Florida Senate - 2009 CS for CS for CS for SB 2630
By the Committees on Judiciary; Commerce; and Transportation;
and Senator Haridopolos
590-05739A-09 20092630c3
1 A bill to be entitled
2 An act relating to motor vehicle dealerships; amending
3 s. 320.64, F.S.; revising provisions prohibiting
4 certain acts by a motor vehicle manufacturer, factory
5 branch, distributor, or importer licensed under
6 specified provisions; revising conditions and
7 procedures for certain audits; making rebuttable a
8 presumption that a dealer had no actual knowledge and
9 should not have known that a customer intended to
10 export or resell a motor vehicle; clarifying a
11 dealer’s eligibility requirements for licensee-offered
12 program bonuses, incentives, and other benefits;
13 requiring certain payments if a termination,
14 cancellation, or nonrenewal of a dealer’s franchise is
15 the result of cessation of manufacture or distribution
16 of a line-make or a bankruptcy or reorganization;
17 amending s. 320.642, F.S.; revising provisions for
18 establishing an additional motor vehicle dealership in
19 or relocating an existing dealer to a location within
20 a community or territory where the same line-make
21 vehicle is presently represented by a franchised motor
22 vehicle dealer or dealers; revising requirements for
23 protests; revising provisions for denial of an
24 application for a motor vehicle dealer license in any
25 community or territory; revising provisions for
26 evidence to be considered by the Department of Highway
27 Safety and Motor Vehicles when evaluating the
28 application; revising provisions under which a dealer
29 has standing to protest a proposed additional or
30 relocated motor vehicle dealer; amending s. 320.643,
31 F.S.; revising provisions for a transfer, assignment,
32 or sale of franchise agreements; prohibiting rejection
33 of proposed transfer of interest in a motor vehicle
34 dealer entity to a trust or other entity, or a
35 beneficiary thereof, which is established for estate
36 planning purposes; prohibiting placing certain
37 conditions on such transfer; revising provisions for a
38 hearing by the department or a court relating to a
39 proposed transfer; amending s. 320.696, F.S.; revising
40 warranty responsibility provisions; providing for
41 severability; providing an effective date.
42
43 Be It Enacted by the Legislature of the State of Florida:
44
45 Section 1. Subsections (10), (25), (26), and (36) of
46 section 320.64, Florida Statutes, are amended, and subsection
47 (38) is added to that section, to read:
48 320.64 Denial, suspension, or revocation of license;
49 grounds.—A license of a licensee under s. 320.61 may be denied,
50 suspended, or revoked within the entire state or at any specific
51 location or locations within the state at which the applicant or
52 licensee engages or proposes to engage in business, upon proof
53 that the section was violated with sufficient frequency to
54 establish a pattern of wrongdoing, and a licensee or applicant
55 shall be liable for claims and remedies provided in ss. 320.695
56 and 320.697 for any violation of any of the following
57 provisions. A licensee is prohibited from committing the
58 following acts:
59 (10)(a) The applicant or licensee has attempted to enter,
60 or has entered, into a franchise agreement with a motor vehicle
61 dealer who does not, at the time of the franchise agreement,
62 have proper facilities to provide the services to his or her
63 purchasers of new motor vehicles which are covered by the new
64 motor vehicle warranty issued by the applicant or licensee.
65 (b) Notwithstanding any provision of a franchise, a
66 licensee may not require a motor vehicle dealer, by agreement,
67 program, policy, standard, or otherwise, to relocate, to make
68 substantial changes, alterations, or remodeling to, or to
69 replace a motor vehicle dealer’s sales or service facilities
70 unless the licensee’s requirements are reasonable and
71 justifiable in light of the current and reasonably foreseeable
72 projections of economic conditions, financial expectations, and
73 the motor vehicle dealer’s market for the licensee’s motor
74 vehicles.
