Bill Text: FL H1375 | 2010 | Regular Session | Introduced

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Bill Title: Motor Vehicle Franchise Agreements

Spectrum: Partisan Bill (Republican 1-0)

Status: (Failed) 2010-04-30 - Died in Committee on Insurance, Business, & Financial Affairs Policy (GGPC) [H1375 Detail]

Download: Florida-2010-H1375-Introduced.html

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HB 1375

1	A bill to be entitled
2	An act relating to motor vehicle franchise agreements;
3	amending s. 320.60, F.S.; revising the definition of the
4	terms "agreement" and "franchise agreement" to include
5	certain ancillary agreements; amending s. 320.605, F.S.;
6	revising legislative intent; amending s. 320.61, F.S.;
7	prohibiting the Department of Highway Safety and Motor
8	Vehicles from renewing the license of a manufacturer,
9	factory branch, distributor, or importer unless the
10	licensee complies with specified provisions; amending s.
11	320.63, F.S.; requiring such licensee to provide an
12	affidavit to the department regarding the provisions of
13	its existing franchise agreements; amending s. 320.64,
14	F.S.; providing for a dealer to make an immediate request
15	for payment for loss if there is a public announcement of
16	the discontinuance of a line-make; providing for a
17	determination of the fair market value of the franchise;
18	prohibiting requiring an existing motor vehicle dealer to
19	enter into a site control agreement or an exclusive use
20	agreement; defining the terms "site control agreement" and
21	"exclusive use agreement"; amending s. 320.695, F.S.;
22	authorizing a motor vehicle dealer association to apply
23	for injunctive relief under certain circumstances for an
24	action by a manufacturer, importer, or distributor which
25	adversely affects more than one of the association's
26	members; amending s. 320.699, F.S.; authorizing certain
27	associations to seek a declaration and adjudication of
28	their rights with respect to the alleged action or conduct
29	of a manufacturer, importer, or distributor; providing
30	procedures for a hearing conducted by the department;
31	providing an effective date.
32
33	Be It Enacted by the Legislature of the State of Florida:
34
35	Section 1. Subsection (1) of section 320.60, Florida
36	Statutes, is amended to read:
37	320.60 Definitions for ss. 320.61-320.70.-Whenever used in
38	ss. 320.61-320.70, unless the context otherwise requires, the
39	following words and terms have the following meanings:
40	(1) "Agreement" or "franchise agreement" means a contract,
41	franchise, new motor vehicle franchise, sales and service
42	agreement, or dealer agreement or any other terminology used to
43	describe the contractual relationship between a manufacturer,
44	factory branch, distributor, or importer, and a motor vehicle
45	dealer, including any ancillary agreement relating to a dealer's
46	facilities, staffing, and operations or relating to a licensee's
47	programs, policies, or requirements pursuant to which the motor
48	vehicle dealer is authorized to transact business pertaining to
49	motor vehicles of a particular line-make.
50	Section 2. Section 320.605, Florida Statutes, is amended
51	to read:
52	320.605 Legislative intent.-It is the intent of the
53	Legislature to protect the public health, safety, and welfare of
54	the citizens of the state by regulating the licensing of motor
55	vehicle dealers and manufacturers, maintaining competition,
56	reconciling the disparity in the economic power manufacturers
57	have over motor vehicle dealers, providing consumer protection
58	and fair trade, and providing minorities with opportunities for
59	full participation as motor vehicle dealers.
60	Section 3. Subsection (2) of section 320.61, Florida
61	Statutes, is amended to read:
62	320.61 Licenses required of motor vehicle manufacturers,
63	distributors, importers, etc.-
64	(2) The department may prescribe an abbreviated
65	application for renewal of a license if the licensee had
66	previously filed an initial application pursuant to s. 320.63.
67	The application for renewal shall include any information
68	necessary to bring current the information required in the
69	initial application. The department shall not issue a renewal of
70	any license unless the licensee complies with the provisions of
71	s. 320.63.
72	Section 4. Subsections (4) through (7) of section 320.63,
73	Florida Statutes, are renumbered as subsections (5) through (8),
74	respectively, and a new subsection (4) is added to that section
75	to read:
76	320.63 Application for license; contents.-Any person
77	desiring to be licensed pursuant to ss. 320.60-320.70 shall make
78	application therefor to the department upon a form containing
79	such information as the department requires. The department
80	shall require, with such application or otherwise and from time
81	to time, all of the following, which information may be
82	considered by the department in determining the fitness of the
83	applicant or licensee to engage in the business for which the
84	applicant or licensee desires to be licensed:
85	(4) Upon annual renewal of its license, an affidavit
86	acknowledging that the terms or provisions of every existing
87	franchise agreement with a motor vehicle dealer in this state
88	are not inconsistent with, prohibited by, or contrary to the
89	existing provisions contained in ss. 320.60-320.70 and the
90	existing rules adopted by the department then in effect, and
91	that any terms or provisions in such a franchise agreement which
92	are determined to be inconsistent with, prohibited by, or
