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Regular Session, 2012
SENATE BILL NO. 276
BY SENATOR MARTINY AND REPRESENTATIVE PONTI
COMMERCIAL REGULATIONS. Provides for distribution and sale of motorcycles and
all-terrain vehicles. (8/1/12)
AN ACT1
To amend and reenact R.S. 32:1257.1 and 1261 and to enact R.S. 32:1252(52) through (60),2
1262(C), 1267(C), 1268(D), and Part II of Chapter 6 of Title 32 of the Louisiana3
Revised Statutes of 1950, to be comprised of R.S. 32:1270 through 1270.10, relative4
to motorcycles and all-terrain vehicles; to provide for terms, conditions, and5
procedures; to provide for definitions; to provide for the establishment of a new6
motorcycle or all-terrain vehicle dealership or the relocation of an existing7
motorcycle or all-terrain vehicle dealership; to provide for unauthorized acts; to8
provide for warranty agreements and applications; to provide for the sale of certain9
motorcycles or all-terrain vehicles; to provide relative to the leasing of motorcycles10
or all-terrain vehicles; to provide for the succession of motorcycle or all-terrain11
vehicle dealer; to provide relative to conflicts of laws; to provide for indemnification12
of motorcycle and all-terrain vehicle franchised dealers; and to provide for related13
matters.14
Be it enacted by the Legislature of Louisiana:15
Section 1. R.S. 32:1257.1 and 1261 are hereby amended and reenacted and R.S.16
32:1252(52) through (60), 1262(C), 1267(C), 1268(D), and Part II of Chapter 6 of Title 3217 SB NO. 276
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of the Louisiana Revised Statutes of 1950, to be comprised of R.S. 32:1270 through 1270.101
are hereby enacted to read as follows:2
§1252. Definitions3
The following words, terms, and phrases, when used in this Chapter, shall4
have the meanings respectively ascribed to them in this Section, except where the5
context clearly indicates a different meaning:6
* * *7
(52) "Motorcycle or all-terrain vehicle dealer" means any person who,8
for a commission or with intent to make a profit or gain of money or other thing9
of value, buys, sells, brokers, exchanges, auctions, offers, or attempts to10
negotiate a sale or exchange of an interest in motorcycles or all-terrain vehicles11
and who is engaged wholly or in part in the business of buying and selling12
motorcycles or all-terrain vehicles in the state of Louisiana and who holds a13
license as a recreational products dealer under the provisions of this Chapter.14
(a) The term shall also include anyone not licensed under Chapter 6 of15
Title 32 of the Louisiana Revised Statutes of 1950, who sells motorcycles or all-16
terrain vehicles and who rents on a daily basis motorcycles or all-terrain17
vehicles, not of the current year or immediate prior year models, that have been18
titled previously to an ultimate purchaser.19
(b) "Motorcycle or all-terrain vehicle dealer" shall not include any of20
the following:21
(i) Receivers, trustees, administrators, executors, guardians, or other22
persons appointed by or acting under the judgment or order of any court.23
(ii) Public officers while performing their official duties.24
(iii) Employees of motorcycle or all-terrain vehicle dealers when engaged25
in the specific performance of their duties of such employees.26
(iv) Mortgagees or secured parties as to sales of motorcycles or all-27
terrain vehicles constituting collateral on a mortgage or security agreement.28
(v) Insurance companies.29 SB NO. 276
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(vi) Auctioneers or auction houses who are not engaged in the auction1
of motorcycles or all-terrain vehicles as the principal part of their business,2
including but not limited to the following auctions: estate auctions, bankruptcy3
auctions, farm equipment auctions, or government auctions.4
(53)(a) "Motorcycle or all-terrain vehicle lessor" shall mean any person,5
not excluded by Subparagraph (b) of this Paragraph, engaged in the motorcycle6
or all-terrain vehicle leasing or rental business and who holds a license as a7
motor vehicle lessor under the provisions of this Chapter. It shall also include8
a subsidiary of any such entity.9
(b) The term "motorcycle or all-terrain vehicle lessor" does not include10
any of the following:11
(i) Receivers, trustees, administrators, executors, guardians, or other12
persons appointed by or acting under judgment or order of any court.13
(ii) Public officers while performing or in the operation of their duties.14
(iii) Employees of persons, corporations, or associations enumerated in15
Item (i) of this Subparagraph when engaged in the specific performance of their16
duties as such employees.17
(iv) Financial institutions engaged in the leasing of motorcycles or all-18
terrain vehicles.19
(c) Any motorcycle or all-terrain vehicle lessor who rents on a daily basis20
motorcycles or all-terrain vehicles not of the current year or immediate prior21
year models that have been titled previously to an ultimate purchaser, and who22
is otherwise not required to obtain a license under this Chapter, shall be subject23
to the regulation of the Louisiana Used Motor Vehicle Commission.24
(54) "Motorcycle or all-terrain vehicle lessor agent" means any natural25
person, other than a daily rental person, who holds a license as a motor vehicle26
lessor agent under the provisions of this Chapter and is employed by a27
motorcycle or all-terrain vehicle lessor licensed by the commission whose duties28
include the leasing, renting or offering for lease or rent motorcycles or all-29 SB NO. 276
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terrain vehicles on behalf of said motorcycle or all-terrain vehicle lessor.1
(55) "Motorcycle or all-terrain vehicle lessor franchisor" means any2
person who holds a license as a motor vehicle lessor franchisor under the3
provisions of this Chapter and grants a franchise to any person granting the4
right to lease or rent a motorcycle or all-terrain vehicle under its trade name,5
trademark, or service mark or to sell used motorcycle or all-terrain vehicles6
formerly a part of its rental fleet.7
(56) "Motorcycle or all-terrain vehicle salesman" means any natural8
person employed by a licensee of the commission whose duties include the9
selling, leasing, or offering for sale or lease, financing or insuring motorcycle or10
all-terrain vehicles on behalf of said licensee and who holds a motor vehicle11
salesman license under the provisions of this Chapter.12
(57) "New motorcycle or all-terrain vehicle" means a motorcycle or all-13
terrain vehicle, the legal title to which has never been transferred by a14
manufacturer, distributor, or dealer to an ultimate purchaser.15
(58) "Used motorcycle or all-terrain vehicle" means a motorcycle or all-16
terrain vehicle, the legal title of which has been transferred by a manufacturer,17
distributor, or dealer to an ultimate purchaser.18
(59)(a) "Used motorcycle or all-terrain vehicle dealer" means any19
person, whose business is to sell, or offer for sale, display, or advertise used20
motorcycles or all-terrain vehicles, or any person who holds a license from the21
commission and is not excluded by Subparagraph (b) of this Paragraph.22
(b) "Used motorcycle or all-terrain vehicle dealer" shall not include any23
of the following:24
(i) Receivers, trustees, administrators, executors, guardians, or other25
persons appointed by or acting under the judgment or order of any court.26
(ii) Public officers while performing their official duties.27
(iii) Employees of persons, corporations, or associations enumerated in28
the definition of "used motorcycle or all-terrain vehicle dealer" when engaged29 SB NO. 276
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in the specific performance of their duties as such employees.1
(iv) Mortgagees or secured parties as to sales of motorcycles or all-2
terrain vehicles constituting collateral on a mortgage or security agreement and3
who do not maintain a used car lot or building with one or more employed4
motorcycle or all-terrain vehicle salesman.5
(v) Insurance companies who sell motorcycles or all-terrain vehicles to6
which they have taken title as an incident of payments made under policies of7
insurance and who do not maintain a used car lot or building with one or more8
employed motorcycle or all-terrain vehicle salesman.9
(vi) Used motorcycle or all-terrain vehicle dealers licensed pursuant to10
R.S. 32:781 et seq.11
(60) "Used motorcycle or all-terrain vehicle facility" means any facility12
which is owned and operated by a licensee of the commission and offers for sale13
used motorcycles or all-terrain vehicles.14
* * *15
§1257.1. Establishment of new recreational products dealerships or relocations;16
protests; procedure17
A.(1) Whenever the commission receives an application for a recreational18
products dealer's license which would add a new motorcycl e or all-terrain vehicle19
dealership, it shall first notify the existing licensed motorcycle or all-terrain vehicle20
dealership or dealerships selling the same-line makes, models, or classifications if21