75 (c)(b) A licensee may, however, consistent with the
76 licensee’s allocation obligations at law and to its other same
77 line-make motor vehicle dealers, provide to a motor vehicle
78 dealer a commitment to supply allocate additional vehicles or
79 provide a loan or grant of money as an inducement for the motor
80 vehicle dealer to relocate, expand, improve, remodel, alter, or
81 renovate its facilities if the licensee delivers an assurance to
82 the dealer that it will offer to supply to the dealer a
83 sufficient quantity of new motor vehicles, consistent with its
84 allocation obligations at law and to its other same line-make
85 motor vehicle dealers, which will economically justify such
86 relocation, expansion, improvement, remodeling, renovation, or
87 alteration, in light of reasonably current and reasonably
88 projected market and economic conditions. the provisions of the
89 commitment are increase in vehicle allocation, the loan or grant
90 and the assurance, and the basis for them must be contained in a
91 writing written agreement voluntarily agreed to entered into by
92 the dealer and are must be made available, on substantially
93 similar terms, to any of the licensee’s other same line-make
94 dealers in this state who voluntarily agree to make a
95 substantially similar facility expansion, improvement,
96 remodeling, alteration, or renovation with whom the licensee
97 offers to enter into such an agreement.
98 (d) Except as provided in paragraph (c), subsection (36),
99 or as otherwise provided by law, this subsection does not
100 require a licensee to provide financial support for, or
101 contribution to, the purchase or sale of the assets of or equity
102 in a motor vehicle dealer or a relocation of a motor vehicle
103 dealer because such support has been provided to other
104 purchases, sales, or relocations.
105 (e)(c) A licensee or its common entity may shall not
106 withhold a bonus, incentive, or other benefit that is available
107 to its other same line-make franchised dealers in this state
108 from, or take or threaten to take any action that is unfair or
109 adverse to a dealer who does not enter into an agreement with
110 the licensee pursuant to paragraph (c) (b).
111 (d) A licensee may not refuse to offer a program, bonus,
112 incentive, or other benefit, in whole or in part, to a dealer in
113 this state which it offers to its other same line-make dealers
114 nationally or in the licensee’s zone or region in which this
115 state is included. Neither may it discriminate against a dealer
116 in this state with respect to any program, bonus, incentive, or
117 other benefit. For purposes of this chapter, a licensee may not
118 establish this state alone as a zone, region, or territory by
119 any other designation.
120 (f)(e) This subsection does Paragraphs (a) and (b) do not
121 affect any contract between a licensee and any of its dealers
122 regarding relocation, expansion, improvement, remodeling,
123 renovation, or alteration which exists on the effective date of
124 this act.
125 (f) Any portion of a licensee-offered program for a bonus,
126 incentive, or other benefit that, in whole or in part, is based
127 upon or aimed at inducing a dealer’s relocation, expansion,
128 improvement, remodeling, renovation, or alteration of the
129 dealer’s sales or service facility, or both, is void as to each
130 of the licensee’s motor vehicle dealers in this state who,
131 nevertheless, shall be eligible for the entire amount of the
132 bonuses, incentives, or benefits offered in the program upon
133 compliance with the other eligibility provisions in the program.
134 (g) A licensee may set and uniformly apply reasonable
135 standards for a motor vehicle dealer’s sales and service
136 facilities which are related to upkeep, repair, and cleanliness.
137 (h) A violation of paragraphs (b) through (g) is not a
138 violation of s. 320.70 and does not subject any licensee to any
139 criminal penalty under s. 320.70.
140 (25) The applicant or licensee has undertaken an audit of
141 warranty, maintenance, and other service-related payments or
142 incentive payments, including payments to a motor vehicle dealer
143 under any licensee-issued program, policy, or other benefit,
144 which previously have been paid to a motor vehicle dealer in
145 violation of this section or has failed to comply with any of
146 its obligations under s. 320.696. An applicant or licensee may
147 reasonably and periodically audit a motor vehicle dealer to
148 determine the validity of paid claims as provided in s. 320.696.
