Meetfresh Franchising Pty Ltd v Ivanman Pty Ltd

The dispute in *Meetfresh Franchising Pty Ltd v Ivanman Pty Ltd* concerned alleged breaches of a franchise agreement. Meetfresh Franchising Pty Ltd (the appellant) appealed a decision of the primary judge to the Court of Appeal of the Supreme Court of New South Wales. Ivanman Pty Ltd (the respondent) was the franchisee.

The Court of Appeal was required to determine whether a force majeure clause in the franchise agreement excused the appellant's breaches. It also had to consider whether damages for wasted expenditure, or reliance damages, could only be awarded if expectation damages were impossible to quantify, and whether the evidence was sufficient to discharge the appellant's onus of proving it unlikely the respondent would have earned sufficient revenue to cover its costs over the contract term. Furthermore, the court considered whether two separate agreements were interdependent, precluding the appellant from recovering amounts due under one if it did not fulfil its obligations under the other.

The Court of Appeal held that the force majeure clause provided an exception to, rather than a qualification of, the appellant's promises, and the appellant bore the onus of establishing its applicability. Regarding damages, the court affirmed that reliance damages may be awarded where the evidence does not establish any loss of profits, provided the appellant fails to discharge its onus of proving it unlikely the respondent would have earned sufficient revenue to cover its costs. The court found the two sets of agreements to be inextricably linked, meaning they were interdependent.

The appeal was allowed only to the extent of giving effect to the respondents’ concession that $6,146.23 was payable by the respondents to the appellant, and judgment was entered for the appellant for that amount. Otherwise, the appeal was dismissed, and the appellant was ordered to pay the respondents’ costs of the appeal.