Drafting Issues with Franchise Agreements

1 Introduction

This joint paper is provided by Allison McLeod of Norton Rose Fulbright in Melbourne, Australia and Stewart Germann of Stewart Germann Law Office in Auckland, New Zealand. We are limiting our paper to consideration of a standard (unit) franchise agreement. We will not be considering master franchise agreements, sub-franchise agreements, area developer agreements and joint ventures.

2 The commercial deal

2.1 What is the role of the franchise agreement?

The role of the franchise agreement is to state the legal rules between a franchisor and a franchisee in relation to a particular system. It does not matter whether the franchisor is a big corporation like McDonald's or a small franchisor with six franchisees. What matters is that there is certainty between the parties in relation to the legal rules and the obligations and behaviour expected by each of the parties.

Most people will accept that a standard franchise agreement is weighted in favour of the franchisor. This is generally because it is the franchisor providing all of the know-how for the set-up of the business. Without this, there would be no business, so the franchisor has a desire to draft the agreement in its favour to best protect its valuable assets. The franchise agreement will therefore be robust and powerful but at the end of the day it must also be fair. Why? Because franchisees must obtain their own independent legal advice and if an agreement is too one-sided or unfair, any experienced franchising lawyer would object to it and recommend that their clients do not sign it.

Franchisors and their lawyers have a duty to provide franchise agreements which are easily understood, are not ambiguous and clearly set out the obligations of each party. The agreement must contain robust clauses to protect the intellectual property of the franchisor and to allow a franchisor to take urgent steps to stop any franchisee who is damaging the system and brand or who has left the system and is competing in a similar business using the intellectual property of the franchisor.

There is a commercial relationship between the parties and each party must understand what its particular obligations are towards the other party – the franchise agreement does just this.

3 Trends

3.1 Template Agreement

Franchise agreements are often standard form documents. A franchisor will generally prepare a template which is then used across the network. If the parties agree to changes, the template itself is amended or specific special conditions are included in the agreement to document the agreed amendments. This process provides significant efficiencies for franchise networks and ensures that the contractual obligations across the network are generally the same (or very similar).

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However as with most, if not all legal documents, from time to time different trends emerge that guide the way in which template agreements are drafted.

3.2 Plain English

Gone are the days when clients sought an agreement replete with legal jargon and complex legal phrases. Instead, in both Australia and New Zealand, the emphasis is now almost exclusively on drafting franchise agreements in plain English, devoid of legal jargon. In this regard, it is important to ensure that:

(1) sentence structure is considered and sentences are drafted succinctly. In many older style agreements, sentences run for a paragraph and cover a range of issues. This is confusing, not just for franchisors and franchisees, but also for their lawyers trying to correctly determine what a sentence is trying to say. This confusion (and resultant frustration) can be easily avoided by using shorter, more succinct sentences; and

(2) terms that were once commonly used in legal documents (eg hereto, forthwith) are omitted in preference for more modern, approachable language. As a general rule of thumb, if a word is not used in everyday language, and is not strictly necessary for the purposes of the clause being drafted, you should reconsider if the word is really necessary.

Using plain English ensures that the agreement can be understood by both franchisors and prospective franchisees. It also minimises the likelihood of a clause being misinterpreted. That is not to say that the issues covered in the franchise agreement may not be complex – rather, that the reader will at least be able to understand what is being said, even if the underlying legal issue is complex.

3.3 Length of agreement

Many franchise networks are re-considering the length of their franchise agreements and, in particular, whether they should opt for a shorter style agreement in preference to a “bells and whistles” 100+ page document.

While a longer form agreement is often used to ensure that as many potential issues as possible are addressed, a longer form agreement can create its own problems. For instance, sometimes franchisors with long agreements do not actually know what is in their agreements. So while they have the “bells and whistles” they are not using those “bells and whistles” to their advantage.

Similarly, lengthy agreements often scare away prospective franchisees, particularly franchisees who are not sophisticated business people or for whom English is not their first language. They may be threatened by the length of the agreement (“What am I signing up to?”) and less likely to seek legal advice, considering that the costs of obtaining the legal advice will be prohibitive given that a lawyer will have to review and consider such a long document. Franchise agreements are invariably much longer in Australia than in New Zealand with the main reason probably being that New Zealand does not have a mandatory Code of Conduct like Australia and the Australian Code (discussed in more detail below) does not apply in New Zealand.

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While many franchise networks are considering shorter form agreements, such agreements may not necessarily work for everyone. Moving to a shorter form agreement generally requires removing some of the detail from a longer form agreement. In some instances, franchisors want a “bells and whistles” agreement to ensure that there are clear, well detailed contractual obligations on the franchisee to act in accordance with the franchisor’s requirements.

In other instances, franchisors are looking to shorten their franchise agreements by moving some of the detail that was in their franchise agreement into their operations manual. Sometimes this can be a good idea, particularly where the detail in the franchise agreement is more operational in nature (provided, of course, that there is an obligation in the franchise agreement for the franchisee to comply with the terms of the operations manual). However, franchisors should be wary of moving fundamental terms to the operations manual. Similarly, franchisors in Australia should be wary of any clause in the franchise agreement that allows them to unilaterally vary the terms of the operations manual, as under the new Unfair Contracts Legislation (discussed in greater detail below) the Australian Competition and Consumer Commission (ACCC) may, depending on the specifics of such clause, potentially find such a term “unfair” and therefore rendered void.

3.4 The operations manual

Almost all networks have an operations (or similar) manual. The operations manual is generally read in conjunction with the franchise agreement and provides specific details about the actual operation of the business. It is essentially the day-to-day guide as to how to actually operate the business.

As noted above some networks have, as a way to shorten their franchise agreements, started moving some detail from their franchise agreement to their operations manual. Indeed, it might be more appropriate for some details to be included in the operations manual. For instance, in a business where the opening hours may vary, it may be more appropriate to include this detail in the operations manual.

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However, when drafting a franchise agreement it is important to ensure that:

(1) the operations manual is adequately referenced and that it is clearly stated that the franchisee must comply with the terms of the operations manual. A failure to include this detail could mean that that there is no contractual obligation on the franchisee to comply with the operations manual; and

(2) the agreement clearly sets out how the operations manual can be varied and when any such variation will take effect. For instance, do variations have to be agreed by franchisees? Do they need to be implemented within a certain time period? Who is responsible for costs associated with any changes required to be made to the business as a consequence of changes to the operations manual? These issues, at a minimum, should be considered in the franchise agreement; and

(3) in Australia, the operations manual is also considered in the context of the UCT Legislation. For instance will it be caught? If so, are there any terms in the operations manual that could potentially be “unfair” and therefore rendered void?

