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*The above articles reflect the law at the date on which they were written. Since that time the law may have changed. No reliance should therefore be placed on any statements or opinions in the articles without first checking that they represent the current state of the law.


Benjys faces lawsuit from franchisees


BENJYS, the sandwich bars chain, is under legal attack from its own franchise operators, who allege the operation is a ' living nightmare'.

A 29-page letter addressed to Benjys' lawyers on behalf of 33 current and former franchisees of Benjys Delivered, the company's food delivery operation, is threatening legal action over a series of alleged misrepresentations.

Starting formal High Court proceedings could see the franchisees seeking damages of about £10m, say sources close to the spat.

Among the van workers' allegations are that Benjys induced people to buy into its operation with a pledge of 'ready to go customers' which 'it deliberately knew to be false or made recklessly'.

Both sides met behind closed doors in a related High Court injunction hearing yesterday over attempts by van franchisees to claw back money handed to Benjys' owners under banking agreements.

The action comes as sources at newly set-up Benjys shop franchises in London said they are considering legal action, after the collapse this week of an outlet in Paddington.

Latest published figures for Benjys' operating company show almost £3m of losses for the year to 31 March 2005, against a pre-tax profit of £263,747 a year earlier. But at group level losses widened to over £5.3m.

Chief executive Ian Rickwood said: 'Benjys Delivered continues to see fantastic growth, we have around 115 vans on the road and are currently enjoying like-forlike growth of 20%. The majority of our franchisees are enjoying success.'


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SPAT:

Franchisees could seek damages of about £10m, say sources