Scraps buffet family dining chain

Buffet chain Valentines has denied disharmony is on its menu because of restaurant closures and a legal scrap with its South Auckland franchisee. The chain's Tauranga operator has left the franchise and changed the name of his restaurant.

The New Zealand Herald
October 20, 2001

Scraps buffet family dining chain
Simon Hendery

Buffet chain Valentines has denied disharmony is on its menu because of restaurant closures and a legal scrap with its South Auckland franchisee.

One of Valentines' two Christchurch restaurants closed this year and its Nelson restaurant will shut its doors at the end of this month.

The chain's Tauranga operator has left the franchise and changed the name of his restaurant.

Manukau franchisee Des Cowie went to the Manukau District Court last month seeking a stay of proceedings against a claim for $63,000 lodged by the franchise company.

Valentines' owner, Aucklander Geoff MacRae, says the closures are part of the 16-restaurant chain's evolution and the court case is typical of issues that arise with franchises.

In a judgment released this month, Judge Heather Simpson said that during last year, Mr. Cowie raised a number of concerns he claimed were breaches of his franchise agreement with Valentines. As the issues were not resolved so he withheld payments to the company.

Valentines went to court claiming $29,000 in unpaid franchising fees and almost $34,000 in advertising contributions.

Mr. Cowie argued in court that the legal action should be stayed because under the franchise agreement disputes were to be referred to arbitration.

Judge Simpson agreed. She ordered a stay of the proceedings, awarded $500 costs to Mr. Cowie and said the dispute should be sent to arbitration.

"I am satisfied from the background of dealings between the parties that the plaintiff's claim must be seen as part of a wider dispute," Judge Simpson said.

"There is no indication that the defendant [Mr. Cowie] is unable to meet the payments due but has deliberately delayed as a way of bringing to a head various matters at issue between the parties."

Mr. Cowie, who has run the Manukau restaurant since 1993, declined to comment.

Mr. MacRae said that although the two sides would go to arbitration, he intended appealing against the judge's decision.

He said the dispute was typical of "issues that come into any franchising relationship" that got resolved in the course of time and in the course of business.

He said Valentines had terminated its contract with Tauranga franchisee Brian Willers and planned to open at another site in the city "which suits us better". Mr. Willers, who has renamed his restaurant Caeser's Buffet & Bar, declined to comment.

Robyn Broughton, a director of Valentines Nelson, which is closing at the end of this month, also declined to comment.

Mr. MacRae said a mutual and amicable decision had been made to close the business.

Sales had been slow in Nelson, an opportunity to lease out the building had arisen, and Mrs. Broughton and her husband had decided to leave Nelson for family reasons.

Mr. MacRae said the Christchurch restaurant, once one of the chain's star performers, faced strong competition from other buffet restaurants in the city and was closed after it was decided that
Valentines could best compete if it had only one restaurant.

"A chain of restaurants has got to be continually evolving and keeping up with the times and I wouldn't want [the closures] to be taken in the wrong light," he said.

The chain, which since 1989 was known for its pink-and-blue livery, underwent a facelift this year as part of a marketing campaign aimed at updating its image.

Mr. MacRae said the rebranding had gone well and had boosted the turnover of restaurants.


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Risks: Franchisee decision, independence, Independence, Abandonment, Termination of franchisee, single, Franchisee revolt, New Zealand, 20011020 Scraps buffet

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