4 The law

A key aspect that needs to be considered when drafting a franchise agreement is the applicable law. In some jurisdictions, such as New Zealand, there are no specific franchise laws so franchisors have broad scope to draft their agreements as they please (subject to any other applicable laws).

In other jurisdictions, such as Australia, there is specific franchise legislation which dictates, to a degree, the clauses that can and cannot be included in a franchise agreement. Again, this specific legislation needs to also be considered in the context of other applicable legislation.

It is obviously incredibly important to be aware of the laws that apply in a given jurisdiction and to ensure that the agreement complies with those laws.

The Law from an Australian Perspective

4.1 Franchising Code of Conduct

Franchising in Australia is specifically regulated by the Competition and Consumer (Industry Codes – Franchising) Regulation 2014, which is commonly referred to as the Franchising Code of Conduct (Australian Code). The Franchising Code of Conduct was first introduced in 1998. On 1 January 2015 the previous Franchising Code of Conduct was repealed and the current version was introduced.

The Australian Code covers a range of franchise related issues. In relation to franchise agreements, the Australian Code specifically states that a franchise agreement must:

(1) provide for a complaint handling procedure that complies with Division 2 of Part 4 of the Australian Code.1 Dispute resolution clauses are considered in more detail below;

1 Competition and Consumer (Industry Codes – Franchising) Regulation 2014, clause 34.

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(2) not require a franchisee to sign:

(i) a general release of the franchisor from liability towards the franchisee; or

(ii) a waiver of any verbal or written representations made by the franchisor.2

If a franchise agreement does contain a general release or waiver in contravention of clause 20(1) of the Australian Code, then the general release or waiver (as applicable) is of no effect. 3 The drafting of releases is considered in more detail below.

(3) not contain a clause that requires the franchisee to pay to the franchisor costs incurred by the franchisor in relation to settling a dispute under the agreement. If the agreement does include such a clause, it is of no effect.4

Note that this clause does not say that a franchisee does not ever have to pay the franchisor’s costs incurred in relation to settling a dispute. It simply says that a franchise agreement cannot include a clause that requires the franchisee to pay such costs. As such, it is important to ensure that any clause relating to a franchisor’s costs incurred in relation to settling a dispute:

(i) does not contravene clause 22 of the Australian Code; but

(ii) still allows for the franchisor to recover costs, for instance if the parties become involved in litigation and a court awards costs to the franchisor.

(4) not contain a clause that limits or excludes the obligation to act in good faith. If such a clause is included in a franchise agreement, it is of no effect. 5 Similarly, the franchise agreement may not limit or exclude the obligation to “act in good faith by applying, adopting or incorporating, with or without modification, the words of another document…in the agreement.” 6

The Australian Code also addresses a range of other issues that, while they do not necessarily prescribe how the franchise agreement should be drafted, should be closely considered (and, in some instances, potentially replicated) when drafting. In particular, in drafting the franchise agreement it is important to consider the following clauses of the Australian Code:

(5) clauses relating to renewal of a franchise agreement (see eg clauses 4, 9(2), 10 and 18). Renewal clauses are considered in more detail in section 5 below;

(6) clauses relating to termination of a franchise agreement (see clauses 26 – 29). Termination clauses are considered in more detail in section 5 below;

(7) clauses relating to a transfer of a franchise agreement (see clauses 4, 24 and 25);

2 Ibid, clause 20(1).3 Ibid, clause 20(3).4 Ibid, clause 22.5 Ibid, clause 6(4).6 Ibid, clause 6(5).

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Like the clauses on termination, the clauses on transfer do not specifically state the details that must be included in a franchise agreement. However, how the requirements of these clauses are drafted into the franchise agreement can vary considerably. For instance clause 25(3) of the Australian Code includes a list of circumstances when it would be reasonable for a franchisor to withhold consent to a transfer. However this list is not exhaustive. Therefore, a franchise agreement could specify many other circumstances where it is reasonable for a franchisor to withhold consent to a transfer. The circumstances where it is reasonable for a franchisor to withhold consent are likely to vary between networks and it is important to consider this issue when drafting an agreement, not simply cut and paste between documents.

(8) clauses of the Australian Code relating to restraints of trade (see clause 23). Restraints of trade are considered in more detail below.

Various other matters are also covered by the Australian Code and may be relevant in drafting a franchise agreement. For instance, clause 21(1) provides that a franchise agreement may contain a clause that if a party to a franchise agreement wants to refer a dispute to mediation, the mediation must be conducted in the State or Territory where the franchised business is located. Clause 21(2) then specifically states that a franchise agreement must not contain a clause that requires a party to the agreement to bring action or proceedings in relation to a dispute in a State or Territory outside where the franchised business is located or in a jurisdiction outside of Australia. Note that the Australian Code does not state that these matters must be addressed in the franchise agreement. So it may be that the franchise agreement stays silent on such matters.

The Australian Code is mandatory if the agreement or arrangement in place satisfies the definition of a “franchise agreement” set out in clause 5 of the Australian Code. It is not possible to contract out of the Australian Code. There are many intricacies in the Australian Code and it is important to have a comprehensive knowledge of the Australian Code when drafting franchise agreements to ensure that such agreements are compliant with the Australian Code.

4.2 Competition and Consumer Act 2010 (Cth)

Another important piece of legislation to consider when drafting franchise agreements is the Competition and Consumer Act 2010 (Cth) (CCA). The CCA is particularly relevant when drafting clauses relating to issues such as product supply, product pricing and marketing, as it covers a broad range of issues including exclusive dealing, cartel conduct, resale price maintenance and misleading or deceptive conduct.

In regard to franchise agreements, the most common CCA issues that are likely to arise are:

(1) third line forcing, where a franchisor requires the franchisee to acquire certain goods from a specific third party. Such supply arrangements are common in franchise networks and are often aimed at ensuring consistency across the brand. Such arrangements often fall within the scope of the third line forcing prohibitions. However, there are ways to address this issue.

Depending on how essential it is to use specific suppliers, the relevant clauses in the franchise agreement could be drafted more broadly to give the franchisee scope to

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use their own suppliers (provided that those suppliers meet certain requirements). Alternatively, a franchisor might wish to seek immunity for third line forcing from the ACCC by submitting a notification in the prescribed form; and

(2) setting of prices. As a general rule, franchisees should be allowed to set their own prices. However franchisors can set maximum prices (but not minimum prices).

