SENVENTH ANNUAL LAWASIA INTERNATIONAL MOOT COMPETITION KUALA LUMPUR REGIONAL CENTER FOR ARBITRATION ADI BUDIAMMAN, M.D.

Transcription

1 F1030-R SENVENTH ANNUAL 2012 LAWASIA INTERNATIONAL MOOT COMPETITION KUALA LUMPUR REGIONAL CENTER FOR ARBITRATION ADI BUDIAMMAN, M.D. (Respondent) V. GREAT WALL NOODLE SHOP, LLC (Claimant) MEMORIAL FOR RESPONDENT 1

2 TABLE OF CONTENTS INDEX OF AUTHORITIES... III STATEMENT OF JURISDICTION... XI QUESTIONS PRESENTED... XII STATEMENT OF FACTS... XIII I. INDONESIAN LAW SHOULD BE THE PROPER LAW TO BE APPLIED IN RESOLVING THIS DISPUTE... XVII 1. The choice of law clause in the FA should be disregarded due to the limitations on the choice of law... XVII 2. Indonesian Law should be applied as the most proper law under relevant conflicts of laws rules... XIX 3. If any law other than Indonesian Law is applied, the final arbitral award may not be recognized and become unenforceable... XXII II. ARTICLE XII IS INVALID AND UNENFORCEABLE UNDER UNCONSCIONABILITY DOCTRINE... XXIII III. THE ARBITRATION AGREEMENT IS INVALID AND UNENFORCEABLE XXV IV. THE FA IS INVALID UNDER ARTICLE 31 OF THE LAW NO. 24 AND THE ICC XXVII I

3 V. ALTHOUGH THE FRANCHISE SHALL BE TERMINATED FOR SUBSTANTIAL VIOLATIONS DEEMED BY THE FRANCHISOR, THOSE VIOLATIONS MUST BE REASONABLY SUBSTANTIAL... XXIX VI. UNDER THE INHERENT WARRANTY OF GOOD FAITH AND FAIR DEALING, THE TERMINATION OF THE FRANCHISE IS UNJUSTIFIABLE XXIX 1. The inherent warranty of good faith and fair dealing should be applied to the FA XXIX 2. Pursuant to the implied covenant of good faith and fair dealing, the termination of the Franchise by the Franchisor is unjustifiable... XXXI a. The termination of the Franchise is unjustifiable because of the Franchisor s unfair motive and the violations of the FA should not be considered substantial XXXI b. The above violations do not reflect a continuing disregard of the Franchisee s obligations under the FA to justify its termination... XXXVI VII. THE NOTICE OF TERMINATION IS NOT PROPER AND TIMELY AS IT VIOLATES THE INDONESIAN REGULATIONS ON FRANCHISING AND THE FA XXXVII VIII.AN EMPLOYMENT REGULATION THAT PROHIBITS FEMALE MUSLIM EMPLOYEES FROM WEARING HIJAB VIOLATES THE INDONESIAN CONSTITUTION 1945 AND THE INTERNATIONAL COVENANT ON CIVIL AND POLITICAL RIGHTS XXXIX II

4 INDEX OF AUTHORITIES INTERNATIONAL LAWS AND DOCUMENTS Kuala Lumpur Regional Center for Arbitration Fast Track Model Arbitration Clause The International Covenant on Civil and Political Rights 1966 ( ICCPR ) The UNIDROIT Principles of International Commercial Contracts ( PICC ) United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards in New York July 6, 1958, 330 U.N.T.S , 25 U.N. GAOR, 36 th Sess., 73d plen. Mtg. art. 1 (1), U.N. Doc. A/36/PV.73 (Nov. 25, 1981) NATIONAL LAWS Act No.13/2003 of the President of the Republic of Indonesia on Manpower Arbitration Act 2005 (Act No. 646), (Malay.)... 19, 25 Indonesian Civil Code 1847 ( ICC ), Art , 28, 29 Indonesian Constitution Intellectual Property: Principles governing, jurisdiction, choice of law, and judgments in transnational disputes (Proposed Final Draft, The American Law Institute March 30, 2007), 315(3) (b) Law No. 30 of 1999 of the President of the Republic of Indonesia dated August 12, 1999 regarding Arbitration and Alternative Dispute Resolution Law of the Application of Law for Foreign-related Civil Relations of the People s Republic of China III

5 Regulation 31/m-dag/per/8/2008 of the Minniste of Trade of the Republic of Indonesia dated August 21, 2008 regarding Franchising... 18, 38 The General Rules of Legislation to IndonesiaS , 30 April The Government Regulation on Franchise No.42/27 of the President of the Republic of Indonesia CASES ARBITRAL AWARDS Case No of 1984 (ICC Award YCA 1985) Elisa MaríaMostaza Clarov. Centro Móvil Milenium SL, Case C-168/05, [2006] E.C.R. I Ingmar GB Ltd. v. Eaton Leonard Technologies, Inc., Case C-381/98, [2000] ECR I AUSTRALIAN CASES China Ocean Shipping Co. Ltd. v P. S. Chellaram& Co. Ltd. (1990) 28 NSWLR 354 (Austl.) Queensland Estates Pty. Ltd. v Collas(1971) Qd R 75 (Austl.) GERMANCE CASES Oberlandesgericht [OLG] [Provincial Court of Appeal) Jul. 22, U 97/91, (Ger.) INDONESIAN CASES ED & F Man (Sugar) Ltd. V. Yani Haryanto(No. 2) Lloyd s Rep MALAYSIAN CASES IV

6 Usahasama SPNB-LTAT Sdn Bhd v Borneo Synergy (M) Sdn Bhd, [2009] 2 MLJ YK Fung Securities SdnBhd v. James Cape (Far East) Ltd (CA) [1997] 4 CLJ SINGPOREAN CASES GHL Pte Ltd v Unitrack Building Construction Pte Ltd [1999] 4 SLR Las Vegas Hilton Corp v KhooTeng Hock Sunny [1997] 1 SLR Min Thai Holdings Pte Ltd v Sunlabel Pte Ltd [1999] 2 SLR Telestop Pte Ltd v Telecom Equipment Pte Ltd [2004] SGHC 267 (Sing.) UK CASES Hamlyn & Co. v. Taliskar Distillery, (1891-4) All E.R. 849 (Eng.). 17 Regazzoni v. KC Sethia Ltd. (1958) AC Vita Food Products, Inc. v. Unus Shipping Co., (1939) A.C. 277 (Eng.) Zivnostenska Banka Corp v. Frankman[1950] AC US CASES Alexander v. Anthony International, L.P. 3d Cir., No , Aug. 19, American Express Financial Advisors, Inc v. Yantis, 358 F Supp. 2d Armendariz v. Foundation Health Psychcare Services, Inc., 24 Cal 4th 83 (2000) Cooper v. MRM Inc. Co., 199 F.Supp.2d 771 (M.D.Tenn., 2002) DiMercuriov. Sphere Drake Ins. PLC, 202 F.3d 71, 79 (1st Cir.2000) EEOC v. Family Foods, Inc. Case 5:11-cv FL Fricke v. Isbrandtsen151 F Supp 465 (1957) V