93	contrary to the existing laws or rules of this state then in
94	effect are of no force and effect.
95	Section 5. Subsection (36) of section 320.64, Florida
96	Statutes, is amended, and subsection (39) is added to that
97	section, to read:
98	320.64 Denial, suspension, or revocation of license;
99	grounds.-A license of a licensee under s. 320.61 may be denied,
100	suspended, or revoked within the entire state or at any specific
101	location or locations within the state at which the applicant or
102	licensee engages or proposes to engage in business, upon proof
103	that the section was violated with sufficient frequency to
104	establish a pattern of wrongdoing, and a licensee or applicant
105	shall be liable for claims and remedies provided in ss. 320.695
106	and 320.697 for any violation of any of the following
107	provisions. A licensee is prohibited from committing the
108	following acts:
109	(36)(a) Notwithstanding the terms of any franchise
110	agreement, in addition to any other statutory or contractual
111	rights of recovery after the voluntary or involuntary
112	termination, cancellation, or nonrenewal of a franchise, failing
113	to pay the motor vehicle dealer, as provided in paragraph (e)
114	(d), the following amounts:
115	1. The net cost paid by the dealer for each new car or
116	truck in the dealer's inventory with mileage of 2,000 miles or
117	less, or a motorcycle with mileage of 100 miles or less,
118	exclusive of mileage placed on the vehicle before it was
119	delivered to the dealer.
120	2. The current price charged for each new, unused,
121	undamaged, or unsold part or accessory that:
122	a. Is in the current parts catalogue and is still in the
123	original, resalable merchandising package and in an unbroken
124	lot, except that sheet metal may be in a comparable substitute
125	for the original package; and
126	b. Was purchased by the dealer directly from the
127	manufacturer or distributor or from an outgoing authorized
128	dealer as a part of the dealer's initial inventory.
129	3. The fair market value of each undamaged sign owned by
130	the dealer which bears a trademark or trade name used or claimed
131	by the applicant or licensee or its representative which was
132	purchased from or at the request of the applicant or licensee or
133	its representative.
134	4. The fair market value of all special tools, data
135	processing equipment, and automotive service equipment owned by
136	the dealer which:
137	a. Were recommended in writing by the applicant or
138	licensee or its representative and designated as special tools
139	and equipment;
140	b. Were purchased from or at the request of the applicant
141	or licensee or its representative; and
142	c. Are in usable and good condition except for reasonable
143	wear and tear.
144	5. The cost of transporting, handling, packing, storing,
145	and loading any property subject to repurchase under this
146	section.
147	(b) If the termination, cancellation, or nonrenewal of the
148	dealer's franchise is the result of the bankruptcy or
149	reorganization of a licensee or its common entity;, or the
150	result of a licensee's plan, scheme, or policy, whether or not
151	publicly declared, which is intended to decrease or has the
152	effect of decreasing the number of, or eliminating, the
153	licensee's franchised motor vehicle dealers of a line-make in
154	this state;, or the result of a termination, elimination, or
155	cessation of manufacture or reorganization of a licensee or its
156	common entity;, or the result of a termination, elimination, or
157	cessation of manufacture or distribution of a line-make, in
158	addition to the above payments to the dealer, the licensee or
159	its common entity, shall be liable to and shall pay the motor
160	vehicle dealer for an amount at least equal to the fair market
161	value of the franchise for the line-make, which shall be the
162	greater of the value determined as of the day the licensee
163	announces the action that results in the termination,
164	cancellation, or nonrenewal, or the value determined on the day
165	that is 12 months before that date. Fair market value of the
166	franchise for the line-make includes only the goodwill value of
167	the dealer's franchise for that line-make in the dealer's
168	community or territory.
169	(c) In the case of a public announcement by the licensee
170	or its common entity that the line-make will be discontinued
171	presently or in the future, the motor vehicle dealer may
172	immediately request payment of fair market value under this
173	subsection following the announcement in exchange for canceling
174	any further franchise rights, except payments owed to the motor
175	vehicle dealer in the ordinary course, and such fair market
176	value for the franchise shall be the greater of the value
177	determined as of the day of the initial public announcement or
178	the value determined on the day that is 12 months before that
179	date.
180	(d)(c) This subsection does not apply to a termination,
181	cancellation, or nonrenewal that is implemented as a result of
182	the sale of the assets or corporate stock or other ownership
183	interests of the dealer.
184	(e)(d) The dealer shall return the property listed in this
185	subsection to the licensee within 90 days after the effective
186	date of the termination, cancellation, or nonrenewal. The
187	licensee shall supply the dealer with reasonable instructions
188	regarding the method by which the dealer must return the
189	property. Absent shipping instructions and prepayment of
190	shipping costs from the licensee or its common entity, the