4.3 Unfair Contracts Legislation

The Treasury Legislation Amendment (Small Business and Unfair Contract Terms Act (UCT Legislation) is due to come into effect on 12 November 2016.

The UCT Legislation will apply to standard form contracts entered into, renewed, rolled over or varied (but only to the parts varied) after 12 November 2016. While, in some instances, there may be an argument that a particular franchise agreement is not a “standard form contract” (and therefore not caught by the UCT Legislation) it is possible that many franchise agreements will be considered standard form contracts and therefore fall within the scope of the legislation. Indeed, the ACCC has already provided a number of examples of situations where a clause in an agreement might be declared unfair. Of those examples 3 specifically relate to franchise agreements (right to terminate without cause; franchise operations manual; and right to unilaterally vary a franchise agreement).7 This clearly suggests that the ACCC does consider that the UCT Legislation will be an issue for franchising and is therefore something that franchisor should be considering before the law comes into effect later this year.

If a provision of a franchise agreement is declared “unfair” it will be rendered void and therefore unenforceable. If the contract is able to operate without the unfair term then the franchise agreement will continue to bind the parties but the unfair clause will not apply. 8 It is important to note that the UCT Legislation may also apply to other agreements entered into with the franchisee, such as supply agreements.

Noting the above, franchise agreements should now be drafted with the UCT Legislation in mind. In particular:

(1) any clauses that may be of particular concern – eg unilateral rights of termination; liquidated damages; unilateral rights to vary the agreement - should be reviewed and considered for fairness. In this regard, franchisors should think about the reasons why such clauses have been included and if the clauses, as drafted, are accurate/necessary. If the clause seems unfair but there is a legitimate reason why the franchisor considers that the clause is necessary, then the franchisor should ensure that it can justify the inclusion of the clause (and is also made aware that the clause may be rendered void if it is later declared unfair); and

(2) it is important to ensure that franchise agreements include a severability clause, so as to allow a clause to be severed from the agreement if that clause is found to be unfair.

7 See http://www.accc.gov.au/business/business-rights-protections/unfair-contract-terms/determining-whether-a-contract-term-is-unfair. 8 See http://www.nortonrosefulbright.com/knowledge/publications/139436/franchising-focus for further information regarding the UCT Legislation.

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4.4 Other applicable legislation

In addition to the above, there is a raft of other legislation that needs to be considered when drafting franchise agreements. One of the most important pieces of legislation that should be considered, but which is often overlooked, is the A New Tax System (Goods and Services Tax) Act 1999 (Cth) (GST Act). It is important to ensure that the language relating to the GST Act (and other tax issues) correctly reflects the current law. As tax laws constantly change, these clauses should be reviewed regularly, preferably by specialist tax lawyers.

The following pieces of legislation may also be relevant, however have not been considered in this paper:

(i) Corporations Act 2001 (Cth);

(ii) Income Tax Assessment Act 1936 (Cth) and the Income Tax Assessment Act 1997 (Cth);

(iii) Occupation Health and Safety Acts applicable in each state;

(iv) Fair Work Act 2009 (Cth);

(v) Property Law Acts applicable in each state;

(vi) Retail Leases Acts applicable in each state;

(vii) Estate Agents Acts applicable in each state; and

(viii) Personal Property Securities Act 2009 (Cth).

The Law from a New Zealand Perspective

Unlike Australia, New Zealand does not have any mandatory franchising legislation. However there are many laws which affect franchising including the Commerce Act 1986, the Fair Trading Act 1986 and the Contractual Remedies Act 1979.

Franchisors in New Zealand either belong to the Franchise Association of New Zealand (FANZ) in which case they have to comply with the Code of Practice and Code of Ethics; they do not belong to the FANZ but still choose to comply with both Codes; or they do not belong to the FANZ and do not comply with the Codes.

(1) NZ Franchising Code of Practice

The FANZ, which was formed in 1996, has its own Code of Practice and Code of Ethics and franchisors who belong to it must comply with both Codes. In particular, the Code of Practice requires a franchisor to include in its standard franchise agreement a dispute resolution clause, a cooling off clause and a covenant that it will comply with the Code of Practice and Code of Ethics; and such a franchisor must publish a Disclosure Document which complies with the Code of Practice. If a franchisor breaches the Codes and a complaint by a franchisee is made to the FANZ, then, if the complaint is upheld, the only sanction which the FANZ has is to expel the franchisor from membership of the FANZ and to notify the members accordingly.

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The Code of Practice covers the following:

(i) Compliance - all members must certify that they will comply with the Code and members must renew their certificate of compliance on an annual basis.

(ii) Disclosure - a disclosure document must be provided to all prospective franchisees at least 14 days prior to signing a franchise agreement. This disclosure document must be updated by franchisors every 2 years and it must provide information including a company profile, details of the officers of the company, an outline of the franchise, full disclosure of any payment or commission made by a franchisor to any adviser or consultant in connection with a sale, listing of all components making up the franchise purchase, references and projections of turnover and possible profitability of the business.

(iii) Certification - the Code requires franchisors to give franchisees a copy of the Code and the franchisee must then certify that he or she has had legal advice before signing the franchise agreement.

(iv) Cooling Off Period - all franchise agreements must contain a minimum 7 day period from the date of the agreement during which a franchisee may change its mind and terminate the purchase. This is very important and the cooling off period does not apply to renewals of term or resales by franchisees.

(v) Dispute Resolution - the Code sets out a dispute resolution procedure which can be used by both franchisor and franchisee to seek a more amicable and cost-effective solution. The Code requires all members to try to settle disputes by mutual negotiation in the first instance and this process does not affect the legal rights of both parties to resort to litigation.

(vi) Advisers - all advisers must provide clients with written details of their relevant qualifications and experience and they must respect confidentiality of all information received.

(vii) Code of Ethics - all members must subscribe to the Code of Ethics which sets out the spirit in which the Code of Practice will be interpreted.

