The highly-anticipated changes to the Franchising Code of Conduct are now in force.

These changes follow a parliamentary inquiry into the Code, which began in 2018. The inquiry saw many franchisees explain how their franchised business failed, and the consequences on their lives. It also exposed questionable business strategies by some franchisors, and has directly led to at least one enforcement action by the Australian Competition and Consumer Commission.

It is important for both franchisors and franchisees to understand that significant changes to the Code are now in force – many of which involve imposing civil penalties for breach.

This article contains a summary of five core areas that have seen significant change. 

On 10 August 2021 both Houses of Parliament passed the Treasury Laws Amendment (2021 Measures  No 1) Bill 2021, enabling companies to sign and execute documents, hold meetings, provide notices relating to meetings and keep minutes using electronic means or other alternative technologies, until the end of March 2022.

The Act will formally take effect once it receives Royal assent.

On 25 June 2021, the High Court of Australia refused two insurers special leave to appeal the decision of the NSW Court of Appeal in HDI Global Specialty SE v Wonkana No 3 Pty Ltd [2020] NSWCA 296.

The NSW Court of Appeal unanimously held that insurers could not rely on an exclusion clause contained in certain policies to refuse indemnity for business interruption claims arising out of the COVID-19 pandemic.

The first test case does not mandate a blanket approach to policy coverage for all business interruption claims. Each will turn on the language of each policy wording and the circumstances of each claim.

Insurers have sought further judicial guidance on a number of other matters affecting the operation of business interruption policies in the context of COVID-19 in a second test case, due to be heard by the Federal Court later this year.

This article was originally published by the Law Society of New South Wales in the Law Society Journal, Issue 80 August 2021.

Workplace Relations Partner Alicia Mataere recently presented to members of the Association of Corporate Counsel on the topic of Casual Employment Recent Changes, Compliance, Enterprise Bargaining and Award Flexibility.

Click through to view the webinar recording.

In the lengthy Federal Court judgment in Transport Workers Union of Australia v Qantas Airways Limited 2021 FCA 873 delivered on 30 July 2021, Lee J found that Qantas took adverse action when it made over 2,000 workers redundant, and that the airline could not prove that its reasons for doing so were not prohibited by the Fair Work Act 2009. 

The consequences of the breach are yet to be determined.

In the Full Federal Court decision of Liberty Mutual Insurance Company Australia Branch trading as Liberty Specialty Markets v Icon Co (NSW) Pty Ltd [2021] FCAFC 126 given on 20 July 2021, the Full Court addressed the construction and scope of thirdparty liability policies in the context of claims made by a building and construction company for losses occurring as a result of the manifestation of serious defects within a building, during the defects liability period.

Key Take Away

1. The Full Court maintained that in the event of ambiguity in an insurance policy, the context (including the market) in which the parties are operating, as well as the commercial purpose of the policy, must be considered (Icon’s Cross Appeal); and
2. Similarly, the Full Court considered that the context of Insurance Policies must always be considered in circumstances where the definition of ordinary words are not clear (QBE Appeal).
3. The Full Court ultimately prefers Policy Interpretation which refers to extrinsic contextual material where Policy terms are not clear.

Retail and Commercial tenants in NSW are likely familiar with the operation of the provisions of the National Cabinet Mandatory Code of Conduct – SME Commercial Leasing Principles and the NSW Government’s regulations that followed to give effect to the Code in response to COVID-19 pandemic during 2020 and, for some tenants, the first quarter of 2021.

This piece includes a summary of the Code and the regulations that were made to give legal effect to the Code from April to December 2020 and, to a more limited extent, the first quarter of 2021.

On 21 June 2021, Shadow Assistant Minister for Cyber Security, Tim Watts introduced the private members Ransomware Payments Bill 2021 (Cth) into Parliament. The Bill would require the Commonwealth Government and big businesses to report ransomware payments to the Australian Cyber Security Centre (ACSC).

The Bill was introduced in response to the 200% increase in reported ransomware attacks on Australian organisations - including prominent incidents affecting companies such as JBS Foods and Nine Entertainment.

Holman Webb is pleased to announce that Insurance Partner Lucy Rooney has been listed in Insurance Business Magazine's Elite Women in Insurance 2021!

The 16 July 2021 decision in LNCP002 Pty Limited v Akcin [2021] NSWSC 848 has highlighted the obligations of lenders and financiers to act fairly and in good faith with respect to borrowers in mortgage lending, and to do what they have promised to do.