the new dealership's proposed location is within the existing dealer's area of22
responsibility. Any same-line makes, models, or classifications dealership whose23
area of responsibility includes the location of the proposed new motorcycle or all-24
terrain vehicle dealership may object to the granting of the license.25
(2) Whenever the commission receives an application for a recreational26
products dealer's license which would relocate an existing motorcycle or all-terrain27
vehicle dealership, it shall first notify the existing licensed motorcycle or all-terrain28
vehicle dealership or dealerships selling the same-line makes, models, or29 SB NO. 276
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classifications if the dealership's proposed new location is within the existing dealer's1
area of responsibility. The existing same-line makes, models, or classifications2
dealership or dealerships shall have the right to object to the granting of the license3
only if the proposed relocation is within a radius of seven miles of its facility.4
However, without regard to distance, whenever the commission receives an5
application for the relocation of a motorcycle or all-terrain vehicle dealership which6
would add an additional franchise to an existing same-line makes, models, or7
classifications dealership's area of responsibility, the affected dealership shall have8
the right to object.9
(3) The objection shall be in writing and shall be received by the commission10
within a fifteen-day period after receipt of the notice. The fifteen-day objection11
period shall be waived upon written notification to the commission from all licensees12
entitled to object that the licensees have no objections to the proposed change or13
addition for which the notice of intent was issued. If timely objection is lodged, and14
prior to the issuance of the license, the commission shall hold a hearing within thirty15
days after receipt of the objection and issue its decision within ninety days after date16
of the hearing. Notice of hearing and an opportunity to participate therein shall be17
given to the manufacturer or distributor, the applicant for the license as a motorcycle18
or all-terrain vehicle dealer, and to the protesting dealership or dealerships.19
(4) Whenever the commission receives an objection pursuant to the20
provisions of Paragraph (1) of this Subsection, the commission shall consider the21
following and may consider any other relevant factors in determining whether there22
is good cause to issue a license:23
(a) Whether the community or territory can support an additional dealership.24
(b) The financial impact on both the applicant and the existing dealership or25
dealerships.26
(c) Whether the existing motorcycle or all-terrain vehicle dealerships of the27
same-line makes, models, or classifications in the dealership's area of responsibility28
are providing adequate representation, competition, and convenient consumer care29 SB NO. 276
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for the motorcycle or all-terrain vehicles of the same-line makes, models, or1
classifications located within that area.2
(d) Whether the issuance of the license would increase competition, or be in3
the public interest, or both.4
B.(1) A. Whenever the commission receives an application for a recreational5
products dealer's license which would add a new marine dealership, it shall first6
notify the existing licensed marine dealership or dealerships selling the same-line7
makes, models, or classifications if the new dealership's proposed location is within8
the existing dealer's area of responsibility. Any same-line makes, models, or9
classifications dealership whose area of responsibility includes the location of the10
proposed new marine dealership may object to the granting of the license.11
(2) B. Whenever the commission receives an application for a recreational12
products dealer's license which would relocate an existing marine dealership, it shall13
first notify the existing licensed marine dealership or dealerships selling the same-14
line makes, models, or classifications if the dealership's proposed new location is15
within the existing dealer's area of responsibility. The existing same-line makes,16
models, or classifications dealership or dealerships shall have the right to object to17
the granting of the license only if the proposed relocation is within a radius of seven18
miles of its facility. However, without regard to distance, whenever the commission19
receives an application for the relocation of a marine dealership which would add an20
additional franchise to an existing same-line makes, models, or classifications21
dealership's area of responsibility, the affected dealership shall have the right to22
object.23
(3) C. The objection shall be in writing and shall be received by the24
commission within a fifteen-day period after receipt of the notice. The fifteen-day25
objection period shall be waived upon written notification to the commission from26
all licensees entitled to object that the licensees have no objections to the proposed27
change or addition for which the notice of intent was issued. If timely objection is28
lodged, and prior to the issuance of the license, the commission shall hold a hearing29 SB NO. 276
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within thirty days after receipt of the objection and issue its decision within ninety1
days after date of the hearing. Notice of hearing and an opportunity to participate2
therein shall be given to the manufacturer or distributor, the applicant for the license3
as a marine dealer, and to the protesting dealership or dealerships.4
(4) D. Whenever the commission receives an objection pursuant to the5
provisions of Paragraph (1) of this Subsection A of this Section, or whenever the6
commission receives an objection pursuant to the assignment of the marine dealer's7
area of principal sales and service responsibility, the commission shall consider the8
following and may consider any other relevant factors in determining whether there9
is good cause to approve or reject the assignment of the marine dealer's area of10
principal sales and service responsibility, or to issue a license:11
(a) (1) Whether the community or territory can support an additional12
dealership.13
(b) (2) The financial impact on both the applicant and the existing dealership14
or dealerships.15
(c) (3) Whether the existing marine dealerships of the same-line makes,16
models, or classifications in the dealership's area of responsibility are providing17
adequate representation, competition, and convenient consumer care for the marine18
products of the same-line makes, models, or classifications located within that area.19
(d) (4) Whether the issuance of the license would increase competition, be20
in the public interest, or both.21
(5) E. In disputes between the marine dealers and marine manufacturers and22
distributors regarding the execution of an agreement that would add a new same-line23
make marine dealership or would add the same product line regardless of brand24
name within the area of responsibility of an existing marine product line dealer, the25
name brand of the boat determines whether a dealer may enter into a franchise or26
selling agreement for a particular boat package or boat package line. The marine27
motor, marine engine, boat trailer, or any accessory made a part of a boat package28
shall not be the subject of, or a consideration in, an area of responsibility dispute for29 SB NO. 276
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violation involving the boat package.1
(6) F. A manufacturer or distributor of a marine motor or marine engine2
may, in their discretion, enter into a warranty service agreement with a marine dealer3
of a boat package that is packaged with its particular brand marine motor or engine4
without violating the area of responsibility of any other marine dealer that has a5
franchise or selling agreement of that brand marine motor or engine. However, the6
warranty service agreement shall not be construed to permit the marine dealer to sell7
the marine motor or engine separate from the boat package, and the marine dealer8
shall not hold itself out to be a full-line or loose marine motor or engine dealership.9
* * *10
§1261. Unauthorized acts11
A. It shall be a violation of this Chapter:12
* * *13
B. The provisions of this Section shall not apply to a dealer,14
manufacturer, distributor, wholesaler, distributor branch, factory branch, or15
convertor of motorcycles, all-terrain vehicles, or any officer, agent, or other16
representative thereof.17
* * *18
§1262. Warranty; compensation; audits of dealer records19
* * *20
C. The provisions of this Section shall not apply to a dealer,21
manufacturer, distributor, wholesaler, distributor branch, or factory branch of22
motorcycles or all-terrain vehicles, or any officer, agent, or representative23
thereof.24
* * *25
§1267. Succession; right of first refusal26
* * *27
C. The provisions of this Section shall not apply to the succession of any28