(2) Other applicable legislation

The following legislation, which may be relevant, has not been considered in this paper:

(i) Commerce Act 1986;

(ii) Fair Trading Act 1986;

(iii) Contractual Remedies Act 1979;

(iv) Consumer Guarantees Act 1993;

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(v) Defamation Act 1992;

(vi) Employment Relations Act 2000;

(vii) Health and Safety at Work Act 2015;

(viii) Human Rights Act 1993;

(ix) Personal Property Securities Act 1999;

(x) Privacy Act 1993;

(xi) Property Law Act 2007;

(xii) Resource Management Act 1991;

(xiii) Trade Marks Act 2002; and

(xiv) Unsolicited Electronic Messages Act 2007.

(3) Proposed Cartels Legislation

The Commerce (Cartels and Other Matters) Amendment Bill is before Parliament and is expected to become law in 2017. The proposed legislation introduces a new cartel prohibition that replaces the existing price-fixing prohibitions of the Commerce Act 1986. These prohibitions apply to cartels comprising competitors and as a general rule franchise relationships should not be caught.

However, a more academic interpretation may say that franchisees within a particular franchise system are competitors and that their respective entries into franchise agreements with the franchisor make them parties to a cartel provision (which may divide a market and regulate prices, for example). In that event, it is likely that a “collaborative activity” exemption in the Bill will apply that would provide an exemption to a cartel provision in an arrangement where it is an enterprise “carried out by two or more people in trade and is not carried on for the dominant purpose of lessening competition between any two or more of the parties”. There are also exemptions for collaborative marketing and promotions.

Noting the above, the new Act could have significant repercussions for franchising. The Commerce Commission has explained that under the Bill a cartel provision is any provision in an arrangement between competitors that has the purpose, effect, or likely effect, of:

(i) fixing prices – for example an agreement not to compete on price or on any element of price;

(ii) restricting output – for example an arrangement to prevent, restrict or limit output, production capacity, supply or acquisition;

(iii) allocating markets – for example an agreement not to sell or to buy from certain customers or suppliers, or in particular areas.

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It is important to note that there will not be a cartel arrangement in place where parties are not in competition with each other. In most franchise systems the franchisor will not be in competition with their own franchisees but that is not always the case. For example, a franchisor which owns its own outlet might be found to be in competition with franchisees. Similarly, where a franchisor sells online direct to the end consumer, yet at the same time has franchisees who sell to those consumers, it may also be in competition with its franchisees. There may also be instances where the franchisees are in competition with each other. Where a franchisor is in competition with a franchisee or where franchisees are found to be in competition with each other, there will be a competitive relationship so the franchisor needs to be cognisant that there may be provisions in its franchise agreements which potentially amount to cartel provisions.

5 Consideration of some key issues

5.1 Termination clauses

(1) The Australian Perspective

The Australian Code strictly prescribes the situations when a franchisor can terminate a franchise agreement. As such, it is very important to be aware of these clauses in the Australian Code and to draft the termination provisions of a franchise agreement to ensure compliance with these clauses. It is also important to note that just because there are clauses in the Australian Code dealing with termination, these clauses do not, of themselves, give a franchisor a right to terminate. The relationship between the franchisor and the franchisee is essentially contractual – so all termination rights must be included in the franchise agreement itself.

When drafting such clauses, it also important to ensure that the termination clauses fit within the parameters set out in the Australian Code. If a franchise agreement includes broader termination provisions than those permitted by the Australian Code, a franchisee could seek to have a termination set aside on the basis that the termination was not in accordance with the Australian Code.

Noting the above, it is essential to consider the Australian Code when drafting termination clauses. In this regard:

(a) pursuant to clause 26(1) of the Australian Code, a franchisee may terminate an agreement with 7 days of entering into the agreement or making a payment under the agreement. If the franchise agreement is drafted to specifically address this clause, the applicable clause in the franchise agreement should also recognise the limitations set out in clause 26(2) of the Australian Code – ie the right to terminate should not apply if the agreement relates to the transfer or a renewal of an existing franchise agreement or the extension of the term or scope of an existing franchise agreement;

(b) the breach procedure set out in clause 27 of the Australian Code should be incorporated in the franchise agreement. Ideally this would occur via drafting of applicable clauses, rather than by simply stating that in the case of a breach the procedure set out in clause 27 of the Australian Code applies;

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(c) if the franchisor wants to have rights to terminate where there is no breach by the franchisee, it is important to ensure that such contractual rights are written into the franchise agreement and that they are consistent with clause 28 of the Australian Code. This is something to consider throughout the agreement, not just in the termination clause. For instance, if, at any point in the agreement, the franchisor has a right to terminate other than for breach (eg a right to terminate if the franchisee does not complete training or fails to secure a new lease within a given period) it is important to ensure that such termination right falls within the scope of clause 28 of the Australian Code. If it does not, and it cannot otherwise fall within the scope of the Australian Code, then it is unlikely to be enforceable.

For instance, a right for the franchisor to terminate the franchise agreement by providing the franchisee with 60 days’ notice might be contractually acceptable, but will not fall within the termination parameters set out in the Australian Code. If a franchisor wishes to include such rights, they need to be drafted within the scope of the Australian Code - for instance, it might be that this arrangement is drafted to fall within the scope of a termination in accordance with clause 28 of the Australian Code which allows for termination without cause, provided reasonable notice and reasons for the termination are provided.

It is also important to consider the UCT Legislation when drafting any such clauses, to ensure that such clauses are not “unfair”; and

(d) the franchise agreement should explicitly allow for termination by the franchisor in the specific circumstances set out in clause 29 of the Australian Code. However, the franchise agreement should not allow for termination by the franchisor in any other circumstances, unless those circumstances fall within the scope of clause 27 or 28 of the Australian Code. Similarly, the franchise agreement should explicitly state that it can be terminated if the parties agree to termination.

(2) The New Zealand perspective

Termination during the term of a franchise is the worst event to happen for any franchisee, as the franchisee immediately loses its right to sell the business and recoup the goodwill invested. Termination can occur either because of a default by the franchisee or by the expiration of the term. If a franchisor terminates a franchise agreement because of default which has not been remedied or which is not capable of being remedied, then the agreement is over.

