Davaria Pty Limited v 7-Eleven Stores Pty Ltd [2019] FCA 2214

Davaria Pty Limited v 7-Eleven Stores Pty Ltd [2019] FCA 2214

The undertaking offered by 7-Eleven sufficiently protects group members by informing them of the nature of releases and their right to obtain legal advice without overreaching into legitimate business activities. The Court dismissed the interlocutory application save for the opt-out issue, which will be revisited.

Parties
Applicant: Davaria Pty Limited; Applicant: Pareshkumar Davaria; Applicant: Khushbu Davaria; First Respondent: 7-Eleven Stores Pty Ltd; Second Respondent: 7-Eleven Inc (A Texas Corporation); Third Respondent: Australia and New Zealand Banking Group Limited
Jurisdiction
Australia
Judgment Date
11 December 2019
Procedural Posture
Class Action (proceedings VID 180/2018 and VID 182/2018) / Interlocutory Application With Undertakings and Partial Dismissal
Outcome
Applicant's Further Amended Interlocutory Application dismissed except regarding opt-out issue; undertaking by First Respondent accepted; costs reserved.
Legal Topics
Class Actions, Franchise Agreements, Communication With Class Members, Settlement Releases
Commercial Law Class Actions Franchise Agreements Communication With Class Members Settlement Releases

Case Brief

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Parties

Davaria Pty Limited

Applicant

Pareshkumar Davaria

Applicant

Khushbu Davaria

Applicant

7-Eleven Stores Pty Ltd

First Respondent

7-Eleven Inc (A Texas Corporation)

Second Respondent

Australia and New Zealand Banking Group Limited

Third Respondent

Procedural Posture

Class Action (proceedings VID 180/2018 and VID 182/2018) / Interlocutory Application With Undertakings and Partial Dismissal

Legal Issues

  1. 1 Whether the Court should restrain the first respondent from communicating with group members regarding releases or compromises relating to the class action
  2. 2 Appropriateness of undertakings offered by the first respondent regarding communication and releases
  3. 3 Extent to which releases should be restricted for class members, including store transfers, renewals and payments

Ratio Decidendi

The undertaking offered by 7-Eleven sufficiently protects group members by informing them of the nature of releases and their right to obtain legal advice without overreaching into legitimate business activities. The Court dismissed the interlocutory application save for the opt-out issue, which will be revisited.

Court Disposition

Applicant's Further Amended Interlocutory Application dismissed except regarding opt-out issue; undertaking by First Respondent accepted; costs reserved.

Orders

  • First Respondent undertakes to provide a letter in prescribed form before seeking release from franchisees in respect of the Class Action and not to make release a condition for store transfer.
  • Applicant's Further Amended Interlocutory Application dismissed other than regarding opt-out.