motorcycle dealer or all-terrain vehicle dealer.29 SB NO. 276
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§1268. Requirements upon termination; penalty; indemnity1
* * *2
D. Notwithstanding any provision of law to the contrary, the provisions3
of this Section shall not apply to motorcycle dealers or all-terrain vehicle4
dealers.5
* * *6
PART II. PROVISIONS SPECIFIC TO MOTORCYCLES AND ALL-TERRAIN7
VEHICLES8
§1270. Establishment of new motorcycle or all-terrain vehicle dealerships or9
relocations; protests; procedure10
A. Whenever the commission receives an application for a recreational11
products dealer's license which would add a new motorcycle or all-terrain12
vehicle dealership, it shall first notify the existing licensed motorcycle or all-13
terrain vehicle dealership or dealerships selling the same-line makes, models,14
or classifications if the new dealership's proposed location is within the existing15
dealer's area of responsibility. Any same-line makes, models, or classifications16
dealership whose area of responsibility includes the location of the proposed17
new motorcycle or all-terrain vehicle dealership may object to the granting of18
the license.19
B. Whenever the commission receives an application for a recreational20
products dealer's license which would relocate an existing motorcycle or all-21
terrain vehicle dealership, it shall first notify the existing licensed motorcycle22
or all-terrain vehicle dealership or dealerships selling the same-line makes,23
models, or classifications if the dealership's proposed new location is within the24
existing dealer's area of responsibility. The existing same-line makes, models,25
or classifications dealership or dealerships shall have the right to object to the26
granting of the license only if the proposed relocation is within a radius of seven27
miles of its facility. However, without regard to distance, whenever the28
commission receives an application for the relocation of a motorcycle or all-29 SB NO. 276
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terrain vehicle dealership which would add an additional franchise to an1
existing same-line makes, models, or classifications dealership's area of2
responsibility, the affected motorcycle or all-terrain vehicle dealership shall3
have the right to object.4
C. The objection shall be in writing and shall be received by the5
commission within a fifteen-day period after receipt of the notice. The fifteen-6
day objection period shall be waived upon written notification to the7
commission from all licensees entitled to object that the licensees have no8
objections to the proposed change or addition for which the notice of intent was9
issued. If timely objection is lodged, and prior to the issuance of the license, the10
commission shall hold a hearing within thirty days after receipt of the objection11
and issue its decision within ninety days after date of the hearing. Notice of12
hearing and an opportunity to participate therein shall be given to the13
manufacturer or distributor, the applicant for the license as a motorcycle or all-14
terrain vehicle dealer, and to the protesting motorcycle or all-terrain vehicle15
dealership or dealerships.16
D. Whenever the commission receives an objection pursuant to the17
provisions of Subsection A of this Section, the commission shall consider the18
following and may consider any other relevant factors in determining whether19
there is good cause to issue a license:20
(1) Whether the community or territory can support an additional21
motorcycle or all-terrain vehicle dealership.22
(2) The financial impact on both the applicant and the existing23
motorcycle or all-terrain vehicle dealership or dealerships.24
(3) Whether the existing motorcycle or all-terrain vehicle dealerships of25
the same-line makes, models, or classifications in the dealership's area of26
responsibility are providing adequate representation, competition, and27
convenient consumer care for the motorcycle or all-terrain vehicles of the same-28
line makes, models, or classifications located within that area.29 SB NO. 276
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(4) Whether the issuance of the license would increase competition, or be1
in the public interest, or both.2
§1270.1. Unauthorized acts3
It shall be a violation of this Part:4
(1) For a manufacturer, distributor, wholesaler, distributor branch,5
factory branch, converter or officer, agent, or other representative thereof:6
(a) To induce or coerce, or attempt to induce or coerce, any licensee:7
(i) To order or accept delivery of any motorcycle or all-terrain vehicle,8
appliances, equipment, parts or accessories therefor, or any other commodity9
or commodities which shall not have been voluntarily ordered.10
(ii) To order or accept delivery of any motorcycle or all-terrain vehicle11
with special features, appliances, accessories, or equipment not included in the12
list price of said vehicles as publicly advertised.13
(iii) To order for any person any parts, accessories, equipment,14
machinery, tools, appliances, or any commodity whatsoever.15
(iv) To assent to a release, assignment, novation, waiver, or estoppel16
which would relieve any person from liability to be imposed by law, unless done17
in connection with a settlement agreement to resolve a matter pending a18
commission hearing or pending litigation between a manufacturer, distributor,19
wholesaler, distributor branch or factory branch, or officer, agent, or other20
representative thereof.21
(v) To enter into a franchise with a licensee or during the franchise term,22
use any written instrument, agreement, release, assignment, novation, estoppel,23
or waiver, to attempt to nullify or modify any provision of this Chapter, or to24
require any controversy between a dealer and a manufacturer to be referred to25
any person or entity other than the commission, or duly constituted courts of26
this state or the United States, if such referral would be binding upon the27
motorcycle or all-terrain vehicle dealer. Such instruments are null and void,28
unless done in connection with a settlement agreement to resolve a matter29 SB NO. 276
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pending a commission hearing or pending litigation.1
(vi) To waive the right to a jury trial.2
(vii) To release, convey, or otherwise provide customer information, if3
to do so is unlawful or if the customer objects in writing. This does not include4
information that is necessary for the manufacturer to meet its obligations to the5
motorcycle or all-terrain vehicle dealer or consumers in regard to contractual6
responsibilities, motorcycle or all-terrain vehicle recalls, or other requirements7
imposed by state or federal law. The manufacturer is further prohibited from8
providing any consumer information received from the motorcycle or all-9
terrain vehicle dealer to any unaffiliated third party.10
(viii) To pay the attorney fees of the manufacturer or distributor related11
to hearings and appeals brought under this Chapter.12
(b) To threaten to cancel any franchise or any contractual agreement13
existing between such manufacturer, distributor, wholesaler, distributor branch14
or factory branch and motorcycle or all-terrain vehicle dealer for any reason.15
(c) To unfairly, without just cause and due regard to the equities of16
motorcycle or all-terrain vehicle dealer, cancel the franchise of the licensee. The17
nonrenewal of a franchise with such dealer or his successor without just18
provocation or cause, or the refusal, or approve a qualified transferee or19
qualified successor to the dealer-operator as provided for in the franchise shall20
be deemed an evasion of this Subparagraph and shall constitute an unfair21
cancellation, regardless of the terms or provisions of such franchise. However,22
at least ninety days notice shall be given to the dealer of a cancellation or23
nonrenewal of franchise except for a cancellation arising out of fraudulent24
activity of the dealer principal which results in the conviction of a crime25
punishable by imprisonment.26
(d) To refuse to extend to a licensee the privilege of determining the27
mode or manner of available transportation facility that the motorcycle or all-28
terrain vehicle dealer desires to be used or employed in making deliveries of29 SB NO. 276
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motorcycles or all-terrain vehicles to him or it.1
(e) To ship or sell motorcycles or all-terrain vehicles to a licensee prior2
to the licensee having been granted a license by the commission to sell3
motorcycles or all-terrain vehicles.4
(f) To unreasonably withhold consent to the sale, transfer, or exchange5
of the franchise to a qualified transferee capable of being licensed as a6
motorcycle or all-terrain vehicle dealer in this state, provided the transferee7
meets the criteria generally applied by the manufacturer in approving new8
motorcycle or all-terrain vehicle dealers and agrees to be bound by all the terms9
and conditions of the standard franchises.10
