By Cain H.B. No. 941
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the authority and responsibility of the Texas Motor
1-3 Vehicle Board of the Texas Department of Transportation.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 1.03, Texas Motor Vehicle Commission Code
1-6 (Article 4413(36), Vernon's Texas Civil Statutes), is amended to
1-7 read as follows:
1-8 Sec. 1.03. Definitions. In this Act:
1-9 (1) "Motor vehicle" means:
1-10 (A) every fully self-propelled vehicle which has
1-11 as its primary purpose the transport of a person or persons, or
1-12 property, on a public highway, and having two or more wheels;
1-13 (B) every two or more wheeled fully
1-14 self-propelled, titled vehicle which has as its primary purpose the
1-15 transport of a person or persons or property and is not
1-16 manufactured for use on public streets, roads, or highways; or
1-17 (C) an engine, transmission, or rear axle
1-18 manufactured for installation in a vehicle having as its primary
1-19 purpose the transport of a person or persons or property on a
1-20 public highway and having a gross vehicle weight rating of more
1-21 than 16,000 pounds, whether or not attached to a vehicle chassis.
1-22 (2) "New motor vehicle" means a motor vehicle which
1-23 has not been the subject of a "retail sale" without regard to the
2-1 mileage of the vehicle.
2-2 (3) "Person" means a natural person, partnership,
2-3 corporation, association, trust, estate, or any other legal entity.
2-4 (4) "Dealer" means any person engaged in the business
2-5 of buying, selling or exchanging new motor vehicles at an
2-6 established and permanent place of business pursuant to a franchise
2-7 in effect with a manufacturer or distributor.
2-8 (5) "Manufacturer" means any person who manufactures
2-9 or assembles new motor vehicles either within or without this
2-10 State.
2-11 (6) "Distributor" means any person who distributes
2-12 and/or sells new motor vehicles to dealers and who is not a
2-13 manufacturer.
2-14 (7) "Representative" means any person who is or acts
2-15 as an agent, employee or representative of a manufacturer,
2-16 distributor, or converter who performs any duties in this State
2-17 relating to promoting the distribution and/or sale of new motor
2-18 vehicles or contacts dealers in this State on behalf of a
2-19 manufacturer, distributor, or converter.
2-20 (8) "Franchise" means one or more contracts under
2-21 which (A) the franchisee is granted the right to sell new motor
2-22 vehicles manufactured or distributed by the franchisor; (B) the
2-23 franchisee as an independent business is a component of
2-24 franchisor's distribution system; (C) the franchisee is
2-25 substantially associated with franchisor's trademark, tradename and
3-1 commercial symbol; (D) the franchisee's business is substantially
3-2 reliant on franchisor for a continued supply of motor vehicles,
3-3 parts, and accessories for the conduct of its business; or (E) any
3-4 right, duty, or obligation granted or imposed by this Act is
3-5 affected. The term includes a written communication from a
3-6 franchisor to a franchisee by which a duty is imposed on the
3-7 franchisee.
3-8 (10) "Broker" means a person who, for a fee,
3-9 commission, or other valuable consideration, arranges or offers to
3-10 arrange a transaction involving the sale, for purposes other than
3-11 resale, of a new motor vehicle, and who is not:
3-12 (A) a dealer or bona fide employee of a dealer
3-13 when acting on behalf of a dealer;
3-14 (B) a representative or bona fide employee of a
3-15 representative when acting on behalf of a representative;
3-16 (C) a distributor or bona fide employee of a
3-17 distributor when acting on behalf of a distributor; or
3-18 (D) at any point in the transaction the bona
3-19 fide owner of the vehicle involved in the transaction.
