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Regular Session, 2012
SENATE BILL NO. 360
BY SENATOR MARTINY AND REPRESENTATIVE PONTI
COMMERCIAL REGULATIONS. Provides for distribution and sale of marine products,
motorcycles, all-terrain vehicles, and recreational vehicles. (8/1/12)
AN ACT1
To amend and reenact R.S. 32:1252(4) and (19), 1261, 1261.1, and 1263, to enact R.S.2
32:1252(52) through (69), 1262(C), 1264(D), 1267(C), 1268(D), and Parts II, III, and3
IV of Chapter 6 of Title 32 of the Louisiana Revised Statutes of 1950, to be4
comprised of R.S. 32:1270 through 1270.30, and to repeal R.S. 32:1257.1,5
1261(6)(a)(ii), and 1268.1, relative to marine products, motorcycles, all-terrain6
vehicles, and recreational vehicles; to provide for certain terms, conditions,7
requirements, and procedures; to provide for definitions; to provide for the8
establishment of new dealerships and the relocation of existing dealerships; to9
provide for payment to dealers; to provide for unauthorized acts; to provide for10
warranty agreements and application thereof; to provide for the sale and leasing of11
certain marine products, motorcycles, all-terrain vehicles, and recreational vehicles;12
to provide for the succession of a dealer; to provide for the procedure to terminate13
a dealership; to provide for the repurchase of certain products, equipment, parts, and14
tools; and to provide for related matters.15
Be it enacted by the Legislature of Louisiana:16
Section 1. R.S. 32:1252(4) and (19), 1261, 1261.1, and 1263 are hereby amended17 SB NO. 360
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and reenacted and R.S. 32:1252(52) through (69), 1262(C), 1264(D), 1267(C), 1268(D), and1
Parts II, III, and IV of Chapter 6 of Title 32 of the Louisiana Revised Statutes of 1950, to be2
comprised of R.S. 32:1270 through 1270.30 are hereby enacted to read as follows:3
§1252. Definitions4
The following words, terms, and phrases, when used in this Chapter, shall5
have the meanings respectively ascribed to them in this Section, except where the6
context clearly indicates a different meaning:7
* * *8
(4) "Boat package" means a boat that is equipped from its manufacturer or9
distributor with an inboard, outboard, or inboard/outboard motor or engine attached10
thereto, installed thereon, or shipped or invoiced together as a package. The boat11
package may include a trailer invoiced from the manufacturer of the boat. For12
the purposes of this Chapter, the boat package brand shall be determined by the13
brand of the boat.14
* * *15
(19) "Franchise" means any written contract or selling agreement between16
a motor vehicle or recreational products dealer, a motor vehicle lessor, or a specialty17
vehicle dealer and a manufacturer, motor vehicle lessor franchisor, or converter of18
a new motor vehicle or specialty vehicle or its distributor or factory branch by which19
the motor vehicle or recreational products dealer, motor vehicle lessor, or specialty20
vehicle dealer is authorized to engage in the business of selling or leasing the21
specific makes, models, or classifications of new motor vehicles, recreational22
products, or specialty vehicles marketed or leased by the manufacturer, motor23
vehicle lessor franchisor, or converter and designated in the franchise agreement or24
any addendum thereto. For purposes of this Chapter, any written modification,25
amendment, or addendum to the original franchise agreement, which changes the26
rights and obligations of the parties to the original franchise agreement, shall27
constitute a new franchise agreement, effective as of the date of the modification,28
amendment, or addendum.29 SB NO. 360
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(52) "Marine product salesman" means any natural person employed2
by a licensee of the commission whose duties include the selling, leasing, or3
offering for sale or lease, financing or insuring marine products on behalf of4
said licensee and who holds a motor vehicle salesman license under the5
provisions of this Chapter.6
(53) "New marine product" means a marine product, the legal title to7
which has never been transferred by a manufacturer, distributor, or dealer to8
an ultimate purchaser.9
(54) "Selling agreement" means any written contract or agreement10
between a marine dealer and a manufacturer, or its distributor or factory11
branch, by which the marine dealer is authorized to engage in the business of12
selling or leasing the specific makes, models, or classifications of marine13
products marketed or leased by the manufacturer, and designated in the selling14
agreement or any addendum thereto. For the purposes of this Paragraph, any15
written modification, amendment, or addendum to the original selling16
agreement that changes the rights and obligations of the parties to the original17
selling agreement shall constitute a new selling agreement, effective as of the18
date of the modification, amendment, or addendum.19
(55) "Used marine product" means a marine product, the legal title of20
which has been transferred by a manufacturer, distributor, or dealer to an21
ultimate purchaser.22
(56)(a) "Used marine product dealer" means any person, whose business23
is to sell, or offer for sale, display, or advertise used marine products, or any24
person who holds a license from the commission and is not excluded by25
Subparagraph (b) of this Paragraph.26
(b) "Used marine dealer" shall not include any of the following:27
(i) Receivers, trustees, administrators, executors, guardians, or other28
persons appointed by or acting under the judgment or order of any court.29 SB NO. 360
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(ii) Public officers while performing their official duties.1
(iii) Employees of persons, corporations, or associations enumerated in2
the definition of "used marine dealer" when engaged in the specific3
performance of their duties as such employees.4
(iv) Mortgagees or secured parties as to sales of marine products5
constituting collateral on a mortgage or security agreement and who do not6
maintain a used car lot or building with one or more employed marine product7
salesman.8
(v) Insurance companies who sell motor vehicles to which they have9
taken title as an incident of payments made under policies of insurance and who10
do not maintain a used car lot or building with one or more employed marine11
product salesman.12
(vi) Used motor vehicle dealers licensed pursuant to R.S. 32:781 et seq.13
(57) "Used marine product facility" means any facility which is owned14
and operated by a licensee of the commission and offers for sale used marine15
products.16
(58) "Motorcycle or all-terrain vehicle dealer" means any person who,17
for a commission or with intent to make a profit or gain of money or other thing18
of value, buys, sells, brokers, exchanges, auctions, offers, or attempts to19
negotiate a sale or exchange of an interest in motorcycles or all-terrain vehicles20
and who is engaged wholly or in part in the business of buying and selling21
motorcycles or all-terrain vehicles in the state of Louisiana and who holds a22
license as a recreational products dealer under the provisions of this Chapter.23
(a) The term shall also include anyone not licensed under Chapter 6 of24
Title 32 of the Louisiana Revised Statutes of 1950, who sells motorcycles or all-25
terrain vehicles and who rents on a daily basis motorcycles or all-terrain26
vehicles, not of the current year or immediate prior year models, that have been27
titled previously to an ultimate purchaser.28
(b) "Motorcycle or all-terrain vehicle dealer" shall not include any of29 SB NO. 360
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the following:1
(i) Receivers, trustees, administrators, executors, guardians, or other2
persons appointed by or acting under the judgment or order of any court.3
(ii) Public officers while performing their official duties.4
(iii) Employees of motorcycle or all-terrain vehicle dealers when engaged5
in the specific performance of their duties of such employees.6
(iv) Mortgagees or secured parties as to sales of motorcycles or all-7
terrain vehicles constituting collateral on a mortgage or security agreement.8
(v) Insurance companies.9
(vi) Auctioneers or auction houses who are not engaged in the auction10
of motorcycles or all-terrain vehicles as the principal part of their business,11
including but not limited to the following auctions: estate auctions, bankruptcy12
auctions, farm equipment auctions, or government auctions.13
(59) "Motorcycle or all-terrain vehicle salesman" means any natural14
person employed by a licensee of the commission whose duties include the15
selling, leasing, or offering for sale or lease, financing or insuring motorcycle or16
all-terrain vehicles on behalf of said licensee and who holds a motor vehicle17
salesman under the provisions of this Chapter.18
(60) "New motorcycle or all-terrain vehicle" means a motorcycle or all-19
terrain vehicle, the legal title to which has never been transferred by a20
manufacturer, distributor, or dealer to an ultimate purchaser.21
(61) "Used motorcycle or all-terrain vehicle" means a motorcycle or all-22
terrain vehicle, the legal title of which has been transferred by a manufacturer,23
distributor, or dealer to an ultimate purchaser.24
(62)(a) "Used motorcycle or all-terrain vehicle dealer" means any25
person, whose business is to sell, or offer for sale, display, or advertise used26
motorcycles or all-terrain vehicles, or any person who holds a license from the27
commission and is not excluded by Subparagraph (b) of this Paragraph.28
(b) "Used motorcycle or all-terrain vehicle dealer" shall not include any29 SB NO. 360
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of the following:1
(i) Receivers, trustees, administrators, executors, guardians, or other2
persons appointed by or acting under the judgment or order of any court.3
(ii) Public officers while performing their official duties.4
(iii) Employees of persons, corporations, or associations enumerated in5
the definition of "used motorcycle or all-terrain vehicle dealer" when engaged6
in the specific performance of their duties as such employees.7
(iv) Mortgagees or secured parties as to sales of motorcycles or all-8
terrain vehicles constituting collateral on a mortgage or security agreement and9
who do not maintain a used car lot or building with one or more employed10
motorcycle or all-terrain vehicle salesman.11
(v) Insurance companies who sell motorcycles or all-terrain vehicles to12
which they have taken title as an incident of payments made under policies of13
insurance and who do not maintain a used car lot or building with one or more14
employed motorcycle or all-terrain vehicle salesman.15
(vi) Used motorcycle or all-terrain vehicle dealers licensed pursuant to16
R.S. 32:781 et seq.17
(63) "Used motorcycle or all-terrain vehicle facility" means any facility18
which is owned and operated by a licensee of the commission and offers for sale19
used motorcycles or all-terrain vehicles.20
(64) "New recreational vehicle" means a recreational vehicle, the legal21
title to which has never been transferred by a manufacturer, distributor, or22
dealer to an ultimate purchaser.23
(65) "Recreational vehicle dealer" means any person who, for a24
commission or with intent to make a profit or gain of money or other thing of25
value, buys, sells, brokers, exchanges, auctions, offers, or attempts to negotiate26
a sale or exchange of an interest in recreational vehicles and who is engaged27
wholly or in part in the business of buying and selling recreational vehicles in28
the state of Louisiana and who holds a license as a recreational products dealer29 SB NO. 360
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under the provisions of this Chapter.1
(a) The term shall also include anyone not licensed under Chapter 6 of2
Title 32 of the Louisiana Revised Statutes of 1950, who sells recreational3
vehicles and who rents on a daily basis recreational vehicles, not of the current4
year or immediate prior year models, that have been titled previously to an5
ultimate purchaser.6
(b) "Recreational vehicle dealer" shall not include any of the following:7
(i) Receivers, trustees, administrators, executors, guardians, or other8
persons appointed by or acting under the judgment or order of any court.9
(ii) Public officers while performing their official duties.10
(iii) Employees of recreational vehicle dealers when engaged in the11
specific performance of their duties as such employees.12
(iv) Mortgagees or secured parties as to sales of recreational vehicles13
constituting collateral on a mortgage or security agreement.14
(v) Insurance companies.15
(vi) Auctioneers or auction houses who are not engaged in the auction of16
recreational vehicles as the principal part of their business, including but not17
limited to the following auctions: estate auctions, bankruptcy auctions, farm18
equipment auctions, or government auctions.19
(66) "Recreational vehicle salesman" means any natural person20
employed by a licensee of the commission whose duties include the selling,21
leasing, or offering for sale or lease, financing or insuring recreational vehicles22
on behalf of said licensee and who holds a motor vehicle salesman license under23
the provisions of this Chapter.24
(67) "Used recreational vehicle" means a recreational vehicle, the legal25
title of which has been transferred by a manufacturer, distributor, or dealer to26
an ultimate purchaser.27
(68)(a) "Used recreational vehicle dealer" means any person, whose28
business is to sell, or offer for sale, display, or advertise used recreational29 SB NO. 360
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vehicles, or any person who holds a license from the commission and is not1
excluded by Subparagraph (b) of this Paragraph.2
(b) "Used recreational vehicle dealer" shall not include any of the3
following:4
(i) Receivers, trustees, administrators, executors, guardians, or other5
persons appointed by or acting under the judgment or order of any court.6
(ii) Public officers while performing their official duties.7
(iii) Employees of persons, corporations, or associations enumerated in8
the definition of "used recreational vehicle dealer" when engaged in the specific9
performance of their duties as such employees.10
(iv) Mortgagees or secured parties as to sales of recreational vehicles11
constituting collateral on a mortgage or security agreement and who do not12
maintain a used car lot or building with one or more employed recreational13
vehicle salesman.14
(v) Insurance companies who sell recreational vehicles to which they15
have taken title as an incident of payments made under policies of insurance16
and who do not maintain a used car lot or building with one or more employed17
recreational vehicle salesman.18
(vi) Used recreational vehicle dealers licensed pursuant to R.S. 32:781 et19
seq.20
(69) "Used recreational vehicle facility" means any facility which is21
owned and operated by a licensee of the commission and offers for sale used22
recreational vehicles.23
* * *24
§1261. Unauthorized acts25
A. It shall be a violation of this Chapter:26
* * *27
B. The provisions of this Section shall not apply to a dealer,28
manufacturer, distributor, wholesaler, distributor branch, factory branch, or29 SB NO. 360
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convertor of marine products, motorcycles or all-terrain vehicles, or1
recreational vehicles, or any officer, agent, or other representative thereof.2
§1261.1. Indemnification of franchised dealers3
A. Notwithstanding the terms of any franchise agreement, each manufacturer4
or converter shall indemnify and hold harmless its franchised dealers against any5
judgment for damages, including but not limited to court costs and reasonable6
attorney fees of the dealer, arising out of complaints, claims, or lawsuits including7
but not limited to strict liability, negligence, misrepresentation, express or implied8
warranty, or rescission of sale to the extent that the judgment arises out of alleged9
defective or negligent manufacture, assembly, or design of motor vehicles, speciality10
vehicle, recreational product, parts, or accessories, or other functions by the11
manufacturer of converter, which are beyond the control of the dealer.12
B. The provisions of this Section shall not apply to a franchised13
recreational vehicle dealer, marine dealer, and motorcycle or all-terrain vehicle14
dealer.15
§1262. Warranty; compensation; audits of dealer records16
* * *17
C. The provisions of this Section shall not apply to a dealer,18
manufacturer, distributor, wholesaler, distributor branch, or factory branch of19
marine products, motorcycles or all-terrain vehicles, or recreational vehicles,20
or any officer, agent, or other representative thereof.21
§1263. Motor vehicle repairs22
A. Suppliers of mechanical repairs and services for any vehicle subject to23
regulation pursuant to this Chapter shall provide each consumer with an itemized bill24
indicating repairs and services performed, parts replaced, or materials used, the total25
labor charge, and the identity of the mechanic, repairman, or supplier who performed26
the work. However, nothing in this Section shall prohibit a supplier of mechanical27
repairs and services from charging a service fee for the use of shop supplies such as28
rags, fender covers, small amounts of fluid, or other items which are not itemized,29 SB NO. 360
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provided that such fee does not exceed five percent of the total invoice for1
mechanical repairs or thirty-five dollars, whichever is less.2
B. The provisions of this Section shall not apply to suppliers of3
mechanical repairs and services for any recreational vehicle subject to4
regulation of this Chapter.5
§1264. Damage disclosure6
* * *7
D. The provisions of this Section shall not apply to marine products,8
