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Regular Session, 2012 ENROLLED
SENATE BILL NO. 360
BY SENATOR MARTINY AND REPRESENTATIVE PONTI
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 and5
1268.1, relative to marine products, motorcycles, all-terrain vehicles, and6
recreational vehicles; to provide for certain terms, conditions, requirements, and7
procedures; to provide for definitions; to provide for the establishment of new8
dealerships and the relocation of existing dealerships; to provide for payment to9
dealers; to provide for unauthorized acts; to provide for warranty agreements and10
application thereof; to provide for the sale and leasing of certain marine products,11
motorcycles, all-terrain vehicles, and recreational vehicles; to provide for the12
succession of a dealer; to provide for the procedure to terminate a dealership; to13
provide for the repurchase of certain products, equipment, parts, and tools; and to14
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
and reenacted and R.S. 32:1252(52) through (69), 1262(C), 1264(D), 1267(C), 1268(D), and18
Parts II, III, and IV of Chapter 6 of Title 32 of the Louisiana Revised Statutes of 1950, to be19
comprised of R.S. 32:1270 through 1270.30 are hereby enacted to read as follows:20
§1252. Definitions21
The following words, terms, and phrases, when used in this Chapter, shall22
have the meanings respectively ascribed to them in this Section, except where the23
context clearly indicates a different meaning:24
* * *25
(4) "Boat package" means a boat that is equipped from its manufacturer or26
distributor with an inboard, outboard, or inboard/outboard motor or engine attached27
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thereto, installed thereon, or shipped or invoiced together as a package. The boat1
package may include a trailer invoiced from the manufacturer of the boat. For2
the purposes of this Chapter, the boat package brand shall be determined by the3
brand of the boat.4
* * *5
(19) "Franchise" means any written contract or selling agreement between6
a motor vehicle or recreational products dealer, a motor vehicle lessor, or a specialty7
vehicle dealer and a manufacturer, motor vehicle lessor franchisor, or converter of8
a new motor vehicle or specialty vehicle or its distributor or factory branch by which9
the motor vehicle or recreational products dealer, motor vehicle lessor, or specialty10
vehicle dealer is authorized to engage in the business of selling or leasing the11
specific makes, models, or classifications of new motor vehicles, recreational12
products, or specialty vehicles marketed or leased by the manufacturer, motor13
vehicle lessor franchisor, or converter and designated in the franchise agreement or14
any addendum thereto. For purposes of this Chapter, any written modification,15
amendment, or addendum to the original franchise agreement, which changes the16
rights and obligations of the parties to the original franchise agreement, shall17
constitute a new franchise agreement, effective as of the date of the modification,18
amendment, or addendum.19
* * *20
(52) "Marine product salesman" means any natural person employed21
by a licensee of the commission whose duties include the selling, leasing, or22
offering for sale or lease, financing or insuring marine products on behalf of23
said licensee and who holds a motor vehicle salesman license under the24
provisions of this Chapter.25
(53) "New marine product" means a marine product, the legal title to26
which has never been transferred by a manufacturer, distributor, or dealer to27
an ultimate purchaser.28
(54) "Selling agreement" means any written contract or agreement29
between a marine dealer and a manufacturer, or its distributor or factory30 SB NO. 360 ENROLLED
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branch, by which the marine dealer is authorized to engage in the business of1
selling or leasing the specific makes, models, or classifications of marine2
products marketed or leased by the manufacturer, and designated in the selling3
agreement or any addendum thereto. For the purposes of this Paragraph, any4
written modification, amendment, or addendum to the original selling5
agreement that changes the rights and obligations of the parties to the original6
selling agreement shall constitute a new selling agreement, effective as of the7
date of the modification, amendment, or addendum.8
(55) "Used marine product" means a marine product, the legal title of9
which has been transferred by a manufacturer, distributor, or dealer to an10
ultimate purchaser.11
(56)(a) "Used marine dealer" means any person, whose business is to12
sell, or offer for sale, display, or advertise used marine products, or any person13
who holds a license from the commission and is not excluded by Subparagraph14
(b) of this Paragraph.15
(b) "Used marine dealer" shall not include any of the following:16
