Franchisee gunning for Tammy Taylor Nails SA’s liquidation

The Tammy Taylor Nails SA franchise is in hot water with a franchisee.

Two women who wanted to buy a franchise are asking the court to provisionally liquidate the company, while the National Consumer Commission has also issued an investigation directive to investigate the franchise.

However, Tammy Taylor Nails SA is opposing the application, raising several factual disputes and asking the court to dismiss the application.

Cynthia Buthelezi and Rumbidzai Hove say in their founding affidavit submitted in support of the provisional liquidation application that they planned to open a franchise as partners.

After putting their savings together, they paid R172 500, half of the required R345 000 of the purchase price. The women say they signed a franchise agreement, but did not receive a copy, even after numerous requests.

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Deciding to cancel within the cooling-off period

However, after reading various news articles and watching a television programme which made “rather unsavoury comments and disclosures” about Tammy Taylor Nails and its alleged “unethical business practices”.

They were not aware of these allegations and decided to use their right to cancel within the cooling-off period and rather cancel the deal.

According to section 7(2) of the Consumer Protection Act, a franchisee can cancel a franchise agreement without cost or penalty within 10 business days after signing the agreement by giving written notice to the franchisor.

The women explain in court papers that two days after they signed, their lawyer, franchise expert Charl Groenewald of MacRobert Attorneys, contacted the head office to cancel the agreement.

In particular, he requested a signed copy of the contract and notwithstanding an employee’s express undertaking to do so, Tammy Taylor inexplicably refused to disclose it.

Although the company denies of this conversation, the two applicants attached an actual transcription of this phone call to their court papers.

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No copy of the Tammy Taylor Nails franchise agreement

MacRobert then forwarded a letter to the company to formally cancel and request a copy of the agreement.

Apparently no reply was received, except for various promises that the agreement would be forwarded, but it was not sent.

According to their founding affidavit, the women then served a liquidation notice on Tammy Taylor Nails for its failure to repay their money, but again received no reply.

The inescapable conclusion is that the company is financially unable to repay them and they subsequently applied for the company’s provisional liquidation.

In her answering affidavit Melany Viljoen, the CEO of Tammy Taylor Nails SA, said the company is opposing this application on two grounds, namely that the agreement was not cancelled in time and that the women brought the application against the wrong company.

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Did they cancel too late?

Tammy Taylor Nails alleges that the franchise agreement was not cancelled within the cooling-off period and in the answering affidavit gives a date of signature which is different to what Buthelezi and Hove allege.

In their responding affidavit, the women claim they were instructed to not put in the date, as they were told that would be done once they paid the outstanding balance.

They allege that Tammy Taylor Nails “in an unlawful manner backdated” the franchise agreement.

They also submitted Tracker reports and WhatsApp messages which, on the face of it, show that the agreement could not have been signed on the date that Viljoen says it was.

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Which Tammy Taylor Nails company?

Tammy Taylor Nails states in its answering papers that the franchisees actually contracted with Tammy Taylor Nails Franchising No. 81 (Pty) Ltd, instead of Tammy Taylor Nails SA Franchising (Pty) Ltd.

According to Groenewald, a cursory CIPC search reveals that there are seemingly 100 Tammy Taylor companies registered in South Africa with Melany Viljoen as sole director.

Tammy Taylor Nails “inserted into the franchise agreement the registration of a private company that would be the actual franchisor, as opposed to the franchisor we dealt with and paid” and which “was not even in existence until more than a month later,” their court papers read.

Viljoen also denies the allegations in the media, saying the women tried to create “atmosphere in this application with irrelevant, unsubstantiated and slanderous information” and asks the court that it be struck for being vague, irrelevant and vexatious. Viljoen also wants the court to “take a dim view” of their actions.

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No right to a refund at Tammy Taylor Nails

She also argues that the agreement, which was filed as part of the answering affidavit, contains a clause that reads: “The franchisee shall have no right to any refund of the franchise fee, or any other sum paid to the franchisor under this agreement.”

Therefore, she believes that the company is not liable to pay any amount.

The women argue in their replying affidavit that Viljoen did not supply any proof that the company is solvent.

The replying affidavit also contained an investigation directive from the National Consumer Commission that indicates that the Commission is investigating nine other complaints about the franchise as well.

A date for the hearing has not yet been set.