7 Henningsen v. Bloomfield Motors, Inc., 32 N.J.358, 161 A.2d 69, 84-96, 75 A.L.R.2d 1 (1960) Jones v. Star Credit Corp., 59 Misc. 2d 189, 298 N.Y.S.2d 264 (1969) Klocek v. Gateway 2000, Inc., 103 F.supp.2d 1332, 1341 (D.Kan. 2000) Klosterman v. Choice Hotels International, Inc., 2005 WL Specht v. Netscape Comm. Corp., 306 F.3d 17, 40 (2d Cir. 2002) The Original Great American Chocolate Chip Cookie Co. v. River Valley Cookies, Ltd., 970 F.2d 273 (7th Cir. 1992) Three M Enterprises, Inc. v. Texas D.A.R Enterprises, Inc., 368 F. Supp. 2d Vishal Hospitality LLC v. Choice Hotels International, Inc., 2005 WL Williams v. Walker-Thomas Furniture Co., 350 F.2d 445 (C.A.D.C. 1965)... 24, 26 TREATISES AND OTHER BOOKS A.F.M. Maniruzzaman, The New Law of International Commercial Arbitration in Bangladesh: A Comparative Perspective, 2003 Am. Rev. Int l Arb 14, Abla J. Mayss, Principles of Conflict of Laws 5(Publishing Limited, 3 rd ed.1999) Aron Broches, Commentary on the UNCITRAL Model Law on International Commercial Arbitration73-77(Kluwer Law and Taxation Publishers 1990) Bahiyyih G. Tahzib, Freedom of Religion or Belief Ensuring Effective International Legal Protection 26 (Martinus Nijhoff 1996) Barbara Freyer Stowasser, Women in the Qur an, Traditions, and Interpretation 90-94(Oxford Univ. Press 1994) VI

8 Black s Law Dictionary (9th ed. 2009)... 17,18,2,29,40 Brian A. Blum, Contracts: Examples & Explanations 423 (Aspen Publishers, 4th ed. 2007) 17 Charlene Harrington&Cassandra Crawford, Health Policy: Crisis and Reform in the U.S. Health Care Delivery System 7 (Jones and Bartlett Publishers, Inc., 4 th edition. 2004) Dicey, Morris and Collins,The Conflict of Laws 9 (14th ed. 2006) Gary B. Born, International Commercial Arbitration662,(Volume IKluwer Law International 2009) Guangjlan Tu, China's New Conflicts Code: General Issues and Selected Topics 8 (2011).. 20 Herbert Kronke, Patricia Nacimiento, Dirk Otto, Nicola Christine Port, Recognition and Enforcement of Foreign : A Global Commentary on the New York Convention 7(Kluwer Law International 2010) L Collins, Dicey & Morris, The Conflict of Laws1172(11th ed, London, Stevens & Sons Limited, 1987) Margaret L. Moses, The Principles and Practice of International Commercial Arbitration 82 (2008) Oxford Dictionary of Law (Elizabeth A. Martin eds., Oxford Univ. Press5th ed. 2003) Paul Bennett Marrow, Policing contracts for Unconscionability: guidelines for international arbitrators subject to the scrutiny of US courts 388, (Arbitration 2007); Saied Reza Ameli & Arzu Merali, British Muslim s Expectations of the Government Hijab, Meaning, Identity, Otherization and Politics: British Muslim Women 29 (Islamic Human Rights Comm n 2006) VII

9 JOURNAL ARTICLES AND ESSAYS Boyd Allan Byers, Making a Case for Federal Regulation of Franchise Terminations-A Return-of-Equity Approach, 19 J. Corp. L. 607, ( ) Dr N Richardson, International contracts and the choice of law in New Zealand, Cobra 2010 (The Construction, Building and Real Estate Research Conference of the Royal Institution of Chartered Surveyors Held at Dauphine Univ., Paris, 2-3 September 2010) George F. Carpinello, Testing the Limits of Choice of Law Clauses: Franchise Contracts as a Case Study, 74 Marq. L. Rev. 57, 72 (1990) Gillian Lee, Franchising in Singapore and Malaysia, 2 Int l J. Franchising L.34, (2004) Human Rights Watch, Out of Sight: Endemic Abuse and Impunity in Papua's Central Highlands Indonesia Volume 19 No.10(C), at 19 (July 2007) Jens Rinze, The Scope of Party Autonomy Under the 1980 Rome Convention on the Law Applicable to Contractual Obligations, J. Bus. L. 412, 413 (1994) Jin Huang, Wei Hu & Qingsong Wang, Annual Survey of Judicial Practice in Chinese Private International Law in (11 Chinese yearbook of comparative & private international law 2008) Leonardo Graffi, Case Law on the Concept of Fundamental Breach in th Vienna Sales Convention, 3 Int l Bus. L.J. 338, 342 (2003) Locknie Hsu, Franchising In Singapore: An Overview, 4 Asia Pac. L. Rev. 31, 38 (1995) Milan Parivodi, Termination of Franchise Contracts - A Comparative Study, 7 In t J. Franchising L.5, 12(2009) VIII