(g) To fail to respond in writing to a written request for consent as11
specified in Subparagraph (f) of this Paragraph above within sixty days of12
receipt of a written request on the forms, if any, generally utilized by the13
manufacturer or distributor for such purposes and containing the information14
required therein. Failure to respond shall be deemed to be consent to the15
request.16
(h)(i) To sell or offer to sell a new or unused motorcycle or all-terrain17
vehicle directly to a consumer except as provided in this Chapter, or to compete18
with a licensee in the same-line makes, models, or classifications operating19
under an agreement or franchise from the aforementioned manufacturer. A20
manufacturer shall not, however, be deemed to be competing when any one of21
the following conditions are met:22
(aa) Operating a motorcycle or all-terrain vehicle dealership temporarily23
for a reasonable period, not to exceed two years.24
(bb) Operating a bona fide retail dealership which is for sale to any25
qualified independent person at a fair and reasonable price, not to exceed two26
years.27
(cc) Operating in a bona fide relationship in which a person independent28
of a manufacturer has made a significant investment subject to loss in the29 SB NO. 276
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dealership, and can reasonably expect to acquire full ownership of such1
dealership on reasonable terms and conditions.2
(ii) After any of the conditions have been met under Subitems (aa) and3
(bb) of Item (i) of this Subparagraph, the commission shall allow the4
manufacturer to compete with licensees of the same-line makes, models, or5
classifications under an agreement or franchise from said manufacturer for6
longer than two years when, in the discretion of the commission, the best7
interest of the manufacturer, consuming public, and licensees are best served.8
(i) To fail to compensate its motorcycle or all-terrain vehicle dealers for9
the work and services they are required to perform in connection with the10
motorcycle or all-terrain vehicle dealer's delivery and preparation obligations11
according to the terms of compensation that shall be filed with the commission12
on or before October first of each year. The commission shall find the13
compensation to be reasonable or the manufacturer shall remedy any14
deficiencies.15
(j) To fail to designate and provide to the commission in writing the16
community or territory assigned to a licensee.17
(k) To unreasonably discriminate among competing, similarly situated,18
same-line make dealers in the sales of motorcycles or all-terrain vehicles, in the19
availability of motorcycles or all-terrain vehicles, in the terms of incentive20
programs or sales promotion plans, or in other similar programs.21
(l) To use any subsidiary, affiliate, or any other controlled person or22
entity, or to employ the services of a third party, to accomplish what would23
otherwise be illegal conduct under this Chapter on the part of the manufacturer24
or distributor.25
(m) To make a change in the area of responsibility described in the26
franchise agreement or sales and service agreement of a motorcycle or all-27
terrain vehicle dealer, without the franchisor, converter, or manufacturer28
giving said motorcycle or all-terrain vehicle dealer and the commission no less29 SB NO. 276
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than sixty days prior written notice by certified or registered mail.1
(2) For a motorcycle or all-terrain vehicle dealer, used motorcycle or all-2
terrain vehicle dealer, or a motorcycle or all-terrain vehicle salesman:3
(a) To require a purchaser of a motorcycle or all-terrain vehicle, as a4
condition of sale and delivery thereof, to also purchase special features,5
appliances, accessories, or equipment not desired or requested by the6
purchaser; however, this prohibition shall not apply as to special features,7
appliances, accessories, or equipment which are permanently affixed to the8
motorcycle or all-terrain vehicle.9
(b) To represent and sell as a new motorcycle or all-terrain vehicle any10
motorcycle or all-terrain vehicle, the legal title of which has been transferred11
by a manufacturer, distributor, or dealer to an ultimate purchaser.12
(c) To resort to or use any false or misleading advertisement in13
connection with his business as such motorcycle or all-terrain vehicle dealer or14
motorcycle or all-terrain vehicle salesman.15
(d) To sell or offer to sell makes, models, or classifications of new16
motorcycles or all-terrain vehicles for which no franchise and license to sell is17
held.18
(e) Except as otherwise approved by the commission, to sell or offer to19
sell a motorcycle or all-terrain vehicle from an unlicensed location.20
(f) To deliver to a prospective purchaser a new or a used motorcycle or21
all-terrain vehicle on a sale conditioned on financing, i.e., a spot delivery, except22
on the following terms and conditions which shall be in writing and shall be a23
part of the conditional sales contract or other written notification signed by the24
purchaser:25
(i) That if the sale is not concluded by the financing of the sale to the26
purchaser within twenty-five days of the delivery, the sale contract shall be null27
and void.28
(ii) That the motorcycle or all-terrain vehicle being offered for trade-in29 SB NO. 276
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by the purchaser shall not be sold by the motorcycle or all-terrain vehicle dealer1
until the conditional sale is complete.2
(iii) That there shall be no charge to the purchaser should the conditional3
sale not be completed, including but not limited to mileage charges or charges4
to refurbish the motorcycle or all-terrain vehicle offered for trade-in. However,5
the purchaser shall be responsible for any and all damages to the motorcycle or6
all-terrain vehicle or other motorcycles or all-terrain vehicles damaged by the7
fault of the purchaser and any and all liability incurred by the purchaser during8
the purchaser's custody of the vehicle to the extent provided for in R.S. 22:1296.9
(iv) That if the conditional sale is not completed, the motorcycle or all-10
terrain vehicle dealer shall immediately refund to the purchaser upon return11
of the motorcycle or all-terrain vehicle all sums placed with the dealership as12
a deposit or any other purpose associated with the attempted sale of the13
motorcycle or all-terrain vehicle.14
(v) That the prospective purchaser shall return the motorcycle or all-15
terrain vehicle to the dealership within forty-eight hours of notification by the16
dealer that the conditional sale will not be completed. If the prospective17
purchaser does not return the motorcycle or all-terrain vehicle to the dealership18
within forty-eight hours of notification by the motorcycle or all-terrain vehicle19
dealer, an authorized agent of the motorcycle or all-terrain vehicle dealer shall20
have the right to recover the motorcycle or all-terrain vehicle without the21
necessity of judicial process, provided that such recovery can be accomplished22
without unauthorized entry into a closed dwelling, whether locked or unlocked23
and without a breach of peace.24
(g) To pay a fee to any person in return for the solicitation, procurement,25
or production by that person of prospective purchasers for new and used26
motorcycles or all-terrain vehicles, except to a motorcycle or all-terrain vehicle27
salesman licensed under the provisions of this Chapter.28
(h) To fail to fully and completely explain each charge listed on a retail29 SB NO. 276
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buyer's order or motorcycle or all-terrain vehicle invoice prior to the purchase1
of a motorcycle or all-terrain vehicle.2
(i) When selling a motorcycle or all-terrain vehicle to a consumer, to3
assess any consumer services fees, which shall include fees for treating the4
interior upholstery of the vehicle, oil changes, roadside assistance, dealer5
inspections, or any other service offered by the dealer, without allowing the6
buyer to refuse such services and be exempt from payment for such services.7
The provisions of this Subparagraph shall not apply to dealer-added options or8
accessories which are permanently affixed to the motorcycle or all-terrain9
vehicle.10
(j)(i) To fail to disclose to a purchaser in writing on the sales contract,11
buyer's order, or any other document that the motorcycle or all-terrain vehicle12
dealer may be participating in finance charges associated with the sale.13
(ii) To participate in a finance charge that would result in a difference14
between the buy rate and the contract rate of more than three percentage15
points.16
(iii) The provisions of this Subparagraph shall apply only to transactions17
subject to the Louisiana Motor Vehicle Sales Finance Act.18
(3) For a motorcycle or all-terrain vehicle lessor or motorcycle or all-19
terrain vehicle lessor agent:20
(a) To represent and sell as a new motorcycle or all-terrain vehicle any21
motorcycle or all-terrain vehicle which has been used or intended to be used and22