3-20 (11) "Motor home" means a motor vehicle which is
3-21 designed to provide temporary living quarters and which:
3-22 (A) is built onto as an integral part of, or is
3-23 permanently attached to, a motor vehicle chassis; and
3-24 (B) contains at least four of the following
3-25 independent life support systems if each is permanently installed
4-1 and designed to be removed only for purposes of repair or
4-2 replacement and meets the standards of the American National
4-3 Standards Institute, Standards for Recreational Vehicles:
4-4 (i) a cooking facility with an on-board
4-5 fuel source;
4-6 (ii) a gas or electric refrigerator;
4-7 (iii) a toilet with exterior evacuation;
4-8 (iv) a heating or air conditioning system
4-9 with an on-board power or fuel source separate from the vehicle
4-10 engine;
4-11 (v) a potable water supply system that
4-12 includes at least a sink, a faucet, and a water tank with an
4-13 exterior service supply connection;
4-14 (vi) a 110-125 volt electric power supply.
4-15 (12) "Conversion" means a motor vehicle, other than a
4-16 motor home, which has been modified by a person other than the
4-17 dealer or manufacturer of the chassis of the motor vehicle and
4-18 which has not been the subject of a retail sale.
4-19 (13) "Motor home manufacturer" means a person other
4-20 than the manufacturer of the chassis of a motor vehicle who, prior
4-21 to the retail sale of the motor vehicle, performs modifications on
4-22 the chassis that result in the finished product being classified as
4-23 a motor home.
4-24 (14) "Chassis manufacturer" means a person who
4-25 manufactures and produces the frame upon which is mounted the body
5-1 of a motor vehicle.
5-2 (15) "Converter" means a person, other than a dealer,
5-3 who prior to the retail sale of a motor vehicle, assembles,
5-4 installs, or affixes a body, cab, or special equipment to a
5-5 chassis, or who adds, subtracts from, or modifies a previously
5-6 assembled or manufactured motor vehicle.
5-7 (16) "Rule" means a statement by the Commission of
5-8 general and future applicability that implements, interprets, or
5-9 prescribes law or policy or describes the organization or
5-10 procedural practice requirements of the Commission. The term
5-11 includes the amendment or repeal of a prior rule, but does not
5-12 include statements concerning only the internal management of the
5-13 Commission which do not affect the rights of a person not connected
5-14 with the Commission.
5-15 (17) "Party" means each person or agency named or
5-16 admitted as a party and whose legal rights, duties, or privileges
5-17 are to be determined by the Commission after an opportunity for
5-18 adjudicative hearing.
5-19 (18) "Relocation" means the transfer of an existing
5-20 dealership operation to facilities at a different location,
5-21 including a transfer which results in a consolidation or dualing of
5-22 an existing dealer's operation.
5-23 (19) "Retail sale" means the sale of a motor vehicle
5-24 except:
5-25 (A) a sale in which the purchaser acquires a
6-1 vehicle for the purpose of resale; or
6-2 (B) a sale of a vehicle that is operated under
6-3 and in accordance with Article 6686, Revised Statutes.
6-4 (20) "Warranty work" means parts, labor, and any other
6-5 expenses incurred by a dealer in complying with the terms of a
6-6 manufacturer's or distributor's warranty.
6-7 SECTION 2. Section 1.04, Texas Motor Vehicle Commission Code
6-8 (Article 4413(36), Vernon's Texas Civil Statutes), is amended to
6-9 read as follows:
6-10 Sec. 1.04. Construction and severability. This Act shall be
6-11 liberally construed so as to effectuate its purposes. The
6-12 provisions of this Act are severable and if any phrase, clause,
6-13 sentence, or provision of this Act is declared to be contrary to
6-14 the constitution of this state, or of the United States or the
6-15 applicability thereof to any person or circumstance is held
6-16 invalid, the validity of the remainder of this Act and the
6-17 applicability thereof to any person or circumstance is not affected
6-18 thereby. An agreement to waive the terms of this Act is void and
6-19 unenforceable.