(i) Receivers, trustees, administrators, executors, guardians, or other17
persons appointed by or acting under the judgment or order of any court.18
(ii) Public officers while performing their official duties.19
(iii) Employees of persons, corporations, or associations defined as "used20
marine dealers" when engaged in the specific performance of their duties as21
such employees.22
(iv) Mortgagees or secured parties as to sales of marine products23
constituting collateral on a mortgage or security agreement and who do not24
maintain a used car lot or building with one or more employed marine product25
salesman.26
(v) Insurance companies who sell motor vehicles to which they have27
taken title as an incident of payments made under policies of insurance and who28
do not maintain a used car lot or building with one or more employed marine29
product salesman.30 SB NO. 360 ENROLLED
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(vi) Used motor vehicle dealers licensed pursuant to R.S. 32:781 et seq.1
(57) "Used marine product facility" means any facility which is owned2
and operated by a licensee of the commission and offers for sale used marine3
products.4
(58) "Motorcycle or all-terrain vehicle dealer" means any person who,5
for a commission or with intent to make a profit or gain of money or other thing6
of value, buys, sells, brokers, exchanges, auctions, offers, or attempts to7
negotiate a sale or exchange of an interest in motorcycles or all-terrain vehicles8
and who is engaged wholly or in part in the business of buying and selling9
motorcycles or all-terrain vehicles in the state of Louisiana and who holds a10
license as a recreational products dealer under the provisions of this Chapter.11
(a) The term shall also include anyone not licensed under Chapter 6 of12
Title 32 of the Louisiana Revised Statutes of 1950, who sells motorcycles or all-13
terrain vehicles and who rents on a daily basis motorcycles or all-terrain14
vehicles, not of the current year or immediate prior year models, that have been15
titled previously to an ultimate purchaser.16
(b) "Motorcycle or all-terrain vehicle dealer" shall not include any of17
the following:18
(i) Receivers, trustees, administrators, executors, guardians, or other19
persons appointed by or acting under the judgment or order of any court.20
(ii) Public officers while performing their official duties.21
(iii) Employees of motorcycle or all-terrain vehicle dealers when engaged22
in the specific performance of their duties as such employees.23
(iv) Mortgagees or secured parties as to sales of motorcycles or all-24
terrain vehicles constituting collateral on a mortgage or security agreement.25
(v) Insurance companies.26
(vi) Auctioneers or auction houses who are not engaged in the auction27
of motorcycles or all-terrain vehicles as the principal part of their business,28
including but not limited to the following auctions: estate auctions, bankruptcy29
auctions, farm equipment auctions, or government auctions.30 SB NO. 360 ENROLLED
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(59) "Motorcycle or all-terrain vehicle salesman" means any natural1
person employed by a licensee of the commission whose duties include the2
selling, leasing, or offering for sale or lease, financing or insuring motorcycle or3
all-terrain vehicles on behalf of said licensee and who holds a motor vehicle4
salesman license under the provisions of this Chapter.5
(60) "New motorcycle or all-terrain vehicle" means a motorcycle or all-6
terrain vehicle, the legal title to which has never been transferred by a7
manufacturer, distributor, or dealer to an ultimate purchaser.8
(61) "Used motorcycle or all-terrain vehicle" means a motorcycle or all-9
terrain vehicle, the legal title of which has been transferred by a manufacturer,10
distributor, or dealer to an ultimate purchaser.11
(62)(a) "Used motorcycle or all-terrain vehicle dealer" means any12
person, whose business is to sell, or offer for sale, display, or advertise used13
motorcycles or all-terrain vehicles, or any person who holds a license from the14
commission and is not excluded by Subparagraph (b) of this Paragraph.15
(b) "Used motorcycle or all-terrain vehicle dealer" shall not include any16
of the following:17
(i) Receivers, trustees, administrators, executors, guardians, or other18
persons appointed by or acting under the judgment or order of any court.19
(ii) Public officers while performing their official duties.20
(iii) Employees of persons, corporations, or associations enumerated in21
the definition of "used motorcycle or all-terrain vehicle dealer" when engaged22
in the specific performance of their duties as such employees.23
(iv) Mortgagees or secured parties as to sales of motorcycles or all-24
terrain vehicles constituting collateral on a mortgage or security agreement and25