191	dealer shall tender the inventory and other items to be returned
192	at the dealer's facility. The compensation for the property
193	shall be paid by the licensee or its common entity
194	simultaneously with the tender of inventory and other items,
195	provided that, if the dealer does not have clear title to the
196	inventory and other items and is not in a position to convey
197	that title to the licensee, payment for the property being
198	returned may be made jointly to the dealer and the holder of any
199	security interest.
200	(39)(a) On or after the effective date of this subsection
201	and notwithstanding the terms of any franchise agreement, the
202	applicant or licensee has directly or indirectly required an
203	existing motor vehicle dealer or motor vehicle dealer applicant
204	to enter into a site control agreement or exclusive use
205	agreement.
206	(b) For purposes of this subsection, the terms "site
207	control agreement" and "exclusive use agreement" include any
208	agreement that has the effect of:
209	1. Requiring that the motor vehicle dealer establish or
210	maintain exclusive dealership facilities; or
211	2. Restricting the ability of the motor vehicle dealer, or
212	the ability of the motor vehicle dealer's lessor in the event
213	the dealership facility is being leased, to transfer, sell,
214	lease, or change the use of the dealership premises, whether by
215	sublease, lease, collateral pledge of lease, right of first
216	refusal to purchase or lease, option to purchase, option to
217	lease, or other similar agreement, regardless of the parties to
218	such agreement.
219
220	A motor vehicle dealer who can demonstrate that a violation of,
221	or failure to comply with, any of the preceding provisions by an
222	applicant or licensee will or can adversely and pecuniarily
223	affect the complaining dealer, shall be entitled to pursue all
224	of the remedies, procedures, and rights of recovery available
225	under ss. 320.695 and 320.697.
226	Section 6. Section 320.695, Florida Statutes, is amended
227	to read:
228	320.695 Injunction.-In addition to the remedies provided
229	in this chapter, and notwithstanding the existence of any
230	adequate remedy at law, the department, or any motor vehicle
231	dealer in the name of the department and state and for the use
232	and benefit of the motor vehicle dealer, or any association that
233	is comprised of a minimum of 100 new motor vehicle dealers
234	licensed in this state and that represents the collective
235	interests of its members with more than one member directly and
236	adversely affected by the action or conduct of an applicant or
237	licensee may is authorized to make application to any circuit
238	court of the state for the grant, upon a hearing and for cause
239	shown, of a temporary or permanent injunction, or both,
240	restraining any person from acting as a licensee under the terms
241	of ss. 320.60-320.70 without being properly licensed hereunder,
242	or from violating or continuing to violate any of the provisions
243	of ss. 320.60-320.70, or from failing or refusing to comply with
244	the requirements of this law or any rule or regulation adopted
245	hereunder. Such injunction shall be issued without bond. A
246	single act in violation of the provisions of ss. 320.60-320.70
247	shall be sufficient to authorize the issuance of an injunction.
248	However, this statutory remedy shall not be applicable to any
249	motor vehicle dealer after final determination by the department
250	under s. 320.641(3).
251	Section 7. Section 320.699, Florida Statutes, is amended
252	to read:
253	320.699 Administrative hearings and adjudications;
254	procedure.-
255	(1) A motor vehicle dealer, or person with entitlements to
256	or in a motor vehicle dealer, who is directly and adversely
257	affected by the action or conduct of an applicant or licensee
258	that which is alleged to be in violation of any provision of ss.
259	320.60-320.70, or any association that is comprised of a minimum
260	of 100 new motor vehicle dealers licensed in this state and that
261	represents the collective interests of its members with more
262	than one member directly and adversely affected by the action or
263	conduct of an applicant or licensee that is alleged to be in
264	violation of any provision of ss. 320.60-320.70, may seek a
265	declaration and adjudication of its rights with respect to the
266	alleged action or conduct of the applicant or licensee by:
267	(a) Filing with the department a request for a proceeding
268	and an administrative hearing which conforms substantially with
269	the requirements of ss. 120.569 and 120.57; or
270	(b) Filing with the department a written objection or
271	notice of protest pursuant to s. 320.642.
272	(2) If a written objection or notice of protest is filed
273	with the department under paragraph (1)(b), a hearing shall be
274	held not sooner than 180 days nor later than 240 days from the
275	date of filing of the first objection or notice of protest,
276	unless the time is extended by the administrative law judge for
277	good cause shown. This subsection shall govern the schedule of
278	hearings in lieu of any other provision of law with respect to
279	administrative hearings conducted by the Department of Highway
280	Safety and Motor Vehicles or the Division of Administrative
281	Hearings, including performance standards of state agencies,
282	which may be included in current and future appropriations acts.
283	Section 8. This act shall take effect July 1, 2010.

CODING: Words stricken are deletions; words underlined are additions.