149 Audits Audit of warranty, maintenance, and other service-related
150 payments shall only be performed by an applicant or licensee
151 only during for the 1-year period immediately following the date
152 the claim was paid. Audit of incentive payments shall only be
153 for an 18-month period immediately following the date the
154 incentive was paid. After such time periods have elapsed, all
155 warranty, maintenance, and other service-related payments and
156 incentive payments shall be deemed final and incontrovertible
157 for any reason notwithstanding any otherwise applicable law, and
158 the motor vehicle dealer shall not be subject to any charge-back
159 or repayment. An applicant or licensee may deny a claim or, as a
160 result of a timely conducted audit, impose a charge-back against
161 a motor vehicle dealer for warranty, maintenance, or other
162 service-related payments or incentive payments only if An
163 applicant or licensee shall not deny a claim or charge a motor
164 vehicle dealer back subsequent to the payment of the claim
165 unless the applicant or licensee can show that the warranty,
166 maintenance, or other service-related claim or incentive claim
167 was false or fraudulent or that the motor vehicle dealer failed
168 to substantially comply with the reasonable written and
169 uniformly applied procedures of the applicant or licensee for
170 such repairs or incentives. An applicant or licensee may not
171 charge a motor vehicle dealer back subsequent to the payment of
172 a warranty, maintenance, or service-related claim or incentive
173 claim unless, within 30 days after a timely conducted audit, a
174 representative of the applicant or licensee first meets in
175 person, by telephone, or by video teleconference with an officer
176 or employee of the dealer designated by the motor vehicle
177 dealer. At such meeting the applicant or licensee must provide a
178 detailed explanation, with supporting documentation, as to the
179 basis for each of the claims for which the applicant or licensee
180 proposed a charge-back to the dealer and a written statement
181 containing the basis upon which the motor vehicle dealer was
182 selected for audit or review. Thereafter, the applicant or
183 licensee must provide the motor vehicle dealer’s representative
184 a reasonable period after the meeting within which to respond to
185 the proposed charge-backs, with such period to be commensurate
186 with the volume of claims under consideration, but in no case
187 less than 45 days after the meeting. The applicant or licensee
188 is prohibited from changing or altering the basis for each of
189 the proposed charge-backs as presented to the motor vehicle
190 dealer’s representative following the conclusion of the audit
191 unless the applicant or licensee receives new information
192 affecting the basis for one or more charge-backs and that new
193 information is received within 30 days after the conclusion of
194 the timely conducted audit. If the applicant or licensee claims
195 the existence of new information, the dealer must be given the
196 same right to a meeting and right to respond as when the charge
197 back was originally presented. After all internal dispute
198 resolution processes provided through the applicant or licensee
199 have been completed, the applicant or licensee shall give
200 written notice to the motor vehicle dealer of the final amount
201 of its proposed charge-back. If the dealer disputes that amount,
202 the dealer may file a protest with the department within 30 days
203 after receipt of the notice. If a protest is timely filed, the
204 department shall notify the applicant or licensee of the filing
205 of the protest and the applicant or licensee may not take any
206 action to recover the amount of the proposed charge-back until
207 the department renders a final determination, which is not
208 subject to further appeal, that the charge-back is in compliance
209 with the provisions of this section. In any hearing pursuant to
210 this subsection, the applicant or licensee has the burden of
211 proof that its audit and resulting charge-back are in compliance
212 with this subsection.
213 (26) Notwithstanding the terms of any franchise agreement,
214 including any licensee’s program, policy, or procedure, the
215 applicant or licensee has refused to allocate, sell, or deliver
216 motor vehicles; charged back or withheld payments or other
217 things of value for which the dealer is otherwise eligible under
218 a sales promotion, program, or contest; prevented a motor
219 vehicle dealer from participating in any promotion, program, or
220 contest; or has taken or threatened to take any adverse action
221 against a dealer, including charge-backs, reducing vehicle
222 allocations, or terminating or threatening to terminate a
223 franchise because the dealer sold or leased a motor vehicle to a
224 customer who exported the vehicle to a foreign country or who
225 resold the vehicle, unless the licensee proves that the dealer
226 knew or reasonably should have known had actual knowledge that
227 the customer intended to export or resell the motor vehicle.