motorcycle or all-terrain vehicles, or recreational vehicles.9
* * *10
§1267. Succession; right of first refusal11
* * *12
C. The provisions of this Section shall not apply to the succession of any13
marine dealer, motorcycle or all-terrain vehicle, or recreational vehicle.14
§1268. Requirements upon termination; penalty; indemnity15
* * *16
D. Notwithstanding any provision of law to the contrary, the provisions17
of this Section shall not apply to a marine dealer, motorcycle or all-terrain18
vehicle dealer, or recreational vehicle dealer.19
* * *20
PART II. PROVISIONS SPECIFIC TO MARINE PRODUCTS21
§1270. Establishment of new marine dealerships or relocations; protests;22
procedure23
A. Whenever the commission receives an application for a recreational24
products dealer's license which would add a new marine dealership, it shall first25
notify the existing licensed marine dealership or dealerships selling the same-26
line makes, models, or classifications if the new dealership's proposed location27
is within the existing dealer's area of responsibility. Any same-line makes,28
models, or classifications dealership whose area of responsibility includes the29 SB NO. 360
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location of the proposed new marine dealership may object to the granting of1
the license.2
B. Whenever the commission receives an application for a recreational3
products dealer's license which would relocate an existing marine dealership,4
it shall first notify the existing licensed marine dealership or dealerships selling5
the same-line makes, models, or classifications if the dealership's proposed new6
location is within the existing dealer's area of responsibility. The existing same-7
line makes, models, or classifications dealership or dealerships shall have the8
right to object to the granting of the license only if the proposed relocation is9
within a radius of seven miles of its facility. However, without regard to10
distance, whenever the commission receives an application for the relocation of11
a marine dealership which would add an additional marine dealership to an12
existing same-line makes, models, or classifications dealership's area of13
responsibility, the affected dealership shall have the right to object.14
C. The objection shall be in writing and shall be received by the15
commission within a fifteen-day period after receipt of the notice. The fifteen-16
day objection period shall be waived upon written notification to the17
commission from all licensees entitled to object that the licensees have no18
objections to the proposed change or addition for which the notice of intent was19
issued. If timely objection is lodged, and prior to the issuance of the license, the20
commission shall hold a hearing within thirty days after receipt of the objection21
and issue its decision within ninety days after date of the hearing. Notice of22
hearing and an opportunity to participate therein shall be given to the23
manufacturer or distributor, the applicant for the license as a marine dealer,24
and to the protesting dealership or dealerships.25
D. Whenever the commission receives an objection pursuant to the26
provisions of Subsection A of this Section, or whenever the commission receives27
an objection pursuant to the assignment of the marine dealer's area of principal28
sales and service responsibility, the commission shall consider the following and29 SB NO. 360
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may consider any other relevant factors in determining whether there is good1
cause to approve or reject the assignment of the marine dealer's area of2
principal sales and service responsibility, or to issue a license:3
(1) Whether the community or territory can support an additional4
marine dealership.5
(2) The financial impact on both the applicant and the existing marine6
dealership or dealerships.7
(3) Whether the existing marine dealerships of the same-line makes,8
models, or classifications in the dealership's area of responsibility are providing9
adequate representation, competition, and convenient consumer care for the10
marine products of the same-line makes, models, or classifications located11
within that area.12
(4) Whether the issuance of the license would increase competition, be13
in the public interest, or both.14
E. In disputes between the marine dealers and manufacturers and15
distributors regarding the execution of an agreement that would add a new16
same-line make marine dealership or would add the same product line17
regardless of brand name within the area of responsibility of an existing marine18
dealer, the name brand of the boat determines whether a dealer may enter into19
a franchise for a particular boat package or boat package line. The marine20
motor, marine engine, boat trailer, or any accessory made a part of a boat21
package shall not be the subject of, or a consideration in, an area of22
responsibility dispute for violation involving the boat package.23
F. A manufacturer or distributor of a marine motor or marine engine24
may, in their discretion, enter into a warranty service agreement with a marine25
dealer of a boat package that is packaged with its particular brand marine26
motor or engine without violating the area of responsibility of any other marine27
dealer that has a franchise of that brand marine motor or engine. However, the28
warranty service agreement shall not be construed to permit the marine dealer29 SB NO. 360
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to sell the marine motor or engine separate from the boat package, and the1
marine dealer shall not hold itself out to be a full-line or loose marine motor or2
engine dealership.3
§1270.1. Unauthorized acts; marine products4
It shall be a violation of this Part:5
(1) For a manufacturer, a distributor, a wholesaler, distributor branch,6
or factory branch of marine products or any officer, agent, or other7
representative thereof:8
(a) To induce or coerce, or attempt to induce or coerce, any licensee.9
(i) To order or accept delivery of any marine product, appliances,10
equipment, parts or accessories therefor, or any other commodity or11
commodities which shall not have been voluntarily ordered.12
(ii) To order for any person any parts, accessories, equipment,13
machinery, tools, appliances, or any commodity whatsoever.14
(iii) To assent to a release, assignment, novation, waiver, or estoppel15
which would relieve any person from liability to be imposed by law, unless done16
in connection with a settlement agreement to resolve a matter pending a17
commission hearing or pending litigation between a manufacturer, distributor,18
wholesaler, distributor branch or factory branch, or officer, agent, or other19
representative thereof.20
(iv) To enter into a franchise with a licensee or during the franchise21
term, use any written instrument, agreement, release, assignment, novation,22
estoppel, or waiver, to attempt to nullify or modify any provision of this23
Chapter, or to require any controversy between a marine dealer and a24
manufacturer to be referred to any person or entity other than the commission,25
or duly constituted courts of this state or the United States, if such referral26
would be binding upon the dealer. Such instruments are null and void, unless27
done in connection with a settlement agreement to resolve a matter pending a28
commission hearing or pending litigation.29 SB NO. 360
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(v) To waive the right to a jury trial.1
(vi) To participate in an advertising group or to participate monetarily2
in an advertising campaign or contest or to purchase any promotional3
materials, showroom, or other display decorations or materials at the expense4
of such marine dealer.5
(vii) To adhere to performance standards that are not applied uniformly6
to other similarly situated marine dealers. Any such performance standards7
shall be fair, reasonable, equitable, and based on accurate information. If8
marine dealership performance standards are based on a survey, the9
manufacturer, distributor, wholesaler, distributor branch, or factory branch10
shall establish the objectivity of the survey process and provide this information11
to any marine dealer of the same-line make covered by the survey request. Each12
response to a survey used by a manufacturer in preparing an evaluation or13
performance-rating of a marine dealer shall be made available to that marine14
dealer, or it cannot be used by the manufacturer. However, if a customer15
requests that the manufacturer or distributor not disclose the consumer's16
identity to the dealer, the manufacturer may withhold the consumer's identity17
in providing the survey response to the dealer, and the manufacturer may use18
the response. Any survey used must have the following characteristics:19
(aa) It was designed by experts.20
(bb) The proper universe was examined.21
(cc) A representative sample was chosen.22
(dd) The data was accurately reported.23
(viii) To release, convey, or otherwise provide customer information, if24
to do so is unlawful or if the customer objects in writing. This does not include25
information that is necessary for the manufacturer to meet its obligations to the26
marine dealer or consumers in regard to contractual responsibilities, marine27
product recalls, or other requirements imposed by state or federal law. The28
manufacturer is further prohibited from providing any consumer information29 SB NO. 360
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received from the marine dealer to any unaffiliated third party.1
(ix) To pay the attorney fees of the manufacturer or distributor related2
to hearings and appeals brought under this Chapter.3
(x) To order or accept delivery of any vehicle with special features,4
appliances, accessories, or equipment not included in the list price of said5
vehicles as publicly advertised.6
(b) To refuse to deliver to any licensee having a franchise or contractual7
arrangement for the retail sale of marine products sold or distributed by such8
manufacturer, distributor, wholesaler, distributor branch or factory branch,9
any marine product, publicly advertised for immediate delivery, within sixty10
days after such marine dealer's order shall have been received.11
(c) To threaten to cancel any franchise existing between such12
manufacturer, distributor, wholesaler, distributor branch or factory branch13
and said marine dealer for any reason.14
(d) To unfairly, without just cause and due regard to the equities of the15
marine dealer, cancel the franchise of the licensee. The nonrenewal of a16
franchise with a marine dealer or his successor without just provocation or17
cause, or the refusal to approve a qualified transferee or qualified successor to18
the dealer-operator as provided for in the selling agreement, shall be deemed19
an evasion of this Subparagraph and shall constitute an unfair cancellation,20
regardless of the terms or provisions of such franchise. However, at least ninety21
days notice shall be given to the dealer of a cancellation or nonrenewal of a22
franchise except for a cancellation arising out of fraudulent activity of the23
dealer principal which results in the conviction of a crime punishable by24
imprisonment.25
(e) To refuse to extend to a licensee the privilege of determining the mode26
or manner of available transportation facility that such marine dealer desires27
to be used or employed in making deliveries of marine products to him or it.28
(f) To ship or sell marine products to a licensee prior to the licensee29 SB NO. 360
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having been granted a license by the commission to sell such products.1
(g) To unreasonably withhold consent to the sale, transfer, or exchange2
of the dealership to a qualified transferee capable of being licensed as a marine3
dealer in this state, provided the transferee meets the criteria generally applied4
by the manufacturer in approving new marine dealers and agrees to be bound5
by all the terms and conditions of the standard franchises.6
(h) To fail to respond in writing to a written request for consent as7
specified in Subparagraph (g) of this Paragraph within sixty days of receipt of8
a written request on the forms, if any, generally utilized by the manufacturer9
or distributor for such purposes and containing the information required10
therein. Failure to respond shall be deemed to be consent to the request.11
(i)(i) To sell or offer to sell a new or unused marine product directly to12
a consumer except as provided in this Chapter, or to compete with a licensee in13
the same-line makes, models, or classifications operating under an agreement14
from the aforementioned manufacturer. A manufacturer shall not, however, be15
deemed to be competing when any one of the following conditions are met:16
(aa) Operating a marine dealership temporarily for a reasonable period,17
not to exceed two years.18
(bb) Operating a bona fide retail marine dealership which is for sale to19
any qualified independent person at a fair and reasonable price, not to exceed20
two years.21
(cc) Operating in a bona fide relationship in which a person independent22
of a manufacturer has made a significant investment subject to loss in the23
marine dealership, and can reasonably expect to acquire full ownership of such24
dealership on reasonable terms and conditions.25
(ii) After any of the conditions have been met under Subitems (aa) and26
(bb) of Item (i) of this Subparagraph, the commission shall allow the27
manufacturer to compete with licensees of the same-line makes, models, or28
classifications under an agreement from said manufacturer for longer than two29 SB NO. 360
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years when, in the discretion of the commission, the best interest of the1
manufacturer, consuming public, and licensees are best served.2
(j) To fail to compensate its marine dealers for the work and services3
they are required to perform in connection with the marine dealer's delivery4
and preparation obligations according to the terms of compensation that shall5
be filed with the commission on or before October first of each year. The6
commission shall find the compensation to be reasonable or the manufacturer7
shall remedy any deficiencies.8
(k) To fail to designate and provide to the commission in writing the9
community or territory assigned to a licensee.10
(l) To unreasonably discriminate among competing, similarly situated,11
same-line make dealers in the sales of the marine products, in the availability12
of such marine products, in the terms of incentive programs or sales promotion13
plans, or in other similar programs.14
(m) To use any subsidiary, affiliate, or any other controlled person or15
entity, or to employ the services of a third party, to accomplish what would16
otherwise be illegal conduct under this Chapter on the part of the manufacturer17
or distributor.18
(n) To make a change in the area of responsibility described in the19
franchise or sales and service agreement of a dealer, without the manufacturer20
or distributor giving said marine dealer and the commission no less than sixty21
days prior written notice by certified or registered mail.22
(2) For a marine dealer, used marine product dealer, marine product23
salesman:24
(a) To require a purchaser of a marine product, as a condition of sale25
and delivery thereof, to also purchase special features, appliances, accessories,26
or equipment not desired or requested by the purchaser; however, this27
prohibition shall not apply as to special features, appliances, accessories, or28
equipment which are permanently affixed to the marine product.29 SB NO. 360
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(b) To represent and sell as a new marine product any marine product,1
the legal title of which has been transferred by a manufacturer, distributor, or2
dealer to an ultimate purchaser.3
(c) To resort to or use any false or misleading advertisement in4
connection with his business as such marine dealer or marine product salesman.5
(d) To sell or offer to sell makes, models, or classifications of new marine6
products for which no franchise and license to sell is held.7
(e) Except as otherwise approved by the commission, to sell or offer to8
sell a marine product from an unlicensed location.9
(f) To deliver to a prospective purchaser a new or a used marine product10
on a sale conditioned on financing, i.e., a spot delivery, except on the following11
terms and conditions which shall be in writing and shall be a part of the12
conditional sales contract or other written notification signed by the purchaser:13
(i) That if the sale is not concluded by the financing of the sale to the14
purchaser within twenty-five days of the delivery, the sale contract shall be null15
and void.16
(ii) That the marine product being offered for trade-in by the purchaser17
shall not be sold by the marine dealer until the conditional sale is complete.18
(iii) That there shall be no charge to the purchaser should the conditional19
sale not be completed, including but not limited to mileage charges or charges20
to refurbish the marine product offered for trade-in. However, the purchaser21
shall be responsible for any and all damages to the marine product or other22
marine products damaged by the fault of the purchaser and any and all liability23
incurred by the purchaser during the purchaser's custody of the marine24
product to the extent provided for in R.S. 22:1296.25
(iv) That if the conditional sale is not completed, the marine dealer shall26
immediately refund to the purchaser upon return of the marine product all27
sums placed with the dealership as a deposit or any other purpose associated28
with the attempted sale of the marine product.29 SB NO. 360
