Bill Text: MI HB4782 | 2009-2010 | 95th Legislature | Engrossed
Bill Title: Trade; vehicles; recreational vehicle manufacturers, wholesalers, warrantors, and dealers; regulate. Creates new act. TIE BAR WITH: HB 4781'09
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2009-04-28 - Referred To Committee On Commerce And Tourism [HB4782 Detail]
Download: Michigan-2009-HB4782-Engrossed.html
HB-4782, As Passed House, April 23, 2009
HOUSE BILL No. 4782
April 2, 2009, Introduced by Rep. Sheltrown and referred to the Committee on Tourism, Outdoor Recreation and Natural Resources.
A bill to regulate recreational vehicle dealers,
manufacturers, wholesalers, warrantors, and their representatives;
to regulate dealings between recreational vehicle manufacturers,
wholesalers, warrantors, and dealers; to regulate dealings between
consumers and recreational vehicle manufacturers, wholesalers,
warrantors, and dealers; to prohibit certain trade practices; to
provide for the powers and duties of certain state and local
governmental officers and entities; and to provide remedies.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 1. This act shall be known and may be cited as the
"recreational vehicle franchise act".
Sec. 3. As used in this act:
(a) "Area of sales responsibility" means a geographical area
agreed to by a dealer and the manufacturer in a dealer agreement in
which the dealer has the exclusive right to display or sell the
manufacturer's new recreational vehicles of a particular line‑make
to the public.
(b) "Dealer" means a person that is a dealer, as that term is
defined in section 11 of the Michigan vehicle code, 1949 PA 300,
MCL 257.11, and is licensed as a dealer of recreational vehicles
under that act.
(c) "Dealer agreement" means a written agreement or contract
entered into between a manufacturer and a dealer that establishes
the legal rights and obligations of the parties to that agreement
or contract and pursuant to which the dealer is authorized to sell
new recreational vehicles manufactured or distributed by the
manufacturer.
(d) "Department" means the department of state.
(e) "Factory campaign" means an effort by a warrantor to
contact recreational vehicle owners or dealers in order to address
an issue concerning a problem or defective part or equipment.
(f) "Family member" means any of the following:
(i) A spouse of an individual.
(ii) A child, grandchild, parent, sibling, niece, or nephew of
an individual.
(iii) The spouse of a child, grandchild, parent, sibling, niece,
or nephew of an individual.
(g) "Line-make" means a specific series of recreational
vehicle products that meet all of the following:
(i) Are identified by a common series trade name or trademark.
(ii) Are targeted to a particular market segment based on their
decor, features, equipment, size, weight, and price range.
(iii) Have dimensions and interior floor plans that distinguish
the recreational vehicles from recreational vehicles that have
substantially the same decor, features, equipment, weight, and
price.
(iv) Belong to a single, distinct classification of
recreational vehicle product type that has a substantial degree of
commonality in the construction of the chassis, frame, and body.
(v) Are authorized for sale by the dealer in the dealer
agreement.
(h) "Manufacturer" means a person that manufactures or
wholesales recreational vehicles or that distributes or wholesales
recreational vehicles to dealers.
(i) "Park model trailer" means that term as defined in section
38a of the Michigan vehicle code, 1949 PA 300, MCL 257.38a.
(j) "Person" means an individual, partnership, corporation,
limited liability company, association, trust, estate, or other
legal entity.
(k) "Proprietary part" means a recreational vehicle part
manufactured by or for and sold exclusively by a manufacturer.
(l) "Public vehicle show" means a recreational vehicle show
that meets the requirements of section 248(10) of the Michigan
vehicle code, 1949 PA 300, MCL 257.248.
(m) "Recreational vehicle" means that term as defined in
section 49a of the Michigan vehicle code, 1949 PA 300, MCL 257.49a,
except a park model trailer.
(n) "Transient customer" means a person who owns a
recreational vehicle, is temporarily traveling through a dealer's
area of sales responsibility, and engages the dealer to perform
service work on that recreational vehicle.
(o) "Warrantor" means a manufacturer or any other person that
provides a warranty to the consumer in connection with a new
recreational vehicle or parts, accessories, or components of a new
recreational vehicle. The term does not include a person that
provides a service contract, mechanical or other insurance, or an
extended warranty sold for separate consideration by a dealer or
other person not controlled by a manufacturer.