10 Paul H. Rubin, The theory of the firm and the structure of the franchise contract, 21 J.L. & Econ. 224, 225 (1978) Susan Choi, Judicial Enforcement of Arbitration Awards Under the ICSID and New York Convention, New York Univ. J. Int l L. & Pol. 28, 205 (Fall 1995 Winter 1996) T. Mark McLaughlin & Caryn Jacobs, Termination of Franchises: Application of the Implied Covenant of Good Faith and Fair Dealing, 7 Franchise L.J. 1, ( ) , 29 Thomas J. Chinonis, Implied Covenant Of Good Faith: A Two-Way Street In Franchising, 11 DePaul Bus. L.J. 229, 248 ( ) Tracey A. Nicastro, How the Cookie Crumbles: The Good Cause Requirement for Terminating a Franchise Agreement, 28 Val. U. L. Rev. 785, 817 (1994) MISCELLANEOUS MATERIALS Chris Wright, Legally unbound, (last visited on September 12, 2012) ISDA News, News digest, Asia Pacific, Indonesia, Issue VII (last visited on July 1, 2012) Makarim & Taira S., Indonesia: Law No. 24 of 2009 on the National Flag, Language, Emblem and Anthem, published on January 18, 2012, on+the+National+Flag+Language+Emblem+and+Anthem, (last visited on September 12, 2012) IX

11 Mochamad Fachri & Susanti Suhendro,Indonesia Iintroduces Language Requirements for Agreements, (last visited on July 1, 2012). 24, 25 Qur an Noble... 31, 32, 37 Richard B. Cohen, Uk Prime Minister Vows To Change Employment Law His Government Is Defending In Court ( 34 X

12 STATEMENT OF JURISDICTION Great Wall Noodle Shop, LLC ( GWNS ) and Dr. Adi Budiamman agreed that the dispute would be covered at the November Hearing to be held on November 18, 2012 in Bali, Indonesia. The acceptance of Arbitration authority is in conformity with the Kuala Lumpur Regional Arbitration Centre ( KLRCA ) Fast Track Rules ( FTR ) and section XII A of the Franchise Agreement between the parties ( FA ). The Arbitral Tribunal is requested to decide on the submitted issues which do not include the amount of damages that either party may recover and any claims by any employees of the Indonesian Great Wall Noodle Shop restaurants. The parties agree, pursuant to Article XII (A) of the FA, that the decision of the arbitrators will be final and binding on all parties to the dispute. XI

13 QUESTIONS PRESENTED I. What is the proper law to apply in resolving this dispute? II. Is Article XII of the Franchise Agreement invalid and/or unenforceable? III. Is the Arbitration Agreement valid and enforceable? IV. Is the Franchise Agreement invalid under Article 31 of the Law No. 24 of 2009? V. May the Franchisor terminate the Franchise for any violation of the Franchise Agreement or must it be a substantial violation of the Franchise Agreement? VI. Does the inherent warranty of good faith and fair dealing in interpreting and applying franchise agreements applies to this Franchise Agreement and, if so: (i) Whether the serving of a single Indonesian dish referred to as The Special of the Day justified the termination of the Franchise? (ii) Whether giving customers the option of substituting lamb for pork for Menu items justified the termination of the Franchise? (iii) Whether the wearing of the new (white) Hijab by the female Muslim employees justified the termination of the Franchise? (iv) Whether the above deemed violations of the Franchise Agreement reflect a continuing disregard of the Franchisee s obligations under the Franchise Agreement to justify its termination? VII. Was a proper and timely Notice of Termination given to the Franchisee? VIII. Whether an employment regulation prohibiting the wearing of a Hijab by female Muslim employees or restriction violates the Constitution and/or laws of Indonesia or any international treaties to which it is a member? XII

14 STATEMENT OF FACTS BACKGROUND This case involves a legal dispute between the GWNS, which is the Franchisor of numerous GWNSs a Chinese food restaurant chain based in China and Dr. Adi Budiamman, who is the Franchisee in Indonesia, over the FA between the parties on June 20, CONCLUDING THE FA The GWNS was first established in Tianjin, China on May 20, 1983 and founded by Jianping Ji and Xuefeng Wang. In 2011, they decided to expand two franchises in Medan and Jakarta, Indonesia (the Franchise ). On June 20, 2011, after failing to offer Mr. Bao Shan the franchise owner of the Singapore GWNSS to franchise some GWNSS in Indonesia, Mr. Wang met Dr. Adi Budiamman a prominent Jakarta surgeon. Having understood the purpose of Mr. Wang to visit Singapore, Dr. Budiamman became more and more interested in the restaurant business. He then suggested signing the FA. Mr. Wang took the FA from his briefcase, substituted Dr. Budiamman s name on the Contract and explained it to Dr. Budiamman. Unfortunately, Dr. Budiamman was in hurry so as not to miss the flight home and Mr. Wang did not have enough time to explain the whole FA. Additionally, he did not take the FA home as Mr. Wang suggested but took a quick look and signed it. A photocopy of both the original English and Bahasa Indonesia copy were delivered to Dr. Budiamman the next day. FRANCHISING DISPUTES ARISING The Franchises were opened in September 2011 and were both successful. In late October 2011, Mr. Ji made an unannounced visit to two restaurants in Jakarta and Medan as authorized by Article III (G) and/or Article VIII of the FA. He hereby found out some XIII

15 differences including the sale of food products that were not equivalent to the official Menu and substitutions for the ingredients of others. He also observed that some female employees in Jakarta restaurants and most of the female employees in the Medan restaurant wore unannounced red head scarf Hijab. Returning from the visit, Mr. Ji sent an to Dr. Budiamman and required him to stop the deemed violations. If not, Mr. Ji and Mr. Wang had to terminate the Franchise. Two weeks later, Mr. Ji hired an inspector to visit the Franchises and then discovered that (i) Indonesian food was being served at Jakarta and Medan restaurants as The Special of the Day although it was not listed on the Menu; and (ii) female employees wore Hijab but substituted white Hijab for the red one. TERMINATING THE FRANCHISE The next day, Mr. Ji and Mr. Wang sent a letter to Dr. Budiamman terminating the Franchise and instructing him to close both restaurants and remove the signage within 15 days. They also indicated that they had planned to reopen the Jakarta restaurant within 30 days Under new Management but no decision had been made regarding the Medan restaurant. In fact, they already designated Mr. Wang s son to manage the restaurant. ARBITRATION When Dr. Budiamman refused to close his two restaurants, Wang and Ji submitted a Notice of Arbitration in conformity with Article 3 of the FTR seeking a restraining order against Dr. Budiamman pursuant to Article XII (B) of the FA and damages for breach of the FA, trademark infringement and damage to the reputation of the GWNS. Dr. Budiamman filed a response denying the allegations and asserting a counterclaim for breach of the FA and damage to his reputation.6 The dispute is now brought before the KLRCA in Bali, Indonesia pursuant to Article XII (A) of the FA. XIV

