A franchise relationship is created when the franchisee and the
franchisor agree to be bound by the terms of a franchise contract.
If a dispute arises between the franchisee and franchisor, it will
not always be important to identify the date from which the
franchise relationship began.
Sometimes, however, the date from which the relationship began
will be a central issue in the dispute; for instance, franchise
disclosure legislation (with the exception of Alberta's
Franchises Act) provides that a franchisee seeking to
exercise its statutory right of rescission must do so no later than
two years after "entering into the franchise
agreement".1
If a franchisee attempts to rescind its franchise agreement near
that two-year mark, the franchisor may respond by alleging that the
franchisee is out of time to do so because more than two years have
elapsed since the franchise agreement was "entered
into".