6-20 SECTION 3. Section 4.05(e), Texas Motor Vehicle Commission
6-21 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
6-22 to read as follows:
6-23 (e) The filing fees for a contested case or protest that
6-24 involves a hearing are:
6-25 (1) for a complaint filed under Section 6.07 of this
7-1 Act, $35 <$75>; and
7-2 (2) for all other complaints or protests, $200.
7-3 SECTION 4. Section 5.01, Texas Motor Vehicle Commission Code
7-4 (Article 4413(36), Vernon's Texas Civil Statutes), is amended to
7-5 read as follows:
7-6 Sec. 5.01. DEALERS. It shall be unlawful for any dealer to:
7-7 (1) Require a retail purchaser of a new motor vehicle
7-8 as a condition of sale and delivery thereof to purchase special
7-9 features, equipment, parts, or accessories not ordered or desired
7-10 by the purchaser, provided such features, equipment, parts, or
7-11 accessories are not already installed on the new motor vehicle at
7-12 the time of sale.
7-13 (2) Use false, deceptive, or misleading advertising.
7-14 (3) Fail to perform the obligations placed on the
7-15 selling dealer in connection with the delivery and preparation of a
7-16 new motor vehicle for retail sale as provided in the manufacturer's
7-17 preparation and delivery agreements on file with the Commission and
7-18 applicable to such vehicle.
7-19 (4) Fail to perform the obligations placed on the
7-20 dealer in connection with the manufacturer's warranty agreements on
7-21 file with the Commission.
7-22 (5) Operate as a dealer without a currently valid
7-23 license from the Commission or otherwise violate this Act or rules
7-24 promulgated by the Commission hereunder.
7-25 (6) Operate without appropriate signs readily and
8-1 easily visible to the public, identifying the dealer's place of
8-2 business and the products the dealer offers for sale. In the event
8-3 of a conflict with another law or ordinance, this subdivision
8-4 prevails, and in the event of a dispute, the Board has exclusive
8-5 jurisdiction to determine whether a sign or signs are in compliance
8-6 with the terms of this subdivision.
8-7 SECTION 5. Section 5.02, Texas Motor Vehicle Commission Code
8-8 (Article 4413(36), Vernon's Texas Civil Statutes), is amended to
8-9 read as follows:
8-10 Sec. 5.02. Manufacturers; Distributors; Representatives. It
8-11 shall be unlawful for any manufacturer, distributor, or
8-12 representative to:
8-13 (1) Require or attempt to require any dealer to order,
8-14 accept delivery of or pay anything of value, directly or
8-15 indirectly, for any motor vehicle, appliance, part, accessory or
8-16 any other commodity unless voluntarily ordered or contracted for by
8-17 such dealer.
8-18 (2) Refuse or fail to deliver, in reasonable
8-19 quantities and within a reasonable time, to <after receipt of an
8-20 order from> a dealer having a franchise agreement for the retail
8-21 sale of any motor vehicles sold or distributed by such
8-22 manufacturer, distributor, or representative, any new motor vehicle
8-23 or parts or accessories to new motor vehicles as are covered by
8-24 such franchise if such vehicle, parts or accessories are publicly
8-25 advertised as being available for delivery or are actually being
9-1 delivered; provided, however, this provision is not violated if
9-2 such failure is caused by acts of God, work stoppage or delays due
9-3 to strikes or labor disputes, freight embargoes or other causes
9-4 beyond the control of the manufacturer, distributor, or
9-5 representative.