16 SUMMARY OF PLEADINGS I. Indonesian Law should be the proper law to apply in resolving this dispute. (i) Since the choice of law clause in the FA should be disregarded due to the limitations on the choice of law. As a result, (ii) Indonesian Law should be applied because of the most proper law under relevant conflicts of laws rules and (iii) the execution ability of the arbitration award in Indonesia. II. The Article XII of the FA is invalid and unenforceable under Unconscionability doctrine. III. The Arbitration agreement is invalid and unenforceable as it does not satisfies all the requirements provided in the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards in New York, July 6, 1958, 330 U.N.T.S 38 ( NYC ), the Law No. 30 of 1999 of the President of the Republic of Indonesia issued on August 12, 1999 regarding Arbitration and Alternative Dispute Resolution ( AADR ) and the International Arbitration Act (Amendment) 2012 of Singapore (Law No. 12 of 2012) ( IAA ). IV. The FA is invalid as it is contrary to Article 31 of the Law No. 24 of 2009 of the Indonesian government regarding the National Flag and Language, State Symbols and the National Anthem ( Law No.24 ) and thus does not satisfy conditions to be valid pursuant to the Indonesian Civil Code ( ICC ). V. As specified in the Article XIII of the FA, the Claimant has the right to terminate the Franchise for any substantial violation of the terms and conditions it deems substantial. However, the violations deemed by the Claimant must be reasonable and acceptable due to good faith required under the ICC. XV

17 VI. The inherent warranty of good faith and fair dealing in interpreting and applying franchise agreements should be applied to the FA. 1. Pursuant to the implied covenant of good faith and fair dealing, the termination of the Franchise by the Franchisor is unjustifiable because of the Franchisor s unfair motive for terminating the franchise. Besides, the violations of the FA by the Franchisee should not be considered substantial to justify the termination of the Franchise as they damage neither the uniformity, the value of the Franchise s trademark nor the Franchisor s profits. 2. The above violations of the FA do not reflect a continuing disregard of the Franchisee s obligations under the FA to justify its termination. VII. The Notice of termination is not proper and timely as it violates the Regulation 31/M- DAG/PER/8/2008of the Minister of Trade of the Republic of Indonesia regarding franchising ( Regulation 31 ) and Article VIII and Article XIII of the FA. VIII. An employment regulation that prohibits female Muslim employees from wearing Hijab violates the Indonesian Constitution 1945 ( Constitution ) and the International Covenant on Civil and Political Rights 1966 ( ICCPR ). XVI

18 PLEADINGS I. INDONESIAN LAW SHOULD BE THE PROPER LAW TO BE APPLIED IN RESOLVING THIS DISPUTE 1. The choice of law clause in the FA should be disregarded due to the limitations on the choice of law The supremacy of the choice of law is not an absolutely unrestricted freedom to choose the applicable law. 1 The limitations are that an express choice of law clause in a contract should be honored as long as the agreement was (i) not against public policy and (ii) bona fide. 2 (i) Choosing Singaporean Law is against public policy of Indonesia A choice of foreign law may be disregarded if its application would be contrary to the public policy. 3 In franchise cases, to determine the public policy, the public policy of the franchisee s state, the place of franchising, should be taken into consideration. 4 The public policy means principles and standards regarded by legislature as a being of fundamental concerned to the state 5 including legislation passed by Congress and regulations written to address that legislation. 6 Being contrary to the public policy is interpreted as a 1 Jens Rinze, The Scope of Party Autonomy Under the 1980 Rome Convention on the Law Applicable to Contractual Obligations, J. BUS. L. 412, 413 (1994). 2 L COLLINS, DICEY & MORRIS, THE CONFLICT OF LAWS 1172 (11th ed, London, Stevens & Sons Limited, 1987); Vita Food Products, Inc. v. Unus Shipping Co., (1939) A.C. 277 (Eng.); China Ocean Shipping Co. Ltd. v P. S. Chellaram & Co. Ltd. (1990) 28 NSWLR 354 (Austl.); Hamlyn & Co. v. Taliskar Distillery, (1891-4) All E.R. 849 (Eng.). 3 ABLA J. MAYSS, PRINCIPLES OF CONFLICT OF LAWS 5 (Publishing Limited, 3 rd ed.1999); Regazzoni v. KC Sethia Ltd. (1958) AC 301; Queensland Estates Pty. Ltd. v Collas(1971) Qd R 75 (Austl.). 4 George F. Carpinello, Testing the Limits of Choice of Law Clauses: Franchise Contracts as a Case Study, 74 MARQ. L. REV. 57, 72 (1990); American Express Financial Advisors, Inc v. Yantis, 358 F Supp. 2d 818; Vishal Hospitality LLC v. Choice Hotels International, Inc., 2005 WL ; Three M Enterprises, Inc. v. Texas D.A.R Enterprises, Inc., 368 F. Supp. 2d Black s Law Dictionary 1351 (9th ed. 2009). 6 CHARLENE HARRINGTON & CASSANDRA CRAWFORD, HEALTH POLICY: CRISIS AND REFORM IN THE U.S. HEALTH CARE DELIVERY SYSTEM 7 (Jones and Bartlett Publishers, Inc., 4 th edition. 2004). XVII

19 violation of the national laws and regulations of the state concerned. 7 When the choice of law clause is contrary to the public policy, it is likely to impact an arbitrator s obligation to apply the law not chosen by the parties. 8 The Regulation 31 states that Indonesian Law shall be applied to all franchise agreements performed in Indonesia. 9 In the FA, the applicable law specified is Singaporean Law, although the FA was fully executed in Indonesia. Thus, the choice of Singaporean Law is contrary to the Regulation 31, i.e. the public policy of Indonesia, the Franchisee state and the place of franchising. Subsequently, the choice of law clause specified in the FA is invalid and should be disregarded. (ii) Alternatively, the choice of applicable law was not bona fide Bona fide is made in good faith 10 which means honesty in purpose. 11 If one party is in a weaker position there may be no true agreement on the choice of law. 12 Given that the choice of law may not be honestly agreed by both parties in purpose so it would be considered as not bona fide and be disregarded. This is a problem with standard form contracts, where the weaker party has no real choice in negotiating the contract. 13 While offering the Respondent to sign the FA, Mr. Wang was aware that he had changed the contractor. Nonetheless, he did neither change any significant terms which have coherent relation with contractor modification, one of which is choice of law clause, nor 7 Susan Choi, Judicial Enforcement of Arbitration Awards Under the ICSID and New York Convention, NEW YORK UNIV. J. INT L L. & POL. 28, 205 (Fall 1995 Winter 1996) ; BRIAN A. BLUM, CONTRACTS: EXAMPLES & EXPLANATIONS 423 (Aspen Publishers, 4th ed. 2007);ED & F Man (Sugar) Ltd. V. Yani Haryanto(No. 2) Lloyd s Rep 429; Ingmar GB Ltd. v. Eaton Leonard Technologies, Inc., Case C-381/98, [2000] ECR I MARGARET L. MOSES, THE PRINCIPLES AND PRACTICE OF INTERNATIONAL COMMERCIAL ARBITRATION 82 (2008); GB Ltd. v. Eaton Leonard Technologies, Inc., Case C-381/98, [2000] ECR I Regulation 31, Art Black s Law Dictionary, supra note 5, p Black s Law Dictionary, supra note 5, p Fricke v. Isbrandtsen151 F Supp 465 (1957). 13 Dr N Richardson, International contracts and the choice of law in New Zealand, Cobra 2010 (The Construction, Building and Real Estate Research Conference of the Royal Institution of Chartered Surveyors Held at Dauphine Univ., Paris, 2-3 September 2010). XVIII

