VANCOUVER (NEWS1130) – Three former smoothie franchisees who set up shop along the Canada Line are accusing Jugo Juice of misrepresentation.
Documents read the franchisees thought commuters could take their drinks on the train, that the Oakridge and King Ed shops would be outside of fare-paid zones and that their employees wouldn’t have to pay to travel between the two.
Professor Ken Thornicroft with the Gustavson School of Business at UVIC says this is hardly the first time a franchise has had an issue with a franchisor.
“With the costs associated with pursuing a claim and until a judge actually makes a determination, there is some uncertainty as to how a claim may be resolved. It is always better to do your due diligence up front.”
He says in cases like this typically a franchisee would have to prove fraudulent promises were made to be entitled to damages. “They should carefully document all of the representations made on behalf of the franchisor, review the agreement carefully to ensure those representations are not inconsistent.”
None of these accusations have been proven in court.