Sec. 5. (1) A manufacturer shall not sell a recreational
vehicle in the state to or through a dealer unless the manufacturer
has a dealer agreement with the dealer that meets the requirements
of this act and is signed by both parties.
(2) Except as provided in subsection (4), a dealer shall not
sell a new recreational vehicle in this state unless the dealer has
a dealer agreement with a manufacturer of that recreational vehicle
that meets the requirements of this act and is signed by both
parties.
(3) All of the following apply to a dealer's area of sales
responsibility included in a dealer agreement between a
manufacturer and a dealer:
(a) The manufacturer shall designate in the dealer agreement
the area of sales responsibility exclusively assigned to the
dealer.
(b) The manufacturer shall not change the dealer's area of
sales responsibility or establish another dealer for the same line-
make in that area during the term of the dealer agreement.
(c) if the dealer enters into an agreement to sell any
recreational vehicles that compete with the recreational vehicles
included in the dealer agreement, or enters into an agreement to
increase a preexisting commitment to sell any recreational vehicles
that compete with the recreational vehicles included in the dealer
agreement, while the dealer agreement is in place, the manufacturer
may revise the dealer's area of sales responsibility if both of the
following are met:
(i) The dealer agreement does not authorize or permit the
dealer to enter into that subsequent agreement.
(ii) If, in the reasonable opinion of the manufacturer, the
market penetration of the manufacturer's products is jeopardized by
that subsequent agreement.
(d) The area of sales responsibility is not subject to review
or change in the 1-year period after the date of the first delivery
of new recreational vehicles to the dealer under the initial dealer
agreement.
(4) A dealer may sell recreational vehicles outside of its
designated area of sales responsibility if all of the following are
met:
(a) If required under section 248(10) of the Michigan vehicle
code, 1949 PA 300, MCL 257.248, the dealer has obtained a separate
or supplemental license to sell those recreational vehicles.
(b) The sales meet 1 of the following:
(i) If the sales are off-premises sales that takes place at a
location in another dealer's designated area of sales
responsibility, the dealer obtains in advance of the off-premises
sales a written agreement that meets all of the following:
(A) Is signed by the dealer, the manufacturer of the
recreational vehicles the dealer intends to sell at that location,
and the other dealer.
(B) Designates the recreational vehicles to be offered for
sale.
(C) Includes the time period for the off‑premises sales.
(D) Affirmatively authorizes the sale of the designated
recreational vehicles.
(ii) The sales are off-premises sales that take place at a
location that is not in another dealer's same line-make designated
area of sales responsibility.
(iii) The sales are off-premises sales that take place in
conjunction with a public vehicle show in which more than 3 dealers
are participating and that is predominantly funded by manufacturers
or sponsored by a recreational vehicle trade association.
(5) A dealer agreement must include a designated principal of
the dealer.
(6) For purposes of section 15, a dealer agreement may
identify a family member as the successor of the principal
designated under subsection (5) or include that principal's
succession plan. A dealer may at any time change a designation or
succession plan made in the dealer agreement by providing written
notice to the manufacturer.
Sec. 7. (1) A manufacturer shall from time to time publish its
prices, charges, and terms of sale for recreational vehicles and
may only sell a recreational vehicle to a dealer in accordance with
the published prices, charges, and terms of sale in effect at the
time of sale.
(2) If a manufacturer offers a dealer a rebate, discount, or
program on any recreational vehicles, the manufacturer must offer
the same rebate, discount, or program to every similarly situated
dealer.
(3) In a renewal of a dealer agreement, the manufacturer may
not impose on the dealer additional inventory stocking requirements
or retail sales targets in excess of market growth in the dealer's
area of sales responsibility.
Sec. 9. (1) A manufacturer, directly or through any officer,
agent, or employee, may not terminate or not renew a dealer
agreement without good cause.
(2) A manufacturer has the burden of showing good cause for
terminating or not renewing a dealer agreement. All of the
following factors must be considered in determining whether there
is good cause for a proposed termination or nonrenewal of a dealer
agreement by a manufacturer:
(a) The extent of the dealer's penetration in the relevant
market area.
(b) The nature and extent of the dealer's investment in its
business.
(c) The adequacy of the dealer's service facilities,
equipment, parts, supplies, and personnel.
(d) The effect of the proposed action on the community.
(e) The extent and quality of the dealer's service under
recreational vehicle warranties.
(f) Whether the dealer fails to follow agreed‑upon procedures
or standards related to the overall operation of the dealership.