who do not maintain a used car lot or building with one or more employed26
motorcycle or all-terrain vehicle salesman.27
(v) Insurance companies who sell motorcycles or all-terrain vehicles to28
which they have taken title as an incident of payments made under policies of29
insurance and who do not maintain a used car lot or building with one or more30 SB NO. 360 ENROLLED
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employed motorcycle or all-terrain vehicle salesman.1
(vi) Used motorcycle or all-terrain vehicle dealers licensed pursuant to2
R.S. 32:781 et seq.3
(63) "Used motorcycle or all-terrain vehicle facility" means any facility4
which is owned and operated by a licensee of the commission and offers for sale5
used motorcycles or all-terrain vehicles.6
(64) "New recreational vehicle" means a recreational vehicle, the legal7
title to which has never been transferred by a manufacturer, distributor, or8
dealer to an ultimate purchaser.9
(65) "Recreational vehicle dealer" means any person who, for a10
commission or with intent to make a profit or gain of money or other thing of11
value, buys, sells, brokers, exchanges, auctions, offers, or attempts to negotiate12
a sale or exchange of an interest in recreational vehicles and who is engaged13
wholly or in part in the business of buying and selling recreational vehicles in14
the state of Louisiana and who holds a license as a recreational products dealer15
under the provisions of this Chapter.16
(a) The term shall also include anyone not licensed under Chapter 6 of17
Title 32 of the Louisiana Revised Statutes of 1950, who sells recreational18
vehicles and who rents on a daily basis recreational vehicles, not of the current19
year or immediate prior year models, that have been titled previously to an20
ultimate purchaser.21
(b) "Recreational vehicle dealer" shall not include any of the following:22
(i) Receivers, trustees, administrators, executors, guardians, or other23
persons appointed by or acting under the judgment or order of any court.24
(ii) Public officers while performing their official duties.25
(iii) Employees of recreational vehicle dealers when engaged in the26
specific performance of their duties as such employees.27
(iv) Mortgagees or secured parties as to sales of recreational vehicles28
constituting collateral on a mortgage or security agreement.29
(v) Insurance companies.30 SB NO. 360 ENROLLED
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(vi) Auctioneers or auction houses who are not engaged in the auction of1
recreational vehicles as the principal part of their business, including but not2
limited to the following auctions: estate auctions, bankruptcy auctions, farm3
equipment auctions, or government auctions.4
(66) "Recreational vehicle salesman" means any natural person5
employed by a licensee of the commission whose duties include the selling,6
leasing, or offering for sale or lease, financing or insuring recreational vehicles7
on behalf of said licensee and who holds a motor vehicle salesman license under8
the provisions of this Chapter.9
(67) "Used recreational vehicle" means a recreational vehicle, the legal10
title of which has been transferred by a manufacturer, distributor, or dealer to11
an ultimate purchaser.12
(68)(a) "Used recreational vehicle dealer" means any person, whose13
business is to sell, or offer for sale, display, or advertise used recreational14
vehicles, or any person who holds a license from the commission and is not15
excluded by Subparagraph (b) of this Paragraph.16
(b) "Used recreational vehicle dealer" shall not include any of the17
following:18
(i) Receivers, trustees, administrators, executors, guardians, or other19
persons appointed by or acting under the judgment or order of any court.20
(ii) Public officers while performing their official duties.21
(iii) Employees of persons, corporations, or associations enumerated in22
the definition of "used recreational vehicle dealer" when engaged in the specific23
performance of their duties as such employees.24
(iv) Mortgagees or secured parties as to sales of recreational vehicles25
constituting collateral on a mortgage or security agreement and who do not26
maintain a used car lot or building with one or more employed recreational27
vehicle salesman.28
(v) Insurance companies who sell recreational vehicles to which they29
have taken title as an incident of payments made under policies of insurance30 SB NO. 360 ENROLLED
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and who do not maintain a used car lot or building with one or more employed1
recreational vehicle salesman.2
(vi) Used recreational vehicle dealers licensed pursuant to R.S. 32:781 et3
seq.4
(69) "Used recreational vehicle facility" means any facility which is5
owned and operated by a licensee of the commission and offers for sale used6
recreational vehicles.7
* * *8
§1261. Unauthorized acts9
A. It shall be a violation of this Chapter:10