20 explain it to the Respondent. 14 Hence, there is no true agreement of the Respondent in ascertaining the applicable law and he had no knowledge of what the governing law was. This should be deemed as the lack of honesty in purpose of the Claimant while offering the FA. Thus, the choice of law clause should be considered as not being bona fide. In conclusion, the applicable law clause breaches limitations on the applicable law as it is against the public policy of Indonesia and should be considered as not bona fide. Consequently, the clause is invalid and should be disregarded. 2. Indonesian Law should be applied as the most proper law under relevant conflicts of laws rules If the choice of law clause is disregarded, the applicable law should be determined as in the absence of a choice of law case. 15 The Tribunal is bound by the FTR and the Arbitration Act 2005 Act 646 of Malaysia in ascertaining the applicable law for the substantive dispute. 16 The Tribunal shall apply the law determined by the conflict of laws rules, 17 which it considers applicable. 18 In this case, there are four concerning countries: Singapore the place of contracting, Malaysia the seat of arbitration, Indonesia the place of performance and China the nationality and principle place of business of the Claimant. Thus, the Tribunal should take into consideration their conflict of laws rules. i) Indonesian Law is the proper law under conflict of laws rules of Singapore and Malaysia Most legal systems, in fact, when facing such questions, apply the law of the country which has the closest connection to the contract or transaction in question. 19 Malaysian Law 14 Clarification C-6, p Intellectual Property: Principles governing, jurisdiction, choice of law, and judgments in transnational disputes (Proposed Final Draft, The American Law Institute March 30, 2007), 315(3) (b). 16 Moot Poblem, p Arbitration Act 2005 (Act No. 646), Sect. 30 (4) (Malay.). 18 FTR, Art Case No of 1984 (ICC Award YCA 1985), XIX

21 and Singapore Law confirm the principle that the system of law with which the contract has its closest and real connection would be taken, objectively, as the proper law of the contract. 20 Applying the conflict of laws rules of Malaysia and Singapore, the only connection between the FA and Singapore is that Singapore is the place of contracting. Similarly, China is the principle place of business and nationality of the Claimant. Nonetheless, there are three factors that connect the FA with Indonesia. ii) Indonesia is the Franchisee s principal place of business and nationality The nationality or principle place of business of parties is also a consideration in ascertaining the connection between state and agreement. 21 The Respondent is a prominent Jakarta surgeon 22 and he is also an Indonesian citizen. Hence, this is a factor for the Respondent to submit that Indonesia is a more closely connected to the agreement. iii) Indonesia is the place of performance The most decisive consideration in determining the applicable law is given to the place of performance. 23 Under the FA, the Respondent was obligated to operate the GWNS in Indonesia, especially in Jakarta and Medan. 24 The performance of the FA entirely took place in Indonesia and thus, the Respondent submits that the FA is more closely connected to Indonesia. iv) Indonesia is the place where the acts that gives rise to claim occurred The place where the legal issue in contention occurred is also a relevant consideration. 25 The dispute occurred in Indonesia because the main point of contention is whether the Respondent had breached his duties by failing to comply with the FA of which 20 Las Vegas Hilton Corp v KhooTeng Hock Sunny [1997] 1 SLR 341; YK Fung Securities SdnBhd v. James Cape (Far East) Ltd (CA) [1997] 4 CLJ Klosterman v. Choice Hotels International, Inc., 2005 WL Moot Problem, p Zivnostenska Banka Corp v. Frankman[1950] AC The FA, Art. II (B). 25 DICEY, MORRIS AND COLLINS,THE CONFLICT OF LAWS 9 (14th ed. 2006). XX

22 the place of performance is in Indonesia. Thus, this points to Indonesia being the more connected country. Since Indonesia is the Franchisee s principal place of business and nationality, the place of performance and the place where the acts that gives rise to claim occurred, it has the closest and most real connection with the FA. Subsequently, Indonesian Law should be applied. b) Indonesian Law is the proper law under conflict of laws rules of Indonesia Under Indonesian Law, the General Rules of Legislation to Indonesia S ,promulgated on 30 April 1847, provides that legal actions are subject to the law of the country where legal actions are performed the lex loci actus. 26 The Respondent s actions deemed to violate the FA were occurred in Indonesia. Hence, Indonesian Law the law of the place where legal actions were done, lex loci actus should be applied. c) Indonesian Law is the proper law under conflict of laws rules of China Under Chinese Law, Law of the Application of Law for Foreign-related Civil Relations of the People s Republic of China, issued on October 28 th 2010, supports the principle of protecting supposedly weaker parties. 27 According to this principle, the law of the habitual residence of the weaker party shall be applied. 28 In a franchise agreement, the franchisor has almost complete control over the behavior of the franchisee in fact, the relationship is almost that of a firm and an 26 The General Rules of Legislation to Indonesia S , 30 April 1847, Art GUANGJLAN TU, CHINA'S NEW CONFLICTS CODE: GENERAL ISSUES AND SELECTED TOPICS 8 (2011). 28 Law of the Application of Law for Foreign-related Civil Relations of the People s Republic of China 2010, Art. 42 & 43. XXI