(g) The dealer's performance under the terms of dealer
agreement.
(3) Except as otherwise provided in this section, a
manufacturer shall provide a dealer with written notice of a
termination or nonrenewal of a dealer agreement. All of the
following apply to a notice described in this subsection:
(a) Except as provided in subdivision (d) or (e), the
manufacturer shall provide the notice at least 90 days before the
effective date of the termination or nonrenewal.
(b) The notice shall state all of the reasons for the
termination or nonrenewal.
(c) The notice shall state that if the dealer provides to the
manufacturer a written notification of intent to cure all claimed
deficiencies within 30 days after the dealer receives the notice,
the dealer has 30 days after the date of the notice to correct the
deficiencies. If all of the deficiencies are corrected within that
30-day period, the notice is void and the manufacturer may not
terminate or not renew the dealer agreement because of the
deficiencies stated in the notice. If the dealer does not provide a
notification of intent to cure deficiencies in that 30-day period,
the termination or nonrenewal takes effect 90 days after the dealer
received the notice.
(d) A manufacturer may reduce the notice period described in
subdivision (a) to 10 days, and is not required to allow the dealer
an opportunity to correct the deficiencies, if the manufacturer's
grounds for termination or nonrenewal are any of the specific
categories of good cause described in subsection (6)(a) to (e).
(e) A manufacturer is not required to provide notice or an
opportunity to correct deficiencies under this subsection if the
manufacturer's grounds for termination or nonrenewal is that the
dealer becomes insolvent, is bankrupt, or makes an assignment for
the benefit of creditors.
(4) If a manufacturer terminates or does not renew a dealer
agreement for good cause under this section, the manufacturer at
its option may repurchase any of the following from the dealer:
(a) All new, untitled recreational vehicles that were acquired
from the manufacturer within 12 months before the effective date of
the notice of termination that have not been used, except for
demonstration purposes, and that have not been altered or damaged,
at 100% of the net invoice cost of the recreational vehicles,
including transportation, less applicable rebates and discounts to
the dealer.
(b) All current and undamaged accessories and proprietary
parts sold to the dealer for resale within the 12 months before the
effective date of the termination that are accompanied by the
original invoice, at 105% of the original net price paid to the
manufacturer to compensate the dealer for handling, packing, and
shipping the accessories and parts.
(c) Any properly functioning diagnostic equipment, special
tools, current signage, and other equipment and machinery,
purchased by the dealer within the 5 years before the effective
date of the termination at the manufacturer's request, if it cannot
be used in the normal course of the dealer's ongoing business, at
100% of the dealer's net cost, plus freight, destination, delivery,
and distribution charges and sales taxes.
(5) The dealer shall promptly return or arrange for the return
of all of the items the manufacturer elects to repurchase under
subsection (4) at the manufacturer's expense and the manufacturer
shall pay all of the amounts owed to the dealer under subsection
(4) to the dealer within 30 days after it receives the returned
items.
(6) As used in this section, "good cause" includes, but is not
limited to, any of the following:
(a) Conviction of, or plea of nolo contendere by, a dealer or
an owner of a dealer to a felony.
(b) Abandonment or closing the business operations of a dealer
for 10 consecutive business days unless the closing is due to an
act of God, strike, labor difficulty, or other cause over which the
dealer has no control.
(c) A material misrepresentation to a manufacturer by a dealer
that affects the business relationship between the dealer and the
manufacturer.
(d) Suspension or revocation of a dealer's license, or refusal
to renew a dealer's license, by the department.
(e) A material violation of this act by a dealer that is not
cured within 30 days after written notice of the violation by a
manufacturer.
(f) The dealer becomes insolvent, is bankrupt, or makes an
assignment for the benefit of creditors.
Sec. 11. (1) A dealer may not terminate a dealer agreement
without good cause. A dealer that terminates a dealer agreement
shall provide the manufacturer with written notice at least 90 days
before the effective date of the termination.
(2) All of the following apply to a termination of a dealer
agreement under this section for good cause:
(a) The notice described in subsection (1) shall state all
reasons for the proposed termination.
(b) The notice described in subsection (1) shall state that if
the manufacturer provides to the dealer a written notification of
intent to cure all claimed deficiencies within 30 days after the
manufacturer receives the notice, the manufacturer has 30 days
after the date of the notice to correct the deficiencies. If all of
the deficiencies are corrected within that 30-day period, the
notice is void and the dealer may not terminate the dealer
agreement because of the deficiencies stated in the notice. If the
manufacturer does not provide a notification of intent to cure
deficiencies in that 30-day period, the termination takes effect 90
days after the manufacturer received the notice.
