Sunshine Coast businessman embroiled in ex-licensee disputes
An award-winning Sunshine Coast businessman has become embroiled in several bitter disputes with former landlords and licensees which they claim forced venues to close.
Business
Don't miss out on the headlines from Business. Followed categories will be added to My News.
An award-winning Sunshine Coast businessman has been embroiled in a bitter dispute between former licensees and landlords which they claim resulted in the closure of two company stores.
The Good Place Co founder and well-known Kawana businessman James McGovern has rejected claims made by Sunshine Coast and Brisbane ex-licensees, suppliers and a landlord that they were left with substantial debts.
TGP Regional Investments Pty Ltd – named as the parent company in a letter of demand sighted by the Sunshine Coast Daily – lists The Good Place Co Pty Ltd as one of the shareholders.
Mr McGovern confirmed he was the founder of the The Good Place brand and a shareholder of The Good Place Co Pty Ltd however he has rejected claims made in the letter of demand sent to the parent company TGP Regional Investments as well as Mr McGovern and his business partners.
The Good Place venues in Noosa and Indooroopilly closed after relationships became “untenable” between licensees and Mr McGovern and the parent company.
The company’s Cleveland store remains open under a different licensee.
The letter of demand was sent on behalf of former Cleveland franchisee Mustapha Habbouchi, 26.
His representatives fired off a letter on January 17, 2022 seeking payment of more than $120,000.
However Mr McGovern and his lawyers rejected the letter.
The prominent Sunshine Coast entrepreneur who provided several documents to support his claims slammed the accusations as “false”.
Mr Habbouchi opened the Cleveland store in August, 2021 and said he ran a “successful, profitable” business.
However, Mr Habbouchi said it quickly unravelled.
“I went in with a good heart and I’ve worked in hospitality for a decade. I know what I’m doing,” Mr Habbouchi said.
Mr Habbouchi officially walked away from the company in November, 2021, claiming he did not expect to be paid money he claimed was owed to him.
Mr McGovern’s lawyers rejected the letter of demand which Mr McGovern said was “baseless”.
Mr McGovern added that he considered the matter to be closed and said he was in the process of pursuing civil actions against Mr Habbouchi and the ex-licensee from the Noosa store, which also closed last year, over a range of issues.
Mr Habbouchi said no civil action had been taken up with him.
A search of online civil court files found no results for any matters between Mr McGovern and Mr Habbouchi as of February 24, 2022.
The ex-Noosa licensee declined to comment when approached by the Sunshine Coast Daily.
Mr McGovern said the closure of the Noosa outlet was “facilitated by its licensee”.
“This is a legal matter we are pursuing that is currently not resolved,” Mr McGovern said.
“The Good Place Co is an unpaid creditor of both of these ex-licensees (Noosa and Cleveland).”
The former Noosa licensee declined to comment when asked about Mr McGovern’s claims and Mr Habbouchi said they were laughable.
Mr McGovern was sent a list of questions about claims he owed money to the former licensees and a landlord, as well as suppliers on the Sunshine Coast.
Mr McGovern rejected the claims and said they came from “disgruntled” ex-licensees who were “jealous of the positive attitude and success of his business”.
He accused Mr Habbouchi and others of trying to “shift the blame to others who they hope to damage” – a claim which Mr Habbouchi rejected.
“The licensor of The Good Place, of which I am a shareholder, currently has no outstanding creditors,” Mr McGovern said.
“Licensees of a parent business benefit from the use of the licensor’s name/brand, but the licensee is himself or herself responsible for the day-to-day operations of the business and any debts incurred. That is common business practice.”
Mr Habbouchi said the claims were “ridiculous” and stressed that had been made by Mr McGovern to repay the debts.
Landlord of the The Good Place Co’s former Indooroopilly site, Samantha Mathers claims she and her business partners were still owed at least $20,000.
“We are still owed $20,000 just in hard cost of rent, outgoings,” Mrs Mathers said.