228 There is a rebuttable conclusive presumption that the dealer
229 neither knew nor reasonably should have known of its customer’s
230 intent to export or resell the vehicle had no actual knowledge
231 if the vehicle is titled or registered in any state in this
232 country. A licensee may not take any action against a motor
233 vehicle dealer, including reducing its allocations or supply of
234 motor vehicles to the dealer, or charging back a dealer for an
235 incentive payment previously paid, unless the licensee first
236 meets in person, by telephone, or video conference with an
237 officer or other designated employee of the dealer. At such
238 meeting, the licensee must provide a detailed explanation, with
239 supporting documentation, as to the basis for its claim that the
240 dealer knew or reasonably should have known of the customer’s
241 intent to export or resell the motor vehicle. Thereafter, the
242 motor vehicle dealer shall have a reasonable period,
243 commensurate with the number of motor vehicles at issue, but not
244 less than 15 days, to respond to the licensee’s claims. If,
245 following the dealer’s response and completion of all internal
246 dispute resolution processes provided through the applicant or
247 licensee, the dispute remains unresolved, the dealer may file a
248 protest with the department within 30 days after receipt of a
249 written notice from the licensee that it still intends to take
250 adverse action against the dealer with respect to the motor
251 vehicles still at issue. If a protest is timely filed, the
252 department shall notify the applicant or licensee of the filing
253 of the protest and the applicant or licensee may not take any
254 action adverse to the dealer until the department renders a
255 final determination, which is not subject to further appeal,
256 that the licensee’s proposed action is in compliance with the
257 provisions of this subsection. In any hearing pursuant to this
258 subsection, the applicant or licensee has the burden of proof on
259 all issues raised by this subsection.
260 (36)(a) Notwithstanding the terms of any franchise
261 agreement, in addition to any other statutory or contractual
262 rights of recovery after the voluntary or involuntary
263 termination, cancellation, or nonrenewal of a franchise, failing
264 to pay the motor vehicle dealer, as provided in paragraph (d)
265 within 90 days after the effective date of the termination,
266 cancellation, or nonrenewal, the following amounts:
267 1. The net cost paid by the dealer for each new car or
268 truck in the dealer’s inventory with mileage of 2,000 miles or
269 less, or a motorcycle with mileage of 100 miles or less,
270 exclusive of mileage placed on the vehicle before it was
271 delivered to the dealer.
272 2. The current price charged for each new, unused,
273 undamaged, or unsold part or accessory that:
274 a. Is in the current parts catalogue and is still in the
275 original, resalable merchandising package and in an unbroken
276 lot, except that sheet metal may be in a comparable substitute
277 for the original package; and
278 b. Was purchased by the dealer directly from the
279 manufacturer or distributor or from an outgoing authorized
280 dealer as a part of the dealer’s initial inventory.
281 3. The fair market value of each undamaged sign owned by
282 the dealer which bears a trademark or trade name used or claimed
283 by the applicant or licensee or its representative which was
284 purchased from or at the request of the applicant or licensee or
285 its representative.
286 4. The fair market value of all special tools, data
287 processing equipment, and automotive service equipment owned by
288 the dealer which:
289 a. Were recommended in writing by the applicant or licensee
290 or its representative and designated as special tools and
291 equipment;
292 b. Were purchased from or at the request of the applicant
293 or licensee or its representative; and
294 c. Are in usable and good condition except for reasonable
295 wear and tear.
296 5. The cost of transporting, handling, packing, storing,
297 and loading any property subject to repurchase under this
298 section.
299 (b) If the termination, cancellation, or nonrenewal of the
300 dealer’s franchise is the result of the bankruptcy or
301 reorganization of a licensee or its common entity, or the result
302 of a licensee’s plan, scheme, or policy, whether or not publicly
303 declared, which is intended to or has the effect of decreasing
304 the number of, or eliminating, the licensee’s franchised motor
305 vehicle dealers of a line-make in this state, or the result of a
306 termination, elimination, or cessation of manufacture or
307 reorganization of a licensee or its common entity, or the result
308 of a termination, elimination, or cessation of manufacture or
309 distribution of a line-make, in addition to the above payments
310 to the dealer, the licensee or its common entity, shall be
311 liable to and shall pay the motor vehicle dealer for an amount
312 at least equal to the fair market value of the franchise for the
313 line-make, which shall be the greater of the value determined as
314 of the day the licensee announces the action that results in the
315 termination, cancellation, or nonrenewal, or the value
316 determined on the day that is 12 months before that date. Fair
317 market value of the franchise for the line-make includes only
318 the goodwill value of the dealer’s franchise for that line-make
319 in the dealer’s community or territory.
320 (c)(b) This subsection does not apply to a termination,
321 cancellation, or nonrenewal that is implemented as a result of
322 the sale of the assets or corporate stock or other ownership
323 interests of the dealer.