In New Zealand a typical termination clause in a franchise agreement might read as follows:

1.1 Immediate Termination with No Opportunity to Remedy

In the event of the occurrence of any of the following defaults the Franchisee shall have no right or opportunity to remedy the default and this Agreement will terminate effective immediately on receipt by the Franchisee of a Notice of Termination of Franchise Agreement issued by the Franchisor:

1.1.1 Any material misrepresentation or omission in the Franchisee’s franchise application;

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1.1.2 The Franchisee voluntarily abandons the Business and therefore this Agreement;

1.1.3 The Franchisee fails to do or does anything or permits or causes anything to be done as a result of which the lease of the Premises at which the Franchisee conducts the Business is terminated;

1.1.4 The Franchisee breaches any confidentiality agreement or any confidentiality covenants or secrecy requirements as set out in this Agreement including a breach of any part of the manuals by providing such to any third parties;

1.1.5 The Franchisee fails to meet the standard of proficiency required by the Franchisor in relation to the initial training;

1.1.6 The Franchisee fails to commence the Business as soon as practicable after the agreed commencement date;

1.1.7 The Franchisee understates gross sales by more than 2% on more than one occasion unless the understatement can be proved to be an inadvertent error;

1.1.8 The Franchisee directly or indirectly transfers or assigns or attempts to transfer or assign the Business without informing the Franchisor and obtaining the prior written consent of the Franchisor;

1.1.9 The Franchisee has its property seized under any distress or execution or makes any arrangements with or assignment for the benefit of its creditors or becomes bankrupt or being a company is the subject of liquidation or makes any arrangements or compositions with its creditors or if the Guarantor is adjudicated bankrupt or commits an act of bankruptcy;

1.1.10 The Franchisee being a natural person or any one of its directors or shareholders of the Franchisee being a company is convicted of any criminal offence punishable by imprisonment or involving dishonesty;

1.1.11 The Franchisee being a natural person becomes of unsound mind or infirm;

1.1.12 The Franchisee being a company has a receiver or a receiver and manager appointed over any of its assets, or has a security holder take possession of or otherwise seek to enforce its security over any of its assets;

1.1.13 The Franchisee receives from the Franchisor two (2) or more notices within a period of twelve (12) months for a breach of the same covenant or condition on the part of the Franchisee required to be observed and performed;

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1.1.14 The Franchisee breaches any agreement it has entered into with the Franchisor whereby the Franchisee becomes an unauthorised user of any trade or service mark owned by the Franchisor for the duration of this Agreement or any renewal or extension;

1.1.15 The Franchisee damages the goodwill of the Franchisor in any way;

then the Franchisor may at its option terminate this Agreement and the franchise granted without prejudice to any remedy which the Franchisor may have against the Franchisee. Any costs incurred by the Franchisor including legal costs in connection with any default or termination by the Franchisee shall be payable by the Franchisee.

1.2 Termination After Opportunity to Remedy

In the event of the occurrence of any of the following events:

1.2.1 The Franchisee fails to pay any sum of money due to the Franchisor within fourteen (14) days from the due date of payment;

1.2.2 The Franchisee is unable to pay the debts of the Business as they fall due or within fourteen (14) days of due date;

1.2.3 The Franchisee fails to comply with the minimum performance criteria;

1.2.4 If and whenever there shall be a breach or non-observance or non-performance of any of the other covenants and conditions contained in this Agreement and on the part of the Franchisee to be observed and performed and such breach continues for fourteen (14) days after service of a notice on the Franchisee requiring the Franchisee to remedy the same;

then the Franchisor may at its option by notice in writing terminate this Agreement and the franchise granted without prejudice to any remedy the Franchisor may have against the Franchisee. Any costs incurred by the Franchisor including legal costs in connection with any default or termination by the Franchisee shall be payable by the Franchisee.

5.2 Restraints of trade

(1) The Australian perspective

In Australia restraints of trade are generally only enforceable to the extent that they are necessary to protect a legitimate business interest. When a restraint dispute comes to court, the starting position is that the restraint is unenforceable and the onus lies with the franchisor to prove it is reasonable. As such, it is important, when drafting the franchise agreement, to consider precisely what the restraint is aiming to protect and how long such protection is required for – this detail might be relevant if it is ever necessary to argue that the restraint is reasonable.

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While restraints of trade that apply during the term of an agreement are often enforceable (depending on their terms), post-termination restraints can be particularly vulnerable. As such, it may be appropriate to draft restraint of trade clauses in a “cascading” manner – ie the geographical area and time period of the restraint has several different “levels”, starting broadly and becoming successively narrower. For instance, a basic restraint of trade clause might read:

The franchisee must not operate a competitive business within the Restraint Area during the Restraint Period.

For the purposes of this clause:

Restraint Period means each of the following time periods:

(a) a period of 3 years after the transfer or end of the franchise;

(b) a period of 2 years after the transfer or end of the franchise;

(c) a period of 12 months after the transfer or end of the franchise;

(d) a period of 6 months after the transfer or end of the franchise; and

(e) the period from the beginning to the end of the franchise.

and

Restraint Area means each of the following separate geographical areas:

(a) Australia;

(b) the area within a 10 kilometre radius of the premises;

(c) the area within a 3 kilometre radius of the premises; and

(d) the premises.

If a restraint of trade is drafted as set out, a court has the option to read down the restraint to the extent that it considers to be reasonable. If a cascading clause is not used, a court may determine that the restraint is not reasonable and declare that the whole restraint is unenforceable.

Another aspect that needs to be considered when drafting a restraint of trade is who will be restrained by the restraint. Generally, a franchisee will always be covered by the restraint and often any guarantors under the franchise agreement will also be restrained. However this may not be sufficient – for instance, if only these entities were covered in their own capacities, the guarantors could easily set up a new company and start operating through that entity. It is important to ensure that the restraint is drafted broadly to capture not only relevant individuals and companies, but also those entities acting in other capacities. A clause along the following lines may be helpful to address this issue:

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The restraint set out above applies to any of the Franchisee or Guarantors acting:

(a) alone or in partnership or association with another person;

(b) as guarantor, agent, representative, director, officer, employee or financier;

(c) as member, shareholder, debenture holder, note holder or holder of any other security;

(d) as trustee of or as a consultant or adviser to any person; or

(e) in any other capacity.

While noting the above, it is also important to keep in mind clause 23 of the Australian Code. Clause 23 of the Australian Code provides that a restraint of trade in a franchise agreement will have no effect, following the expiration of the franchise agreement, in certain circumstances – eg if the franchisee sought a new franchise agreement, the franchisor did not extend the franchise agreement and did not offer any compensation. It is not necessary to strictly address this clause in the franchise agreement. However, it is important to be aware of this clause and to ensure that clients are advised about the clause and the potential consequences of this clause on any restraint included in a franchise agreement.

In addition to the above, it is also important to consider what you want to restrain the franchisee/guarantor from doing. Is it just operating a competitive business? Or does the restraint also need to cover other issues such as approaching clients/employees or using specified information? While these issues may take a restraint beyond simply being a “restraint of trade” these issues also need to be considered when drafting restraints, as they may be highly relevant.

