The Florida Senate

320.644  Change of executive management control; objection by licensee; procedure.--

(1)  Notwithstanding the terms of any franchise agreement, a licensee shall not, by contract or otherwise, fail or refuse to give effect to, prevent, prohibit, or penalize, or attempt to refuse to give effect to, prevent, prohibit, or penalize any motor vehicle dealer from changing its executive management control unless the licensee proves at a hearing pursuant to a complaint filed by a motor vehicle dealer under this section that such change is to a person who is not of good moral character or who does not meet the written, reasonable, and uniformly applied standards of the licensee relating to the business experience of executive management required by the licensee of its motor vehicle dealers. A motor vehicle dealer who desires to change its executive management control shall notify the licensee by written notice, setting forth the name, address, and business experience of the proposed executive management. A licensee who receives such notice shall, in writing, within 60 days following such receipt, inform the motor vehicle dealer either of the approval of the proposed change in executive management or the unacceptability of the proposed change. If the licensee does not so inform the motor vehicle dealer within the 60-day period, its approval of the proposed change is deemed granted. A motor vehicle dealer whose proposed change is rejected may, within 60 days following receipt of such rejection, file with the department a complaint for a determination that the proposed change of executive management has been rejected in violation of this section. The licensee has the burden of proof with respect to all issues raised by such complaint. The department shall determine, and enter an order providing, that the person proposed for the change is either qualified or is not and cannot be qualified for specific reasons, or the order may provide the conditions under which a proposed executive manager would be qualified. If the licensee fails to file a response to the motor vehicle dealer's complaint within 30 days after receipt of the complaint, unless the parties agree in writing to an extension, or if the department after a hearing renders a decision other than one disqualifying the person proposed for the change, the franchise agreement between the motor vehicle dealer and the licensee shall be deemed amended to incorporate such change or amended in accordance with the determination or order rendered, effective upon compliance by the person proposed for the change with any conditions set forth in the determination or order.

(2)  For the purpose of this section, the mere termination of employment of executive management shall not be deemed to be a change in executive management or a transfer of the franchise; however, the proposal of replacement executive management shall be subject to this section.

(3)  For the purpose of this section, the term "executive management" means, and is limited to, the person or persons designated under the franchise agreement as the dealer-operator, executive manager, or similarly designated persons who are responsible for the overall day-to-day operation of the dealership. A motor vehicle dealer may change all other dealership personnel without seeking approval from the licensee.

(4)  During the pendency of any such hearing, the franchise agreement of the motor vehicle dealer shall continue in effect in accordance with its terms. The department shall expedite any determination requested under this section.

(5)  It shall be a violation of this section for the licensee to reject or withhold approval of a proposed transfer unless the licensee can prove in any court of competent jurisdiction in defense of any claim brought pursuant to s. 320.697 that, in fact, the rejection or withholding of approval of the proposed transfer was reasonable. The determination of whether such rejection or withholding was reasonable shall be based on an objective standard. Alleging the permitted statutory grounds by the licensee in the written rejection of the proposed transfer shall not protect the licensee from liability for violating this section.

History.--ss. 9, 13, ch. 84-69; ss. 14, 20, 21, ch. 88-395; s. 4, ch. 91-429; s. 5, ch. 2003-269.