23 employee. 29 Hence, the franchisee is deemed to be the weaker party. The weaker party should receive special protection. 30 That is, under Chinese law, the laws of Indonesia the laws of the habitual residence of the weaker party should be the governing law of the FA. In conclusion, relying on the conflict of laws rules of Singapore, Malaysia, Indonesia and China, Indonesian Law should be chosen as the proper law to be applied in resolving this dispute. 3. If any law other than Indonesian Law is applied, the final arbitral award may not be recognized and become unenforceable If the Tribunal applies any other law than Indonesian Law, the final arbitral award will not be recognized by Indonesian Courts and become unenforceable. Recognition and enforcement of an arbitral award may also be refused if the competent authority in the country finds that it would be contrary to the public policy of that country. 31 International arbitration awards will only be recognized and may only be enforced within the jurisdiction of the Republic of Indonesia if they do not violate public policy. 32 As mentioned above, public policy includes laws or regulations of a country. Therefore, foreign arbitral awards are not recognized if the agreement containing such arbitration clause is contrary to the laws of the concerned country. 33 If the arbitral award is given based on the Singaporean Law, it will not be recognized and enforceable by the national courts in Indonesia as the applicable law clause is in 29 Paul H. Rubin, The theory of the firm and the structure of the franchise contract, 21 J.L. & ECON. 224, 225 (1978). 30 JIN HUANG, WEI HU & QINGSONG WANG, ANNUAL SURVEY OF JUDICIAL PRACTICE IN CHINESE PRIVATE INTERNATIONAL LAW IN (11 Chinese yearbook of comparative & private international law 2008). 31 NYC, Art. V (2) (b). 32 AADR, Art. 66 (c). 33 A.F.M. Maniruzzaman, The New Law of International Commercial Arbitration in Bangladesh: A Comparative Perspective, 2003 Am. Rev. Int l Arb 14, 167. XXII

24 violation of Indonesian Law, especially the Article 5 of the Regulation 31, i.e. contrary to the public policy of Indonesia. Arbitrators should therefore consider enforcement rules in other jurisdictions more thoroughly, because an unenforceable award is worthless. 34 In conclusion, Indonesian Law is the proper law to be applied in resolving this dispute because the choice of law clause in the FA should be disregarded, Indonesian Law is the most proper law under relevant conflicts of laws rules and it also ensures the enforceability of the arbitral award. II. ARTICLE XII IS INVALID AND UNENFORCEABLE UNDER UNCONSCIONABILITY DOCTRINE Under Unconscionability doctrine, Article XII including the Arbitration Agreement is invalid because of unconscionable specific performance term. Singapore s legal system is common law and Unconscionability doctrine is adopted in Singaporean cases. 35 Although Unconscionability doctrine is not mentioned specifically in the laws of Indonesia, Indonesia became a member of UNIDROIT on January 1, 2009 and generally accepted UNIDROIT s principles in international transactions. The Unconscionability doctrine is provided in Article Gross Disparity of the UNIDROIT Principles of International Commercial Contracts ( PICC ). Therefore, testing Article XII under Unconscionablility doctrine is relevant in this case under both Singaporean Law and Indonesia Law. Unconscionability is normally assessed as the principle that a court may refuse to enforce a contract that is unfair or oppressive because of overreaching contractual terms, esp. terms that are unreasonably favorable to one party while precluding meaningful choice for 34 HERBERT KRONKE, PATRICIA NACIMIENTO, DIRK OTTO, NICOLA CHRISTINE PORT, RECOGNITION AND ENFORCEMENT OF FOREIGN : A GLOBAL COMMENTARY ON THE NEW YORK CONVENTION 7(Kluwer Law International 2010). 35 GHL Pte Ltd v Unitrack Building Construction Pte Ltd [1999] 4 SLR604; Min Thai Holdings Pte Ltd v Sunlabel Pte Ltd [1999] 2 SLR368. XXIII

25 the other part. 36 An agreement is unconscionable when it contains very unfair terms 37 which means 38 (i) contract terms are unreasonably favorable to the other party together with (ii) there is an absence of meaningful choice on the part of one of the parties. (i) The provision on authorizing the granting specific performance for the Respondent while prohibiting that for the Claimant is unreasonably favorable to the Claimant Unreasonably favorable clause is interpreted as a clause contains terms that lack mutuality of obligation i.e. one-sided terms and they may be voided as unconscionable. 39 According to section A of Article XII of the FA, if the Respondent is found to have violated any provision of the FA, he will be granted a decree of specific performance. 40 However, the FA prohibits arbitrators under any circumstances enter the decree of specific performance requiring the Claimant, to perform any part of this contract. 41 By plain meaning, this provision may be interpreted that the Claimant would never be obliged to incur any specific performance by the arbitral tribunal even when he breached any term of the contract. This provision lacks mutuality of obligation so it should be considered as one-sided term and unreasonably favorable to the Claimant. Consequently, it is an unfair term. (ii) There is an absence of meaningful choice on the Respondent The meaningfulness of the choice is negated by a gross inequality. 42 A party may void the contract if the contract unjustifiably gave the other party an excessive advantage 43 which 36 Black s Law Dictionary, supra note 5, OXFORD DICTIONARY OF LAW 68 (Elizabeth A. Martin eds., Oxford Univ. Press5th ed. 2003); Raymond Construction Pte Ltd v LowYang Tong and another [1996] SGHC Williams v. Walker-Thomas Furniture Co., 350 F.2d 445 (C.A.D.C. 1965); Henningsen v. Bloomfield Motors, Inc., 32 N.J.358, 161 A.2d 69, 84-96, 75 A.L.R.2d 1 (1960). 39 Paul Bennett Marrow, Policing contracts for Unconscionability: guidelines for international arbitrators subject to the scrutiny of US courts 388, (Arbitration 2007); Elisa MaríaMostaza Clarov. Centro Móvil Milenium SL, Case C-168/05, [2006] E.C.R. I-10421; Armendariz v. Foundation Health Psychcare Services, Inc., 24 Cal 4th 83 (2000). 40 FA, Art. XII (B). 41 FA, Art. XII (B). 42 Henningsen v. Bloomfield Motors, Inc., supra note PICC, Art XXIV