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(v) That the prospective purchaser shall return the marine product to the1
dealership within forty-eight hours of notification by the marine dealer that the2
conditional sale will not be completed. If the prospective purchaser does not3
return the marine product to the dealership within forty-eight hours of4
notification by the marine dealer, an authorized agent of the marine dealer shall5
have the right to recover the marine product without the necessity of judicial6
process, provided that such recovery can be accomplished without unauthorized7
entry into a closed dwelling, whether locked or unlocked and without a breach8
of peace.9
(g) To pay a fee to any person in return for the solicitation, procurement,10
or production by that person of prospective purchasers for new and used11
marine products, except to a salesman licensed under the provisions of this12
Chapter.13
(h) To fail to fully and completely explain each charge listed on a retail14
buyer's order or marine product invoice prior to the purchase of a marine15
product.16
(i) When selling a marine product to a consumer, to assess any consumer17
services fees, which shall include fees for treating the interior upholstery of the18
marine product, oil changes, roadside assistance, dealer inspections, or any19
other service offered by the dealer, without allowing the buyer to refuse such20
services and be exempt from payment for such services. The provisions of this21
Subparagraph shall not apply to dealer-added options or accessories which are22
permanently affixed to the marine product.23
(3) For any person or other licensee:24
(a) To modify a franchise during the term of the agreement or upon its25
renewal if the modification substantially and adversely affects the dealer's26
rights, obligations, investment, or return on investment without giving sixty-day27
written notice of the proposed modification to the licensee and the commission28
unless the modifications are required by law, court order, or the commission.29 SB NO. 360
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Within the sixty-day notice period the licensee may file with the commission a1
complaint for a determination whether there is good cause for permitting the2
proposed modification. The party seeking to modify or replace an agreement3
shall demonstrate by a preponderance of the evidence that there is good cause4
for the modification or replacement. The commission shall schedule a hearing5
within sixty days to decide the matter. Multiple complaints pertaining to the6
same proposed modifications shall be consolidated for hearing. The proposed7
modification may not take effect pending the determination of the matter.8
(b) In making a determination of whether there is good cause for9
permitting a proposed modification, the commission may consider any relevant10
factor including:11
(i) The reasons for the proposed modification.12
(ii) Whether the proposed modification is applied to or affects all13
licensees in a nondiscriminating manner.14
(iii) The degree to which the proposed modification will have a15
substantial and adverse effect upon the licensee's investment or return on16
investment.17
(iv) Whether the proposed modification is in the public interest.18
(v) The degree to which the proposed modification is necessary to the19
orderly and profitable distribution of marine products and other services by the20
licensee.21
(vi) Whether the proposed modification is offset by other modifications22
beneficial to the licensee.23
(c) The decision of the commission shall be in writing and shall contain24
findings of fact and a determination of whether there is good cause for25
permitting the proposed modification. The commission shall deliver copies of26
the decision to the parties personally or by registered mail.27
(4) For any employee of a licensee while acting in the scope of his28
employment, to accept any payment, commission, fee, or compensation of any29 SB NO. 360
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kind from any person other than the employing licensee, unless such payment1
is fully disclosed to and approved by the employing licensee.2
§1270.2. Warranty; compensation; audits of marine dealer records3
A.(1) It shall be a violation of this Chapter for a manufacturer,4
distributor, wholesaler, distributor branch, or factory branch of marine5
products or any officer, agent or other representative thereof to fail to6
adequately and fairly compensate its marine dealers for labor, parts, and other7
expenses incurred by such dealer to perform under and comply with a8
manufacturer's or a distributor's warranty agreement.9
(2) In no event shall any manufacturer or distributor pay its marine10
dealers at a price or rate for warranty work that is less than that charged by the11
marine dealer to the retail customers of the marine dealer for nonwarranty12
work of like kind.13
(3) Warranty work includes parts and labor performed.14
(4) All claims made by the marine dealer for compensation under this15
Subsection shall be paid within thirty days after approval and shall be approved16
or disapproved within thirty days after receipt. When any claim is disapproved,17
the marine dealer shall be notified in writing of the grounds for disapproval.18
(5) The obligations set forth in this Subsection may be modified by19
contract.20
B.(1) Notwithstanding the terms of any franchise, warranty and sales,21
incentive, audits of marine dealer records may be conducted by the22
manufacturer, distributor, distributor branch, or factory branch. Any audit for23
warranty parts or service compensation shall be for the twelve-month period24
immediately following the date of the payment of the claim by the manufacturer25
or distributor. However, a marine dealer shall not be held liable by virtue of an26
audit for failure to retain parts for a period in excess of six months. Any audit27
for sales incentives, service incentives, rebates, or other forms of incentive28
compensation shall only be for the twelve-month period immediately following29 SB NO. 360
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the date of the final payment to the marine dealer under a promotion, event,1
program, or activity. In no event shall the manufacturer, distributor,2
distributor branch, or factory branch fail to allow the marine dealer to make3
corrections to the sales data in less than one hundred twenty days from the4
program period. Additionally, no penalty other than amounts advanced on a5
marine product reported incorrectly shall be due in connection with the audit.6
With respect to marine products sold during the time period subject to the7
audit, but submitted incorrectly to the manufacturer, distributor, or wholesale8
distributor branch or factory branch, the marine dealer shall be charged back9
for the amount reported incorrectly and credited with the amount due, if10
anything, on the actual sale date.11
(2) No claim which has been approved and paid may be charged back to12
the marine dealer unless it can be shown that one or all of the following applies:13
(a) The claim was false or fraudulent.14
(b) The repairs were not properly made.15
(c) The repairs were unnecessary to correct the defective condition under16
generally accepted standards of workmanship.17
(d) The marine dealer failed to reasonably substantiate the repair in18
accordance with reasonable written requirements of the manufacturer or19
distributor, if the marine dealer was notified of the requirements prior to the20
time the claim arose and if the requirements were in effect at the time the claim21
arose.22
(3) A manufacturer or distributor shall not deny a claim solely based on23
a marine dealer's incidental failure to comply with a specific claim processing24
requirement, or a clerical error, or other administrative technicality.25
(4) Limitations on warranty parts or service compensation, sales26
incentive audits, rebates, or other forms of incentive compensation, chargebacks27
for warranty parts or service compensation, and service incentives and28
chargebacks for sales compensation only shall not be effective in the case of29 SB NO. 360
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intentionally false or fraudulent claims.1
(5) It shall be deemed an unfair act pursuant to this Chapter to audit a2
marine dealer more frequently than two sales-related and two service-related3
audits in a twelve-month period. Nothing in this Subsection shall limit a4
manufacturer's or distributor's ability to perform routine claim reviews in the5
normal course of business.6
(6) No claim may be rejected as late if it has been submitted within sixty7
days of the date the repair order was written.8
§1270.3. Sale of water-damaged marine products9
A. No person shall sell, transfer, or convey any new or used marine10
product to any person without notifying the buyer or receiver of the marine11
product in writing of the extent of any water damage from flooding which12
occurred to the marine product prior to the transaction.13
B. If a sale, transfer, or conveyance of a new or used marine product14
occurs in violation of Subsection A of this Section, the person receiving15
ownership and title to the marine product who is not otherwise aware of the16
damage at the time of the transaction may bring an action to set aside the17
transaction within one year from the date of the transaction and receive all18
monies or other property given as consideration for the marine product less a19
reasonable assessment for wear and tear.20
C. For the purposes of this Section, a "water-damaged marine product"21
means any marine product whose power train, computer, or electrical system22
has been damaged by flooding.23
§1270.4. Succession; right of first refusal; marine dealers24
A. The terms of the franchise notwithstanding, any marine dealer may25
appoint by will, or other written instrument, a designated successor to succeed26
in the ownership interest of the marine dealer in the marine dealership upon the27
death or incapacity of the marine dealer.28
B. Unless good cause exists for refusal to honor the succession on the29 SB NO. 360
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part of the manufacturer or distributor, any designated successor of a deceased1
or incapacitated marine dealer of a marine dealership may succeed to the2
ownership of the marine dealership under the existing franchise if:3
(1) The designated successor gives the manufacturer or distributor4
written notice of his or her intention to succeed to the ownership of the marine5
dealer within sixty days of the marine dealer's death or incapacity.6
(2) The designated successor agrees to be bound by all the terms and7
conditions of the franchise.8
C. The manufacturer or distributor may request, and the designated9
successor shall provide, promptly upon such request, personal and financial10
data reasonably necessary to determine whether the succession should be11
honored.12
D. If a manufacturer or distributor believes that good cause exists for13
refusing to honor the succession of a deceased or incapacitated marine dealer,14
the manufacturer or distributor may, not more than sixty days following receipt15
of notice of the designated successor's intent to succeed and receipt of such16
personal or financial data, serve upon the designated successor notice of its17
refusal to honor the succession and of its intent to discontinue the existing18
franchise with the marine dealer not earlier than six months from the date such19
notice is served.20
E. The notice must state the specific grounds for the refusal to honor the21
succession.22
F. If notice of refusal and discontinuance is not timely served upon the23
designated successor, the franchise shall continue in effect subject to24
termination only as otherwise permitted by this Part.25
G. In determining whether good cause for the refusal to honor the26
succession exists, the manufacturer or distributor has the burden of proving27
that the designated successor is not of good moral character or does not28
otherwise meet the manufacturer's or distributor's reasonable standards as a29 SB NO. 360
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marine dealer.1
H. If a manufacturer or distributor refuses to honor the succession to2
the ownership interest of a deceased or incapacitated owner for good cause, then3
and in such event the manufacturer or distributor shall allow the designated4
successor a reasonable period of time which shall not be less than six months in5
which to consummate a sale of the marine dealership. Any such sale shall be6
subject to R.S. 32:1270.1(2)(d).7
§1270.5. Manufacturer, distributor, or wholesaler repurchase; marine dealer;8
products9
A. If any marine dealer enters into a franchise with a manufacturer,10
distributor, or wholesaler wherein the marine dealer agrees to maintain an11
inventory of marine products or repair parts, the manufacturer, distributor, or12
wholesaler shall not terminate or fail to renew such franchise unless there is a13
breach of the franchise by the marine dealer and until ninety days after notice14
of such intention to terminate, including the breach of the franchise, has been15
sent by certified mail, return receipt requested, or commercial delivery service16
with verification of receipt, to the marine dealer and the marine dealer has17
failed to correct the breach within such period.18
B. If the franchise is terminated as a result of any action by the marine19
dealer and the manufacturer, distributor, or wholesaler has not given due cause,20
as provided in this Section, for termination of such franchise, the manufacturer,21
distributor, or wholesaler shall not be required to repurchase the inventory as22
provided in this Section; however, if the franchise is terminated as a result of23
any action by the marine dealer and the manufacturer, distributor, or24
wholesaler has given the marine dealer due cause, as provided in this Section,25
to terminate the franchise, the manufacturer, distributor, or wholesaler shall26
be required to repurchase that inventory previously purchased from them,27
including any new and unused marine products of the current and immediate28
prior model or program year and new and unused parts inventory as provided29 SB NO. 360
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in this Section.1
C. It shall be unlawful for the manufacturer, wholesaler, or distributor,2
without due cause and pursuant to its own initiating action, to terminate or fail3
to renew a franchise, unless the manufacturer, wholesaler, or distributor4
repurchases the new and unused inventory as provided for in this Section.5
D. It shall not be unlawful for the marine dealer with due cause and6
pursuant to the marine dealer's own initiating action to terminate or fail to7
renew a franchise with a manufacturer, wholesaler, or distributor, and the8
manufacturer, wholesaler, or distributor shall repurchase inventory as provided9
by this Section. To determine what constitutes due cause for a marine dealer to10
terminate or fail to renew a franchise, the following factors regarding the11
manufacturer, wholesaler, distributor or representative of one of the so named12
shall include whether the manufacturer, wholesaler, distributor, or one of the13
so named:14
(1) Has made a material misrepresentation in accepting or acting under15
the franchise.16
(2) Has engaged in an unfair business practice.17
(3) Has engaged in conduct which is injurious or detrimental to public18
welfare.19
(4) Has failed to comply with any applicable Section of this Chapter.20
(5) Has been convicted of a crime, the effect of which would be21
detrimental to the marine dealership or dealer.22
(6) Has violated the Louisiana marine dealers area of responsibility.23
(7) Has failed to operate in the normal course of business for thirty24
consecutive days.25
(8) Has failed to comply with the terms of the franchise with the marine26
dealer.27
(9) Has materially misrepresented the performance or fitness for sale or28
use of a product line or products covered by the franchise.29 SB NO. 360
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E. If a manufacturer, distributor, or wholesaler does not intend to renew1
a franchise, the manufacturer, distributor, or wholesaler shall give the marine2
dealer ninety days written notice prior to the effective date by certified mail,3
return receipt requested, or commercial delivery service with verification of4
receipt.5
F. As required by this Section, the manufacturer, distributor, or6
wholesaler shall repurchase that inventory which can be verified as previously7
purchased from them, including all new and unused marine products of the8
current and immediate prior model or program year and new and unused parts9
on hand and held by the marine dealer on the date of termination of the10
contract. The manufacturer, distributor, or wholesaler shall pay an amount11
equivalent to the cost actually paid by the marine dealer, including discounts12
given and rebates paid per unit for any new, unused, undamaged, and unaltered13
from original invoice and delivery, and complete marine product. The14
manufacturer, distributor, or wholesaler shall also pay an amount equal to the15
price paid by the marine dealer for any new, unused, and undamaged repair16
parts and accessories which are listed in the manufacturer's, distributor's, or17
wholesaler's prevailing parts list or were delivered in the past forty-eight18
months and are in their original packaging.19
G. The provisions of this Section shall not require the repurchase from20
a marine dealer of:21
(1) Any repair part which has a limited storage life or is otherwise22
subject to deterioration.23
(2) Any single repair part which is priced and packaged as a set of two24
or more items.25
(3) Any repair part which, because of its condition, is not resalable as a26
new part without repackaging or reconditioning.27
