On remittal from the Court of Appeal, the Supreme Court held that Netdeen's board satisfied the requirements of clause 4.7 of the Master Franchise Agreement because each director honestly and reasonably formed the opinion that, based on Lindfield's performance as master franchisee (including inadequate support of sub-franchisees, the Specified Person's disengagement, brand disparagement, and MFA breaches), renewal was not in the best interests of Netdeen and sub-franchisees. The absence of detailed board minutes was not fatal where the directors' unchallenged or insufficiently challenged oral evidence established their reasoning. Had Lindfield succeeded, the Court would have awarded $13.4 million in damages using a DCF model with a 20% discount rate, 32 sub-franchisees as the starting point, and 2024 market share data rather than historical averages.
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