Ontario’s franchise disclosure regime is one of the most protective in Canada, and at its core sits section 7(1) of the Arthur Wishart Act (Franchise Disclosure), 2000 (the “Act”). This provision creates liability for a wide range of individuals, either based on a misrepresentation contained in a disclosure document or as a result of the franchisor’s failure to comply with the disclosure regime prescribed by the Act. Furthermore, for those found to be liable in a section 7(1) action, the liability is joint and several. As courts continue to strictly enforce the Act, directors, officers, brokers, agents, and signatories must understand that personal liability is now a central risk in franchise operations.
