Update on Franchise Non-compliance Enforcement Activity: Cash Converters, Mobile Travel Agents and RAMS franchise systems
The ACCC has issued penalties to Cash Converters and Mobile Travel Agents for breaching the Franchising Code of Conduct by failing to update required information on the Franchise Disclosure Register.
Post the ASIC civil penalty proceedings against RAMS Financial Group over alleged systemic misconduct in its home loan operations a class action by former franchisees is now seeking to intervene in the ASIC matter, citing overlapping factual issues and concerns over reliance on Westpac’s internal findings. #franchising #disclosure #franchisor_liability
FCT v Bendel: one more piece but uncertainty remains
On 12 June 2025, the High Court granted the Commissioner special leave to appeal the decision of the Full Federal Court in FCT v Bendel [2025] FCAFC 15 (Full Court Decision) that we wrote about here.
Licenced to operate: What the ASIC v RAMS litigation offers about licence models applying to franchise systems
The Schaper report in December 2023 recommended further evaluation of the merits of replacing the Franchising Code of Conduct with a licensing regime. This recommendation arose after a submission to the review by the Australian Competition and Consumer Commission. Without detail of what a licensing regime may look like there is uncertainty about what any licensing regime may require. The recent case of ASIC v RAMS however provides an illustration of the effect a licensing regime may have on a franchisors. Click here to read more.
#franchising #licensing #franchisor_liability
Imprecise Contracts and Good Faith: Lessons from Beecham Motors Pty Ltd v General Motors Holden Australia NSC Pty Ltd
The language used in a contract can significantly impact its enforceability. Reliance on the incorporation of an obligation to act in good faith will not necessarily result in an outcome sought. This was considered in the recent Supreme Court decision in Beecham Motors Pty Ltd v General Motors Holden Australia NSC Pty Ltd, which provides guidance for those with or considering a franchise agreement and the drafters of franchise agreements. #franchise_agreements #good_faith #franchisee_group_action
Statutory Demands with Offsetting Claims and the Building and Construction Industry Security of Payment Act 2002 (Vic) : Can you Mix the Two?
On 6 March 2025, Associate Justice Barrett handed down his decision in the matter of Duke Ventures Wellington Street Pty Ltd [2025] VSC 75. In this case, the Court clarified when a debtor can rely on an offsetting claim to set aside a statutory demand in a dispute adjudicated under the Building and Construction Industry Security of Payment Act 2002 (Vic) (SOPA).
#insolvency #statuory_demand #creditors #securityforpayments
Div 296 and “withdrawals”
If Div 296 comes back – what should members and SMSFs do?
With the recent Labor election victory, and a potentially friendlier Senate, it is likely that the proposed Division 296 tax of an additional 15% on members with a $3 million or more total super balance (not indexed) will be enacted. See here for our previous commentary on the measure.
FCT v Liang: Full Federal Court reaffirms taxpayer burden of proof
The Full Federal Court case of Commissioner of Taxation v Liang [2025] FCAFC 4 serves as a reminder that when challenging an ATO decision at a court or tribunal, it is the taxpayer who carries the burden of proving that an assessment is excessive and what the assessment should have been.
Court authorises priority payment to funder of liquidator action recovering money for creditors
The matter of Ford Kinter & Associates Pty Ltd v Reliance Franchise Partners Pty Ltd (in liq) [2025] FCA 139 emphasises the important role that creditors can play in facilitating asset recovery during insolvency proceedings. It further examines the broad discretionary powers the courts have under section 564 of the Corporations Act 2001 (Cth) (the Act), which enables courts to reward creditors who take on the financial risks of litigation to be prioritised when recovering company property or expenses in a winding up due to the risk assumed by them. In doing so, the court considers the public interest in encouraging creditors to provide indemnities so as to enable assets to be recovered.
#insolvency #liquidation #creditors #publicinterest
Franchisor Obligations for Communication with Franchisees: Lessons from Sec New Line Pty Ltd v Muffin Break Pty Ltd
Withholding information whilst negotiating agreements can amount to misleading and deceptive conduct. However, the recent Supreme Court decision in Sec New Line Pty Ltd v Muffin Break Pty Ltd provides important guidance on when silence will become deceptive, specifically in the context of lease and franchising renewals.