(4) Any inventory for which the marine dealer cannot provide good title,28
free and clear of all claims, liens, and encumbrances.29 SB NO. 360
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(5) Any inventory which the marine dealer desires to keep, provided that1
the marine dealer has a contractual right to do so.2
(6) Any marine product which is not in new, unused, undamaged, and3
complete condition.4
(7) Any repair parts which are not in new, unused, and undamaged5
condition.6
(8) Any inventory which was ordered by the marine dealer on or after7
the date of receipt of the notification of termination of the franchise.8
(9) Any inventory which was acquired by the marine dealer from any9
source other than the manufacturer, distributor, or wholesaler, or its immediate10
predecessor.11
(10) Any marine product that has been altered substantially from12
original delivery.13
H. Upon termination of the franchise, the marine dealer shall submit a14
final inventory of marine products and parts on hand to the manufacturer,15
distributor, or wholesaler by certified mail, return receipt requested, or16
commercial delivery service with verification of receipt. If a manufacturer,17
distributor, or wholesaler fails or refuses to repurchase as required by this18
Section within thirty days of the receipt of the inventory, without just cause, the19
manufacturer, distributor, or wholesaler shall be subjected to a penalty of the20
marine dealer's reasonable attorney fees, court costs, and interest on the21
inventory value of returnable marine products and parts required to be22
purchased computed at the rate of one and one-half percent per month from the23
thirty-first day, as long as such repurchase is not made.24
I. Notwithstanding any other provision of law to the contrary, it shall be25
unlawful for a manufacturer, distributor, or wholesaler, either by contract or26
practice, to assess repurchase or restocking charges, freight charges except for27
return charges, reimbursement of interest charges paid, and any similar28
charges to the marine dealer.29 SB NO. 360
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J. If a marine dealer completes a bona fide, orderly, and permanent1
closure of the marine dealership, which does not involve a sale of the dealership,2
and provides at least ninety days notice to the manufacturer, wholesaler, or3
distributor, the marine products and parts inventory shall be repurchased by4
the manufacturer, wholesaler, or distributor in the manner provided for in this5
Section, when a franchise is terminated as result of action by the manufacturer,6
wholesaler, or distributor.7
K. In the event of the death or incapacity of the marine dealer or the8
majority owner of a person operating as a marine dealer, the manufacturer,9
distributor, or wholesaler shall, at the option of the heirs if the marine dealer10
died intestate or the legatees or transferees under the terms of the deceased11
marine dealer's last will and testament if the marine dealer died testate,12
repurchase the inventory from the heirs, legatees, or transferees as if the13
manufacturer, distributor, or wholesaler had terminated the contract, and the14
inventory repurchase provisions of this Section shall apply. The heirs or legatees15
shall have until the end of the contract term or one year from the date of the16
death of the marine dealer or majority owner of a person, whichever comes17
first, to exercise their option pursuant to this Section; provided, however, that18
nothing in this Section shall require the repurchase of inventory if the heirs,19
legatees, or transferees and the manufacturer, distributor, or wholesaler enter20
into a new franchise to operate the marine dealership.21
§1270.6. Manufacturer termination of line-make; manufacturer bankruptcy;22
license23
Notwithstanding the terms of any franchise or other provision of law, if24
the termination, cancellation, or nonrenewal of a licensee's selling agreement is25
the 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. 360
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§1270.7. Indemnification of marine dealers1
Notwithstanding the terms of any franchise agreement, each2
manufacturer or converter shall indemnify and hold harmless its franchised3
marine dealers against any judgment for damages, including but not limited to4
court costs and reasonable attorney fees of the marine dealer, arising out of5
complaints, claims, or lawsuits including but not limited to strict liability,6
negligence, misrepresentation, express or implied warranty, or rescission of sale7
to the extent that the judgment arises out of alleged defective or negligent8
manufacture, assembly, or design of marine products, parts, or accessories, or9
other functions by the manufacturer of converter, which are beyond the control10
of the marine dealer.11
§1270.8. Marine products repairs12
Suppliers of mechanical repairs and services for any marine product13
subject to regulation pursuant to this Part shall provide each consumer with an14
itemized bill indicating repairs and services performed, parts replaced, or15
materials used, the total labor charge, and the identity of the mechanic,16
repairman, or supplier who performed the work. However, nothing in this17
Section shall prohibit a supplier of mechanical repairs and services from18
charging a service fee for the use of shop supplies such as rags, fender covers,19
small amounts of fluid, or other items which are not itemized, provided that20
such fee does not exceed five percent of the total invoice for mechanical repairs21
or thirty-five dollars, whichever is less.22
§1270.9. Damage disclosure23
A. Whenever a new marine product subject to regulation pursuant to24
this Chapter is sold to any person, the seller shall notify the purchaser of any25
body damage or mechanical damage which the marine product has sustained26
that exceeds six percent of the manufacturer's suggested retail price. Such27
notice shall be in writing and a copy thereof shall be delivered to the purchaser28
prior to or simultaneous with transfer of the vehicle title.29 SB NO. 360
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B. This Section shall apply to all instances of vehicular body or1
mechanical damage to marine products and to all actions involving such2
damage, notwithstanding the application of other codal, statutory, or regulatory3
provisions, including but not limited to Civil Code Articles 2520 et seq.4
PART III. PROVISIONS SPECIFIC TO MOTORCYCLES AND5
ALL-TERRAIN VEHICLES6
§1270.10. Establishment of new motorcycle or all-terrain vehicle dealerships or7
relocations; protests; procedure8
A. Whenever the commission receives an application for a recreational9
products dealer's license which would add a new motorcycle or all-terrain10
vehicle dealership, it shall first notify the existing licensed motorcycle or all-11
terrain vehicle dealership or dealerships selling the same-line makes, models,12
or classifications if the new dealership's proposed location is within the existing13
dealer's area of responsibility. Any same-line makes, models, or classifications14
dealership whose area of responsibility includes the location of the proposed15
new motorcycle or all-terrain vehicle dealership may object to the granting of16
the license.17
B. Whenever the commission receives an application for a recreation18
products dealer's license which would relocate an existing motorcycle or all-19
terrain vehicle dealership, it shall first notify the existing licensed motorcycle20
or all-terrain vehicle dealership or dealerships selling the same-line makes,21
models, or classifications if the dealership's proposed new location is within the22
existing dealer's area of responsibility. The existing same-line makes, models,23
or classifications dealership or dealerships shall have the right to object to the24
granting of the license only if the proposed relocation is within a radius of seven25
miles of its facility. However, without regard to distance, whenever the26
commission receives an application for the relocation of a motorcycle or all-27
terrain vehicle dealership which would add an additional franchise to an28
existing same-line makes, models, or classifications dealership's area of29 SB NO. 360
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responsibility, the affected motorcycle or all-terrain vehicle dealership shall1
have the right to object.2
C. The objection shall be in writing and shall be received by the3
commission within a fifteen-day period after receipt of the notice. The fifteen-4
day objection period shall be waived upon written notification to the5
commission from all licensees entitled to object that the licensees have no6
objections to the proposed change or addition for which the notice of intent was7
issued. If timely objection is lodged, and prior to the issuance of the license, the8
commission shall hold a hearing within thirty days after receipt of the objection9
and issue its decision within ninety days after date of the hearing. Notice of10
hearing and an opportunity to participate therein shall be given to the11
manufacturer or distributor, the applicant for the license as a motorcycle or all-12
terrain vehicle dealer, and to the protesting motorcycle or all-terrain vehicle13
dealership or dealerships.14
D. Whenever the commission receives an objection pursuant to the15
provisions of Subsection A of this Section, the commission shall consider the16
following and may consider any other relevant factors in determining whether17
there is good cause to issue a license:18
(1) Whether the community or territory can support an additional19
motorcycle or all-terrain vehicle dealership.20
(2) The financial impact on both the applicant and the existing21
motorcycle or all-terrain vehicle dealership or dealerships.22
(3) Whether the existing motorcycle or all-terrain vehicle dealerships of23
the same-line makes, models, or classifications in the dealership's area of24
responsibility are providing adequate representation, competition, and25
convenient consumer care for the motorcycle or all-terrain vehicles of the same-26
line makes, models, or classifications located within that area.27
(4) Whether the issuance of the license would increase competition, or be28
in the public interest, or both.29 SB NO. 360
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§1270.11. Unauthorized acts1
It shall be a violation of this Part:2
(1) For a manufacturer, distributor, wholesaler, distributor branch,3
factory branch, converter or officer, agent, or other representative thereof:4
(a) To induce or coerce, or attempt to induce or coerce, any licensee:5
(i) To order or accept delivery of any motorcycle or all-terrain vehicle,6
appliances, equipment, parts or accessories therefor, or any other commodity7
or commodities which shall not have been voluntarily ordered.8
(ii) To order or accept delivery of any motorcycle or all-terrain vehicle9
with special features, appliances, accessories, or equipment not included in the10
list price of said vehicles as publicly advertised.11
(iii) To order for any person any parts, accessories, equipment,12
machinery, tools, appliances, or any commodity whatsoever.13
(iv) To assent to a release, assignment, novation, waiver, or estoppel14
which would relieve any person from liability to be imposed by law, unless done15
in connection with a settlement agreement to resolve a matter pending a16
commission hearing or pending litigation between a manufacturer, distributor,17
wholesaler, distributor branch or factory branch, or officer, agent, or other18
representative thereof.19
(v) To enter into a franchise with a licensee or during the franchise term,20
use any written instrument, agreement, release, assignment, novation, estoppel,21
or waiver, to attempt to nullify or modify any provision of this Chapter, or to22
require any controversy between a dealer and a manufacturer to be referred to23
any person or entity other than the commission, or duly constituted courts of24
this state or the United States, if such referral would be binding upon the25
motorcycle or all-terrain vehicle dealer. Such instruments are null and void,26
unless done in connection with a settlement agreement to resolve a matter27
pending a commission hearing or pending litigation.28
(vi) To waive the right to a jury trial.29 SB NO. 360
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(vii) To release, convey, or otherwise provide customer information, if1
to do so is unlawful or if the customer objects in writing. This does not include2
information that is necessary for the manufacturer to meet its obligations to the3
motorcycle or all-terrain vehicle dealer or consumers in regard to contractual4
responsibilities, motorcycle or all-terrain vehicle recalls, or other requirements5
imposed by state or federal law. The manufacturer is further prohibited from6
providing any consumer information received from the motorcycle or all-7
terrain vehicle dealer to any unaffiliated third party.8
(viii) To pay the attorney fees of the manufacturer or distributor related9
to hearings and appeals brought under this Chapter.10
(b) To threaten to cancel any franchise or any contractual agreement11
existing between such manufacturer, distributor, wholesaler, distributor branch12
or factory branch and motorcycle or all-terrain vehicle dealer for any reason.13
(c) To unfairly, without just cause and due regard to the equities of14
motorcycle or all-terrain vehicle dealer, cancel the franchise of the licensee. The15
nonrenewal of a franchise with such dealer or his successor without just16
provocation or cause, or the refusal to approve a qualified transferee or17
qualified successor to the dealer-operator as provided for in the franchise shall18
be deemed an evasion of this Subparagraph and shall constitute an unfair19
cancellation, regardless of the terms or provisions of such franchise. However,20
at least ninety days notice shall be given to the dealer of a cancellation or21
nonrenewal of franchise except for a cancellation arising out of fraudulent22
activity of the dealer principal which results in the conviction of a crime23
punishable by imprisonment.24
(d) To refuse to extend to a licensee the privilege of determining the25
mode or manner of available transportation facility that the motorcycle or all-26
terrain vehicle dealer desires to be used or employed in making deliveries of27
motorcycles or all-terrain vehicles to him or it.28
(e) To ship or sell motorcycles or all-terrain vehicles to a licensee prior29 SB NO. 360
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to the licensee having been granted a license by the commission to sell1
motorcycles or all-terrain vehicles.2
(f) To unreasonably withhold consent to the sale, transfer, or exchange3
of the franchise to a qualified transferee capable of being licensed as a4
motorcycle or all-terrain vehicle dealer in this state, provided the transferee5
meets the criteria generally applied by the manufacturer in approving new6
motorcycle or all-terrain vehicle dealers and agrees to be bound by all the terms7
and conditions of the standard franchises.8
(g) To fail to respond in writing to a written request for consent as9
specified in Subparagraph (f) of this Paragraph above within sixty days of10
receipt of a written request on the forms, if any, generally utilized by the11
manufacturer or distributor for such purposes and containing the information12
required therein. Failure to respond shall be deemed to be consent to the13
request.14
(h)(i) To sell or offer to sell a new or unused motorcycle or all-terrain15
vehicle directly to a consumer except as provided in this Chapter, or to compete16
with a licensee in the same-line makes, models, or classifications operating17
under an agreement or franchise from the aforementioned manufacturer. A18
manufacturer shall not, however, be deemed to be competing when any one of19
the following conditions are met:20
(aa) Operating a motorcycle or all-terrain vehicle dealership temporarily21
for a reasonable period, not to exceed two years.22
(bb) Operating a bona fide retail dealership which is for sale to any23
qualified independent person at a fair and reasonable price, not to exceed two24
years.25
(cc) Operating in a bona fide relationship in which a person independent26
of a manufacturer has made a significant investment subject to loss in the27
dealership, and can reasonably expect to acquire full ownership of such28
dealership on reasonable terms and conditions.29 SB NO. 360
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(ii) After any of the conditions have been met under Subitems (aa) and1
(bb) of Item (i) of this Subparagraph, the commission shall allow the2
manufacturer to compete with licensees of the same-line makes, models, or3
classifications under an agreement or franchise from said manufacturer for4
longer than two years when, in the discretion of the commission, the best5
interest of the manufacturer, consuming public, and licensees are best served.6
(i) To fail to compensate its motorcycle or all-terrain vehicle dealers for7
the work and services they are required to perform in connection with the8
motorcycle or all-terrain vehicle dealer's delivery and preparation obligations9
according to the terms of compensation that shall be filed with the commission10
on or before October first of each year. The commission shall find the11
compensation to be reasonable or the manufacturer shall remedy any12
deficiencies.13
(j) To fail to designate and provide to the commission in writing the14
community or territory assigned to a licensee.15
(k) To unreasonably discriminate among competing, similarly situated,16
same-line make dealers in the sales of motorcycles or all-terrain vehicles, in the17
availability of motorcycles or all-terrain vehicles, in the terms of incentive18
programs or sales promotion plans, or in other similar programs.19
