Day 139 - 21 Jun 95 - Page 04

     
     1   Q.   If they were not producing certain standards in respect of
     2        service, for example, you could terminate a franchise
     3        agreement?
     4        A.  It is not that simple.  Most laws, most countries --
     5        and use the United States as an example -- there is a whole
     6        area franchise legislation; there are processes with
     7        procedures and potentially court actions that govern that
     8        whole area.
     9
    10   Q.   But, presumably, there is some point in having a franchise
    11        agreement?
    12        A.  Oh, absolutely.
    13
    14   Q.   And that point would be that if they do not stick to it,
    15        you can take some kind of action?
    16        A.  It sets out the terms and conditions under which the
    17        franchise has been awarded.
    18
    19   Q.   If they do not fulfil those terms and conditions, you can
    20        take some kind of action?
         A.  That is correct.
    22
    23   Q.   Including terminating franchise?
    24        A.  I think I have tried to describe to you that we could
    25        initiate a process that could lead into an action.  We do
    26        not have the right just to say: "Hey, you are out."  That
    27        is not the way it works.
    28
    29   MR. MORRIS:  Can we go to the franchise agreement relating to
    30        Ireland, between McDonald's Corporation and -----
    31
    32   MR. JUSTICE BELL:  Yes.  Yellow X.
    33        A.  Which number?
    34
    35   Q.    Yellow X.  You had it out on the side.  It is the open
    36        one, I think, by your right hand.
    37        A.  Yes, I have it.
    38
    39   Q.    If you turn to tab 4, that is your first, longest
    40        statement.
         A.  Yes.
    42
    43   Q.   I think you will find there an operating licence which had
    44        the franchise on it.
    45        A.  OK.  Yes, I have it, my Lord.
    46
    47   MR. MORRIS:  If we look on the first page, at the bottom of the
    48        page, the sentence reads:
    49
    50        "The foundation of the McDonald's System and the essence of 
    51        this License is the adherence by Licensee to standards and 
    52        policies of Licensor" -- that is the McDonald's Corporation 
    53        -- "providing for the uniform operation of all McDonald's
    54        Restaurants within the McDonald's System...."
    55
    56        Then it goes on another various things that that would
    57        apply to, but not limited to.  I am not going to read it
    58        out.
    59
    60        "....including but not limited to, serving only designated