9-6 (3) Notwithstanding the terms of any franchise
9-7 agreement:
9-8 (A) Terminate or refuse to continue any
9-9 franchise with a dealer unless all of the following conditions are
9-10 met:
9-11 (i) the dealer and the Commission have
9-12 received written notice by registered or certified mail from the
9-13 manufacturer, distributor, or representative not less than 60 days
9-14 before the effective date of termination or noncontinuance setting
9-15 forth the specific grounds for termination or noncontinuance; and
9-16 (ii) the written notice contains on the
9-17 first page thereof a conspicuous statement which reads as
9-18 follows: "NOTICE TO DEALER: YOU MAY BE ENTITLED TO FILE A PROTEST
9-19 WITH THE TEXAS MOTOR VEHICLE COMMISSION IN AUSTIN, TEXAS, AND HAVE
9-20 A HEARING IN WHICH YOU MAY PROTEST THE PROPOSED TERMINATION OR
9-21 NONCONTINUANCE OF YOUR FRANCHISE UNDER THE TERMS OF THE TEXAS MOTOR
9-22 VEHICLE COMMISSION CODE IF YOU OPPOSE THIS ACTION."; and
9-23 (iii) the manufacturer, distributor, or
9-24 representative has received the informed, written consent of the
9-25 affected dealer or the appropriate period for the affected dealer
10-1 to protest the proposed franchise termination or noncontinuance has
10-2 lapsed; or
10-3 (iv) if the affected dealer files a
10-4 protest with the Commission within the greater of (1) 60 days after
10-5 receiving its 60-day notice of proposed termination or
10-6 noncontinuance or (2) the time specified in such notice, the
10-7 Commission determines that the party seeking to terminate or not
10-8 continue a dealer's franchise has established by a preponderance of
10-9 the evidence, at a hearing called by the Commission, that there is
10-10 good cause for the proposed termination or noncontinuance.
10-11 (v) Notwithstanding Subdivisions (3)(A)(i)
10-12 and (3)(A)(iv) of this section, notice may be made not less than 15
10-13 days prior to the effective date of termination or noncontinuance
10-14 if a licensed dealer fails to conduct its customary sales and
10-15 service operations during its customary business hours for seven
10-16 consecutive business days unless such failure is caused by an act
10-17 of God, work stoppage or delays due to strikes or labor disputes,
10-18 an order of the Commission, or other causes beyond the control of
10-19 the dealer.
10-20 (B) Whenever a dealer files a timely protest to
10-21 a proposed franchise termination or noncontinuance, the Commission
10-22 shall notify the party seeking to terminate or to not continue the
10-23 protesting dealer's franchise that a timely protest has been filed,
10-24 that a hearing is required in accordance with this Act, and that
10-25 the party who gave the dealer notice of termination or
11-1 noncontinuation of the franchise may not terminate or refuse to
11-2 continue the franchise until the Commission issues its final
11-3 decision or order.
11-4 (C) If a franchise is terminated or not
11-5 continued, another franchise in the same line-make will be
11-6 established within a reasonable time unless it is shown to the
11-7 Commission by a preponderance of the evidence that the community or
11-8 trade area cannot reasonably support such a dealership. If this
11-9 showing is made, no dealer license shall be thereafter issued in
11-10 the same area unless a change in circumstances is established.
11-11 (4) Notwithstanding the terms of any franchise
11-12 agreement, modify or replace a franchise with a succeeding
11-13 franchise if the modification or replacement would adversely
11-14 affect, to a substantial degree, the dealer's sales, investment, or
11-15 obligations to provide service to the public, unless the
11-16 manufacturer, distributor, or representative has first given the
11-17 Commission and each affected dealer written notice by registered or
11-18 certified mail of any such action 60 days in advance of the
11-19 modification or replacement. The written notice shall contain on
11-20 the first page thereof a conspicuous statement which reads as
11-21 follows: "NOTICE TO DEALER: YOU MAY BE ENTITLED TO FILE A PROTEST
11-22 WITH THE TEXAS MOTOR VEHICLE COMMISSION IN AUSTIN, TEXAS, AND HAVE
11-23 A HEARING IN WHICH YOU MAY PROTEST THE PROPOSED MODIFICATION OR
11-24 REPLACEMENT OF YOUR FRANCHISE WITH A SUCCEEDING FRANCHISE UNDER THE
11-25 TERMS OF THE TEXAS MOTOR VEHICLE COMMISSION CODE IF YOU OPPOSE THIS
12-1 ACTION." Within the greater of (1) 60 days after receipt of such
12-2 notice or (2) the time specified in such notice, a dealer may file
12-3 a protest with the Commission and the modification or replacement
12-4 shall not become effective unless and until the Commission
12-5 determines that the party seeking to modify or replace a franchise
12-6 with a succeeding franchise has demonstrated by a preponderance of
12-7 the evidence that there is good cause for the modification or
12-8 replacement. The prior franchise shall continue in effect until
12-9 the protest is resolved by the Commission.
