by leaving it at, or by sending it by post to, the address of the place of residence or business of the person last known to the person serving the document; or (b) on a body corporate—by leaving it at, or sending it by post to, the registered office or a principal office of the body corporate or in such other manner as is prescribed.

(2) Nothing in sub-section (1) affects the power of a court to authorize service of a document otherwise than as provided in that sub-section.

Regulations

28. The Governor-General may make regulations, not inconsistent with this Act, prescribing all matters required or permitted by this Act to be prescribed or necessary or convenient to be prescribed for carrying out or giving effect to this Act.