Kanaan v Southbay Automotive, dba Meineke Car Care
May 09, 2017OUTCOME: Claimant won at arbitration and was awarded $80,000 plus costs and attorneys fees
This commercial arbitration action arises out of Claimant’s good faith purchase of Respondent’s Meineke Car Care Service Center franchise located in Anaheim, California. Claimant made and initial $80,0 ... 00 cash outlay to purchase the franchise only to later learn that Respondent materially misled Claimant as to the businesses’ past monthly and annual gross revenue and profitability. Moreover, after Claimant paid Respondent $80,000 to purchase the business and after Claimant successfully attended and completed a mandatory three week franchise training program at Meineke’s North Carolina Franchise Headquarters, Claimant learned that Meineke (hereafter sometimes referred to as “Franchisor”) was unwilling to approve the transfer of the franchise business from Respondent to Claimant due to Respondent’s refusal or inability to pay outstanding account receivable’s that Respondent owed the Franchisor. Claimant initiated an arbitration claim against Respondent and alleged claims for intentional misrepresentation, negligent misrepresentation and breach of contract in connection with the purchase and sale agreement. Claimant sought rescission of the purchase agreement, restitution and damages for intentional and negligent misrepresentation in connection with the purchase and sale agreement. Claimant also sought recovery of attorney’s fees and costs as the prevailing party.