(2) The New Zealand perspective

Restraint of trade clauses differ greatly in New Zealand from Australia. In Australia there are usually sprinkler clauses which cover restraints "in a cascading manner" as described above; but such clauses will most likely be unenforceable in New Zealand.

The New Zealand courts have recognised that it is reasonable for a person in the position of a franchisor to impose a contractual restraint upon competitive conduct by a franchisee or an ex-franchisee but such agreements must not exceed the boundaries of the court's notion of reasonableness. The first principle is that it is reasonable for a person to stipulate that if he is willing to disclose all secrets of how to establish a particular business enterprise, then the recipient of the information cannot immediately terminate the contract and set up a competitive business, using the information which it has received during the course of the relationship. If the courts did not provide protection to franchisors in such situations, there would be no incentive for the owners of established businesses to share their secrets with others and enhance their business skills. The second principle is that it is important for the well-being of the community that every individual should, in general, be free to advance his skills and earning capacity.

The Illegal Contracts Act 1970 in New Zealand has given the courts authority to re-write a restrictive covenant and to allow an excessive covenant to be enforced at a lesser level. Section 8 of the Act states as follows:

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"8 Restraints of trade

(1) Where any provision of any contract constitutes an unreasonable restraint of trade, the court may—

(a) delete the provision and give effect to the contract as so amended; or

(b) so modify the provision that at the time the contract was entered into the provision as modified would have been reasonable, and give effect to the contract as so modified; or

(c) where the deletion or modification of the provision would so alter the bargain between the parties that it would be unreasonable to allow the contract to stand, decline to enforce the contract.

(2) The court may modify a provision under paragraph (b) of subsection (1), notwithstanding that the modification cannot be effected by the deletion of words from the provision."

The ability of the courts to modify excessive restraints is constrained by the principle that terms which could never have been considered reasonable will not be modified as to do so would be contrary to the public interest. This is the doctrine of restraints which are "in terrorem" which translates into “contracts which terrorise a contracting party”. If a franchisor could only ever have reasonably sought a 2 year restraint within a 5 kilometre radius of the business in which the person established goodwill, then a nationwide restraint for 10 years could never be regarded as reasonable; and in that case the courts will refuse to re-write the clause so as to determine that the period of 10 years should be 2 years and the area of the restraint should be 5 kilometres rather than the entire country. What then is a reasonable restraint? There are 2 factors – area and time. So the message is clear in New Zealand – for a restraint to be enforceable it must be reasonable.

There have been a number of restraint of trade cases in the franchising sector over recent years. Some recent New Zealand restraint of trade franchising cases include the following:

(1) Mike Pero (New Zealand) Ltd v Heath;9

(2) Video Ezy International Pty Ltd v Red Bond Ltd;10

(3) Mike Pero Real Estate Ltd v Tauranga Realty Ltd;11 and

(4) Green Acres Franchise Group Ltd v Reube.12

5.3 Renewal clauses

Renewal clauses are very important in franchise agreements, as they provide capacity to extend the term of an agreement beyond the initial term granted. The initial term of a

9 [2015] NZHC 2040.10 [2015] NZHC 1636.11 [2015] NZHC 1162.12 [2014] NZHC 402.

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franchise agreement may be for 5 or 10 years and there is normally some a right of renewal for 5 or 10 years.

(1) The Australian perspective

The Australian Code does not specifically regulate how renewals are to be addressed. however:

(a) clause 18 does require a franchisor to provide notice of its intention whether to extend the agreement or enter into a new agreement at least 6 months prior to the end of the term (for an agreement that is longer than 6 months in duration). There is some debate as to whether this clause applies in the case of renewals. However given that compliance with requirement is usually a very simple task, it is usually easier to comply with the requirement, in case it does apply, than not to comply and run the risk that you will later be found to have breached the clause by failing to comply; and

(b) if a franchisor or franchisee proposes to renew a franchise agreement or extend the term of the franchise agreement, clause 9(2) requires a franchisor to give a franchisee a copy of the franchisor’s disclosure document and certain other documents. As such, the disclosure process set out in the Australian Code will apply to renewals.

The precise process for renewal is generally governed by the franchise agreement itself, with the overlay of the common law and other applicable legislation, such as the CCA.

Renewal clauses are often drafted as options – either options to renew or options to enter into a new agreement. Key aspects of the option are generally:

(c) that it must be exercised within a specified time period. The time period should be determined taking into account clause 18 of the Australian Code, so as to ensure that the franchisor has adequate time to determine its position in relation to the potential renewal and to notify the franchisee of its intention in regard to the potential renewal; and

(d) that it is conditional on satisfaction of certain conditions. It is important to ensure that any renewal clause adequately covers all potential factors that might be relevant at renewal. For instance, if the franchisor may want the franchisee to undertake an upgrade of the premises at the time of renewal, this should be specifically included as a condition of renewal – the franchisor should not simply proceed on the basis that “we will deal with this when the time comes”.

While the factors that will be relevant to each network will vary, the following list provides a useful starting point when considering the renewal conditions to include in a franchise agreement:

The franchisee must:

(a) at the time of exercising the option and at the end of the term, be in full compliance with the terms of the franchise agreement;

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(b) not have been in repeated or persistent breach of the franchise agreement (whether remedied or not) during the term of the franchise agreement;

(c) have consistently met any specified minimum performance criteria during the term of the franchise agreement;

(d) pay all amounts outstanding in relation to the business (including, without limitation, all amounts owing to the franchisor and suppliers of the business);

(e) pay the new term fee;

(f) secure an occupancy right for at least the duration of the new term;

(g) together with the guarantor, execute and return to the franchisor within 1 month, the franchisor’s then standard franchise agreement (which may contain different terms and conditions to those set out in the current franchise agreement, including as to the amounts and types of fees payable and excluding any options for further terms) and any other documents required by the franchisor for the exercise of the option;

(h) together with such other employees specified by the franchisor, undertake any training required by the franchisor, to the satisfaction of the franchisor; and

(i) if required by the franchisor, conduct an upgrade of the premises to the satisfaction of the franchisor.