(c) A dealer may reduce the notice period described in
subsection (1) to 10 days, and is not required to allow the
manufacturer an opportunity to correct the deficiencies, if the
dealer's grounds for termination or nonrenewal are any of the
specific categories of good cause described in subdivision (e)(i) to
(v).
(d) A dealer is not required to provide notice or an
opportunity to correct deficiencies under this subsection if the
dealer's grounds for termination or nonrenewal is that the
manufacturer becomes insolvent, is bankrupt, or makes an assignment
for the benefit of creditors.
(e) The dealer has the burden of showing good cause. Each of
the following is considered good cause for a proposed termination
of a dealer agreement by a dealer:
(i) Conviction of, or plea of nolo contendere by, the
manufacturer to a felony.
(ii) Abandonment or closing the business operations of the
manufacturer for 10 consecutive business days unless the closing is
due to an act of God, strike, labor difficulty, or other cause over
which the manufacturer has no control.
(iii) A material misrepresentation to the dealer by the
manufacturer that affects the business relationship between the
dealer and manufacturer.
(iv) A material violation of this act by the manufacturer that
is not cured within 30 days after written notice of the violation
by the dealer.
(v) A material breach of the dealer agreement by the
manufacturer.
(vi) The manufacturer becomes insolvent, is bankrupt, or makes
an assignment for the benefit of creditors.
(f) If the manufacturer fails to cure any claimed deficiencies
under subdivision (b), the dealer may require that the manufacturer
repurchase any of the following from the dealer:
(i) All new, untitled recreational vehicles that were acquired
from the manufacturer within 12 months before the effective date of
the notice of termination that have not been used, except for
demonstration purposes, and that have not been altered or damaged,
at 100% of the net invoice cost of the recreational vehicles,
including transportation, less applicable rebates and discounts to
the dealer.
(ii) All current and undamaged accessories and proprietary
parts sold to the dealer for resale within the 12 months before the
effective date of the termination that are accompanied by the
original invoice, at 105% of the original net price paid to the
manufacturer to compensate the dealer for handling, packing, and
shipping the accessories and parts.
(iii) Any properly functioning diagnostic equipment, special
tools, current signage, and other equipment and machinery,
purchased by the dealer within the 5 years before the effective
date of the termination at the manufacturer's request, if it cannot
be used in the normal course of the dealer's ongoing business, at
100% of the dealer's net cost, plus freight, destination, delivery,
and distribution charges and sales taxes.
(g) The dealer shall promptly return or arrange for the return
of all of the items the manufacturer is required to repurchase
under subdivision (f) at the manufacturer's expense and the
manufacturer shall pay all of the amounts owed to the dealer under
subdivision (f) to the dealer within 30 days after it receives the
returned items.
Sec. 13. The department may not prohibit a dealer from selling
a particular line-make after a dealer agreement has been terminated
or not renewed under section 9 or 11. If recreational vehicles of a
line-make are not returned or required to be returned to the
manufacturer, the dealer may continue to sell all line-makes that
were subject to the dealer agreement and are currently in stock
until those line-makes are no longer in the dealer inventory.
Sec. 15. (1) All of the following apply to a proposed sale of
the business assets, transfer of the stock, or other transaction
that will result in a change of ownership of a dealer, except a
transaction described in subsection (2):
(a) The dealer must provide written notice to the manufacturer
at least 90 days before the proposed closing of the transaction.
The notice shall include complete copies of all documentation of
the proposed transaction and any other documentation reasonably
requested by the manufacturer in order to determine if it will make
an objection to the transaction.
(b) If the dealer is not in breach of the dealer agreement or
in violation of this act at the time it provides the notice
described in subdivision (a), the manufacturer shall not object to
the proposed transaction unless the prospective transferee meets 1
or more of the following:
(i) It previously was a party to a dealer agreement with the
manufacturer that the manufacturer terminated.
(ii) Was previously convicted of a felony or any crime of
fraud, deceit, or moral turpitude.
(iii) Does not have any license required by law to conduct
business as a dealer in this state.
(iv) Does not have an active line of credit sufficient to
purchase recreational vehicles from the manufacturer according to
the terms of the dealer agreement.