12-10 (5) Notwithstanding the terms of any franchise
12-11 agreement, in determining whether good cause has been established
12-12 for modifying, replacing, terminating, or refusing to continue a
12-13 franchise, the Commission shall consider all the existing
12-14 circumstances including, without limitation by the enumeration
12-15 herein, all the following:
12-16 (A) the dealer's sales in relation to the sales
12-17 in the market;
12-18 (B) the dealer's investment and obligations;
12-19 (C) injury to the public welfare;
12-20 (D) the adequacy of the dealer's service
12-21 facilities, equipment, parts, and personnel in relation to those of
12-22 other dealers of new motor vehicles of the same line-make;
12-23 (E) whether warranties are being honored by the
12-24 dealer;
12-25 (F) the parties' compliance with their franchise
13-1 agreement; and
13-2 (G) the enforceability of the franchise
13-3 agreement from a public policy standpoint, including, without
13-4 limitation, issues of the reasonableness of the franchise
13-5 agreement's terms, oppression, adhesion, and the relative
13-6 bargaining power of the parties.
13-7 Good cause shall not be shown solely by the desire of a
13-8 manufacturer, distributor, or representative for market
13-9 penetration.
13-10 (6) Use any false, deceptive or misleading
13-11 advertising.
13-12 (7) Notwithstanding the terms of any franchise
13-13 agreement, prevent any dealer from reasonably changing the capital
13-14 structure of his dealership or the means by or through which he
13-15 finances the operation thereof, provided that the dealer meets
13-16 reasonable capital requirements.
13-17 (8) Notwithstanding the terms of any franchise
13-18 agreement, fail to give effect to or attempt to prevent any sale or
13-19 transfer of a dealer, dealership or franchise or interest therein
13-20 or management thereof unless, after complaint or protest, it is
13-21 demonstrated to the Commission after hearing that the result of any
13-22 such sale or transfer will be detrimental to the public or the
13-23 representation of the manufacturer or distributor.
13-24 (9) Notwithstanding the terms of any franchise
13-25 agreement, require or attempt to require that a dealer assign to or
14-1 act as an agent for any manufacturer, distributor or representative
14-2 in the securing of promissory notes and security agreements given
14-3 in connection with the sale or purchase of new motor vehicles or
14-4 the securing of policies of insurance on or having to do with the
14-5 operation of vehicles sold.
14-6 (10) Notwithstanding the terms of any franchise
14-7 agreement, fail or refuse, after complaint and hearing, to perform
14-8 the obligations placed on the manufacturer in connection with the
14-9 delivery, preparation and warranty of a new motor vehicle as
14-10 provided in the manufacturer's warranty, preparation, and delivery
14-11 agreements on file with the Commission.