324 (d) The dealer shall return the property listed in this
325 subsection to the licensee within 90 days after the effective
326 date of the termination, cancellation, or nonrenewal. The
327 licensee shall supply the dealer with reasonable instructions
328 regarding the method by which the dealer must return the
329 property. Absent shipping instructions and prepayment of
330 shipping costs from the licensee or its common entity, the
331 dealer shall tender the inventory and other items to be returned
332 at the dealer’s facility. The compensation for the property
333 shall be paid by the licensee or its common entity
334 simultaneously with within 60 days after the tender of inventory
335 and other items, provided that, if the dealer does not have has
336 clear title to the inventory and other items and is not in a
337 position to convey that title to the licensee, manufacturer or
338 distributor. If the inventory or other items are subject to a
339 security interest, the licensee may make payment for the
340 property being returned may be made jointly to the dealer and
341 the holder of any the security interest.
342 (38) The applicant or licensee has failed or refused to
343 offer a bonus, incentive, or other benefit program, in whole or
344 in part, to a dealer or dealers in this state which it offers to
345 all of its other same line-make dealers nationally or to all of
346 its other same line-make dealers in the licensee’s designated
347 zone, region, or other licensee-designated area of which this
348 state is a part, unless the failure or refusal to offer the
349 program in this state is reasonably supported by substantially
350 different economic or marketing considerations than are
351 applicable to the licensee’s same line-make dealers in this
352 state. For purposes of this chapter, a licensee may not
353 establish this state alone as a designated zone, region, or area
354 or any other designation for a specified territory. A licensee
355 may offer a bonus, rebate, incentive, or other benefit program
356 to its dealers in this state which is calculated or paid on a
357 per vehicle basis and is related in part to a dealer’s facility
358 or the expansion, improvement, remodeling, alteration, or
359 renovation of a dealer’s facility. Any dealer who does not
360 comply with the facility criteria or eligibility requirements of
361 such program is entitled to receive a reasonable percentage of
362 the bonus, incentive, rebate, or other benefit offered by the
363 licensee under that program by complying with the criteria or
364 eligibility requirements unrelated to the dealer’s facility
365 under that program. For purposes of the previous sentence, the
366 percentage unrelated to the facility criteria or requirements is
367 presumed to be “reasonable” if it is not less than 80 percent of
368 the total of the per vehicle bonus, incentive, rebate, or other
369 benefits offered under the program.
370
371 A motor vehicle dealer who can demonstrate that a violation of,
372 or failure to comply with, any of the preceding provisions by an
373 applicant or licensee will or can adversely and pecuniarily
374 affect the complaining dealer, shall be entitled to pursue all
375 of the remedies, procedures, and rights of recovery available
376 under ss. 320.695 and 320.697.
377 Section 2. Subsection (1), paragraph (a) of subsection (2),
378 and subsection (3) of section 320.642, Florida Statutes, are
379 amended to read:
380 320.642 Dealer licenses in areas previously served;
381 procedure.—
382 (1) Any licensee who proposes to establish an additional
383 motor vehicle dealership or permit the relocation of an existing
384 dealer to a location within a community or territory where the
385 same line-make vehicle is presently represented by a franchised
386 motor vehicle dealer or dealers shall give written notice of its
387 intention to the department. The Such notice shall state:
388 (a) The specific location at which the additional or
389 relocated motor vehicle dealership will be established.
390 (b) The date on or after which the licensee intends to be
391 engaged in business with the additional or relocated motor
392 vehicle dealer at the proposed location.
393 (c) The identity of all motor vehicle dealers who are
394 franchised to sell the same line-make vehicle with licensed
395 locations in the county and or any contiguous county to the
396 county where the additional or relocated motor vehicle dealer is
397 proposed to be located.
398 (d) The names and addresses of the dealer-operator and
399 principal investors in the proposed additional or relocated
400 motor vehicle dealership.
