…. for a Best Western franchise we don’t own.
More Franchise Questions
The following are two emails I received from one of my readers who wishes to remain anonymous regarding the now infamous $50,000 payment our mayor and council made to Group|Vachon for a Best Western franchise agreement that the latter is now owner of thanks to our municipality’s generosity… stupidity and lack of due diligence bordering on possible criminality.
I do not have a copy of the Best Western contract for the Pass.
I have attached a PDF of the rules by which BW franchisee agreements are played by.
On page 4 Section 7 A the reasons for automatic termination of memberships/ franchises are set forth, they include a change of 50% or more of ownership within a 12 month period.
The agreements also states memberships are either for one year at a time or for four years.
The agreement also states there are annual fees. Annual fees fro an operating BW hotel would be over $50,000 a year for a non operating hotel it is unclear.
So $50,000 has been paid for a franchise which, can not be transferred within its first 12 months, has a shelf life of less than 48 months and needs payments of $50,000 plus per year?
Wondering what a lawyer, a court of law or Best Western might think about the following……
1) Equitable ownership is an arrangement whereby a beneficial owner has the power to influence decisions regarding that ownership, and receives benefits afforded by ownership, even though the ownership may be held by someone else. ( Source – the web)
2) A Best Western Membership shall automatically terminate on the date … a change occurs of 50% or more of the equitable ownership of the Best Western Property within a 12 month period. (Source – BW Bylaws & Articles 2013)
3) Council voted … to reimburse the Vachon Group $50,000 for a franchise application fee to Best Western. …Asked if Vachon Group had signed a memorandum of understanding … Thompson replied yes… ( Source – Pass Promoter August 12 2013)
It is hard to imagine a more stupid or more dangerous way of making decisions than by putting those decisions in the hands of people who pay no price for being wrong.