(l) To use any subsidiary, affiliate, or any other controlled person or20
entity, or to employ the services of a third party, to accomplish what would21
otherwise be illegal conduct under this Chapter on the part of the manufacturer22
or distributor.23
(m) To make a change in the area of responsibility described in the24
franchise agreement or sales and service agreement of a motorcycle or all-25
terrain vehicle dealer, without the franchisor, converter, or manufacturer26
giving said motorcycle or all-terrain vehicle dealer and the commission no less27
than sixty days prior written notice by certified or registered mail.28
(n) To refuse to deliver to any licensee having a franchise or contractual29 SB NO. 360
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arrangement for the retail sale of motorcycles or all-terrain vehicles sold or1
distributed by such manufacturer, distributor, wholesaler, distributor branch2
or factory branch, any motorcycle or all-terrain vehicle, publicly advertised for3
immediate delivery, within sixty days after such dealer's order shall have been4
received.5
(2) For a motorcycle or all-terrain vehicle dealer, used motorcycle or all-6
terrain vehicle dealer, or a motorcycle or all-terrain vehicle salesman:7
(a) To require a purchaser of a motorcycle or all-terrain vehicle, as a8
condition of sale and delivery thereof, to also purchase special features,9
appliances, accessories, or equipment not desired or requested by the10
purchaser; however, this prohibition shall not apply as to special features,11
appliances, accessories, or equipment which are permanently affixed to the12
motorcycle or all-terrain vehicle.13
(b) To represent and sell as a new motorcycle or all-terrain vehicle any14
motorcycle or all-terrain vehicle, the legal title of which has been transferred15
by a manufacturer, distributor, or dealer to an ultimate purchaser.16
(c) To resort to or use any false or misleading advertisement in17
connection with his business as such motorcycle or all-terrain vehicle dealer or18
motorcycle or all-terrain vehicle salesman.19
(d) To sell or offer to sell makes, models, or classifications of new20
motorcycles or all-terrain vehicles for which no franchise and license to sell is21
held.22
(e) Except as otherwise approved by the commission, to sell or offer to23
sell a motorcycle or all-terrain vehicle from an unlicensed location.24
(f) To deliver to a prospective purchaser a new or a used motorcycle or25
all-terrain vehicle on a sale conditioned on financing, i.e., a spot delivery, except26
on the following terms and conditions which shall be in writing and shall be a27
part of the conditional sales contract or other written notification signed by the28
purchaser:29 SB NO. 360
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(i) That if the sale is not concluded by the financing of the sale to the1
purchaser within twenty-five days of the delivery, the sale contract shall be null2
and void.3
(ii) That the motorcycle or all-terrain vehicle being offered for trade-in4
by the purchaser shall not be sold by the motorcycle or all-terrain vehicle dealer5
until the conditional sale is complete.6
(iii) That there shall be no charge to the purchaser should the conditional7
sale not be completed, including but not limited to mileage charges or charges8
to refurbish the motorcycle or all-terrain vehicle offered for trade-in. However,9
the purchaser shall be responsible for any and all damages to the motorcycle or10
all-terrain vehicle or other motorcycles or all-terrain vehicles damaged by the11
fault of the purchaser and any and all liability incurred by the purchaser during12
the purchaser's custody of the vehicle to the extent provided for in R.S. 22:1296.13
(iv) That if the conditional sale is not completed, the motorcycle or all-14
terrain vehicle dealer shall immediately refund to the purchaser upon return15
of the motorcycle or all-terrain vehicle all sums placed with the dealership as16
a deposit or any other purpose associated with the attempted sale of the17
motorcycle or all-terrain vehicle.18
(v) That the prospective purchaser shall return the motorcycle or all-19
terrain vehicle to the dealership within forty-eight hours of notification by the20
dealer that the conditional sale will not be completed. If the prospective21
purchaser does not return the motorcycle or all-terrain vehicle to the dealership22
within forty-eight hours of notification by the motorcycle or all-terrain vehicle23
dealer, an authorized agent of the motorcycle or all-terrain vehicle dealer shall24
have the right to recover the motorcycle or all-terrain vehicle without the25
necessity of judicial process, provided that such recovery can be accomplished26
without unauthorized entry into a closed dwelling, whether locked or unlocked27
and without a breach of peace.28
(g) To pay a fee to any person in return for the solicitation, procurement,29 SB NO. 360
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or production by that person of prospective purchasers for new and used1
motorcycles or all-terrain vehicles, except to a motorcycle or all-terrain vehicle2
salesman licensed under the provisions of this Chapter.3
(h) To fail to fully and completely explain each charge listed on a retail4
buyer's order or motorcycle or all-terrain vehicle invoice prior to the purchase5
of a motorcycle or all-terrain vehicle.6
(i) When selling a motorcycle or all-terrain vehicle to a consumer, to7
assess any consumer services fees, which shall include fees for treating the8
interior upholstery of the vehicle, oil changes, roadside assistance, dealer9
inspections, or any other service offered by the dealer, without allowing the10
buyer to refuse such services and be exempt from payment for such services.11
The provisions of this Subparagraph shall not apply to dealer-added options or12
accessories which are permanently affixed to the motorcycle or all-terrain13
vehicle.14
(j)(i) To fail to disclose to a purchaser in writing on the sales contract,15
buyer's order, or any other document that the motorcycle or all-terrain vehicle16
dealer may be participating in finance charges associated with the sale.17
(ii) To participate in a finance charge that would result in a difference18
between the buy rate and the contract rate of more than three percentage19
points.20
(iii) The provisions of this Subparagraph shall apply only to transactions21
subject to the Louisiana Motor Vehicle Sales Finance Act.22
(3) For any person or other licensee:23
(a) To modify a franchise during the term of the agreement or upon its24
renewal if the modification substantially and adversely affects the franchisee's25
rights, obligations, investment, or return on investment without giving sixty-day26
written notice of the proposed modification to the licensee and the commission27
unless the modifications are required by law, court order, or the commission.28
Within the sixty-day notice period the licensee may file with the commission a29 SB NO. 360
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complaint for a determination whether there is good cause for permitting the1
proposed modification. The party seeking to modify or replace an agreement2
shall demonstrate by a preponderance of the evidence that there is good cause3
for the modification or replacement. The commission shall schedule a hearing4
within sixty days to decide the matter. Multiple complaints pertaining to the5
same proposed modifications shall be consolidated for hearing. The proposed6
modification may not take effect pending the determination of the matter.7
(b) In making a determination of whether there is good cause for8
permitting a proposed modification, the commission may consider any relevant9
factor including:10
(i) The reasons for the proposed modification.11
(ii) Whether the proposed modification is applied to or affects all12
licensees in a nondiscriminating manner.13
(iii) The degree to which the proposed modification will have a14
substantial and adverse effect upon the licensee's investment or return on15
investment.16
(iv) Whether the proposed modification is in the public interest.17
(v) The degree to which the proposed modification is necessary to the18
orderly and profitable distribution of vehicles and other services by the licensee.19
(vi) Whether the proposed modification is offset by other modifications20
beneficial to the licensee.21
(c) The decision of the commission shall be in writing and shall contain22
findings of fact and a determination of whether there is good cause for23
permitting the proposed modification. The commission shall deliver copies of24
the decision to the parties personally or by registered mail.25
(4) For any employee of a licensee while acting in the scope of his26
employment, to accept any payment, commission, fee, or compensation of any27
kind from any person other than the employing licensee, unless such payment28
is fully disclosed to and approved by the employing licensee.29 SB NO. 360
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§1270.12. Indemnification of motorcycle and all-terrain vehicle franchised1
dealers2
Notwithstanding the terms of any franchise agreement, each3
manufacturer or converter shall indemnify and hold harmless its franchised4
motorcycle or all-terrain vehicle dealers against any judgment for damages,5
including but not limited to court costs and reasonable attorney fees of the6
motorcycle or all-terrain vehicle dealer, arising out of complaints, claims, or7
lawsuits including but not limited to strict liability, negligence,8
misrepresentation, express or implied warranty, or rescission of sale to the9
extent that the judgment arises out of alleged defective or negligent10
manufacture, assembly, or design of motorcycles or all-terrain vehicles, parts,11
or accessories, or other functions by the manufacturer of converter, which are12
beyond the control of the motorcycle or all-terrain vehicle dealer.13
§1270.13. Warranty; compensation; audits of motorcycle or all-terrain vehicle14
dealer records15
A.(1) It shall be a violation of this Chapter for a manufacturer, a16
distributor, a wholesaler, distributor branch or factory branch of motorcycles17
or all-terrain vehicles, or officer, agent, or other representative thereof to fail18
to adequately and fairly compensate its motorcycle or all-terrain vehicle dealers19
for labor, parts, and other expenses incurred by such motorcycle or all-terrain20
vehicle dealer to perform under and comply with a manufacturer's or a21
distributor's warranty agreement.22
(2) In no event shall any manufacturer or distributor pay its motorcycle23
or all-terrain vehicle dealers at a price or rate for warranty work that is less24
than that charged by the motorcycle or all-terrain vehicle dealer to the retail25
customers of the motorcycle or all-terrain vehicle dealer for nonwarranty work26
of like kind.27
(3) Warranty work includes parts and labor performed.28
(4) All claims made by the motorcycle or all-terrain vehicle dealer for29 SB NO. 360
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compensation under this Subsection shall be paid within thirty days after1
approval and shall be approved or disapproved within thirty days after receipt.2
When any claim is disapproved, the motorcycle or all-terrain vehicle dealer3
shall be notified in writing of the grounds for disapproval.4
(5) The obligations in this Subsection as they relate to motorcycles or all-5
terrain vehicles may be modified by contract.6
B.(1) Notwithstanding the terms of any franchise, warranty, and sales7
incentive, audits of motorcycle or all-terrain vehicle dealer records may be8
conducted by the manufacturer, distributor, distributor branch, or factory9
branch. Any audit for warranty parts or service compensation shall be for the10
twelve-month period immediately following the date of the payment of the claim11
by the manufacturer or distributor. However, a motorcycle or all-terrain12
vehicle dealer shall not be held liable by virtue of an audit for failure to retain13
parts for a period in excess of six months. Any audit for sales incentives, service14
incentives, rebates, or other forms of incentive compensation shall only be for15
the twelve-month period immediately following the date of the final payment to16
the motorcycle or all-terrain vehicle dealer under a promotion, event, program,17
or activity. In no event shall the manufacturer, distributor, distributor branch,18
or factory branch fail to allow the motorcycle or all-terrain vehicle dealer to19
make corrections to the sales data in less than one hundred twenty days from20
the program period. Additionally, no penalty other than amounts advanced on21
a motorcycle or all-terrain vehicle reported incorrectly shall be due in22
connection with the audit. With respect to motorcycles or all-terrain vehicles23
sold during the time period subject to the audit, but submitted incorrectly to the24
manufacturer, distributor, or wholesale distributor branch or factory branch,25
the motorcycle or all-terrain vehicle dealer shall be charged back for the26
amount reported incorrectly and credited with the amount due, if anything, on27
the actual sale date.28
(2) No claim which has been approved and paid may be charged back to29 SB NO. 360
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the motorcycle or all-terrain vehicle dealer unless it can be shown that one or1
all of the following applies:2
(a) The claim was false or fraudulent.3
(b) The repairs were not properly made.4
(c) The repairs were unnecessary to correct the defective condition under5
generally accepted standards of workmanship.6
(d) The motorcycle or all-terrain vehicle dealer failed to reasonably7
substantiate the repair in accordance with reasonable written requirements of8
the manufacturer or distributor, if the motorcycle or all-terrain vehicle dealer9
was notified of the requirements prior to the time the claim arose and if the10
requirements were in effect at the time the claim arose.11
(3) A manufacturer or distributor shall not deny a claim solely based on12
a motorcycle or all-terrain vehicle dealer's incidental failure to comply with a13
specific claim processing requirement, or a clerical error, or other14
administrative technicality.15
(4) Limitations on warranty parts or service compensation, sales16
incentive audits, rebates, or other forms of incentive compensation, chargebacks17
for warranty parts or service compensation, and service incentives and18
chargebacks for sales compensation only shall not be effective in the case of19
intentionally false or fraudulent claims.20
(5) It shall be deemed an unfair act pursuant to this Chapter to audit a21
motorcycle or all-terrain vehicle dealer more frequently than two sales-related22
and two service-related audits in a twelve-month period. Nothing in this23
Subsection shall limit a manufacturer's or distributor's ability to perform24
routine claim reviews in the normal course of business.25
(6) No claim may be rejected as late if it has been submitted within sixty26
days of the date the repair order was written.27
§1270.14. Damage disclosure28
A. Whenever a new motorcycle or all-terrain vehicle subject to29 SB NO. 360
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regulation pursuant to this Chapter is sold to any person, the seller shall notify1
the purchaser of any body damage or mechanical damage which the motorcycle2
or all-terrain vehicle has sustained that exceeds six percent of the3
manufacturer's suggested retail price or, in the case of recreational vehicles, six4
percent of the manufacturer's wholesale price. Such notice shall be in writing5
and a copy thereof shall be delivered to the purchaser prior to or simultaneous6
with transfer of the motorcycle or all-terrain vehicle title.7
B. This Section shall apply to all instances of vehicular body or8
mechanical damage to motorcycles or all-terrain vehicles and to all actions9
involving such damage, notwithstanding the application of other codal,10
statutory, or regulatory provisions, including but not limited to Civil Code11
Articles 2520 et seq.12
§1270.15. Sale of water-damaged motorcycles or all-terrain vehicles13
A. No person shall sell, transfer, or convey any new or used motorcycle14
or all-terrain vehicle to any person without notifying the buyer or receiver of15
the motorcycle or all-terrain vehicle in writing of the extent of any water16
damage from flooding which occurred to the motorcycle or all-terrain vehicle17
prior to the transaction.18
B. If a sale, transfer, or conveyance of a new or used motorcycle or all-19
terrain vehicle occurs in violation of Subsection A of this Section, the person20
receiving ownership and title to the motorcycle or all-terrain vehicle who is not21
otherwise aware of the damage at the time of the transaction may bring an22
action to set aside the transaction within one year from the date of the23
transaction and receive all monies or other property given as consideration for24
the motorcycle or all-terrain vehicle less a reasonable assessment for miles25
driven.26
C. For the purposes of this Section, a "water-damaged motorcycle or all-27
terrain vehicle" means any motorcycle or all-terrain vehicle whose power train,28
computer, or electrical system has been damaged by flooding.29 SB NO. 360
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§1270.16. Succession; right of first refusal1
A. The terms of the franchise notwithstanding, any motorcycle or all-2
terrain vehicle dealer may appoint by will, or other written instrument, a3
designated successor to succeed in the ownership interest of the motorcycle or4
all-terrain vehicle dealer in the dealership upon the death or incapacity of the5
motorcycle or all-terrain vehicle dealer.6
B. Unless good cause exists for refusal to honor the succession on the7
part of the manufacturer or distributor, any designated successor of a deceased8