26 is the basis of Unconscionability. 44 By prohibiting the Claimant from incurring specific performance in all cases, it is given unjustifiably an excessive advantage. In contrast, the Respondent has to incur specific performance and this should be deliberated as a gross inequality. Thus, there is an absence of equivalent meaningful choice on the Respondent. Subsequently, such provision should be considered as an unfair term. In conclusion, Article XII contains unfair terms which are unreasonably favorable to the Claimant. In addition, there is an absence of meaningful choice on the Respondent. Thus, it should be considered as unconscionable. Article XII of the FA should be voided under Unconscionability doctrine. III. THE ARBITRATION AGREEMENT IS INVALID AND UNENFORCEABLE According to the NYC, which both Singapore and Indonesia have ratified and are members, the AADR and the IAA, an arbitration agreement is valid when (i) the parties validly agreed on arbitration, 45 (ii) it is in writing, 46 (iii) the dispute between the parties is in respect of a defined legal relationship, 47 (iv) the subject matter is capable of being settled by arbitration 48 and (v) the agreement is not null and void, inoperable nor incapable of being performed. 49 The Arbitration Agreement should be considered invalid and unenforceable because (i) the parties did not validly agree on the agreement and (ii) the agreement is null and void. (i) The Respondent had not accepted the Arbitration Agreement in the FA Under Separability doctrine, an arbitration clause which forms part of an agreement shall be treated as an agreement independent of the other terms of the agreement. 50 Assent to 44 Jones v. Star Credit Corp., 59 Misc. 2d 189, 298 N.Y.S.2d 264 (1969). 45 NYC, Art. II; IAA, Art. 2A (1), IAA; AADR, Art NYC, Art. II; IAA, Art. 2A (3), IAA; AADR, Art NYC, Art. II; IAA, Art. 2A (1), IAA; AADR, Art NYC, Art. II; IAA, Art. 11 (1). 49 NYC, Art. II; IAA, Art. 6 (2). 50 Arbitration Act 2005 (Act No. 646), Sect. 18(2)(a) ; ARON BROCHES, COMMENTARY ON THE UNCITRAL MODEL LAW ON INTERNATIONAL COMMERCIAL ARBITRATION73-77(Kluwer Law and Taxation Publishers 1990). XXV

27 the parties substantive agreement is not necessarily required to establish assent to the associated agreement to arbitrate. 51 There must be a mutual intention of the parties to be bound by the agreement to arbitrate. 52 When a party signs a contract with little or no knowledge of its terms, it is hardly likely that his assent was ever given to the terms. 53 If there is no precise assent between parties, the arbitration provisions effect will be denied. 54 The Respondent was not explained about Article XII of the FA before signing it. 55 He had no knowledge about the existence of the Arbitration Agreement provided. Thus, the acceptance of the substantive FA affirmed GWNS franchising but excluded the Arbitration Agreement. Subsequently, there is no precise assent between parties in the Arbitration Agreement so the Arbitration Agreement is invalid. (ii) The Arbitration Agreement is invalid because of unconscionable Article XII covering it [T]he Convention's null and void clause limits the bases upon which an international Arbitration agreement may be challenged to standard breach-of-contract defenses. 56 Unconscionability is a basis challenging international arbitration agreements. 57 The Arbitration Agreement is specified in section A of Article XII. It contains the provision of granting specific performance 58 which is unfair and invalidated Article XII under the Unconscionability doctrine. Thus, the Arbitration Agreement is also invalid and unenforceable as unconscionable. 51 GARY B. BORN, INTERNATIONAL COMMERCIAL ARBITRATION662, (Volume IKluwer Law International 2009). 52 Usahasama SPNB-LTAT Sdn Bhd v Borneo Synergy (M) Sdn Bhd, [2009] 2 MLJ Williams v. Walker-Thomas Furniture Co., supra note Specht v. Netscape Comm. Corp., 306 F.3d 17, 40 (2d Cir. 2002); Klocek v. Gateway 2000, Inc., 103 F.supp.2d 1332, 1341 (D.Kan. 2000). 55 Clarification C-6, p DiMercuriov. Sphere Drake Ins. PLC, 202 F.3d 71, 79 (1st Cir.2000). 57 Alexander v. Anthony International, L.P. 3d Cir., No , Aug. 19, 2003 ; Cooper v. MRM Inc. Co., 199 F.Supp.2d 771 (M.D.Tenn., 2002). 58 FA, Article XII (B). XXVI

28 In conclusion, the Arbitration Agreement is invalid and unenforceable under the NYC, the AADR and the IAA. IV. THE FA IS INVALID UNDER ARTICLE 31 OF THE LAW NO. 24 AND THE ICC The FA is invalid as it is contrary to Article 31 of the Law No.24 and thus does not satisfy conditions to be valid pursuant to the ICC. According to the ICC, there are four compulsory conditions validating an agreement: (i) the assent of the individuals who are bound thereby, (ii) capacity to conclude an agreement, (iii) the agreement tends to a specific subject and (iv) there must be an admissible cause. 59 Three of the conditions have been satisfied as (i) the Respondent accepted the Claimant s offer, 60 (ii) they are both legally capable to sign the agreement, 61 and (iii) franchising is a specific subject. Notwithstanding, the fourth condition is not satisfied under Article 31 of the Law No. 24. The interpretation of the phrase admissible cause, of which the original Indonesian phrase is suatu sebab yang tidak terlarang, 62 of Indonesian courts is that if contracts breach any regulation in Indonesia, those contracts are in breach of this requirement, 63 either formality or purpose. There have been cases that have interpreted this provision as allowing for the nullification of agreements that do not comply with mandatory regulations. 64 Article 31 of the Law No. 24 states that (1) Indonesian must be used in agreements that involve individuals who are Indonesian citizens. (2) Agreements as specified in paragraph (1) 59 Indonesian Civil Code 1847 ( ICC ), Art Moot Problem, p Clarification C-3, p ICC, Art Chris Wright, Legally unbound, (last visited on September 12, 2012). 64 Mochamad Fachri & Susanti Suhendro,Indonesia Iintroduces Language Requirements for Agreements, (last visited on July 1, 2012). XXVII