(1) For a manufacturer, a distributor, a wholesaler, distributor branch, factory11
branch, converter or officer, agent, or other representative thereof:12
(a) To induce or coerce, or attempt to induce or coerce, any licensee:13
(i) To order or accept delivery of any recreational product, motor vehicle or14
vehicles, appliances, equipment, parts or accessories therefor, or any other15
commodity or commodities which shall not have been voluntarily ordered.16
(ii) To order or accept delivery of any vehicle with special features,17
appliances, accessories, or equipment not included in the list price of said vehicles18
as publicly advertised.19
(iii) To order for any person any parts, accessories, equipment, machinery,20
tools, appliances, or any commodity whatsoever.21
(iv) To assent to a release, assignment, novation, waiver, or estoppel which22
would relieve any person from liability to be imposed by law, unless done in23
connection with a settlement agreement to resolve a matter pending a commission24
hearing or pending litigation between a manufacturer, distributor, wholesaler,25
distributor branch or factory branch, or officer, agent, or other representative thereof.26
(v) To enter into a franchise with a licensee or during the franchise term, use27
any written instrument, agreement, release, assignment, novation, estoppel, or28
waiver, to attempt to nullify or modify any provision of this Chapter, or to require29
any controversy between a dealer and a manufacturer to be referred to any person or30 SB NO. 360 ENROLLED
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entity other than the commission, or duly constituted courts of this state or the United1
States, if such referral would be binding upon the dealer. Such instruments are null2
and void, unless done in connection with a settlement agreement to resolve a matter3
pending a commission hearing or pending litigation.4
(vi) To waive the right to a jury trial.5
(vii) To participate in an advertising group or to participate monetarily in an6
advertising campaign or contest or to purchase any promotional materials,7
showroom, or other display decorations or materials at the expense of such motor8
vehicle dealer or specialty dealer.9
(viii) To adhere to performance standards that are not applied uniformly to10
other similarly situated motor vehicle dealers or specialty dealers. Any such11
performance standards shall be fair, reasonable, equitable, and based on accurate12
information. If dealership performance standards are based on a survey, the13
manufacturer, converter, distributor, wholesaler, distributor branch, or factory branch14
shall establish the objectivity of the survey process and provide this information to15
any motor vehicle dealer or specialty vehicle dealer of the same line make covered16
by the survey request. Each response to a survey used by a manufacturer in preparing17
an evaluation or performance-rating of a motor vehicle dealer shall be made18
available to that motor vehicle dealer, or it cannot be used by the manufacturer.19
However, if a customer requests that the manufacturer or distributor not disclose the20
consumer's identity to the dealer, the manufacturer may withhold the consumer's21
identity in providing the survey response to the dealer, and the manufacturer may use22
the response. Any survey used must have the following characteristics:23
(aa) It was designed by experts.24
(bb) The proper universe was examined.25
(cc) A representative sample was chosen.26
(dd) The data was accurately reported.27
(ix) To release, convey, or otherwise provide customer information, if to do28
so is unlawful or if the customer objects in writing. This does not include29
information that is necessary for the manufacturer to meet its obligations to the30 SB NO. 360 ENROLLED
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dealer or consumers in regard to contractual responsibilities, vehicle recalls, or other1
requirements imposed by state or federal law. The manufacturer is further prohibited2
from providing any consumer information received from the dealer to any3
unaffiliated third party.4
(x) To pay the attorney fees of the manufacturer or distributor related to5
hearings and appeals brought under this Chapter.6
(b) To refuse to deliver to any licensee having a franchise or contractual7
arrangement for the retail sale of vehicles sold or distributed by such manufacturer,8
distributor, wholesaler, distributor branch or factory branch, any motor vehicle,9
publicly advertised for immediate delivery, within sixty days after such dealer's order10
shall have been received.11
(c) To threaten to cancel any franchise or any contractual agreement existing12
between such manufacturer, distributor, wholesaler, distributor branch or factory13
branch and said dealer for any reason including but not limited to failure to meet14
performance standards.15