or incapacitated motorcycle or all-terrain vehicle dealer of a dealership may9
succeed to the ownership of the dealership under the existing franchise if:10
(1) The designated successor gives the manufacturer or distributor11
written notice of his or her intention to succeed to the ownership of the12
motorcycle or all-terrain vehicle dealer within sixty days of the motorcycle or13
all-terrain vehicle dealer's death or incapacity.14
(2) The designated successor agrees to be bound by all the terms and15
conditions of the franchise.16
C. The manufacturer or distributor may request, and the designated17
successor shall provide, promptly upon such request, personal and financial18
data reasonably necessary to determine whether the succession should be19
honored.20
D. If a manufacturer or distributor believes that good cause exists for21
refusing to honor the succession of a deceased or incapacitated motorcycle or22
all-terrain vehicle dealer, the manufacturer or distributor may, not more than23
sixty days following receipt of notice of the designated successor's intent to24
succeed and receipt of such personal or financial data, serve upon the25
designated successor notice of its refusal to honor the succession and of its intent26
to discontinue the existing franchise with the motorcycle or all-terrain vehicle27
dealer not earlier than six months from the date such notice is served.28
E. The notice must state the specific grounds for the refusal to honor the29 SB NO. 360
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succession.1
F. If notice of refusal and discontinuance is not timely served upon the2
designated successor, the franchise shall continue in effect subject to3
termination only as otherwise permitted by this Chapter.4
G. In determining whether good cause for the refusal to honor the5
succession exists, the manufacturer or distributor has the burden of proving6
that the designated successor is not of good moral character or does not7
otherwise meet the manufacturer's or distributor's reasonable standards as a8
franchisee.9
H. If a manufacturer or distributor refuses to honor the succession to10
the ownership interest of a deceased or incapacitated owner for good cause, then11
and in such event:12
(1) The manufacturer or distributor shall allow the designated successor13
a reasonable period of time which shall not be less than six months in which to14
consummate a sale of the dealership. Any such sale shall be subject to R.S.15
32:1270.11(1)(c).16
(2) Upon termination of the franchise pursuant to such refusal, the17
provisions of R.S. 32:1270.17 shall apply.18
§1270.17. Requirements upon termination; penalty; indemnity; motorcycle or19
all-terrain vehicle dealers20
A.(1) In the event the licensee ceases to engage in the business of being21
a motorcycle or all-terrain vehicle dealer, or ceases to sell a particular make of22
motorcycle or all-terrain vehicle and after notice to the manufacturer,23
converter, distributor, or representative by certified mail or commercial24
delivery service with verification of receipt, within thirty days of the receipt of25
the notice by the manufacturer, converter, distributor, or representative, the26
manufacturer, converter, distributor, or representative shall repurchase:27
(a) All new motorcycles or all-terrain vehicles of the current and last28
prior model year delivered to the licensee and parts on hand that have not been29 SB NO. 360
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damaged or substantially altered to the prejudice of the manufacturer while in1
the possession of the licensee. As to motorcycle or all-terrain vehicle dealers,2
the repurchase of parts shall be limited to those listed in the manufacturer's3
price book. The motorcycle or all-terrain vehicles and parts shall be4
repurchased at the cost to the licensee which shall include without limitation5
freight and advertising costs, less all allowances paid to the motorcycle or all-6
terrain vehicle dealer.7
(b) At fair market value, each undamaged sign owned by the motorcycle8
or all-terrain vehicle dealer which bears a trademark or trade name used or9
claimed by the manufacturer, converter, distributor, or representative if the10
sign was purchased from or purchased at the request of the manufacturer,11
distributor, or representative. Fair market value shall be no less than cost of12
acquisition of the sign by the motorcycle or all-terrain vehicle dealer.13
(c) At fair market value, all special tools and automotive service14
equipment owned by the motorcycle or all-terrain vehicle dealer which were15
recommended in writing and designated as special tools and equipment and16
purchased from or purchased at the request of the manufacturer, converter,17
distributor, or representative, if the tools and equipment are in usable and good18
condition except for reasonable wear and tear. Fair market value shall be no19
less than cost of acquisition of special tools and automotive service equipment20
by the motorcycle or all-terrain vehicle dealer.21
(d) The manufacturer, converter, distributor, or representative shall pay22
to the motorcycle or all-terrain vehicle dealer the costs of transporting,23
handling, packing, and loading of motorcycles or all-terrain vehicles, or parts,24
signs, tools, and equipment subject to repurchase.25
(2) The manufacturer or converter shall make the required repurchase26
after the dealer terminates his franchise and within sixty days of the submission27
to it, by certified mail, return receipt requested, or commercial delivery service28
with verification of receipt, of a final inventory of motorcycles, all-terrain29 SB NO. 360
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vehicles, and parts on hand.1
B. Failure to make such repurchase without just cause shall subject the2
manufacturer or converter to a penalty of one and one-half percent per month,3
or fraction thereof, of the inventory value or returnable motorcycles or all-4
terrain vehicles, and parts, signs, special tools, and automotive service5
equipment, payable to the dealer, as long as the repurchase is not made.6
§1270.18. Manufacturer termination of line-make; manufacturer bankruptcy;7
license; motorcycle or all-terrain vehicle franchise8
Notwithstanding the terms of any franchise or other provision of law, if9
the termination, cancellation, or nonrenewal of a licensee's franchise is the10
result of the termination, elimination, or cessation of a line-make by the11
manufacturer, distributor, or factory branch, whether by bankruptcy or12
otherwise, the license issued by the commission may remain in effect at the13
discretion of the commission pursuant to its rules.14
§1270.19. Motorcycle or all-terrain vehicle repairs15
Suppliers of mechanical repairs and services for any motorcycle or all-16
terrain vehicle subject to regulation pursuant to this Chapter shall provide each17
consumer with an itemized bill indicating repairs and services performed, parts18
replaced, or materials used, the total labor charge, and the identity of the19
mechanic, repairman, or supplier who performed the work. However, nothing20
in this Section shall prohibit a supplier of mechanical repairs and services from21
charging a service fee for the use of shop supplies such as rags, fender covers,22
small amounts of fluid, or other items which are not itemized, provided that23
such fee does not exceed five percent of the total invoice for mechanical repairs24
or thirty-five dollars, whichever is less.25
PART IV. PROVISIONS SPECIFIC TO RECREATIONAL VEHICLES26
§1270.20. Unauthorized acts; recreational vehicles27
It shall be a violation of this Chapter:28
(1) For a manufacturer, a distributor, a wholesaler, factory branch, or29 SB NO. 360
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officer, agent, or other representative thereof:1
(a) To induce or coerce, or attempt to induce or coerce, any licensee:2
(i) To order or accept delivery of any recreational vehicles, appliances,3
equipment, parts or accessories therefor, or any other commodity or4
commodities which shall not have been voluntarily ordered.5
(ii) To order or accept delivery of any recreational vehicle with special6
features, appliances, accessories, or equipment not included in the list price of7
said recreational vehicles as publicly advertised.8
(iii) To order for any person any parts, accessories, equipment,9
machinery, tools, appliances, or any commodity whatsoever.10
(iv) To assent to a release, assignment, novation, waiver, or estoppel11
which would relieve any person from liability to be imposed by law, unless done12
in connection with a settlement agreement to resolve a matter pending a13
commission hearing or pending litigation between a manufacturer, distributor,14
wholesaler, or factory branch, or officer, agent, or other representative thereof.15
(v) To enter into a franchise with a licensee or during the franchise term,16
use any written instrument, agreement, release, assignment, novation, estoppel,17
or waiver, to attempt to nullify or modify any provision of this Chapter, or to18
require any controversy between a recreational vehicle dealer and a19
manufacturer to be referred to any person or entity other than the commission,20
or duly constituted courts of this state or the United States, if such referral21
would be binding upon the recreational dealer. Such instruments are null and22
void, unless done in connection with a settlement agreement to resolve a matter23
pending a commission hearing or pending litigation.24
(vi) To waive the right to a jury trial.25
(vii) To participate in an advertising group or to participate monetarily26
in an advertising campaign or contest or to purchase any promotional27
materials, showroom, or other display decorations or materials at the expense28
of such recreational vehicle dealer.29 SB NO. 360
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(viii) To release, convey, or otherwise provide customer information, if1
to do so is unlawful or if the customer objects in writing. This does not include2
information that is necessary for the manufacturer to meet its obligations to the3
recreational vehicle dealer or consumers in regard to contractual4
responsibilities, recreational vehicle recalls, or other requirements imposed by5
state or federal law. The manufacturer is further prohibited from providing any6
consumer information received from the recreational vehicle dealer to any7
unaffiliated third party.8
(ix) To pay the attorney fees of the manufacturer or distributor related9
to hearings and appeals brought under this Chapter.10
(b) To refuse to deliver to any licensee having a franchise or contractual11
arrangement for the retail sale of recreational vehicles sold or distributed by12
such manufacturer, distributor, wholesaler, or factory branch, any recreational13
vehicle, publicly advertised for immediate delivery, within sixty days after such14
recreational vehicle dealer's order shall have been received.15
(c) To threaten to cancel any franchise or any contractual agreement16
existing between such manufacturer, distributor, wholesaler, or factory branch17
and said recreational vehicle dealer for any reason.18
(d) To unfairly, without just cause and due regard to the equities of such19
recreational vehicle dealer, cancel the franchise of any licensee. The20
nonrenewal of a franchise with such recreational vehicle dealer or his successor21
without just provocation or cause, or the refusal to approve a qualified22
transferee or qualified successor to the dealer-operator as provided for in the23
franchise agreement, shall be deemed an evasion of this Paragraph and shall24
constitute an unfair cancellation, regardless of the terms or provisions of such25
franchise. However, at least ninety-days notice shall be given to the recreational26
vehicle dealer of any cancellation or nonrenewal of a franchise except for a27
cancellation arising out of the financial default of the recreational vehicle dealer28
or fraudulent activity of the recreational vehicle dealer principal which results29 SB NO. 360
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in the conviction of a crime punishable by imprisonment.1
(e) To refuse to extend to a licensee the privilege of determining the mode2
or manner of available transportation facility that such recreational vehicle3
dealer desires to be used or employed in making deliveries of recreational4
vehicles to him or it.5
(f) To resort to or use any false or misleading advertisement in6
connection with his business as such manufacturer of recreational vehicles,7
distributor, wholesaler, or factory branch, or officer, agent, or other8
representative thereof.9
(g) To delay, refuse, or fail to deliver recreational vehicles in reasonable10
quantities relative to the licensee's facilities and sales potential in the relevant11
market area. This Subparagraph shall not be valid, however, if such failure is12
caused by acts or causes beyond the control of the manufacturer, distributor,13
or other such party.14
(h) To ship or sell recreational vehicles to a licensee prior to the licensee15
having been granted a license by the commission to sell such recreational16
vehicles.17
(i) To unreasonably withhold consent to the sale, transfer, or exchange18
of the franchise to a qualified transferee capable of being licensed as a19
recreational vehicle dealer in this state, provided the transferee meets the20
criteria generally applied by the manufacturer in approving new recreational21
vehicle dealers and agrees to be bound by all the terms and conditions of the22
standard franchises.23
(j) To fail to respond in writing to a written request for consent as24
specified in Subparagraph (i) above within sixty days of receipt of a written25
request on the forms, if any, generally utilized by the manufacturer or26
distributor for such purposes and containing the information required therein.27
Failure to respond shall be deemed to be consent to the request.28
(k)(i) To sell or offer to sell a new or unused recreational vehicle directly29 SB NO. 360
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to a consumer except as provided in this Chapter, or to compete with a licensee1
in the same-line makes, models, or classifications operating under an agreement2
or franchise from the aforementioned manufacturer. A manufacturer shall not,3
however, be deemed to be competing when any one of the following conditions4
are met:5
(aa) Operating a dealership temporarily for a reasonable period, not to6
exceed two years.7
(bb) Operating a bona fide retail dealership which is for sale to any8
qualified independent person at a fair and reasonable price, not to exceed two9
years.10
(cc) Operating in a bona fide relationship in which a person independent11
of a manufacturer has made a significant investment subject to loss in the12
dealership, and can reasonably expect to acquire full ownership of such13
dealership on reasonable terms and conditions.14
(ii) After any of the conditions have been met under Subitems (aa) and15
(bb) of Item (i) of this Subparagraph, the commission shall allow the16
manufacturer to compete with licensees of the same-line makes, models, or17
classifications under an agreement or franchise from said manufacturer for18
longer than two years when, in the discretion of the commission, the best19
interest of the manufacturer, consuming public, and licensees are best served.20
(l) To condition the renewal or extension of a franchise on a new21
recreational vehicle dealer's substantial renovation of the recreational vehicle22
dealer's place of business or on the construction, purchase, acquisition, or rental23
of a new place of business by the new recreational vehicle dealer, unless the24
manufacturer has advised the new recreational vehicle dealer in writing of its25
intent to impose such a condition within a reasonable time prior to the effective26
date of the proposed date of renewal or extension, but in no case less than one27
hundred eighty days, and provided the manufacturer demonstrates the need for28
such demand in view of the need to service the public and the economic29 SB NO. 360
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conditions existing in the recreational vehicle industry at the time such action1
would be required of the new recreational vehicle dealer. As part of any such2
condition the manufacturer shall agree, in writing, to supply the recreational3
dealer with an adequate supply and marketable model mix of recreational4
vehicles to meet the sales levels necessary to support the increased overhead5
incurred by the recreational vehicle dealer by reason of such renovation,6
construction, purchase, or rental of a new place of business.7
(m) To fail to compensate its recreational vehicle dealers for the work8
and services they are required to perform in connection with the recreational9
vehicle dealer's delivery and preparation obligations according to the terms of10
compensation that shall be filed with the commission on or before October first11
of each year. The commission shall find the compensation to be reasonable or12
the manufacturer shall remedy any deficiencies.13
(n) To fail to designate and provide to the commission in writing the14
community or territory assigned to a licensee.15
(o) To unreasonably discriminate among competing, similarly situated,16
same-line make dealers in the sales of recreational vehicles, in the availability17
of such recreational vehicles, in the terms of incentive programs or sales18
promotion plans, or in other similar programs.19
(p) To terminate, cancel, or refuse to continue any franchise agreement20
based upon the fact that the recreational vehicle dealer owns, has an investment21
in, participates in the management, or holds a franchise agreement for the sale22
or service of another make or line of new recreational vehicles at a different23
dealership location, or intends to or has established another make or line of new24
