Study On Civil Liability Of Franchise

This article probes into the civil liability of franchisors and franchisee under the circumstances of the rapid development of franchise in China because the disputes arising from the franchise have been in constant increase and there is no special statute regulating the said civil liability in the franchise, which puts the courts handling the related lawsuits in an awkward situation. This article studies the internal and external civil liability of franchise system on the basis of jurisprudence analysis of franchise, compares the international and domestic legislation and case precedents by taking the franchise's system as the diving line, for the purpose of proposing the author's view on the system construction and perfection of the civil liability in the franchise.This article is composed by three parts as following:Part one summarizes the development history and present situation of franchise in our country, illustrates the reason why the said problem shall be studied and this article shall be written.Part two is main content of this article which is composed by three chapters. The first chapter is about Legal analysis of franchise, which probes into the characteristic, form of franchise, and compares the franchise with other business forms, analyzes the legal relationship in the franchise for the purpose of laying the theory foundation for the research of civil liability. This chapter also points out the particularity about the civil liability in franchise. The second chapter focuses on the internal liability of franchise system. Due to the dominant position, the franchisor's activity is the key of the legal supervision, so the franchisor's liability is the main content of this chapter. The franchise has two basic characteristics. One of which is that two parts in the franchise are not equally informed, and the other is that two parts in the franchise do not assume the equal liability. Due to the superiority of the franchisor, there are two questions which are worth being paid attention in franchisor's liabilities in the breach of contract. One is the fair behavior liability, and the other is the defect obligation of warranty. In addition, the information disclosure obligation is the most important statutory duty of franchisor. The franchisor shall assume the liability of the fault in negotiating, or breaching the contract, or tort and etc. Moreover, there is overlap of breach and tort liability as far as the internal liability of franchise is concerned. The third chapter focuses on the liability of the external liability of franchise system. The contradictory of the internal law personality discrimination and external image uniformity between franchisor and franchisee has initiated the new question of external responsibility assumption. Because of franchisee is in the terminal of the franchise system to provide the product or the service, the external liability of the franchise system has the most close relation with the franchisee. Therefore, it decides that the external liability assumption should revolve the activities of the franchisee to the third part. This chapter studies the legislation and legal precedents home and broad, researches whether franchisor should assume the responsibility for the franchisee's activity of breaching the contract, or tort, and which liability should be assumed. Finally this article proposes the view of the author that the franchisee should assume his own liability of breach of contract, while the apparent agency system shall be applied in accordance with the different objects. The author also holds that the franchisor shall only assume the limited and supplementary liability while the franchisee can pay off his debts due to the characteristic of the franchise, and the assumption the tort liability by the franchisee shall be differentiated in accordance with the various of situation in the product defect, franchise defect and interior reason of franchisee and so on in view of the liability assumption doctrine and the method.Part three concludes with the summary of the writing process of this article, and points out the deficiency and the future direction for further study.