Allan Dick of Sotos LLP won an important appeal this week in the Ontario Court of Appeal.  The appeal dealt with the interpretation of exemptions from disclosure under the Arthur Wishart Act (Franchise Disclosure), 2000.  The Court accepted Allan’s arguments that exemptions from the duty of disclosure in the Act are to be narrowly interpreted in order to advance the purpose of the Act which is to protect franchisees.  According to the Court of Appeal:

Given the purpose and context of the Act, the exemptions to disclosure set out in ss. 5(7)(a)(iv) and 5(8) must be narrowly construed.

The courts have now signalled that franchisors must be very careful in relying upon the exemptions from having to provide a disclosure document.   In light of this very important decision, franchisors should seek legal advice before they try to take advantage of these exemptions under the Act.

Congratulations to Allan on this important victory.