Franchisees left in the lurch

Tammy Taylor: People running nail salons in SA will have to renegotiate deals

- Ina Opperman

Peet and Melany Viljoen have left the country – leaving their Tammy Taylor global franchisees in the lurch. Although the principal franchisor, the Viljoens, have fled, the salons still carry the Tammy Taylor brand name and logo despite South African and American courts forbidding the Viljoens to continue using it.

Trudie Broekmann, a consumer lawyer and expert on the Consumer Protection Act (CPA), said a franchise operation can generally not operate without an engaged national franchisor which properly holds the legal rights to act as franchisor.

The CPA regulates franchises and its provisions regarding franchises were used to its full extent in the application for an order against the Viljoens and Tammy Taylor Global Franchising when Lebohang Hlathuka asked to be refunded the R600 000 she paid for a franchise.

Broekmann said from Hlathuka’s judgment against the Viljoens it is clear that "franchisees" who recently acquired their franchises from the Viljoens’ entities do not have a valid franchise.

“These franchises would have to be reacquired or regularised by either a South African franchisor with a valid right for the relevant territory, or with Tammy Taylor in the US,” Broekmann said.

“If earlier franchisees acquired their franchises validly from the Viljoens while they were authorised by Tammy Taylor to sell franchises, those franchisees have also been left in the lurch by the Viljoens’ sudden departure.