401
402 Immediately upon receipt of the such notice the department shall
403 cause a notice to be published in the Florida Administrative
404 Weekly. The published notice shall state that a petition or
405 complaint by any dealer with standing to protest pursuant to
406 subsection (3) must be filed not more than 30 days from the date
407 of publication of the notice in the Florida Administrative
408 Weekly. The published notice shall describe and identify the
409 proposed dealership sought to be licensed, and the department
410 shall cause a copy of the notice to be mailed to those dealers
411 identified in the licensee’s notice under paragraph (c).
412 (2)(a) An application for a motor vehicle dealer license in
413 any community or territory shall be denied when:
414 1. A timely protest is filed by a presently existing
415 franchised motor vehicle dealer with standing to protest as
416 defined in subsection (3); and
417 2. The licensee fails to show that the existing franchised
418 dealer or dealers who register new motor vehicle retail sales or
419 retail leases of the same line-make in the community or
420 territory of the proposed dealership are not providing adequate
421 representation of such line-make motor vehicles in such
422 community or territory. Adequacy of representation must be
423 measured with respect to the community or territory as a whole
424 and not with respect to any part thereof or any identifiable
425 plot therein. The burden of proof in establishing inadequate
426 representation shall be on the licensee.
427 (3) An existing franchised motor vehicle dealer or dealers
428 shall have standing to protest a proposed additional or
429 relocated motor vehicle dealer when where the existing motor
430 vehicle dealer or dealers have a franchise agreement for the
431 same line-make vehicle to be sold or serviced by the proposed
432 additional or relocated motor vehicle dealer and are physically
433 located so as to meet or satisfy any of the following
434 requirements or conditions:
435 (a) If the proposed additional or relocated motor vehicle
436 dealer is to be located in a county with a population of less
437 than 300,000 according to the most recent data of the United
438 States Census Bureau or the data of the Bureau of Economic and
439 Business Research of the University of Florida:
440 1. The proposed additional or relocated motor vehicle
441 dealer is to be located in the area designated or described as
442 the area of responsibility, or such similarly designated area,
443 including the entire area designated as a multiple-point area,
444 in the franchise agreement or in any related document or
445 commitment with the existing motor vehicle dealer or dealers of
446 the same line-make as such agreement existed upon October 1,
447 1988;
448 2. The existing motor vehicle dealer or dealers of the same
449 line-make have a licensed franchise location within a radius of
450 20 miles of the location of the proposed additional or relocated
451 motor vehicle dealer; or
452 3. Any existing motor vehicle dealer or dealers of the same
453 line-make can establish that during any 12-month period of the
454 36-month period preceding the filing of the licensee’s
455 application for the proposed dealership, the such dealer or its
456 predecessor made 25 percent of its retail sales of new motor
457 vehicles to persons whose registered household addresses were
458 located within a radius of 20 miles of the location of the
459 proposed additional or relocated motor vehicle dealer; provided
460 the such existing dealer is located in the same county or any
461 county contiguous to the county where the additional or
462 relocated dealer is proposed to be located.
463 (b) If the proposed additional or relocated motor vehicle
464 dealer is to be located in a county with a population of more
465 than 300,000 according to the most recent data of the United
466 States Census Bureau or the data of the Bureau of Economic and
467 Business Research of the University of Florida:
468 1. Any existing motor vehicle dealer or dealers of the same
469 line-make have a licensed franchise location within a radius of
470 12.5 miles of the location of the proposed additional or
471 relocated motor vehicle dealer; or
472 2. Any existing motor vehicle dealer or dealers of the same
473 line-make can establish that during any 12-month period of the
474 36-month period preceding the filing of the licensee’s
475 application for the proposed dealership, such dealer or its
476 predecessor made 25 percent of its retail sales of new motor
477 vehicles to persons whose registered household addresses were
478 located within a radius of 12.5 miles of the location of the
479 proposed additional or relocated motor vehicle dealer; provided
480 such existing dealer is located in the same county or any county
481 contiguous to the county where the additional or relocated
482 dealer is proposed to be located.