recreational vehicles in the same dealership facilities of the manufacturer or25
distributor.26
(q) To demand compliance with facilities requirements that include any27
requirements that a recreational vehicle dealer establish or maintain exclusive28
office, parts, service or body shop facilities, unless such requirements would be29 SB NO. 360
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reasonable and justified by business considerations. The burden of proving that1
such requirements are reasonable and justified by business considerations is on2
the manufacturer. If the franchise agreement of the manufacturer or3
distributor requires the approval of the manufacturer or distributor for facility4
uses or modifications, the manufacturer or distributor shall approve or5
disapprove such a request in writing within sixty days of receipt of such request.6
(r) To use any subsidiary, affiliate, or any other controlled person or7
entity, or to employ the services of a third party, to accomplish what would8
otherwise be illegal conduct under this Chapter on the part of the manufacturer9
or distributor.10
(s) To make a change in the area of responsibility described in the11
franchise agreement or sales and service agreement of a recreational vehicle12
dealer, without the franchisor or manufacturer giving said recreational vehicle13
dealer and the commission no less than sixty days prior written notice by14
certified or registered mail.15
(t) To attempt to induce or coerce, or to induce or coerce, any16
recreational vehicle dealer to enter into any agreement with such manufacturer,17
distributor, wholesaler, distributor branch or factory branch or representative18
thereof, or to do any other act unfair to said recreational vehicle dealer.19
(u)(i) To coerce or attempt to coerce any retail recreational vehicle20
dealer or prospective retail recreational vehicle dealer to offer to sell or sell any21
extended service contract or extended maintenance plan or gap product offered,22
sold, backed by, or sponsored by the manufacturer or distributor or affiliate or23
sell, assign, or transfer any retail installment sales contract or lease obtained by24
the dealer in connection with the sale or lease by him of recreational vehicles25
manufactured or sold by the manufacturer or distributor, to a specified finance26
company or class of finance companies, leasing company or class of leasing27
companies, or to any other specified persons by any of the following:28
(aa) By any statement, promise, or threat that the manufacturer or29 SB NO. 360
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distributor will in any manner benefit or injure the dealer, whether the1
statement, suggestion, threat, or promise is express or implied or made directly2
or indirectly.3
(bb) By any act that will benefit or injure the dealer.4
(cc) By any contract, or any express or implied offer of contract, made5
directly or indirectly to the dealer, for handling the recreational vehicle on the6
condition that the recreational vehicle dealer shall offer to sell or sell any7
extended service contract or extended maintenance plan offered, sold, backed8
by, or sponsored by the manufacturer or distributor or that the dealer sell,9
assign, or transfer his retail installment sales contract on or lease of the10
recreational vehicle, to a specified finance company or class of finance11
companies, leasing company or class of leasing companies, or to any other12
specified person.13
(dd) Any such statements, threats, promises, acts, contracts, or offers of14
contracts, when their effect may be to lessen or eliminate competition.15
(ii) Nothing contained in this Subparagraph shall prohibit a16
manufacturer or distributor from offering or providing incentive benefits or17
bonus programs to a retail recreational vehicle dealer or prospective retail18
recreational vehicle dealer who makes the voluntary decision to offer to sell or19
sell any extended service contract or extended maintenance plan offered, sold,20
backed, or sponsored by the manufacturer or distributor or to sell, assign, or21
transfer any retail installment sale or lease by him of recreational vehicles22
manufactured or sold by the manufacturer or distributor to a specified finance23
company or leasing company.24
(2) For a recreational vehicle dealer or a recreational vehicle salesman:25
(a) To require a purchaser of a recreational vehicle, as a condition of sale26
and delivery thereof, to also purchase special features, appliances, accessories,27
or equipment not desired or requested by the purchaser; however, this28
prohibition shall not apply as to special features, appliances, accessories, or29 SB NO. 360
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equipment which are permanently affixed to the recreational vehicle.1
(b) To represent and sell as a new recreational vehicle any vehicle, the2
legal title of which has been transferred by a manufacturer, distributor, or3
dealer to an ultimate purchaser.4
(c) To resort to or use any false or misleading advertisement in5
connection with his business as such recreational vehicle dealer or recreational6
vehicle salesman.7
(d) To sell or offer to sell makes, models, or classifications of new8
recreational vehicles for which no franchise and license to sell is held.9
(e) Except as otherwise approved by the commission, to sell or offer to10
sell a recreational vehicle from an unlicensed location.11
(f) To deliver to a prospective purchaser a new recreational vehicle on12
a sale conditioned on financing, i.e., a spot delivery, except on the following13
terms and conditions which shall be in writing and shall be a part of the14
conditional sales contract or other written notification signed by the purchaser:15
(i) That if the sale is not concluded by the financing of the sale to the16
purchaser within twenty-five days of the delivery, the sale contract shall be null17
and void.18
(ii) That the recreational vehicle being offered for trade-in by the19
purchaser shall not be sold by the recreational vehicle dealer until the20
conditional sale is complete.21
(iii) That there shall be no charge to the purchaser should the conditional22
sale not be completed, including but not limited to mileage charges or charges23
to refurbish the recreational vehicle offered for trade-in. However, the24
purchaser shall be responsible for any and all damages to the recreational25
vehicle or other vehicles damaged by the fault of the purchaser and any and all26
liability incurred by the purchaser during the purchaser's custody of the27
recreational vehicle to the extent provided for in R.S. 22:1296.28
(iv) That if the conditional sale is not completed, the recreational vehicle29 SB NO. 360
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dealer shall immediately refund to the purchaser upon return of the1
recreational vehicle all sums placed with the dealership as a deposit or any2
other purpose associated with the attempted sale of the vehicle.3
(v) That the prospective purchaser shall return the recreational vehicle4
to the dealership within forty-eight hours of notification by the recreational5
vehicle dealer that the conditional sale will not be completed. If the prospective6
purchaser does not return the recreational vehicle to the dealership within7
forty-eight hours of notification by the recreational vehicle dealer, an8
authorized agent of the recreational vehicle dealer shall have the right to9
recover the recreational vehicle without the necessity of judicial process,10
provided that such recovery can be accomplished without unauthorized entry11
into a closed dwelling, whether locked or unlocked and without a breach of12
peace.13
(g) To pay a fee to any person in return for the solicitation, procurement,14
or production by that person of prospective purchasers for new and used15
recreational vehicles, except to a recreational vehicle salesman licensed under16
the provisions of this Chapter.17
(h) To fail to fully and completely explain each charge listed on a retail18
buyer's order or recreational vehicle invoice prior to the purchase of a19
recreational vehicle.20
(i) When selling a recreational vehicle to a consumer, to assess any21
consumer services fees, which shall include fees for treating the interior22
upholstery of the recreational vehicle, oil changes, roadside assistance, dealer23
inspections, or any other service offered by the recreational vehicle dealer,24
without allowing the buyer to refuse such services and be exempt from payment25
for such services. The provisions of this Subparagraph shall not apply to dealer-26
added options or accessories which are permanently affixed to the recreational27
vehicle.28
(j)(i) To fail to disclose to a purchaser in writing on the sales contract,29 SB NO. 360
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buyer's order, or any other document that the recreational vehicle dealer may1
be participating in finance charges associated with the sale.2
(ii) To participate in a finance charge that would result in a difference3
between the buy rate and the contract rate of more than three percentage4
points.5
(iii) The provisions of this Subparagraph shall apply only to transactions6
subject to the Louisiana Motor Vehicle Sales Finance Act.7
(3) For any person or other licensee:8
(a) To modify a franchise during the term of the agreement or upon its9
renewal if the modification substantially and adversely affects the franchisee's10
rights, obligations, investment, or return on investment without giving sixty-day11
written notice of the proposed modification to the licensee and the commission12
unless the modifications are required by law, court order, or the commission.13
Within the sixty-day notice period the licensee may file with the commission a14
complaint for a determination whether there is good cause for permitting the15
proposed modification. The party seeking to modify or replace an agreement16
shall demonstrate by a preponderance of the evidence that there is good cause17
for the modification or replacement. The commission shall schedule a hearing18
within sixty days to decide the matter. Multiple complaints pertaining to the19
same proposed modifications shall be consolidated for hearing. The proposed20
modification may not take effect pending the determination of the matter.21
(b) In making a determination of whether there is good cause for22
permitting a proposed modification, the commission may consider any relevant23
factor including:24
(i) The reasons for the proposed modification.25
(ii) Whether the proposed modification is applied to or affects all26
licensees in a nondiscriminating manner.27
(iii) The degree to which the proposed modification will have a28
substantial and adverse effect upon the licensee's investment or return on29 SB NO. 360
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investment.1
(iv) Whether the proposed modification is in the public interest.2
(v) The degree to which the proposed modification is necessary to the3
orderly and profitable distribution of recreational vehicles and other services4
by the licensee.5
(vi) Whether the proposed modification is offset by other modifications6
beneficial to the licensee.7
(c) The decision of the commission shall be in writing and shall contain8
findings of fact and a determination of whether there is good cause for9
permitting the proposed modification. The commission shall deliver copies of10
the decision to the parties personally or by registered mail.11
(4) For any employee of a licensee while acting in the scope of his12
employment, to accept any payment, commission, fee, or compensation of any13
kind from any person other than the employing licensee, unless such payment14
is fully disclosed to and approved by the employing licensee.15
§1270.21. Indemnification of franchised recreational vehicle dealers16
Notwithstanding the terms of any franchise agreement, each17
manufacturer or converter shall indemnify and hold harmless its franchised18
recreational vehicle dealers against any judgment for damages, including but19
not limited to court costs and reasonable attorney fees of the recreational20
vehicle dealer, arising out of complaints, claims, or lawsuits including but not21
limited to strict liability, negligence, misrepresentation, express or implied22
warranty, or rescission of sale to the extent that the judgment arises out of23
alleged defective or negligent manufacture, assembly, or design of recreational24
vehicles, parts, or accessories, or other functions by the manufacturer of25
converter, which are beyond the control of the recreational vehicle dealer.26
§1270.22. Payment to recreational vehicles dealers; penalties27
It shall be a violation of this Chapter for a recreational vehicle28
manufacturer, distributor, wholesaler, factory branch, officer, agent or other29 SB NO. 360
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representative thereof, to fail to pay a recreational vehicle dealer all monies due1
the recreational vehicle dealer, except manufacturer hold-back amounts, within2
thirty days of the date of completion of the transactions or submissions of the3
claims giving rise to the payments to the recreational vehicle dealers. Failure to4
make payments shall subject the manufacturer, distributor, wholesaler, factory5
branch, officer, agent, or other representative thereof, to a penalty of the one6
and one-half percent interest per month, or fraction thereof, until sums due the7
recreational vehicle dealer are fully paid.8
§1270.23. Warranty; compensation; audits of recreational vehicle dealer9
records10
A.(1) It shall be a violation of this Chapter for a manufacturer, a11
distributor, a wholesaler, or factory branch, or officer, agent or other12
representative thereof, to fail to adequately and fairly compensate its13
recreational vehicle dealers for labor, parts, and other expenses incurred by14
such dealer to perform under and comply with a manufacturer's or a15
distributor's warranty agreement.16
(2) In no event shall any manufacturer or distributor pay its recreational17
vehicle dealers at a price or rate for warranty work that is less than that18
charged by the recreational vehicle dealer to the retail customers of the19
recreational vehicle dealer for nonwarranty work of like kind.20
(3) Warranty work includes parts and labor performed.21
(4) All claims made by the recreational vehicle dealer for compensation22
under this Subsection shall be paid within thirty days after approval and shall23
be approved or disapproved within thirty days after receipt. When any claim24
is disapproved, the recreational vehicle dealer shall be notified in writing of the25
grounds for disapproval.26
(5) The obligations in this Subsection may be modified by contract.27
B.(1) Notwithstanding the terms of any franchise agreement, warranty,28
and sales incentive, audits of recreational vehicle dealer records may be29 SB NO. 360
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conducted by the manufacturer, distributor, or factory branch. Any audit for1
warranty parts or service compensation shall be for the twelve-month period2
immediately following the date of the payment of the claim by the manufacturer3
or distributor. However, a recreational vehicle dealer shall not be held liable by4
virtue of an audit for failure to retain parts for a period in excess of six months.5
Any audit for sales incentives, service incentives, rebates, or other forms of6
incentive compensation shall only be for the twelve-month period immediately7
following the date of the final payment to the recreational vehicle dealer under8
a promotion, event, program, or activity. In no event shall the manufacturer,9
distributor, or factory branch fail to allow the recreational vehicle dealer to10
make corrections to the sales data in less than one hundred twenty days from11
the program period. Additionally, no penalty other than amounts advanced on12
a recreational vehicle reported incorrectly shall be due in connection with the13
audit. With respect to recreational vehicles sold during the time period subject14
to the audit, but submitted incorrectly to the manufacturer, distributor, or15
wholesale distributor branch or factory branch, the recreational vehicle dealer16
shall be charged back for the amount reported incorrectly and credited with the17
amount due, if anything, on the actual sale date.18
(2) No claim which has been approved and paid may be charged back to19
the recreational vehicle dealer unless it can be shown that one or all of the20
following applies:21
(a) The claim was false or fraudulent.22
(b) The repairs were not properly made.23
(c) The repairs were unnecessary to correct the defective condition under24
generally accepted standards of workmanship.25
(d) The recreational vehicle dealer failed to reasonably substantiate the26
repair in accordance with reasonable written requirements of the manufacturer27
or distributor, if the recreational vehicle dealer was notified of the requirements28
prior to the time the claim arose and if the requirements were in effect at the29 SB NO. 360
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time the claim arose.1
(3) A manufacturer or distributor shall not deny a claim solely based on2
a recreational vehicle dealer's incidental failure to comply with a specific claim3
processing requirement, or a clerical error, or other administrative technicality.4
(4) Limitations on warranty parts or service compensation, sales5
incentive audits, rebates, or other forms of incentive compensation, chargebacks6
for warranty parts or service compensation, and service incentives and7
chargebacks for sales compensation only shall not be effective in the case of8
intentionally false or fraudulent claims.9
(5) It shall be deemed an unfair act pursuant to this Chapter to audit a10
recreational vehicle dealer more frequently than two sales-related and two11