operated for leasing and rental purposes.23
(b) To resort to or use any false or misleading advertising in connection24
with the business of leasing or renting motorcycles or all-terrain vehicles.25
(c) To lease, rent, sell, or offer to sell a motorcycle or all-terrain vehicle26
from a location not licensed for such activity.27
(d) To rent or lease any motorcycle or all-terrain vehicle which has been28
located within this state for a period of thirty days or more, unless such29 SB NO. 276
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motorcycle or all-terrain vehicle has been issued a Louisiana license plate by,1
and all license fees and taxes have been paid to, this state.2
(e) To pay a fee to any person in return for the solicitation, procurement,3
or production by that person of prospective lessees of motorcycles or all-terrain4
vehicles, unless the person receiving the fee is a lease facilitator who holds a5
valid license as provided by this Chapter and a valid appointment from the6
motorcycle or all-terrain vehicle lessor as provided by R.S. 32:1270.6(B)(1). The7
fees prohibited by this Subparagraph shall not include amounts paid to a8
motorcycle or all-terrain vehicle dealer as part of the consideration for the sale9
or assignment of a lease or leased vehicle or other amounts paid to the10
motorcycle or all-terrain vehicle dealer who transfers the title on the vehicle or11
assigns the lease contract to the motorcycle or all-terrain vehicle lessor.12
(f) To fail to fully and completely explain each charge listed on a retail13
buyer's or lessee's order or motorcycle or all-terrain vehicle invoice or leasing14
agreement prior to the lease of a motorcycle or all-terrain vehicle.15
(g) When leasing a motorcycle or all-terrain vehicle to a consumer, to16
assess any consumer services fees, which shall include fees for treating the17
interior upholstery of the motorcycle or all-terrain vehicle, oil changes, roadside18
assistance, motorcycle or all-terrain vehicle dealer inspections, or any other19
service offered by the motorcycle or all-terrain vehicle lessor, without allowing20
the consumer to refuse such services and be exempt from payment for such21
services. The provisions of this Subparagraph shall not apply to motorcycle or22
all-terrain vehicle lessor-added options or accessories which are permanently23
affixed to the motorcycle or all-terrain vehicle.24
(4) For a lease facilitator:25
(a) To hold himself out to any person as a "leasing company", "leasing26
agent", "lease facilitator", or similar title, directly or indirectly engaged in the27
business of a lease facilitator, or otherwise engaged in the solicitation or28
procurement of prospective lessees for motorcycles or all-terrain vehicles not29 SB NO. 276
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titled in the name of and registered to the lease facilitator, without holding a1
valid lease facilitator license and being in compliance with the terms of this2
Chapter.3
(b) To sell or offer to sell a new motorcycle or all-terrain vehicle.4
(c) To accept a fee from a motorcycle or all-terrain vehicle dealer or5
consumer.6
(d) To sign a manufacturer's statement of origin to a motorcycle or all-7
terrain vehicle, accept an assignment of a manufacturer's statement of origin8
to a motorcycle or all-terrain vehicle, or otherwise assume any element of title9
to a new motorcycle or all-terrain vehicle.10
(e) To procure or solicit prospective lessees for or on behalf of any person11
other than a motorcycle or all-terrain vehicle lessor.12
(f) To act in the capacity of or engage in the business of a lease facilitator13
without a valid appointment from a motorcycle or all-terrain vehicle lessor to14
act on behalf of the motorcycle or all-terrain vehicle lessor in soliciting15
prospective lease clients or customers as provided by this Chapter.16
(5) For a broker:17
(a) To hold himself out to any person as a "broker", "purchasing18
company", "sales agent", or similar title, engaged in the business of broker, or19
otherwise engaged in the solicitation or procurement of prospective purchasers20
for motorcycles or all-terrain vehicles not titled in the name of and registered21
to the broker, unless the broker holds a valid broker license and is in22
compliance with the terms of this Chapter.23
(b) To sell, or offer to sell, or display a new motorcycle or all-terrain24
vehicle.25
(c) To be paid a fee by a motorcycle or all-terrain vehicle dealer.26
(d) To sign a manufacturer's statement of origin to a motorcycle or all-27
terrain vehicle, accept an assignment of a manufacturer's statement of origin28
to a motorcycle or all-terrain vehicle, or otherwise assume any element of title29 SB NO. 276
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to a new motorcycle or all-terrain vehicle.1
(e) To act in the capacity of or engage in the business of a broker without2
a valid license issued as provided by this Chapter and a valid appointment from3
a motorcycle or all-terrain vehicle lessor to act on behalf of the motorcycle or4
all-terrain vehicle lessor in soliciting prospective lease clients or customers as5
provided by this Chapter.6
(f) To fail to execute a written brokering agreement and provide a7
completed copy to both of the following:8
(i) Any consumer entering into the brokering agreement. The completed9
copy shall be provided prior to the consumer's signing an agreement for the10
purchase of the motorcycle or all-terrain vehicle described in the brokering11
agreement, or, prior to accepting one hundred dollars or more from that12
consumer, whichever comes first.13
(ii) The selling motorcycle or all-terrain vehicle dealer. The completed14
copy shall be provided prior to the selling motorcycle or all-terrain vehicle15
dealer's entering into a purchase agreement with the consumer at the time of16
delivery.17
(g) To accept a purchase deposit from any consumer that exceeds two18
point five percent of the selling price of the motorcycle or all-terrain vehicle19
described in the brokering agreement.20
(h) To fail to refund any purchase money, including purchase deposits,21
upon demand by a consumer at any time prior to the consumer's signing a22
motorcycle or all-terrain vehicle purchase agreement with a selling motorcycle23
or all-terrain vehicle dealer of the motorcycle or all-terrain vehicle described24
in the brokering agreement.25
(i) To fail to cancel a brokering agreement and refund, upon demand,26
any money paid by a consumer, including any brokerage fee, under any of the27
following circumstances:28
(i) When the final price of the brokered vehicle exceeds the purchase29 SB NO. 276
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price listed in the brokering agreement.1
(ii) When the motorcycle or all-terrain vehicle delivered is not as2
described in the brokering agreement.3
(iii) When the brokering agreement expires prior to the customer's being4
presented with a purchase agreement from a selling motorcycle or all-terrain5
vehicle dealer arranged through the brokering dealer that contains a purchase6
price at or below the price listed in the brokering agreement.7
(j) To act as a seller and provide brokering services, both in the same8
transaction.9
(k) To fail to disclose to the consumer the dollar amount of any fee that10
the consumer is obligated to pay to the broker. This arrangement shall be11
confirmed in a brokering agreement.12
(l) To fail to maintain, for a minimum of three years, a copy of the13
executed brokering agreement and other notices and documents related to each14
brokered transaction.15
(m) To fail to advise the consumer, prior to accepting any money, that16
a full refund will be given if the motorcycle or all-terrain vehicle ordered17
through the broker is not obtained for the consumer.18
(6) For any person or other licensee:19
(a) To modify a franchise during the term of the agreement or upon its20
renewal if the modification substantially and adversely affects the franchisee's21
rights, obligations, investment, or return on investment without giving sixty-day22
written notice of the proposed modification to the licensee and the commission23
unless the modifications are required by law, court order, or the commission.24
Within the sixty-day notice period the licensee may file with the commission a25
complaint for a determination whether there is good cause for permitting the26
proposed modification. The party seeking to modify or replace an agreement27
shall demonstrate by a preponderance of the evidence that there is good cause28
for the modification or replacement. The commission shall schedule a hearing29 SB NO. 276
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within sixty days to decide the matter. Multiple complaints pertaining to the1
same proposed modifications shall be consolidated for hearing. The proposed2
modification may not take effect pending the determination of the matter.3
(b) In making a determination of whether there is good cause for4
permitting a proposed modification, the commission may consider any relevant5