(d) To unfairly, without just cause and due regard to the equities of such16
dealer, cancel the franchise of any licensee. Failure to meet performance standards17
based on a survey of sales penetration in a regional, national, territorial, or other18
geographic area shall not be the sole cause for cancellation of a franchise. The19
nonrenewal of a franchise or selling agreement with such dealer or his successor20
without just provocation or cause, or the refusal to approve a qualified transferee or21
qualified successor to the dealer-operator as provided for in the franchise or selling22
agreement, or solely for failure to meet performance standards based on a survey of23
sales penetration in a regional, national, territorial, or other geographic area, shall be24
deemed an evasion of this Paragraph and shall constitute an unfair cancellation,25
regardless of the terms or provisions of such franchise or selling agreement.26
However, at least ninety-days notice shall be given to the dealer of any cancellation27
or nonrenewal of a franchise except for a cancellation arising out of the financial28
default of the motor vehicle dealer or fraudulent activity of the dealer principal29
which results in the conviction of a crime punishable by imprisonment. The30 SB NO. 360 ENROLLED
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provisions of this Subsection relating to performance standards shall not apply to1
recreational products dealers.2
(e) To refuse to extend to a licensee the privilege of determining the mode or3
manner of available transportation facility that such dealer desires to be used or4
employed in making deliveries of vehicles to him or it.5
(f) To resort to or use any false or misleading advertisement in connection6
with his business as such manufacturer of motor vehicles, distributor, wholesaler,7
distributor branch or factory branch, or officer, agent, or other representative thereof.8
(g) To delay, refuse, or fail to deliver motor vehicles in reasonable quantities9
relative to the licensee's facilities and sales potential in the relevant market area. This10
Subparagraph shall not be valid, however, if such failure is caused by acts or causes11
beyond the control of the manufacturer, distributor, or other such party.12
(h) To ship or sell motor vehicles or recreational products to a licensee prior13
to the licensee having been granted a license by the commission to sell such vehicles.14
(i) To unreasonably withhold consent to the sale, transfer, or exchange of the15
franchise to a qualified transferee capable of being licensed as a dealer in this state,16
provided the transferee meets the criteria generally applied by the manufacturer in17
approving new dealers and agrees to be bound by all the terms and conditions of the18
standard franchises.19
(j) To fail to respond in writing to a written request for consent as specified20
in Subparagraph (i) above of this Paragraph within sixty days of receipt of a written21
request on the forms, if any, generally utilized by the manufacturer or distributor for22
such purposes and containing the information required therein. Failure to respond23
shall be deemed to be consent to the request.24
(k)(i) To sell or offer to sell a new or unused motor vehicle or recreational25
product directly to a consumer except as provided in this Chapter, or to compete with26
a licensee in the same-line makes, models, or classifications operating under an27
agreement or franchise from the aforementioned manufacturer. A manufacturer shall28
not, however, be deemed to be competing when any one of the following conditions29
are met:30 SB NO. 360 ENROLLED
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(aa) Operating a dealership temporarily for a reasonable period, not to exceed1
two years.2
(bb) Operating a bona fide retail dealership which is for sale to any qualified3
independent person at a fair and reasonable price, not to exceed two years.4
(cc) Operating in a bona fide relationship in which a person independent of5
a manufacturer has made a significant investment subject to loss in the dealership,6
and can reasonably expect to acquire full ownership of such dealership on reasonable7
terms and conditions.8
(ii) After any of the conditions have been met under Subitems (aa) and (bb)9
of Item (i) of this Subparagraph, the commission shall allow the manufacturer to10
compete with licensees of the same-line makes, models, or classifications under an11
agreement or franchise from said manufacturer for longer than two years when, in12
the discretion of the commission, the best interest of the manufacturer, consuming13
public, and licensees are best served.14
(l) To condition the renewal or extension of a franchise on a new motor15
vehicle dealer's substantial renovation of the dealer's place of business or on the16
construction, purchase, acquisition, or rental of a new place of business by the new17