(2) The New Zealand perspective

Right of renewal clauses differ so it is very important to look at the wording carefully. If the clause contains a time limit for notice by a franchisee to the franchisor and such time limit contains the words "with time being of the essence" then to miss that time limit is often sudden death. A few years ago I had a client with a master franchise in New Zealand with about 300 franchisees. The master franchise agreement contained a right of renewal for 10 years. The relationship had broken down between the franchisor and the master franchisee and each party was making allegations against the other. The master franchisee had not breached the master franchise agreement in any way and all payments had been made. The master franchisee failed to adhere to the notice period to exercise the right of renewal. The master franchisee came to me for legal advice. He had received a notice of termination from the franchisor saying that he was too late in exercising the renewal. Because the clause contained the words "with time being of the essence" I had to advise the master franchisee that it was "dead in the water". The master franchisee had a potential purchaser for the business. However as a consequence of this issue, that sale fell over and the franchisor benefited.

A typical right of renewal clause might read as follows:

Provided the Franchisor is still operating franchises at the time of any renewal in terms of this Agreement, the Franchisee shall have the option to renew the franchise for two (2) Renewal Terms commencing on the day immediately following the date of expiration of the Term or the first Renewal Term as the case may be provided that:

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1.1 The said option is exercisable only by the Franchisee giving to the Franchisor written notice of its exercise of such option and that such notice is given not less than three (3) months and not more than six (6) months prior to the end of the Term (or then current Renewal Term as the case may be) and time shall be of the essence in relation to the time limits as set out in this sub-clause.

1.2 The Franchisee must not have breached the Agreement during the Term.

1.3 The Franchisee pays on demand to the Franchisor the full costs of the Franchisor renewing the franchise including but not limited to legal fees incurred in the preparation of all necessary documents and consultation and/or training fees.

1.4 The Franchisee has undertaken, paid for and completed to the satisfaction of the Franchisor any further training required by the Franchisor.

1.5 The Franchisee is able to continue to conduct the Business from suitable premises for the Renewal Term.

1.6 The Franchisee executes the Franchisor’s then current Franchise Agreement and such other documents then customarily used by the Franchisor for its franchises. The then current Franchise Agreement may contain terms which differ from those contained in this Agreement provided such agreement shall not oblige the Franchisee to pay any further Initial Franchise Fee and provided further that it shall not require the Franchisee to materially alter the manner in which the Franchisee conducts the Business. The Franchisee must also pay to the Franchisor the Renewal Fee which is additional to all costs in relation to the preparation of documents, consultation by the Franchisor and any further training fees.

1.7 The Franchisee shall carry out and complete at its own expense not later than two (2) months prior to the commencement of the new term such renovation, modernisation and refurbishment and such replacement of fixtures, signs, furnishings and equipment as may be necessary to bring the Premises up to the then current standards of the Franchisor and as required in the manuals.

The time sequence is very important and it is essential not to miss the minimum notice period for in the example above there was "sudden death". Any right of renewal clause should allow the franchisor to provide a new form of franchise agreement which may differ from the current form. Disputes can arise between a franchisor and a franchisee in relation to the new form of agreement so great care must be taken. In my opinion the franchisor should discuss the changes with a franchisee at the time the right of renewal is exercised so that there are no surprises down the track.

5.4 Releases

A release is an agreement by one party to relinquish (or release) another party from any claims that the first party may have against the second party. Releases can be partial – just

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covering certain specified claims or conduct, or general, covering all claims that the first party may have against the second party.

(1) The Australian perspective

The Australian Code provides that a franchise agreement cannot require a franchisee to sign a general release of the franchisor from liability towards the franchisee.13

In light of the above, blanket releases are not permitted in franchise agreements – eg a release that provides that the franchisee releases the franchisor from all claims that the franchisee may have in relation to the franchise. However, clause 20(1) of the Australian Code does not prevent the inclusion of limited releases in franchise agreements – for instance, in relation to specific conduct or claims.

In the recent case, Diab Pty Ltd v Yum! Restaurants Australia Pty Ltd,14 one of the clauses in question included a limited release. Specifically, clause 6.2 of the Pizza Hut franchise agreement in dispute provided that:

Franchisee will participate in such national and regional advertising, promotions, research and tests as Franchisor from time to time requires and Franchisee will not have any claim or action against Franchisor in connection with the level of success of any such advertising, promotion, research or test.15

In that case, the Federal Court did not appear to have any concerns with such wording, noting (at 355) that:

…the express provisions of the IFA are also relevant, as is the nature of that agreement. It is a standard form contract applicable to each Franchisee operating a Pizza Hut franchise in different geographical locations in Australia in a uniform manner…The IFA expressly provides, realistically, that Yum is not liable if such marketing campaigns do not result in increased profits…

Further, at 362, the Federal Court noted that:

Clauses 6.2 and C1 of the IFA make it clear that Yum has control of promotions and the setting of a maximum price and that liability for unsuccessful promotions is excluded…

However, while there is scope under the Australian Code to include limited releases in a franchise agreement, such releases also need to be considered in the context of both the UCT Legislation and the CCA. In particular, if a release is unfair there may be potential for the release to be declared void, and therefore unenforceable, under the UCT Legislation (once it comes into effect).

(2) The New Zealand perspective

In New Zealand, any agreed releases between the parties must be documented and a deed of release would set out the terms in a clear and unambiguous manner. It would be unusual and unwise for any franchisor to include a general release of covenants and obligations in

13 Competition and Consumer (Industry Codes – Franchising) Regulation 2014, clause 20(1).14 [2016] FCA 43.15 Ibid, 17.

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any franchise agreement. As I have already said, any agreed releases should be included in a deed.

5.5 Dispute resolution

Dispute resolution can take many forms – from informal discussions, through to mediation, arbitration and court action. In drafting dispute resolution clauses it is important to consider the different forms of dispute resolution and what you consider will work best for your client.

Mediation is a confidential and consensual dispute resolution process in which an independent and impartial mediator facilitates negotiation between the parties in order to assist them to resolve their dispute. Neither the parties nor the mediator are limited by rules of evidence and the mediator is not a decision-maker. The process is based on achieving co-operation between the parties and the mediator assists the parties to make their own decisions and agreements. The mediator's role is to guide the process so that the issues can be defined, the relevant information produced and options explored without undue delay. When a dispute is resolved at a mediation, a written agreement, usually called a deed of settlement, is entered into which sets out the outcomes of the issues that have been resolved is signed by all relevant parties.

Arbitration is the private determination of a dispute by an independent third party and the arbitrator's decision, which is called an award, is normally final and binding on the parties, and enforceable by the courts.