factor including:6
(i) The reasons for the proposed modification.7
(ii) Whether the proposed modification is applied to or affects all8
licensees in a nondiscriminating manner.9
(iii) The degree to which the proposed modification will have a10
substantial and adverse effect upon the licensee's investment or return on11
investment.12
(iv) Whether the proposed modification is in the public interest.13
(v) The degree to which the proposed modification is necessary to the14
orderly and profitable distribution of vehicles and other services by the licensee.15
(vi) Whether the proposed modification is offset by other modifications16
beneficial to the licensee.17
(c) The decision of the commission shall be in writing and shall contain18
findings of fact and a determination of whether there is good cause for19
permitting the proposed modification. The commission shall deliver copies of20
the decision to the parties personally or by registered mail.21
(7) For any employee of a licensee while acting in the scope of his22
employment, to accept any payment, commission, fee, or compensation of any23
kind from any person other than the employing licensee, unless such payment24
is fully disclosed to and approved by the employing licensee.25
§1270.2. Indemnification of motorcycle and all-terrain vehicle franchised26
dealers27
Notwithstanding the terms of any franchise agreement, each28
manufacturer or converter shall indemnify and hold harmless its franchised29 SB NO. 276
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motorcycle or all-terrain vehicle dealers against any judgment for damages,1
including but not limited to court costs and reasonable attorney fees of the2
motorcycle or all-terrain vehicle dealer, arising out of complaints, claims, or3
lawsuits including but not limited to strict liability, negligence,4
misrepresentation, express or implied warranty, or rescission of sale to the5
extent that the judgment arises out of alleged defective or negligent6
manufacture, assembly, or design of motorcycles or all-terrain vehicles, parts,7
or accessories, or other functions by the manufacturer of converter, which are8
beyond the control of the motorcycle or all-terrain vehicle dealer.9
§1270.3. Warranty; compensation; audits of motorcycle or all-terrain vehicle10
dealer records11
A.(1) It shall be a violation of this Chapter for a manufacturer, a12
distributor, a wholesaler, distributor branch or factory branch of motorcycles13
or all-terrain vehicles, or officer, agent, or other representative thereof to fail14
to adequately and fairly compensate its motorcycle or all-terrain vehicle dealers15
for labor, parts, and other expenses incurred by such motorcycle or all-terrain16
vehicle dealer to perform under and comply with a manufacturer's or a17
distributor's warranty agreement.18
(2) In no event shall any manufacturer or distributor pay its motorcycle19
or all-terrain vehicle dealers at a price or rate for warranty work that is less20
than that charged by the motorcycle or all-terrain vehicle dealer to the retail21
customers of the motorcycle or all-terrain vehicle dealer for nonwarranty work22
of like kind.23
(3) Warranty work includes parts and labor performed.24
(4) All claims made by the motorcycle or all-terrain vehicle dealer for25
compensation under this Subsection shall be paid within thirty days after26
approval and shall be approved or disapproved within thirty days after receipt.27
When any claim is disapproved, the motorcycle or all-terrain vehicle dealer28
shall be notified in writing of the grounds for disapproval.29 SB NO. 276
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(5) The obligations in this Subsection as they relate to motorcycles or all-1
terrain vehicles may be modified by contract.2
B.(1) Notwithstanding the terms of any franchise agreement, warranty,3
and sales incentive, audits of motorcycle or all-terrain vehicle dealer records4
may be conducted by the manufacturer, distributor, distributor branch, or5
factory branch. Any audit for warranty parts or service compensation shall be6
for the twelve-month period immediately following the date of the payment of7
the claim by the manufacturer or distributor. However, a motorcycle or all-8
terrain vehicle dealer shall not be held liable by virtue of an audit for failure to9
retain parts for a period in excess of six months. Any audit for sales incentives,10
service incentives, rebates, or other forms of incentive compensation shall only11
be for the twelve-month period immediately following the date of the final12
payment to the motorcycle or all-terrain vehicle dealer under a promotion,13
event, program, or activity. In no event shall the manufacturer, distributor,14
distributor branch, or factory branch fail to allow the motorcycle or all-terrain15
vehicle dealer to make corrections to the sales data in less than one hundred16
twenty days from the program period. Additionally, no penalty other than17
amounts advanced on a motorcycle or all-terrain vehicle reported incorrectly18
shall be due in connection with the audit. With respect to motorcycles or all-19
terrain vehicles sold during the time period subject to the audit, but submitted20
incorrectly to the manufacturer, distributor, or wholesale distributor branch21
or factory branch, the motorcycle or all-terrain vehicle dealer shall be charged22
back for the amount reported incorrectly and credited with the amount due, if23
anything, on the actual sale date.24
(2) No claim which has been approved and paid may be charged back to25
the motorcycle or all-terrain vehicle dealer unless it can be shown that one or26
all of the following applies:27
(a) The claim was false or fraudulent.28
(b) The repairs were not properly made.29 SB NO. 276
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(c) The repairs were unnecessary to correct the defective condition under1
generally accepted standards of workmanship.2
(d) The motorcycle or all-terrain vehicle dealer failed to reasonably3
substantiate the repair in accordance with reasonable written requirements of4
the manufacturer or distributor, if the motorcycle or all-terrain vehicle dealer5
was notified of the requirements prior to the time the claim arose and if the6
requirements were in effect at the time the claim arose.7
(3) A manufacturer or distributor shall not deny a claim solely based on8
a motorcycle or all-terrain vehicle dealer's incidental failure to comply with a9
specific claim processing requirement, or a clerical error, or other10
administrative technicality.11
(4) Limitations on warranty parts or service compensation, sales12
incentive audits, rebates, or other forms of incentive compensation, chargebacks13
for warranty parts or service compensation, and service incentives and14
chargebacks for sales compensation only shall not be effective in the case of15
intentionally false or fraudulent claims.16
(5) It shall be deemed an unfair act pursuant to this Chapter to audit a17
motorcycle or all-terrain vehicle dealer more frequently than two sales-related18
and two service-related audits in a twelve-month period. Nothing in this19
Subsection shall limit a manufacturer's or distributor's ability to perform20
routine claim reviews in the normal course of business.21
(6) No claim may be rejected as late if it has been submitted within sixty22
days of the date the repair order was written.23
§1270.4. Damage disclosure24
A. Whenever a new motorcycle or all-terrain vehicle subject to25
regulation pursuant to this Chapter is sold to any person, the seller shall notify26
the purchaser of any body damage or mechanical damage which the motorcycle27
or all-terrain vehicle has sustained that exceeds six percent of the28
manufacturer's suggested retail price or, in the case of recreational vehicles, six29 SB NO. 276
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percent of the manufacturer's wholesale price. Such notice shall be in writing1
and a copy thereof shall be delivered to the purchaser prior to or simultaneous2
with transfer of the motorcycle or all-terrain vehicle title.3
B. This Section shall apply to all instances of vehicular body or4
mechanical damage to motorcycles or all-terrain vehicles and to all actions5
involving such damage, notwithstanding the application of other codal,6
statutory, or regulatory provisions, including but not limited to Civil Code7
Articles 2520 et seq.8
§1270.5. Sale of water-damaged motorcycles or all-terrain vehicles9
A. No person shall sell, transfer, or convey any new or used motorcycle10
or all-terrain vehicle to any person without notifying the buyer or receiver of11
the motorcycle or all-terrain vehicle in writing of the extent of any water12
damage from flooding which occurred to the motorcycle or all-terrain vehicle13
prior to the transaction.14
B. If a sale, transfer, or conveyance of a new or used motorcycle or all-15
terrain vehicle occurs in violation of Subsection A of this Section, the person16
receiving ownership and title to the motorcycle or all-terrain vehicle who is not17