(v) In the preceding 10 years, was bankrupt or insolvent, made
a general assignment for the benefit of creditors, or a receiver,
trustee, or conservator was appointed to take possession of the
transferee's business or property.
(c) If the manufacturer objects to the proposed transaction,
the manufacturer shall give written notice of its objection,
including its reasons for objecting, to the dealer within 30 days
after receiving the notice described in subdivision (a). If the
manufacturer does not give notice of its objection within that 30-
day period, the proposed transaction is considered approved by the
manufacturer.
(d) For purposes of subdivision (c), the manufacturer has the
burden of demonstrating its objection to the proposed transaction.
(2) All of the following apply concerning the death,
incapacity, or retirement of the designated principal of a dealer:
(a) The manufacturer must provide the dealer an opportunity to
designate, in writing, a family member as a successor to the dealer
in the event of the death, incapacity, or retirement of the
designated principal.
(b) The manufacturer shall not prevent or refuse to honor the
succession to a dealership by a family member of the deceased,
incapacitated, or retired designated principal of that dealer
unless the manufacturer had provided written notice to the dealer
of any objections to the dealer's succession plan within 30 days
after receiving the dealer's succession plan or any modification of
the dealer's succession plan.
(c) Except as provided in subdivision (e), unless the dealer
is in breach of the dealer agreement, a manufacturer shall not
object to the succession to a dealership by a family member of the
deceased, incapacitated, or retired designated principal unless the
successor meets 1 or more of the following:
(i) Was previously convicted of a felony or any crime of fraud,
deceit, or moral turpitude.
(ii) In the preceding 10 years, was bankrupt, insolvent, or
made an assignment for the benefit of creditors.
(iii) Was previously a party to a dealer agreement with the
manufacturer that the manufacturer terminated for a breach of a
dealer agreement.
(iv) Does not have an active line of credit sufficient to
purchase recreational vehicles from the manufacturer according to
the terms of the dealer agreement.
(v) Does not have any license required by law to conduct
business as a dealer in this state.
(d) The manufacturer has the burden of proof regarding any
objection to the succession to a dealership by a family member of
the deceased, incapacitated, or retired designated principal.
(e) The manufacturer's consent is required for the succession
to a dealership by a family member of the deceased, incapacitated,
or retired designated principal if the succession involves a
relocation of the business or an alteration of the terms and
conditions of the dealer agreement.
Sec. 17. (1) A warrantor has all of the following obligations
to each dealer engaged in the sale or lease of products that are
covered by a warranty from that warrantor:
(a) To specify in writing to the dealer the dealer's
obligations, if any, for preparation, delivery, and warranty
service on its products.
(b) To compensate the dealer for warranty service required of
the dealer by the warrantor.
(c) To provide the dealer with a schedule of compensation the
warrantor will pay for warranty work and the warrantor's time
allowances for the performance of that work. All of the following
apply to the schedule of compensation required under this
subdivision:
(i) It must include reasonable compensation for diagnostic work
and warranty labor.
(ii) Time allowances in the schedule for the diagnosis and
performance of warranty labor must be reasonable for the work to be
performed.
(iii) The compensation of a dealer for warranty labor shall
equal or exceed the lowest retail labor rates actually charged by
the dealer for similar nonwarranty labor if those rates are
consistent with the actual wage rates paid by the dealer and the
actual retail labor rates charged by the dealer in the community in
which the dealer is doing business.
(d) To reimburse the dealer for warranty parts at actual
wholesale cost, plus a minimum 30% handling charge and any freight
costs to return warranty parts to the warrantor.
(e) To deny dealer claims for warranty compensation only for
cause, including, but not limited to, performance of nonwarranty
repairs, material noncompliance with the warrantor's published
policies and procedures, lack of material documentation of claims,
fraud, or misrepresentation.
(2) A warrantor may conduct audits of the records of a dealer
that sells or leases its warranted products on a reasonable basis.
(3) A dealer shall submit warranty claims to a warrantor
within 45 days after completing warranty work on a warranted
product.
(4) A dealer shall immediately notify the warrantor orally or
in writing if the dealer is unable to perform warranty repairs on a
warranted product as soon as is reasonably possible, but not later
than 12 days after the delivery of the recreational vehicle to the
dealer for warranty repair. A warrantor that receives a
notification from a dealer under this subsection shall make
arrangements for another dealer or repair facility to perform the
warranty repairs identified by the dealer in the notification
within 12 days after receiving the notification.
