Hi there. It sounds like you are in a difficult position. Generally speaking, a legal contract is formed when all the parties agree on the terms, they have shown an intention to create a contract, and money or something else of value has changed hands. If both parties have signed a document labelled a ‘contract’, then this is a good indicator that a legal contract has been formed. However, whether a contract exists and the terms of that contract will largely depend on your particular circumstances and the dealings you had with the franchisor before you signed the contract.

If the franchisor made a mistake about the price and only notified you of the higher price after you had signed the contract, then you may have the option of withdrawing from the contract without penalty. The law recognises that if one party makes a mistake about an important term of the contract (such as the price), then the other party should have the option of walking away from the contract. Although you may be able to withdraw from the contract, this does not necessarily mean you can enforce the original agreed price.

The law also recognises that sometimes a party makes misleading or false statements when negotiating with another party in an attempt to induce them into signing a contract. This is called ‘misrepresentation’. If the franchisor made false statements about the amount owing under the contract as a way to get you to sign the contract, then he or she may be liable for misrepresentation. This would also entitle you to withdraw from the contract.