483 Section 3. Section 320.643, Florida Statutes, is amended to
484 read:
485 320.643 Transfer, assignment, or sale of franchise
486 agreements.—
487 (1)(a) Notwithstanding the terms of any franchise
488 agreement, a licensee shall not, by contract or otherwise, fail
489 or refuse to give effect to, prevent, prohibit, or penalize or
490 attempt to refuse to give effect to, prohibit, or penalize any
491 motor vehicle dealer from selling, assigning, transferring,
492 alienating, or otherwise disposing of its franchise agreement to
493 any other person or persons, including a corporation established
494 or existing for the purpose of owning or holding a franchise
495 agreement, unless the licensee proves at a hearing pursuant to a
496 complaint filed by a motor vehicle dealer under this section
497 that the such sale, transfer, alienation, or other disposition
498 is to a person who is not, or whose controlling executive
499 management is not, of good moral character or does not meet the
500 written, reasonable, and uniformly applied standards or
501 qualifications of the licensee relating to financial
502 qualifications of the transferee and business experience of the
503 transferee or the transferee’s executive management. A motor
504 vehicle dealer who desires to sell, assign, transfer, alienate,
505 or otherwise dispose of a franchise shall notify, or cause the
506 proposed transferee to notify, the licensee, in writing, setting
507 forth the prospective transferee’s name, address, financial
508 qualifications, and business experience during the previous 5
509 years. A licensee who receives such notice may, within 60 days
510 following such receipt, notify the motor vehicle dealer, in
511 writing, that the proposed transferee is not a person qualified
512 to be a transferee under this section and setting forth the
513 material reasons for such rejection. Failure of the licensee to
514 notify the motor vehicle dealer within the 60-day period of such
515 rejection shall be deemed an approval of the transfer. No such
516 transfer, assignment assign, or sale shall be valid unless the
517 transferee agrees in writing to comply with all requirements of
518 the franchise then in effect, but with the ownership changed to
519 the transferee.
520 (b) A motor vehicle dealer whose proposed sale is rejected
521 may, within 60 days following such receipt of such rejection,
522 file with the department a complaint for a determination that
523 the proposed transferee has been rejected in violation of this
524 section. The licensee has the burden of proof with respect to
525 all issues raised by the such complaint. The department shall
526 determine, and enter an order providing, that the proposed
527 transferee is either qualified or is not and cannot be qualified
528 for specified reasons, or the order may provide the conditions
529 under which a proposed transferee would be qualified. If the
530 licensee fails to file such a response to the motor vehicle
531 dealer’s complaint within 30 days after receipt of the
532 complaint, unless the parties agree in writing to an extension,
533 or if the department, after a hearing, renders a decision other
534 than one disqualifying the proposed transferee, the franchise
535 agreement between the motor vehicle dealer and the licensee is
536 shall be deemed amended to incorporate such transfer or amended
537 in accordance with the determination and order rendered,
538 effective upon compliance by the proposed transferee with any
539 conditions set forth in the determination or order.
540 (2)(a) Notwithstanding the terms of any franchise
541 agreement, a licensee shall not, by contract or otherwise, fail
542 or refuse to give effect to, prevent, prohibit, or penalize, or
543 attempt to refuse to give effect to, prevent, prohibit, or
544 penalize, any motor vehicle dealer or any proprietor, partner,
545 stockholder, owner, or other person who holds or otherwise owns
546 an interest therein from selling, assigning, transferring,
547 alienating, or otherwise disposing of, in whole or in part, the
548 equity interest of any of them in such motor vehicle dealer to
549 any other person or persons, including a corporation established
550 or existing for the purpose of owning or holding the stock or
551 ownership interests of other entities, unless the licensee
552 proves at a hearing pursuant to a complaint filed by a motor
553 vehicle dealer under this section that the such sale, transfer,
554 alienation, or other disposition is to a person who is not, or
555 whose controlling executive management is not, of good moral
556 character. A motor vehicle dealer, or any proprietor, partner,
557 stockholder, owner, or other person who holds or otherwise owns
558 an interest in the motor vehicle dealer, who desires to sell,
559 assign, transfer, alienate, or otherwise dispose of any interest
560 in such motor vehicle dealer shall notify, or cause the proposed
561 transferee to so notify, the licensee, in writing, of the
562 identity and address of the proposed transferee. A licensee who
563 receives such notice may, within 60 days following such receipt,
564 notify the motor vehicle dealer in writing that the proposed
565 transferee is not a person qualified to be a transferee under
566 this section and setting forth the material reasons for such
567 rejection. Failure of the licensee to notify the motor vehicle
568 dealer within the 60-day period of such rejection shall be
569 deemed an approval of the transfer. Any person whose proposed
570 sale of stock is rejected may file within 60 days of receipt of
571 such rejection a complaint with the department alleging that the
572 rejection was in violation of the law or the franchise
573 agreement. The licensee has the burden of proof with respect to
574 all issues raised by such complaint. The department shall
575 determine, and enter an order providing, that the proposed
576 transferee either is qualified or is not and cannot be qualified
577 for specified reasons; or the order may provide the conditions
578 under which a proposed transferee would be qualified. If the
579 licensee fails to file a response to the motor vehicle dealer’s
580 complaint within 30 days of receipt of the complaint, unless the
581 parties agree in writing to an extension, or if the department,
582 after a hearing, renders a decision on the complaint other than
583 one disqualifying the proposed transferee, the transfer shall be
584 deemed approved in accordance with the determination and order
585 rendered, effective upon compliance by the proposed transferee
586 with any conditions set forth in the determination or order.