(5) A warrantor shall approve or disapprove a warranty claim
on a warranted product in writing within 30 days after the date the
dealer submits the claim, if the claim is submitted in the manner
and in the form prescribed by the warrantor. If a claim that is
properly submitted is not specifically disapproved in writing by a
warrantor within that 30-day period, the claim is considered
approved by the warrantor and the warrantor shall pay the amount of
the claim to the dealer within 45 days after the dealer submitted
the claim.
Sec. 19. (1) A warrantor shall not do any of the following:
(a) Fail to perform all of its warranty obligations with
respect to a warranted product.
(b) In any written notice of a factory campaign to
recreational vehicle owners and dealers, fail to include the
expected date by which necessary parts and equipment, including
tires and chassis or chassis parts if required, will be available
to dealers to perform the campaign work. The warrantor shall
provide sufficient parts to the dealer to perform the campaign
work. If the number of parts provided to the dealer under this
subdivision exceed the dealer's requirements to perform the
campaign work, the dealer may return unused parts to the warrantor
for credit after completion of the campaign.
(c) Subject to section 23, fail to compensate a dealer for
authorized repairs of warranted products damaged during the
manufacturing process, or damaged while in transit to the dealer if
the warrantor selected the carrier.
(d) Fail to compensate a dealer for authorized warranty
service under this section in accordance with the applicable
schedule of compensation provided to the dealer under section 17 if
the warranty service is performed in a timely and competent manner.
(e) Intentionally misrepresent in any way to a purchaser of a
warranted product that any warranty concerning the manufacture,
performance, or design of the warranted product is made by the
dealer either as a warrantor or co-warrantor.
(f) Require a dealer to make warranties to customers in any
manner related to the manufacture of a warranted product.
(2) A warrantor shall indemnify the dealer for any money paid
or costs incurred by a dealer in connection with a claim or cause
of action asserted against the dealer, to the extent that payment
or those costs are based on the negligence or intentional conduct
of the warrantor. A warrantor may not limit the obligation to
indemnify described in this subsection by agreement with the
dealer. The dealer shall provide a warrantor with a copy of any
claim or complaint in which an allegation described in this
subsection is made within 10 days after receiving that claim or
complaint.
(3) As used in this section and section 21:
(a) "Products" mean new recreational vehicles or parts,
accessories, or components of new recreational vehicles.
(b) "Warranted products" mean products subject to a warranty
from a specific warrantor.
Sec. 21. (1) A dealer shall not do any of the following:
(a) Fail to perform predelivery inspection of products, if
required, in a competent and timely manner.
(b) If a transient customer requests service work on a
recreational vehicle of a line-make that the dealer is authorized
to display and sell, fail to perform any warranty service work
authorized by a warrantor in a reasonably competent and timely
manner without good cause.
(c) Make a fraudulent warranty claim to a warrantor.
(d) Misrepresent the terms of any warranty.
(2) A dealer shall indemnify a warrantor for any money paid or
costs incurred by a warrantor in connection with a claim or cause
of action asserted against the warrantor, to the extent that
payment or those costs are based on the negligence or intentional
conduct of the dealer. A dealer may not limit the obligation to
indemnify described in this subsection by agreement with the
warrantor. The warrantor shall provide a dealer with a copy of any
claim or complaint in which an allegation described in this
subsection is made within 10 days after receiving that claim or
complaint.
Sec. 23. (1) All of the following apply if a new recreational
vehicle is damaged before it is shipped to a dealer, or is damaged
in transit to the dealer and the manufacturer selected the carrier
or means of transportation:
(a) The dealer shall notify the manufacturer of the damage
within the time period specified in the dealer agreement and do 1
of the following:
(i) In the notice, request authorization to replace the
components, parts, and accessories damaged, or otherwise correct
the damage, from the manufacturer.
(ii) Reject the recreational vehicle within the time period
specified in the dealer agreement.
(b) If the manufacturer refuses or fails to authorize repair
of the damage within 10 days after receiving notice under
subdivision (a), or if the dealer rejects the recreational vehicle
because of the damage within the time period specified in the
dealer agreement, ownership of the recreational vehicle reverts to
the manufacturer.
(c) The dealer shall exercise due care in the custody of the
damaged recreational vehicle, but the dealer has no financial or
other obligation with respect to that recreational vehicle.