Mr McGovern said any unpaid bills left after the closure of the Indooroopilly venue were under the responsibility of the licensee.
It comes 12 months after Mrs Mathers and her partners had entered into a licensed agreement, negotiated by Mr McGovern, with The Good Place Co to open a store in Indooroopilly in November, 2020.
After months of unpaid outgoings and rent and several attempts to resolve the matters, Mrs Mathers and her partners terminated the licence agreement.
Mrs Mathers said she and her business partners issued letters of demand and a statutory demand was issued to TGP Regional Investments – both sighted by the Sunshine Coast Daily – which she said have not been complied with.
Mrs Mathers said no attempt had been made by the company to repay the debt.
In an initial response to questions Mr McGovern said the licensee operates and manages the businesses as their own “to which we have no access and no control of payments”.
When asked about negotiations for the Indooroopilly site and claims of debts outstanding to the landlords Mr McGovern explained the parent company was not responsible for the alleged debts of licensees.
“I understand the frustrations of creditors and that they are seeking to pursue the brand after they have had no luck pursuing those actually responsible,” he said.
“Of course we have negotiated on behalf of licensees and tried to work with them to resolve these issues – as that is our job – but that doesn’t somehow make us responsible for their alleged debts.”
Mrs Mathers said Mr McGovern’s response was “fanciful” and that his claims that he had no responsibility for the site or any of the related debts were “false”.
“The venture was unsuccessful because of poor management on their part, unrelated to Covid or any fault of ours,” Mrs Mathers said.
“Eventually, our relationship with Mr McGovern became untenable.”
Mr McGovern said the claims were part of a smear campaign against himself and The Good Place brand in order to “leverage us”.
He said if the company was guilty of anything it was recruiting the wrong licensees.
“We put our hand up for that and have made adjustments to our recruitment and onboarding process to ensure we don’t make the same mistakes again,” he said.
“However this does not give those ex-licensees the right to defame myself and our current licensees that are running good businesses and doing good things for the community.”
Mr McGovern said it was “interesting to note” that Mr Habbouchi was set to open a new cafe at the same Indooroopilly site.
The Good Place Co was named as a 2021 finalist for hospitality at the Sunshine Coast Business Awards while it also won a corporate volunteering award at the inaugural Sunshine Coast Community Gala and Awards program.
The Australian Securities and Investments Commission search listed Mr McGovern as the former director of Skinnys Cafe Bar and Grill in Bondi Beach.
The search revealed the company was deregistered in November, 2018 following allegations Mr McGovern had been accused of not paying staff at the cafe.
The Daily Mail reported at the time that staff claimed they were owed up to eight weeks’ pay each.
Mr McGovern spoke to the publication and said it was an “awful situation”.
“I’m waiting for a loan and when this comes through I can pay the staff – I understand it’s stressful for them and I feel awful about it,” Mr McGovern said.
Mr McGovern said he was “unaware if they (staff) were paid when the company was deregistered” but said he regretted the failure of the business.
“I’ve always been very open about my business failure five years ago in Sydney,” Mr McGovern said.
“I reference it always during occasional public speaking events and I am always open about it with potential licensees.
“I reveal what I learned from it – while I strongly regret the failure, it is one of the influences of the positive community-focus with which I proudly run my business today.”
The Good Place Co was originally started by former My Kitchen Rules finalist Scott Gooding who opened gluten and soy-free eateries to provide health offerings.
When approached for comment, Mr Gooding said he no longer had anything to do with the company.
The Good Place Co opened a store in Penrith four weeks ago while a store has just opened in Rockhampton.
Share tips: experts’ buy, hold and sell recommendations
A mixed bag of share tips this week has something for everyone, just like global financial markets last week. See their suggestions.
Read more
How ‘dumb luck’ launched a $1 trillion opportunity
Stonepeak founder Mike Dorrell was in the right place at the right time. But the highly sought after fund manager is rewriting the rules on infrastructure.
Read more