587 (b) Notwithstanding paragraph (a), a licensee may not
588 reject a proposed transfer of a legal, equitable, or beneficial
589 interest in a motor vehicle dealer to a trust or other entity,
590 or to any beneficiary thereof, which is established by an owner
591 of any interest in a motor vehicle dealer for purposes of estate
592 planning, if the controlling person of the trust or entity, or
593 the beneficiary, is of good moral character.
594 (3) A licensee may not condition any proposed transfer
595 under this section upon a relocation of a dealer, construction
596 of any addition or modification to, or any refurbishing or
597 remodeling of any dealership structure, facility, or building of
598 the existing motor vehicle dealer, or upon any modification of
599 the existing franchise agreement, except for the change of
600 ownership.
601 (4)(3) During the pendency of any such hearing, the
602 franchise agreement of the motor vehicle dealer shall continue
603 in effect in accordance with its terms. The department shall
604 expedite any determination requested under this section.
605 (5)(4) Notwithstanding the terms of any franchise
606 agreement, the acceptance by the licensee of the proposed
607 transferee shall not be unreasonably withheld. For the purposes
608 of this section, the refusal by the licensee to accept, in a
609 timely manner, a proposed transferee who satisfies the criteria
610 set forth in subsection (1) or subsection (2) is presumed to be
611 unreasonable.
612 (6)(5) It shall be a violation of this section for the
613 licensee to reject or withhold approval of a proposed transfer
614 unless the licensee can prove in any court of competent
615 jurisdiction in defense of any claim brought pursuant to s.
616 320.697 that, in fact, the rejection or withholding of approval
617 of the proposed transfer was not in violation of or precluded by
618 this section and was reasonable. The determination of whether
619 such rejection or withholding was not in violation of or
620 precluded by this section and was reasonable shall be based on
621 an objective standard. Alleging the permitted statutory grounds
622 by the licensee in the written rejection of the proposed
623 transfer shall not protect the licensee from liability for
624 violating this section.
625 Section 4. Subsection (6) of section 320.696, Florida
626 Statutes, is amended to read:
627 320.696 Warranty responsibility.—
628 (6) A licensee shall not recover or attempt to recover,
629 directly or indirectly, any of its costs for compensating a
630 motor vehicle dealer under this section, including by decreasing
631 or eliminating solely in this state or as it relates to any of
632 its dealers, any bonuses or other incentive that the licensee
633 has in effect nationally, regionally, or in a territory by any
634 other designation; by reducing the dealer’s gross margin for any
635 of the licensee’s products or services where the wholesale price
636 charged to the dealer is determined by the licensee and the
637 reduction is not in effect nationally or regionally; by imposing
638 a separate charge or surcharge to the wholesale price paid by a
639 dealer in this state for any product or service offered to or
640 supplied by a licensee under a franchise agreement with the
641 dealer; or by passing on to the dealer any charge or surcharge
642 of a common entity of the licensee.
643 Section 5. If any provision of this act or the application
644 thereof to any person or circumstance is held invalid, the
645 invalidity does not affect other provisions or applications of
646 the act which can be given effect without the invalid provision
647 or application, and to this end the provisions of this act are
648 severable.
649 Section 6. This act shall take effect upon becoming a law.