(2) A dealer agreement shall include a time period for
inspection and rejection of damaged recreational vehicles under
subsection (1) that is not less than 2 business days after the
physical delivery of the recreational vehicle to the dealer.
(3) If a dealer determines that a new recreational vehicle has
an unreasonable number of miles on its odometer at the time it is
delivered to the dealer, the dealer may reject that recreational
vehicle and ownership of the recreational vehicle reverts to the
manufacturer. However, if the number of miles on the odometer is
less than the sum of the distance between the dealer and the
manufacturer's factory or point of distribution plus 100 miles, the
dealer may not consider the number of miles on the odometer
unreasonable for purposes of this subsection.
Sec. 25. (1) A manufacturer may not coerce or attempt to
coerce a dealer to purchase a product or service that the dealer
did not order.
(2) A manufacturer may not coerce or attempt to coerce a
dealer to enter into any agreement with the manufacturer.
(3) A manufacturer may not coerce or attempt to coerce a
dealer to enter into an agreement with the manufacturer or any
other person that requires the dealer to submit its disputes to
binding arbitration or otherwise waive its rights or
responsibilities under this act.
(4) As used in this section, the term "coerce" includes, but
is not limited to, threatening to terminate or not renew a dealer
agreement without good cause; threatening to withhold line-makes or
other product lines the dealer is entitled to display and sell
under the dealer agreement; or delay delivery of recreational
vehicles as an inducement to amend the dealer agreement.
Sec. 27. (1) A dealer, manufacturer, or warrantor injured by
another party's violation of this act may bring a civil action in
circuit court to recover its actual damages. The court shall award
attorney's fees and costs to the prevailing party in a civil action
under this section.
(2) The venue for a civil action under this section involving
1 dealer is the county in which the dealer's business is located.
In an action involving more than 1 dealer, any county in which the
business of any dealer that is party to the action is located is a
proper venue for that action.
(3) Before bringing a civil action under this section, the
party bringing suit for an alleged violation of this act shall
serve a written demand for mediation on the offending party. The
demand for mediation shall include a brief statement of the dispute
and the relief sought by the party making the demand. The party
making the demand for mediation shall serve the demand by certified
mail to 1 of the following addresses:
(a) In an action between a dealer and a manufacturer, the
address stated in the dealer agreement between the parties.
(b) In an action between a dealer and a warrantor that is not
a manufacturer, the address stated in any agreement between the
parties.
(c) In an action between 2 dealers, the address of the
offending dealer in the records of the department.
(4) Within 20 days after a demand for mediation is served
under subsection (3), the parties shall mutually select an
independent mediator who is approved by the department, and meet
with that mediator for the purpose of attempting to resolve the
dispute at a location in this state selected by the mediator. The
mediator may extend the date of the meeting for good cause shown by
either party or if the parties agree to the extension.
(5) The service of a demand for mediation under subsection (3)
tolls the time for the filing of any complaint, petition, protest,
or other action under this act until representatives of both
parties have met with the mediator selected under subsection (4)
for the purpose of attempting to resolve the dispute. If a
complaint, petition, protest, or other action is filed before that
meeting, the court shall enter an order suspending the proceeding
or action until the mediation meeting has occurred and may, if all
of the parties to the proceeding or action stipulate in writing
that they wish to continue to mediate under this section, enter an
order suspending the proceeding or action for as long a period as
the court considers appropriate. The court may modify, extend, or
revoke a suspension order issued under this subsection if it
considers that action appropriate.
(6) Each of the parties to the mediation under this section is
responsible for its own attorney fees. The parties shall equally
divide the cost of the mediator.
Sec. 29. (1) In addition to any remedy available under this
act or otherwise available by law, a manufacturer, warrantor, or
dealer may apply to a circuit court for the grant, after a hearing
and for cause shown, of a temporary or permanent injunction or
other equitable relief restraining any person from doing any of the
following:
(a) Acting as a dealer without a proper license.
(b) Violating or continuing to violate this act. A single
violation of this act is a sufficient basis for the court to grant
equitable relief under this section.
(c) Failing or refusing to comply with any requirement of this
act.
(2) The court may not require a bond as a condition to the
grant of equitable relief under this section.
Enacting section 1. This act takes effect July 1, 2010.
Enacting section 2. This act does not take effect unless
Senate Bill No.____ or House Bill No. 4781(request no. 02963'09) of
the 95th Legislature is enacted into law.
