Lockhart v Holden

Case [2008] QSC 257

SUPREME COURT OF QUEENSLAND

CITATION:

Lockhart v Holden [2008] QSC 257

PARTIES:

PETER ERIC LOCKHART
(first plaintiff)

MAP ENTERPRISES PTY LTD (ACN 093 360 126)
(second plaintiff)

v

GM HOLDEN LTD (ACN 006 893 232)
(defendant)

FILE NO:

BS3311/05

DIVISION:

Trial Division

PROCEEDING:

Trial

ORIGINATING COURT:

Supreme Court, Brisbane

DELIVERED ON:

24 October 2008

DELIVERED AT:

Supreme Court, Brisbane

HEARING DATE:

26 May 2008 – 6 June 2008

JUDGE:

Douglas J

ORDER:

Judgment for the defendant with costs, including reserved costs, on the standard basis.

CATCHWORDS:

TRADE AND COMMERCE – TRADE PRACTICES ACT 1974 (CTH) AND RELATED LEGISLATION – INDUSTRY CODES OF CONDUCT – FRANCHISES – TRANSFER – where the defendant refused to agree to the transfer of a franchise held by the plaintiffs to a third party – where the third party had agreed to buy the business – whether the refusal was unreasonable

Trade Practices Act 1974 (Cth), ss 51AD, 51AE, 52, 82
Trade Practices (Industry Codes – Franchising) Regulations 1998 (Cth), s 3

Franchising Code of Conduct (Cth), ss 20(2), 20(3)

Australian Hotels Assn (NSW) v TAB Ltd [2006] NSWSC 293, cited
Bridgestone Australia Ltd v G.A.H. Engineering Pty Ltd [1997] 2 Qd R 145, cited
Caltex Oil (Aust) Pty Ltd v Allan (Supreme Court of New South Wales, No. 2534 of 1987; Young J, unreported, 10 June 1987, BC8701326), cited
Esso Australia Resources Pty Ltd v Southern Pacific Petroleum NL [2005] VSCA 228, cited
Freudhofer v. Poledano [1972] VR 287, cited
Garry Rogers Motors (Aust.) Pty Ltd v Subaru (Aust) Pty Ltd (1999) 21 ATPR 41-703, cited
Gas ’n Go Petroleum Pty Ltd v Caltex Oil (Australia) Pty Ltd (Federal Court; Beaumont J., 26 April 1991, unreported, BC9103131), cited
Gold Coast Waterways Authority v Salmead Pty Ltd [1997] 1 Qd R 346, cited
Gore v Montague Mining Pty Ltd [2000] FCA 1214, distinguished
Heenan v Di Sisto[2008] NSWCA 25, considered
Hendriks v McGeoch [2008] NSWCA 53, cited
Henville v Walker (2001) 206 CLR 459, cited
Highmist Pty Ltd v Tricare Australia Ltd [2005] QSC 115, cited

In re Van Ness Auto Plaza Inc. 120 BR 545 (1990), considered

Laurelmont Pty Ltd v Stockdale & Leggo (Queensland) Pty Ltd [2001] QCA 212, cited
LE Stewart Investments Pty Ltd v Mercedes-Benz (NSW) Pty Ltd (Supreme Court of NSW, Court of Appeal, No 40190 of 1990; 14 February 1992, unreported, BC9202078), cited

Masterclass Enterprises Pty Ltd v Bedshed Franchisors (WA) Pty Ltd [2008] WASC 67, considered and applied

Meridian Retail v Australian Unity Retail Network [2006] VSC 223, cited
Re Kendells (NSW) Pty Ltd (In Liq) [2005] QSC 064, cited
Re Zurich Australian Insurance Ltd [1999] 2 Qd R 203, cited
Renard Constructions (ME) Pty Ltd v Minister for Public Works (1992) 26 NSWLR 234, cited
Royal Botanic Gardens and Domain Trust v South Sydney City Council (2002) 76 ALJR 436, cited
Sellars v. Adelaide Petroleum N.L. (1994) 179 CLR 332, cited
The…

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AGLC
Lockhart v Holden [2008] QSC 257
Case
[2008] QSC 257
Decision Date

CaseChat Overview and Summary

Lockhart, the franchisor, brought an action against Holden, the franchisee, alleging that Holden's refusal to agree to the transfer of the franchise to a third party was unreasonable. Lockhart sought an order compelling Holden to agree to the transfer of the franchise. The court had to determine whether Holden's refusal was unreasonable under the Trade Practices Act 1974 and related legislation, as well as under the terms of the franchise agreement.

The court considered whether Holden had a legitimate reason for refusing to agree to the transfer of the franchise to the third party. The court noted that the Trade Practices Act and related legislation provided that a franchisor could not unreasonably withhold consent to the transfer of a franchise. The court also considered the terms of the franchise agreement, which provided that the franchisor could only refuse to consent to a transfer if there were reasonable grounds for doing so. The court found that Holden had a legitimate reason for refusing to consent to the transfer, as the third party was not capable of managing the franchise business effectively. The court also found that Holden's refusal was not unreasonable under the Trade Practices Act and related legislation.

The court held that the defendant's refusal to agree to the transfer of the franchise was not unreasonable. The court found that the defendant had a legitimate reason for refusing to consent to the transfer and that the refusal was not in breach of the Trade Practices Act or related legislation. The court dismissed the claim and ordered the plaintiff to pay the defendant's costs, including reserved costs, on the standard basis.

Orders

Orders of the court

Judgment for the defendant with costs, including reserved costs, on the standard basis.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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