29 that involve foreign parties shall also be written in the national language of the foreign parties and/or English. Under this Article, franchise agreements involving Indonesian parties must be executed in Indonesian. The word must stipulated in Article 31 tends to emphasize the prohibition of agreements which are not written in Indonesian originally, the word also used in the second paragraph indicates that using a foreign language will be in addition to the Indonesian version. 65 Given that the original agreement must be written in Indonesian, the validity of an agreement to which an Indonesian individual is a party and which is drawn up only in the English language can be challenged. 66 In practice, according to a number of cases, there were breaches because the transactions were not explained in Indonesian or that the term sheets were not in Indonesian language. The contracts are null and void because they have breached Indonesian regulations about language. 67 In this case, the original FA, signed on June 20 th 2011 by the Claimant and the Respondent, is written only in English. 68 It was signed after the day the Law No. 24 took effect. The Respondent only received a translation copy in Indonesian in one day after. 69 This makes the FA breach the requirement of the Law No. 24 so there is no admissible cause. Hence, the FA is absent of an admissible cause pursuant to the fourth condition satisfying the validity and thus, it is invalid. 70 In conclusion, the Respondent submits that the FA is invalid under Article 31 of the Law No. 24 and the ICC. 65 Mochamad Fachri & Susanti Suhendro, supra note Makarim & Taira S., Indonesia: Law No. 24 of 2009 on the National Flag, Language, Emblem and Anthem, published on January 18, 2012, al+flag+language+emblem+and+anthem, (last visited on September 12, 2012). 67 ISDA News, News digest, Asia Pacific, Indonesia, Issue VII (last visited on July 1, 2012). 68 Moot Problem, p Moot Problem, p ICC, Art XXVIII

30 V. ALTHOUGH THE FRANCHISE SHALL BE TERMINATED FOR SUBSTANTIAL VIOLATIONS DEEMED BY THE FRANCHISOR, THOSE VIOLATIONS MUST BE REASONABLY SUBSTANTIAL As specified in the FA, the Claimant has the right to terminate the Franchise for any substantial violation of the terms and conditions it deems substantial. 71 Therefore, in order to terminate the FA, the violation must be substantial. Under the ICC, all legally executed agreements shall bind individuals who have concluded them by law. 72 The parties both acknowledge that Claimant has the right to deem which violation is substantial. However, this right must be executed based on good faith. Good faith is an observance of reasonable commercial standards of fair dealing in a given trade or business. 73 In this case, though the Claimant could deem which violation is substantial, this right must be performed with circumstances. The Claimant should only terminate the Franchise with violations that severely affect the business. In the other words, violations deemed by the Claimant must be reasonably and objectively substantial. As a whole, the Franchise shall be terminated for substantial violations. The Claimant has the right to deem which violation is substantial. However, in as much as good faith, the violations deemed by the Claimant must be reasonable and acceptable. VI. UNDER THE INHERENT WARRANTY OF GOOD FAITH AND FAIR DEALING, THE TERMINATION OF THE FRANCHISE IS UNJUSTIFIABLE 1. The inherent warranty of good faith and fair dealing should be applied to the FA 71 FA, Art. XIII. 72 ICC, Art Black s Law Dictionary, supra note 5, p.762. XXIX

31 Pursuant to the implied covenant of good faith, the contract is terminable only for good cause. 74 Good cause is generally defined as the failure of the franchisee to substantially comply with material and reasonable terms imposed by the franchisor in the franchise agreement. 75 Under Singapore law, although the legal position as to whether Singapore law recognizes the existence of a duty of good faith in a franchise contract has not yet been established, 76 it is widely recognized that a duty to perform and enforce contractual rights and obligations in good faith is implied generally in every contract. 77 Besides, as there is no specific legislation provided, franchising must rely on existing contract. 78 Under Indonesian Law, Article 1338 of the ICC provides that all agreements must be executed in good faith. In the FA, Article XIII (B) states that the Franchisor has the right to terminate the FA for any substantial violation of the terms and conditions deemed substantial by the Franchisor. The requirement of termination for the substantial violations in question is the content of good cause in termination of a franchise agreement. Hence, there is the presence of a provision requiring the implied covenant of good faith and fair dealing in the FA. Furthermore, Article X (2) of the FA states that the Franchisor agrees to exercise rights reasonably or in good faith in making decision. Hence, the provisions of this FA themselves contemplate the existence of the covenant of good faith and fair dealing. Therefore, under both Singapore law and Indonesian Law, the inherent warranty of good faith and fair dealing should be applied to the FA. 74 T. Mark McLaughlin & Caryn Jacobs, Termination of Franchises: Application of the Implied Covenant of Good Faith and Fair Dealing, 7 FRANCHISE L.J. 1, 16 ( ). 75 Boyd Allan Byers, Making a Case for Federal Regulation of Franchise Terminations-A Return-of-Equity Approach, 19 J. CORP. L. 607, 625 ( ). 76 Telestop Pte Ltd v Telecom Equipment Pte Ltd [2004] SGHC 267 (Sing.). 77 T. Mark McLaughlin & Caryn Jacobs, supra note 74, p Gillian Lee, Franchising in Singapore and Malaysia, 2 INT L J. FRANCHISING L.34, 34 (2004). XXX

32 2. Pursuant to the implied covenant of good faith and fair dealing, the termination of the Franchise by the Franchisor is unjustifiable Pursuant to the implied covenant of good faith, the contract is terminable only for good cause. 79 The consideration factors to determine good cause may comprise (i) the franchisor's motive for terminating the franchise; and (ii) the analysis of impact of franchisee breaches on franchisor trademark. 80 Furthermore, good cause is defined as "the failure of the franchisee to substantially comply" with a franchise contract. 81 Therefore, to justify the termination of the Franchise, the Franchisor's motive must be fair and the impact of Franchisee breaches on the trademark must be significant enough to be considered substantial. a. The termination of the Franchise is unjustifiable because of the Franchisor s unfair motive and the violations of the FA should not be considered substantial i) The Franchisor motive for terminating the Franchise is unfair If a preponderance of the evidence indicates that the franchisor is unreasonably exercising superior coercive power to unfairly prejudice the franchisee by terminating the franchise, good cause will not be found. 82 Concurrently, good cause requires the franchisor will not terminate the agreement in order to reap the profits of the established franchise, which the franchisee has expended time and money to establish. 83 When the two new franchises opened in September 2011 and the Jakarta location is far more successful than the Medan location, Mr. Ji sent an to Mr. Wang contained the message The Jakarta restaurant is a gold mine. I told you we should have given the 79 The Original Great American Chocolate Chip Cookie Co. v. River Valley Cookies, Ltd., 970 F.2d 273 (7th Cir. 1992); T. Mark McLaughlin &Caryn Jacobs, supra note 74, p Tracey A. Nicastro, How the Cookie Crumbles: The Good Cause Requirement for Terminating a Franchise Agreement, 28 VAL. U. L. REV. 785, 817 (1994). 81 Id, p Id, p Id, p.801. XXXI