AusNet v FCT and back-to-back rollovers: nothing else matters?
ASIC -v- PayPal: How it assists understanding what constitutes an Unfair Contract Term
The Federal Court decision of ASIC v PayPal Australia Pty Limited [2024] FCA 762 further clarifies the statutory unfair contract terms regime with respect to standard form contracts and provides another example of ASIC successfully taking action to void an unfair contract term.
Businesses using standard form contracts should review their contracts for potentially unfair contract terms considering recent legislative and common law changes.
#unfaircontractterms #unfair #contract #standardform #ASIC
Sladen Snippet - Bendel and SMSFs – Part 4–Bendel and UPEs owing to SMSFs
As noted in part 1 of our articles on the application of the Bendel decision to the Superannuation Industry (Supervision) Act 1993 (SIS Act), in our view, it is likely that the Courts will apply the Bendel decision to the SIS Act, such that the expanded definition of loan in the SIS Act will apply to arrangements that involve the advancement of principal with an obligation to repay and that it will not apply to a mere creditor and debtor arrangement.
Sladen Snippet - Bendel and SMSFs – Part 3 –Bendel and the in-house asset rules
As noted in part 1 of our articles on the application of the Bendel decision to the Superannuation Industry (Supervision) Act 1993 (SIS Act), in our view, it is likely that the Courts will apply the Bendel decision to the SIS Act, such that the expanded definition of loan in the SIS Act will apply to arrangements that involve the advancement of principal with an obligation to repay and that it will not apply to a mere creditor and debtor arrangement (like a UPE).
In this part 3 of the series we examine how this may play out in the in-house asset rules contained in Part 8 of the SIS Act.
Sladen Snippet - Bendel and SMSFs – Part 2 –Bendel and section 65 of the SIS Act
As noted in part 1 of our articles on the application of the Bendel decision to the Superannuation Industry (Supervision) Act 1993 (SIS Act), in our view, it is likely that the Courts will apply the Bendel decision to the SIS Act, such that the expanded definition of loan in the SIS Act will apply to arrangements that involve the advancement of principal with an obligation to repay and that it will not apply to a mere creditor and debtor arrangement (like a UPE).
Sladen Snippet - Bendel and SMSFs – Part 1 – can Bendel be applied to the SIS Act?
As discussed here, the recent decision of the Full Federal Court (Court) in FCT v Bendel [2025] FCAFC 15 (Bendel) has been a significant one in the private tax world.
Sladen Snippet - Bendel: special leave and updated DIS - ATO fires a warning shot
On 19 February 2025, the Full Federal Court handed down its decision in FCT v Bendel [2025] FCAFC 15. On 18 March 2025, the ATO applied for special leave and, on 19 March 2025, the ATO updated its interim decision statement (DIS) on the case.
We review the updated DIS below.
#Division 7A, #UPE, #Unpaid present entitlements, #Tax, #Trusts, #TD2022/11, #Bendel, #109D #Special leave #Decision Impact Statement
Payday super – exposure draft legislation now open for consultation
In the 2023-24 Budget, the Government announced that the super guarantee framework will be reformed to align the payment of super guarantee contributions with an employee’s regular pay cycle, instead of the current quarterly requirements.
The exposure draft legislation for the new ‘Payday Super’ rules has now been released, with consultation open until 11 April 2025.
The super guarantee charge, payable where employers fail to make contributions in full and on time, will be updated, including a new ‘administrative uplift’ component of up to 60% of the shortfall amount.
Sladen Snippet - QWYN – ART considers what is a superannuation pension (further challenge to the ATO’s view?)
In the decision of QWYN and Commissioner of Taxation (Taxation and business) [2025] ARTA 83 the Administrative Review Tribunal (ART) has determined that regular disability payments described as a superannuation income stream was a superannuation income stream for tax purposes and not a number of (more tax concessionally treated) disability lump sums.