14-12 (11) Notwithstanding the terms of any franchise
14-13 agreement, fail to compensate its dealers for the work and services
14-14 they are required to perform in connection with the dealer's
14-15 delivery and preparation obligations according to the agreements on
14-16 file with the Commission which must be found by the Commission to
14-17 be reasonable, or fail to adequately and fairly compensate its
14-18 dealers for labor, parts and other expenses incurred by such dealer
14-19 to perform under and comply with a manufacturer's or a
14-20 distributor's warranty agreement, or require, as a prerequisite to
14-21 the manufacturer's or distributor's payment of a claim for
14-22 reimbursement as required by this section, that a dealer file with
14-23 the manufacturer or distributor the actual time spent in the
14-24 performance of labor. In no event shall any manufacturer or
14-25 distributor pay its dealers an amount of money for warranty work
15-1 that is less than that charged by the dealer to the retail
15-2 customers of the dealer for nonwarranty work of like kind. All
15-3 claims made by dealers for compensation for delivery, preparation,
15-4 and warranty work shall be paid within 30 days after approval and
15-5 shall be approved or disapproved within 30 days after receipt.
15-6 Payment for all claims made by a dealer for compensation from a
15-7 manufacturer or distributor shall be made by the manufacturer or
15-8 distributor in the form of a negotiable instrument and may not be
15-9 offset by a manufacturer or distributor on a dealer's account.
15-10 When any claim is disapproved, the dealer shall be notified in
15-11 writing of the grounds for disapproval. No claim which has been
15-12 approved and paid may be charged back to the dealer unless it can
15-13 be shown that the claim was false or fraudulent, that the repairs
15-14 were not properly made or were unnecessary to correct the defective
15-15 condition, or that the dealer failed to reasonably substantiate the
15-16 claim in accordance with reasonable <the> written requirements of
15-17 the manufacturer or distributor, if the dealer has been notified of
15-18 the requirements prior to the time the claim arose, and if the
15-19 requirements were in effect at the time the claim arose. A
15-20 manufacturer or distributor may audit a claim following the
15-21 submission of the claim, and may, for a period not to exceed two
15-22 years after the submission of the claim, collect from the dealer
15-23 any sums paid by the manufacturer or distributor as a result of a
15-24 fraudulent claim. Notwithstanding the terms of a franchise
15-25 agreement or provision of law in conflict with this section, the
16-1 dealer's delivery, preparation, and warranty obligations as filed
16-2 with the Commission shall constitute the dealer's sole
16-3 responsibility for product liability as between the dealer and
16-4 manufacturer or distributor, and, except for a loss caused by the
16-5 dealer's failure to adhere to these obligations, a loss caused by
16-6 the dealer's negligence or intentional misconduct, or a loss caused
16-7 by the dealer's modification of a product without manufacturer or
16-8 distributor authorization, the manufacturer or distributor shall
16-9 reimburse the dealer for all loss incurred by the dealer, including
16-10 legal fees, court costs, and damages, as a result of the dealer
16-11 having been named a party in a product liability action.
16-12 (12) Operate as a manufacturer, distributor, or
16-13 representative without a currently valid license from the
16-14 Commission or otherwise violate this Act or rules promulgated by
16-15 the Commission hereunder.
16-16 (13) Notwithstanding the terms of any franchise
16-17 agreement, to prevent or refuse to honor the succession to a
16-18 dealership by any legal heir or devisee under the will of a dealer
16-19 or under the laws of descent and distribution of this State unless
16-20 it is shown to the Commission, after notice and hearing, that the
16-21 result of such succession will be detrimental to the public
16-22 interest and to the representation of the manufacturer or
16-23 distributor; provided, however, nothing herein shall prevent a
16-24 dealer, during his lifetime, from designating any person as his
16-25 successor dealer, by written instrument filed with the manufacturer
17-1 or distributor.
17-2 (14) Notwithstanding the terms of any franchise
17-3 agreement, require that a dealer pay or assume, directly or
17-4 indirectly, any part of any refund, rebate, discount, or other
17-5 financial adjustment made by the manufacturer, distributor, or
17-6 representative to, or in favor of, any customer of a dealer, unless
17-7 voluntarily agreed to by such dealer.