otherwise aware of the damage at the time of the transaction may bring an18
action to set aside the transaction within one year from the date of the19
transaction and receive all monies or other property given as consideration for20
the motorcycle or all-terrain vehicle less a reasonable assessment for miles21
driven.22
C. For the purposes of this Section, a "water-damaged motorcycle or all-23
terrain vehicle" means any motorcycle or all-terrain vehicle whose power train,24
computer, or electrical system has been damaged by flooding.25
§1270.6. Motorcycle or all-terrain vehicle lessors; appointment of motorcycle26
or all-terrain vehicle lease facilitators27
A.(1) Except as otherwise provided by this Chapter, a motorcycle or all-28
terrain vehicle lessor franchisor may not terminate a franchise prior to the29 SB NO. 276
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expiration of its term, except for good cause. Good cause shall include but not1
be limited to the failure of the franchisee to comply with any lawful requirement2
of the franchise, after being given notice thereof, and a reasonable opportunity,3
which in no event need be more than thirty days, to cure the failure. Nothing4
herein shall permit the cancellation of a franchise solely for failure to meet5
performance standards based on a survey of sales penetration in a regional,6
national, territorial, or other geographic area.7
(2) If during the period in which the franchise granted by a motorcycle8
or all-terrain vehicle lessor franchisor is in effect, there occurs any of the9
following events, which is relevant to the franchise, immediate notice of10
termination without opportunity to cure shall be reasonable:11
(a) The franchisee abandons the franchise by failing to operate the12
business for five consecutive days during which the franchisee is required to13
operate the business under the terms of the franchise, unless such failure to14
operate is due to fire, flood, or storms beyond the franchisee's control.15
(b) The motorcycle or all-terrain vehicle lessor franchisor and the16
franchisee agree in writing to terminate the franchise.17
(c) The franchisee fails, for a period of ten days following notification of18
noncompliance, to comply with any federal, state, or local law or regulation19
applicable to the operation of the franchise.20
(d) The franchised business or business premises of the franchise is21
seized, taken over, or foreclosed on by a creditor, lienholder, or lessor, provided22
that a final judgment against the franchisee remains unsatisfied for thirty days,23
unless an appeal bond has been filed.24
(e) The franchisee fails to pay any franchise fees or other amounts due25
to the franchisor within ten days of receiving written notice that such fees are26
overdue.27
(3)(a) No motorcycle or all-terrain vehicle lessor franchisor shall fail to28
renew a franchise unless the franchisor provides the following:29 SB NO. 276
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(i) Written notice to the franchisee at least one hundred eighty days prior1
to his intention not to renew.2
(ii) The franchisee with an opportunity to sell his business, during the3
one hundred eighty days prior to the expiration of the franchise, to a purchaser4
meeting the franchisor's then current requirements for granting new franchises,5
or if not granting a significant number of new franchises, then the current6
requirements for granting renewal franchises.7
(iii) That the refusal not to renew is not for the purpose of converting the8
franchisee's business premises to operation by employees or agents of the9
franchisor for such franchisor's own account, provided that nothing in this10
Section shall prohibit a franchisor from exercising a right of first refusal to11
purchase a franchisee's business.12
(iv) That upon expiration of the franchise, the franchisor agrees not to13
seek to enforce any covenant of the unrenewed franchisee not to compete with14
the franchisor or franchisees of the franchisor.15
(b) Termination of a franchise shall be permitted pursuant to16
Paragraphs (1) and (2) of this Subsection, or if the franchisee and the franchisor17
agree not to renew the franchise.18
B.(1) A motorcycle or all-terrain vehicle lessor may appoint one or more19
lease facilitators licensed pursuant to the terms of this Chapter to represent the20
motorcycle or all-terrain vehicle lessor in obtaining prospective lease customers.21
An appointment complies with the requirements of this Subsection if it is in22
writing, discloses its terms, and otherwise complies with the rules of the23
commission.24
(2) In a lease contract or agreement between a motorcycle or all-terrain25
vehicle lessor and a lessee solicited, procured, or produced by a lease facilitator,26
the motorcycle or all-terrain vehicle lessor shall disclose to the lessee that a fee27
was paid, or will be paid to the lease facilitator for the solicitation, procurement,28
or production of the lessee or the lease. The motorcycle or all-terrain vehicle29 SB NO. 276
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lessor shall include the disclosure required by this Paragraph in a prominent1
position in one or both of the following manners:2
(a) On the face of the written memorandum of the lease, contract, or3
agreement.4
(b) On a separate instrument signed by the lessee at the same time as the5
signing of the lease contract or agreement.6
C.(1) Except as otherwise provided by this Section, a lease facilitator may7
accept a fee for procuring a motorcycle or all-terrain vehicle lessee or8
prospective motorcycle or all-terrain vehicle lessee for or on behalf of a lessor.9
(2) Nothing in this Section shall limit the ability of a lease facilitator to10
accept an appointment from more than one lessor.11
(3) Nothing in this Section shall prohibit a lease facilitator from12
representing a lessor or lessee in the acquisition of a motorcycle or all-terrain13
vehicle for the purpose of leasing the motorcycle or all-terrain vehicle to14
another person.15
§1270.7. Succession; right of first refusal16
A. The terms of the franchise notwithstanding, any motorcycle or all-17
terrain vehicle dealer may appoint by will, or other written instrument, a18
designated successor to succeed in the ownership interest of the motorcycle or19
all-terrain vehicle dealer in the dealership upon the death or incapacity of the20
motorcycle or all-terrain vehicle dealer.21
B. Unless good cause exists for refusal to honor the succession on the22
part of the manufacturer or distributor, any designated successor of a deceased23
or incapacitated motorcycle or all-terrain vehicle dealer of a dealership may24
succeed to the ownership of the dealership under the existing franchise if:25
(1) The designated successor gives the manufacturer or distributor26
written notice of his or her intention to succeed to the ownership of the27
motorcycle or all-terrain vehicle dealer within sixty days of the motorcycle or28
all-terrain vehicle dealer's death or incapacity.29 SB NO. 276
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(2) The designated successor agrees to be bound by all the terms and1
conditions of the franchise.2
C. The manufacturer or distributor may request, and the designated3
successor shall provide, promptly upon such request, personal and financial4
data reasonably necessary to determine whether the succession should be5
honored.6
D. If a manufacturer or distributor believes that good cause exists for7
refusing to honor the succession of a deceased or incapacitated motorcycle or8
all-terrain vehicle dealer, the manufacturer or distributor may, not more than9
sixty days following receipt of notice of the designated successor's intent to10
succeed and receipt of such personal or financial data, serve upon the11
designated successor notice of its refusal to honor the succession and of its intent12
to discontinue the existing franchise with the motorcycle or all-terrain vehicle13
dealer not earlier than six months from the date such notice is served.14
E. The notice must state the specific grounds for the refusal to honor the15
succession.16
F. If notice of refusal and discontinuance is not timely served upon the17
designated successor, the franchise shall continue in effect subject to18
termination only as otherwise permitted by this Chapter.19
G. In determining whether good cause for the refusal to honor the20
succession exists, the manufacturer or distributor has the burden of proving21
that the designated successor is not of good moral character or does not22
otherwise meet the manufacturer's or distributor's reasonable standards as a23
franchisee.24
H. If a manufacturer or distributor refuses to honor the succession to25
the ownership interest of a deceased or incapacitated owner for good cause, then26
and in such event:27
(1) The manufacturer or distributor shall allow the designated successor28
a reasonable period of time which shall not be less than six months in which to29 SB NO. 276
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words in boldface type and underscored are additions.