(1) The Australian perspective

Clause 34 of the Australian Code provides that a franchise agreement must provide for a complaint handling procedure that complies with Division 2 of Part 4 of the Australian Code. When drafting the franchise agreement it is necessary to consider whether new clauses should be drafted in their entirety to address this clause of the Australian Code, or if the franchise agreements should essentially incorporate this clause of the Australian Code by reference. For instance, the following clause may be appropriate:

A party to this agreement who has a dispute with another party to this agreement may use the dispute resolution procedures specified in Part 4 of the Franchising Code of Conduct.

In any case, it is important, when drafting the franchise agreement, to also ensure that it is clear that the parties still have rights to take legal proceedings under the agreement. Such rights may be limited (eg to seek injunctive relief where it is necessary to prevent brand damage) but are important as the dispute resolution procedure outlined in the Australian Code may not always be the most appropriate procedure.

As noted above, the Australian Code also states that a franchise agreement must not contain a clause that requires a party to bring an action or proceedings in relation to a dispute in any State or Territory outside where the franchised business is based or in any jurisdiction outside Australia. Clause 41 of the Australian Code also states that any mediation initiated pursuant to the mandatory dispute resolution process under the Australian Code must be held in Australia.

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(2) The New Zealand perspective

In New Zealand franchising disputes are typically resolved by either mediation or arbitration. The Franchise Association of New Zealand (FANZ) sets out a dispute resolution procedure in its Code of Practice and the relevant provision is as follows:

1.1 Subject to clause 1.2, unless a party has complied with the subclauses 1.1.1 to 1.1.8 that party may not commence court proceedings or arbitration relating to any dispute with any other party to this Agreement.

1.1.1 Where a dispute arises between the Franchisor and the Franchisee (“the parties”), the complainant will set out in writing the nature of the dispute.

1.1.2 Both parties will make every effort to resolve the dispute by mutual negotiation.

1.1.3 In the event that the parties are unable to reach a resolution of the dispute within twenty one (21) days of the dispute first being raised by one party with the other, either party may by notice in writing (“the Mediation Notice”) notify the other party that it seeks to have the dispute resolved by mediation which mediation must take place at a location to be agreed between the parties and failing agreement then clause 1.1.4 shall be activated.

1.1.4 If the parties have not agreed within ten (10) days of the issue of the Mediation Notice on the choice of a mediator then either of them may at any time apply to either the Chairperson or other proper officer of the Franchise Association of New Zealand Inc or to the Chairperson for the time being or other proper officer of the New Zealand Law Society to nominate a Mediator for the purpose of the dispute. Such Mediator may be (but is not required to be) chosen from any panel of mediators from time to time nominated for the purpose by the Franchise Association of New Zealand Inc.

1.1.5 The proceedings of the Mediator will be as informal as is consistent with the proper conduct of the matter and shall allow the Mediator to communicate privately with the respective parties and their lawyers and the parties shall be entitled but not obliged to be legally represented. The Mediator may co-opt other expert assistance.

1.1.6 In any mediation the following shall apply:

(a) everything that occurs before the Mediator will be in confidence and in closed session;

(b) all discussions will be on a “without prejudice” basis;

(c) no documents brought into existence specifically for the purpose of the mediation process shall be called into evidence in any subsequent litigation by either party;

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(d) each party to the mediation shall be given proper opportunity to present its case;

(e) the Mediator shall be required to act fairly, in good faith and without bias for the purpose of seeking a resolution of the dispute and to treat all matters in confidence and to have regard to the fairness and reasonableness of all matters relating to the dispute including the need for the Franchisor to maintain the integrity of its name, image and the System and the reasonable interests of other franchisees and members of the System;

(f) the parties to the mediation and the Mediator shall co-operate with a view to the mediation being determined as speedily as possible and within fourteen (14) days after referral to the Mediator;

(g) the costs of the mediation will be borne by the parties equally unless otherwise agreed or determined by the Mediator and the parties shall grant immunity from liability to the Mediator;

(h) the parties to the mediation shall each report back to the Mediator within fourteen (14) days of the end of the mediation hearings on actions taken, based on the outcome of the mediation; and

(i) subject to the other provisions of this clause, the Mediator shall have the right to determine procedures relating to the conduct of the mediation.

1.1.7 If the dispute is not resolved within forty five (45) days of referral to mediation any party which has complied with the provisions of this clause may by written notice terminate the dispute resolution process and may then commence Court proceedings and/or take any other action it sees fit relating to the dispute.

1.1.8 The parties may by agreement in writing between them agree to extend any of the time periods referred to in the previous provisions of this clause and, if they do, the extended time periods shall apply and be binding on the parties in substitution for the relevant time period contained in this clause.

1.2 Nothing contained in these provisions shall prevent a party from seeking injunctive relief from an appropriate Court, where failure to obtain such relief would cause irreparable damage to the party concerned or the franchise system. Further, the dispute resolution procedure shall not apply to events giving rise to rights to the immediate termination of this Agreement where such events are clearly specified in this Agreement.

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Most franchise agreements prescribe mediation but some require arbitration. Arbitration is meant to be less complex and less costly than litigation but I know of some arbitrations where the pre-hearing procedures were complex and the costs have been considerable. If there is no arbitration clause in the franchise agreement then, if a mediation is unsuccessful, either party can institute litigation proceedings. Notwithstanding all of the above, a party is not prevented from seeking injunctive relief where failure to obtain such relief would cause irreparable damage to the party concerned or the franchise system.

6 Conclusion

In Australia, franchising is quite highly regulated and it is important to have a detailed understanding of the applicable laws before drafting a franchise agreement. That said, at the end of the day, the franchise agreement is drafted to document a commercial arrangement between franchisor and franchisee, so it is always important to ensure that the franchise agreement correctly reflects the commercial deal, but in doing so is cognisant (and compliant with) applicable laws.

From a New Zealand perspective a franchise agreement, which is the key legal document between a franchisor and franchisee, should be written in plain English, should be easy to follow and it is important that all relevant terms are defined clearly. It should include a governing law clause, a dispute resolution clause and a willingness by both parties to abide by the Code of Practice and Code of Ethics of the FANZ.

Joint paper written by Allison McLeod of Norton Rose Fulbright in Melbourne, Australia andStewart Germann of Stewart Germann Law Office at Auckland, New Zealand

Appendices

A. New Zealand Code of Practice (Revised August 2016).

B. New Zealand Code of Ethics.

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A

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B

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