17-8 (15) Notwithstanding the terms of any franchise
17-9 agreement, deny or withhold approval of a written application to
17-10 relocate a franchise unless (A) the applicant has received written
17-11 notice of the denial or withholding of approval within 90 days
17-12 after receipt of the application containing information reasonably
17-13 necessary to enable the manufacturer or distributor to adequately
17-14 evaluate the application, and if (B) the applicant files a protest
17-15 with the Commission and establishes by a preponderance of the
17-16 evidence at a hearing called by the Commission that the grounds
17-17 for, and distance of, the relocation are reasonable.
17-18 (16) Notwithstanding the terms of any franchise
17-19 agreement, fail to pay to a dealer or any lienholder in accordance
17-20 with their respective interest after the termination of a
17-21 franchise:
17-22 (A) the dealer cost of each new motor vehicle in
17-23 the dealer's inventory with the mileage of 6,000 miles or less,
17-24 reduced by the net discount value of each, where "net discount
17-25 value" is determined according to the following formula: net cost
18-1 multiplied by total mileage divided by 100,000, and where "net
18-2 cost" equals the dealer cost plus any charges by the manufacturer,
18-3 distributor, or representative for distribution, delivery, and
18-4 taxes, less all allowances paid to the dealer by the manufacturer,
18-5 distributor, or representative for new, unsold, undamaged, and
18-6 complete motor vehicles of current model year or one year prior
18-7 model year in the dealer's inventory, except that if a vehicle
18-8 cannot be reduced by the net discount value, the manufacturer or
18-9 distributor shall pay the dealer the net cost of the vehicle;
18-10 (B) the dealer cost of each new, unused,
18-11 undamaged, and unsold part or accessory if the part or accessory is
18-12 in the current parts catalogue and is still in the original,
18-13 resalable merchandising package and in unbroken lots, except that
18-14 in the case of sheet metal, a comparable substitute for the
18-15 original package may be used, and if the part or accessory was
18-16 purchased by the dealer either directly from the manufacturer or
18-17 distributor or from an outgoing authorized dealer as a part of the
18-18 dealer's initial inventory;
18-19 (C) the fair market value of each undamaged sign
18-20 owned by the dealer which bears a trademark or tradename used or
18-21 claimed by the manufacturer, distributor, or representative if the
18-22 sign was purchased from or purchased at the request of the
18-23 manufacturer, distributor, or representative;
18-24 (D) the fair market value of all special tools,
18-25 data processing equipment, and automotive service equipment owned
19-1 by the dealer which were recommended in writing and designated as
19-2 special tools and equipment and purchased from or purchased at the
19-3 request of the manufacturer, distributor, or representative, if the
19-4 tools and equipment are in usable and good condition except for
19-5 reasonable wear and tear;
19-6 (E) the cost of transporting, handling, packing,
19-7 storing, and loading of any property subject to repurchase under
19-8 this section;
19-9 (F) except as provided by this subdivision, any
19-10 sums due as provided by Paragraph (A) of this subdivision within 60
19-11 days after termination of a franchise and any sums due as provided
19-12 by Paragraphs (B) through (E) of this subdivision within 90 days
19-13 after termination of a franchise. As a condition of payment, the
19-14 dealer is to comply with reasonable requirements with respect to
19-15 the return of inventory as are set out in the terms of the
19-16 franchise agreement. A manufacturer or distributor shall reimburse
19-17 a dealer for the dealer's cost for storing any property covered by
19-18 this subdivision beginning 90 days following termination. A
19-19 manufacturer or distributor shall reimburse a dealer for the
19-20 dealer's cost of storing any property covered by this subdivision
19-21 before the expiration of 90 days from the date of termination if
19-22 the dealer notifies the manufacturer or distributor of the
19-23 commencement of storage charges within that period. On receipt of
19-24 notice of the commencement of storage charges, a manufacturer or
19-25 distributor may immediately take possession of the property in
20-1 question by repurchasing the property as provided by this
20-2 subdivision. A manufacturer, distributor, or representative who
20-3 fails to pay those sums within the prescribed time or at such time
20-4 as the dealer and lienholder, if any, proffer good title prior to
20-5 the prescribed time for payment, is liable to the dealer for:
20-6 (1) the greatest of dealer cost, fair market
20-7 value, or current price of the inventory;
20-8 (2) interest on the amount due calculated at the
20-9 rate applicable to a judgment of a court; and
20-10 (3) reasonable attorney's fees and costs.