service-related audits in a twelve-month period. Nothing in this Subsection shall12
limit a manufacturer's or distributor's ability to perform routine claim reviews13
in the normal course of business.14
(6) No claim may be rejected as late if it has been submitted within sixty15
days of the date the repair order was written.16
§1270.24. Recreational vehicle repairs17
Suppliers of mechanical repairs and services for any recreational vehicle18
subject to regulation pursuant to this Chapter shall provide each consumer with19
an itemized bill indicating repairs and services performed, parts replaced, or20
materials used, the total labor charge, and the identity of the mechanic,21
repairman, or supplier who performed the work. However, nothing in this22
Section shall prohibit a supplier of mechanical repairs and services from23
charging a service fee for the use of shop supplies such as rags, fender covers,24
small amounts of fluid, or other items which are not itemized, provided that25
such fee does not exceed five percent of the total invoice for mechanical repairs26
or thirty-five dollars, whichever is less.27
§1270.25. Damage disclosure; recreational vehicles28
A. Whenever a new recreational vehicle subject to regulation pursuant29 SB NO. 360
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to this Part is sold to any person, the seller shall notify the purchaser of any1
body damage or mechanical damage which the recreational vehicle has2
sustained that exceeds six percent of the manufacturer's wholesale price. Such3
notice shall be in writing and a copy thereof shall be delivered to the purchaser4
prior to or simultaneous with transfer of the recreational vehicle title.5
B. Replacement of a new recreational vehicle's instrument panels,6
appliances, furniture, cabinetry, televisions, audio equipment, or similar7
residential components shall not be deemed "damage" pursuant to this Section8
if such items are replaced with original manufacturers' parts and materials.9
C. This Section shall apply to all instances of vehicular body or10
mechanical damage to recreational vehicles and to all actions involving such11
damage, notwithstanding the application of other codal, statutory, or regulatory12
provisions, including but not limited to Civil Code Articles 2520 et seq.13
§1270.26. Notice regarding recalls; recreational vehicles14
It shall be a violation of this Part for a recreational vehicle dealer to sell15
a new recreational vehicle without first supplying a prospective buyer with the16
following notice: "A new recreational vehicle may have been subject to a17
National Highway Traffic Safety Administration required recall which would18
be repaired in accordance with manufacturer standards approved by the19
National Highway Traffic Safety Administration. If such a repair is a concern20
before you purchase, please ask for a copy of the recall notice, if applicable, to21
the recreational vehicle being sold." This notice shall be included on the buyer's22
order in a box and in bold print which is signed by the buyer and the seller or23
his representative next to the box. If the buyer requests the recall notice, the24
recall notice shall be included in the sales transaction. If the selling recreational25
vehicle dealer performed the repair, the documents supporting the repair shall26
also be included in the sales transaction.27
§1270.27. Sale of water-damaged recreational vehicles28
A. No person shall sell, transfer, or convey any new or used recreational29 SB NO. 360
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vehicle to any person without notifying the buyer or receiver of the recreational1
vehicle in writing of the extent of any water damage from flooding which2
occurred to the recreational vehicle prior to the transaction.3
B. If a sale, transfer, or conveyance of a new or used recreational vehicle4
occurs in violation of Subsection A of this Section, the person receiving5
ownership and title to the recreational vehicle who is not otherwise aware of the6
damage at the time of the transaction may bring an action to set aside the7
transaction within one year from the date of the transaction and receive all8
monies or other property given as consideration for the vehicle less a reasonable9
assessment for miles driven.10
C. For the purposes of this Section, a "water-damaged vehicle" means11
any recreational vehicle whose power train, computer, or electrical system has12
been damaged by flooding.13
§1270.28. Succession; right of first refusal; recreational vehicle dealer14
A.(1) The terms of the franchise notwithstanding, any recreational15
vehicle dealer may appoint by will, or other written instrument, a designated16
successor to succeed in the ownership interest of the recreational vehicle dealer17
in the dealership upon the death or incapacity of the recreational vehicle dealer.18
(2) Unless good cause exists for refusal to honor the succession on the19
part of the manufacturer or distributor, any designated successor of a deceased20
or incapacitated recreational vehicle dealer of a dealership may succeed to the21
ownership of the dealership under the existing franchise if:22
(a) The designated successor gives the manufacturer or distributor23
written notice of his or her intention to succeed to the ownership of the24
recreational vehicle dealer within sixty days of the recreational vehicle dealer's25
death or incapacity.26
(b) The designated successor agrees to be bound by all the terms and27
conditions of the franchise.28
(3) The manufacturer or distributor may request, and the designated29 SB NO. 360
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successor shall provide, promptly upon such request, personal and financial1
data reasonably necessary to determine whether the succession should be2
honored.3
(4) If a manufacturer or distributor believes that good cause exists for4
refusing to honor the succession of a deceased or incapacitated recreational5
vehicle dealer, the manufacturer or distributor may, not more than sixty days6
following receipt of notice of the designated successor's intent to succeed and7
receipt of such personal or financial data, serve upon the designated successor8
notice of its refusal to honor the succession and of its intent to discontinue the9
existing franchise with the dealer not earlier than six months from the date such10
notice is served.11
(5) The notice must state the specific grounds for the refusal to honor the12
succession.13
(6) If notice of refusal and discontinuance is not timely served upon the14
designated successor, the franchise shall continue in effect subject to15
termination only as otherwise permitted by this Chapter.16
(7) In determining whether good cause for the refusal to honor the17
succession exists, the manufacturer or distributor has the burden of proving18
that the designated successor is not of good moral character or does not19
otherwise meet the manufacturer's or distributor's reasonable standards as a20
franchisee.21
(8) If a manufacturer or distributor refuses to honor the succession to the22
ownership interest of a deceased or incapacitated owner for good cause, then23
and in such event:24
(a) The manufacturer or distributor shall allow the designated successor25
a reasonable period of time which shall not be less than six months in which to26
consummate a sale of the dealership. Any such sale shall be subject to R.S.27
32:1270.20(1)(d).28
(b) Upon termination of the franchise pursuant to such refusal, the29 SB NO. 360
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provisions of R.S. 32:1270.29 shall apply.1
B. In the event of a proposed sale or transfer of a recreational vehicle2
dealership and if the franchise agreement has a right of first refusal in favor of3
the manufacturer or distributor, then, notwithstanding the terms of the4
franchise agreement, the manufacturer or distributor shall be permitted to5
exercise a right of first refusal to acquire the recreational vehicle dealer's assets6
or ownership if all of the following requirements are met:7
(1) In order to exercise its right of first refusal, the manufacturer or8
distributor shall notify the recreational vehicle dealer in writing within sixty9
days of his receipt of the completed proposal for the proposed sale or transfer10
and all related agreements.11
(2) The applicability of R.S. 32:1270.20(1)(l) shall not be expanded or12
changed.13
(3) The exercise of the right of first refusal will result in the recreational14
vehicle dealer receiving the same or greater consideration as he has contracted15
to receive in connection with the proposed change of ownership or transfer.16
(4) The proposed sale or transfer of the dealership's assets does not17
involve the transfer or sale to a member or members of the family of one or18
more recreational vehicle dealers, or to a qualified manager with at least two19
years management experience at the dealership of one or more of these20
recreational vehicle dealers, or to a partnership or corporation controlled by21
such persons.22
(5)(a) The manufacturer or distributor agrees to pay the reasonable23
expenses, including attorney fees which do not exceed the usual, customary, and24
reasonable fees charged for similar work done for other clients, incurred by the25
proposed owner or transferee prior to the manufacturer's or distributor's26
exercise of its right of first refusal in negotiating and implementing the contract27
for the proposed sale or transfer of the dealership or dealership assets. Such28
expenses and attorney fees shall be paid to the proposed new owner or29 SB NO. 360
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transferee at the time of closing of the sale or transfer for which the1
manufacturer or distributor exercised its right of first refusal.2
(b) No payment of such expenses and attorney fees shall be required if3
the new owner or transferee has not submitted or caused to be submitted an4
accounting of those expenses within thirty days of the recreational vehicle5
dealer's receipt of the manufacturer's or distributor's written request for such6
an accounting. A manufacturer or distributor may request such accounting7
before exercising his right of first refusal.8
(6) The recreational vehicle dealer shall not have any liability to any9
person as a result of a manufacturer's exercising its right of first refusal and the10
manufacturer or distributor shall assume the defense of the selling dealer for11
any claim by the proposed owner or transferee arising from the exercise of the12
right of first refusal.13
§1270.29. Requirements upon termination; penalty; indemnity; recreational14
vehicles15
A.(1) In the event the licensee ceases to engage in the business of being16
a recreational vehicle dealer, or ceases to sell a particular recreational vehicle,17
and after notice to the manufacturer, converter, distributor, or representative18
by certified mail or commercial delivery service with verification of receipt,19
within thirty days of the receipt of the notice by the manufacturer, converter,20
distributor, or representative, the manufacturer, converter, distributor, or21
representative shall repurchase:22
(a) All new recreational vehicles of the current and last prior model year23
delivered to the licensee and parts limited to those listed in the manufacturer's24
price book. The recreational vehicles and parts shall be repurchased at the cost25
to the licensee which shall include without limitation freight and advertising26
costs, less all allowances paid to the recreational vehicle dealer.27
(b) At fair market value, each undamaged sign owned by the recreational28
vehicle dealer which bears a trademark or trade name used or claimed by the29 SB NO. 360
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manufacturer, distributor, or representative if the sign was purchased from or1
purchased at the request of the manufacturer, distributor, or representative.2
Fair market value shall be no less than cost of acquisition of the sign by the3
recreational vehicle dealer.4
(c) At fair market value, all special tools and automotive service5
equipment owned by the recreational vehicle dealer which were recommended6
in writing and designated as special tools and equipment and purchased from7
or purchased at the request of the manufacturer, converter, distributor, or8
representative, if the tools and equipment are in usable and good condition9
except for reasonable wear and tear. Fair market value shall be no less than cost10
of acquisition of special tools and automotive service equipment by the11
recreational vehicle dealer.12
(d) The manufacturer, converter, distributor, or representative shall pay13
to the recreational vehicle dealer the costs of transporting, handling, packing,14
and loading of recreational vehicles, or parts, signs, tools, and equipment15
subject to repurchase.16
(2) The manufacturer or converter shall make the required repurchase17
after the recreational vehicle dealer terminates his franchise and within sixty18
days of the submission to it, by certified mail, return receipt requested, or19
commercial delivery service with verification of receipt, of a final inventory of20
recreational vehicles and parts on hand.21
B. Failure to make such repurchase without just cause shall subject the22
manufacturer or converter to a penalty of one and one-half percent per month,23
or fraction thereof, of the inventory value or returnable recreational vehicles,24
and parts, signs, special tools, and automotive service equipment, payable to the25
dealer, as long as the repurchase is not made.26
C.(1) Upon the involuntary termination, nonrenewal, or cancellation of27
any franchise by the manufacturer or converter, except for termination,28
nonrenewal, or cancellation resulting from a felony conviction, notwithstanding29 SB NO. 360
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the terms of any franchise, whether entered into before or after the enactment1
of this Chapter or any of its provisions, the new recreational vehicle dealer shall2
be allowed fair and reasonable compensation by the manufacturer or converter3
as agreed by the parties, or lacking agreement, as determined by the4
commission, for the dealership facilities if the facilities were required to be5
purchased or constructed as a precondition to obtaining the franchise or to its6
renewal; provided that if such facilities were leased and the lease were required7
as a precondition to obtaining the franchise or to its renewal, then the8
manufacturer shall be liable for one year's payment of the rent or the9
remainder of the term of the lease, whichever is less.10
(2) Payment under this Section shall entitle the manufacturers,11
converters, or distributors to possession and use of the facility.12
(3) As used in this Section, "manufacturer" shall include a13
manufacturer, a converter, a distributor, a factory branch, distributor branch,14
or other subsidiary thereof.15
(4) The obligation of the manufacturer or converter to purchase a16
dealership facility, pursuant to this Section, is equally applicable if an entity or17
person affiliated with the dealer is the owner or lessor of the facility.18
§1270.30. Recreational vehicle manufacturer termination of line-make;19
manufacturer bankruptcy; license20
Notwithstanding the terms of any franchise or other provision of law, if21
the termination, cancellation, or nonrenewal of a licensee's franchise is the22
result of the termination, elimination, or cessation of a line-make by the23
manufacturer, distributor, or factory branch, whether by bankruptcy or24
otherwise, the license issued by the commission may remain in effect at the25
discretion of the commission pursuant to its rules.26
Section 2. R.S. 32:1257.1, 1261(6)(a)(ii), and 1268.1 are hereby repealed.27
Section 3. The Louisiana State Law Institute is hereby directed to redesignate R.S.28
32:1251 through 1269 of Chapter 6 of Title 32 of the Louisiana Revised Statues of 1950, as29 SB NO. 360
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Part I of Chapter 6 of Title 32 of the Louisiana Revised Statues of 1950. Part I shall be1
entitled "GENERAL PROVISIONS APPLICABLE TO MOTOR VEHICLES AND2
RECREATIONAL PRODUCTS".3
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Michelle Ducharme.
DIGEST
Martiny (SB 360)
Present law provides for the regulation of motor vehicles, specialty 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 specialty vehicles.
Proposed law changes the definition of "boat package" and "franchise".
Proposed law defines the following terms: "marine product salesman", "new marine
product", "selling agreement", "used marine product", "used marine product dealer", "used
marine product facility", "motorcycle or all-terrain vehicle dealer","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", "used motorcycle or all-terrain
vehicle facility", "new recreational vehicle", "recreational vehicle dealer", "recreational
vehicle salesman", "used recreational vehicle", "used recreational vehicle dealer","used
recreational vehicle facility".
Proposed law replicates certain provisions of present law in new sections of law and limits
the application of such provisions to marine products, motorcycles, all-terrain vehicles, or
recreational vehicles.
Effective August 1, 2012.
(Amends R.S. 32:1252(4) and (19), 1261, 1261.1, and 1263; adds R.S. 32:1252(52)-(69),
1262(C), 1264(D), 1267(C), 1268(D), and 1270-1270.30; repeals R.S. 32:1257.1 and 1268.1)
Summary of Amendments Adopted by Senate
Committee Amendments Proposed by Senate Committee on Commerce, Consumer
Protection, and International Affairs to the original bill
1. Deletes certain definitions.
2. Adds provisions relative to certain unauthorized acts.
3. Removes provisions relative to venue.
4. Adds provisions relative to marine products and motorcycles or all-terrain
vehicles.
5. Adds technical amendments.
6. Changes the phrase "selling agreement" to "franchise".