consummate a sale of the dealership. Any such sale shall be subject to R.S.1
32:1270.1(1)(c).2
(2) Upon termination of the franchise pursuant to such refusal, the3
provisions of R.S. 32:1270.8 shall apply.4
§1270.8. Requirements upon termination; penalty; indemnity; motorcycle or5
all-terrain vehicle dealers6
A.(1) In the event the licensee ceases to engage in the business of being7
a motorcycle or all-terrain vehicle dealer, or ceases to sell a particular make of8
motorcycle or all-terrain vehicle and after notice to the manufacturer,9
converter, distributor, or representative by certified mail or commercial10
delivery service with verification of receipt, within thirty days of the receipt of11
the notice by the manufacturer, converter, distributor, or representative, the12
manufacturer, converter, distributor, or representative shall repurchase:13
(a) All new motorcycles or all-terrain vehicles of the current and last14
prior model year delivered to the licensee and parts on hand that have not been15
damaged or substantially altered to the prejudice of the manufacturer while in16
the possession of the licensee. As to motorcycle or all-terrain vehicle dealers,17
the repurchase of parts shall be limited to those listed in the manufacturer's18
price book. The motorcycle or all-terrain vehicles and parts shall be19
repurchased at the cost to the licensee which shall include without limitation20
freight and advertising costs, less all allowances paid to the motorcycle or all-21
terrain vehicle dealer.22
(b) At fair market value, each undamaged sign owned by the motorcycle23
or all-terrain vehicle dealer which bears a trademark or trade name used or24
claimed by the manufacturer, converter, distributor, or representative if the25
sign was purchased from or purchased at the request of the manufacturer,26
distributor, or representative. Fair market value shall be no less than cost of27
acquisition of the sign by the motorcycle or all-terrain vehicle dealer.28
(c) At fair market value, all special tools and automotive service29 SB NO. 276
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equipment owned by the motorcycle or all-terrain vehicle dealer which were1
recommended in writing and designated as special tools and equipment and2
purchased from or purchased at the request of the manufacturer, converter,3
distributor, or representative, if the tools and equipment are in usable and good4
condition except for reasonable wear and tear. Fair market value shall be no5
less than cost of acquisition of special tools and automotive service equipment6
by the motorcycle or all-terrain vehicle dealer.7
(d) The manufacturer, converter, distributor, or representative shall pay8
to the motorcycle or all-terrain vehicle dealer the costs of transporting,9
handling, packing, and loading of motorcycles or all-terrain vehicles, or parts,10
signs, tools, and equipment subject to repurchase.11
(2) The manufacturer or converter shall make the required repurchase12
after the dealer terminates his franchise and within sixty days of the submission13
to it, by certified mail, return receipt requested, or commercial delivery service14
with verification of receipt, of a final inventory of motorcycles, all-terrain15
vehicles, and parts on hand.16
B. Failure to make such repurchase without just cause shall subject the17
manufacturer or converter to a penalty of one and one-half percent per month,18
or fraction thereof, of the inventory value or returnable motorcycles or all-19
terrain vehicles, and parts, signs, special tools, and automotive service20
equipment, payable to the dealer, as long as the repurchase is not made.21
§1270.9. Manufacturer termination of line-make; manufacturer bankruptcy;22
license; motorcycle or all-terrain vehicle franchise23
Notwithstanding the terms of any franchise or other provision of law, if24
the termination, cancellation, or nonrenewal of a licensee's franchise is the25
result of the termination, elimination, or cessation of a line-make by the26
manufacturer, distributor, or factory branch, whether by bankruptcy or27
otherwise, the license issued by the commission may remain in effect at the28
discretion of the commission pursuant to its rules.29 SB NO. 276
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§1270.10. Venue and choice of law for litigation or arbitration; motorcycle or1
all-terrain vehicle2
A provision contained in a franchise agreement requiring that3
arbitration or litigation be conducted outside this state or a provision that seeks4
to apply any law other than Louisiana law to disputes between the parties to a5
franchise agreement, is void and unenforceable.6
Section 2. The Louisiana State Law Institute is hereby directed to redesignate R.S.7
32:1251 through 1269 of Chapter 6 of Title 32 of the Louisiana Revised Statutes of 1950 as8
Part I of Chapter 6 of Title 32 of the Louisiana Revised Statutes of 1950. Part I shall be9
entitled "GENERAL PROVISIONS APPLICABLE TO MOTOR VEHICLES AND10
RECREATIONAL PRODUCTS".11
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Michelle Ducharme.
DIGEST
Present law provides for the regulation of motor vehicles, speciality vehicles, and
recreational products under the governance of the Motor Vehicle Commission
("commission").
Present law provides for definitions governing the regulation of motor vehicles, recreational
products, and speciality vehicles.
Proposed law adds the following definitions: "motorcycle or all-terrain vehicle dealer",
"motorcycle or all-terrain vehicle lessor", "motorcycle or all-terrain vehicle lessor agent",
"motorcycle or all-terrain vehicle lessor franchisor", "motorcycle or all-terrain vehicle
salesman", "new motorcycle or all-terrain vehicle", "used motorcycle or all-terrain vehicle",
"used motorcycle or all-terrain vehicle dealer", and "used motorcycle or all-terrain vehicle
facility".
Proposed law replicates certain provisions of present law in new sections of law and limits
the application of such provisions to motorcycles and all-terrain vehicles.
Effective August 1, 2012.
(Amends R.S. 32:1257.1 and 1261; adds R.S. 32:1252(52)-(60), 1262(C), 1267(C), 1268(D),
and 1270-1270.10)