20-11 (17) Notwithstanding the terms of any franchise
20-12 agreement, change its distributor, its method of distribution of
20-13 its products in this state, or its business structure or ownership
20-14 in a manner that results in the termination or noncontinuance of a
20-15 franchise without good cause. The manufacturer, distributor, or
20-16 representative shall issue the same notice to the dealer and to the
20-17 Commission as is provided in Subdivisions 3(A) and (B) of this
20-18 section and said same procedures shall apply to the parties.
20-19 (18) Notwithstanding the terms of any franchise
20-20 agreement, require a dealer to submit to arbitration on any issue
20-21 unless the dealer and the manufacturer, distributor, or
20-22 representative and their respective counsel agree to arbitrate
20-23 after a controversy arises. The arbitrator shall apply the
20-24 provisions of this Act in resolving the pertinent controversy.
20-25 Either party may appeal to the Commission a decision of an
21-1 arbitrator on the ground that the arbitrator failed to apply this
21-2 Act.
21-3 (19) Notwithstanding the terms of any franchise
21-4 agreement, require that a dealer join, contribute to, or affiliate
21-5 with, directly or indirectly, any advertising association.
21-6 (20) Notwithstanding the terms of a franchise
21-7 agreement:<,>
21-8 (A) require adherence to unreasonable sales or
21-9 service standards;
21-10 (B) directly or indirectly, discriminate against
21-11 a dealer or otherwise treat dealers differently as a result of a
21-12 formula or other calculation or process intended to gauge the
21-13 performance of a dealership;
21-14 (C) unreasonably require that a dealer purchase
21-15 special tools or equipment; or
21-16 (D) fail to compensate a dealer for all costs
21-17 incurred by the dealer in complying with the terms of a product
21-18 recall by the manufacturer or distributor, including the costs, if
21-19 any, incurred by the dealer in notifying vehicle owners of the
21-20 existence of the recall.
21-21 (21) Discriminate unreasonably between or among
21-22 franchisees in the sale of a motor vehicle owned by the
21-23 manufacturer or distributor.
21-24 (22) Directly or indirectly, or through a subsidiary
21-25 or agent, require, as a condition for obtaining financing for a
22-1 motor vehicle, the purchaser of a vehicle to purchase any product
22-2 other than the motor vehicle from the manufacturer or distributor,
22-3 or from an entity owned or controlled by the manufacturer or
22-4 distributor.
22-5 (23) Directly or indirectly, or through a subsidiary
22-6 or agent, require, as a condition of its or its subsidiary's
22-7 agreement to provide financing for a motor vehicle, that any
22-8 insurance policy or service contract purchased by the motor vehicle
22-9 purchaser be purchased from a specific source.
22-10 (24) Compel a dealer through a financing subsidiary of
22-11 the manufacturer or distributor to agree to unreasonable operating
22-12 requirements or directly or indirectly to terminate a dealer
22-13 through the actions of a financing subsidiary of the manufacturer
22-14 or distributor. This subdivision does not limit the right of a
22-15 financing entity to engage in business practices in accordance with
22-16 the usage of trade in retail and wholesale motor vehicle financing.
22-17 SECTION 6. The importance of this legislation and the
22-18 crowded condition of the calendars in both houses create an
22-19 emergency and an imperative public necessity that the
22-20 constitutional rule requiring bills to be read on three several
22-21 days in each house be suspended, and this rule is hereby suspended,
22-22 and that this Act take effect and be in force from and after its
22-23 passage, and it is so enacted.