motor vehicle dealer, unless the manufacturer has advised the new motor vehicle18
dealer in writing of its intent to impose such a condition within a reasonable time19
prior to the effective date of the proposed date of renewal or extension, but in no case20
less than one hundred eighty days, and provided the manufacturer demonstrates the21
need for such demand in view of the need to service the public and the economic22
conditions existing in the motor vehicle industry at the time such action would be23
required of the new motor vehicle dealer. As part of any such condition the24
manufacturer shall agree, in writing, to supply the dealer with an adequate supply25
and marketable model mix of motor vehicles to meet the sales levels necessary to26
support the increased overhead incurred by the dealer by reason of such renovation,27
construction, purchase, or rental of a new place of business.28
(m) To fail to compensate its dealers for the work and services they are29
required to perform in connection with the dealer's delivery and preparation30 SB NO. 360 ENROLLED
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obligations according to the terms of compensation that shall be filed with the1
commission on or before October first of each year. The commission shall find the2
compensation to be reasonable or the manufacturer shall remedy any deficiencies.3
(n) To fail to designate and provide to the commission in writing the4
community or territory assigned to a licensee.5
(o) To fail or refuse to sell or offer to sell to all motor vehicle franchisees in6
a line make, every motor vehicle sold or offered for sale under a franchise to any7
motor vehicle franchisee of the same-line make, or to unreasonably require a motor8
vehicle dealer to pay an extra fee, purchase unreasonable advertising displays or any9
other materials, or to remodel, renovate, or recondition its existing facilities as a10
prerequisite to receiving a certain model or series of vehicles. However, the failure11
to deliver any such motor vehicle shall not be considered a violation of this Section12
if the failure is due to a lack of manufacturing capacity or to a strike or labor13
difficulty, a shortage of materials, a freight embargo or other cause of which the14
franchisor has no control. This Subparagraph shall not apply to recreational product15
manufacturers.16
(p) To unreasonably discriminate among competing, similarly situated, same-17
line make dealers in the sales of vehicles, in the availability of such vehicles, in the18
terms of incentive programs or sales promotion plans, or in other similar programs.19
(q) To terminate, cancel, or refuse to continue any franchise agreement based20
upon the fact that the motor vehicle dealer owns, has an investment in, participates21
in the management, or holds a franchise agreement for the sale or service of another22
make or line of new motor vehicles at a different dealership location, or intends to23
or has established another make or line of new motor vehicles in the same dealership24
facilities of the manufacturer or distributor.25
(r) To demand compliance with facilities requirements that include any26
requirements that a motor vehicle dealer establish or maintain exclusive office, parts,27
service or body shop facilities, unless such requirements would be reasonable and28
justified by business considerations. The burden of proving that such requirements29
are reasonable and justified by business considerations is on the manufacturer. If the30 SB NO. 360 ENROLLED
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franchise agreement of the manufacturer or distributor requires the approval of the1
manufacturer or distributor for facility uses or modifications, the manufacturer or2
distributor shall approve or disapprove such a request in writing within sixty days of3
receipt of such request.4
(s) To use any subsidiary, affiliate, or any other controlled person or entity,5
or to employ the services of a third party, to accomplish what would otherwise be6
illegal conduct under this Chapter on the part of the manufacturer or distributor.7
(t) To operate a satellite warranty and repair center, to authorize a person to8
perform warranty repairs who is not a motor vehicle dealer, or to authorize a motor9
vehicle dealer to operate a satellite warranty and repair center within the community10
or territory of a same-line or make motor vehicle dealer. This Subparagraph shall not11
apply to recreational product manufacturers.12
(u) To make a change in the area of responsibility described in the franchise13
agreement or sales and service agreement of a dealer, without the franchisor,14
converter, or manufacturer giving said dealer and the commission no less than sixty15
days prior written notice by certified or registered mail.16
(v) To attempt to induce or coerce, or to induce or coerce, any motor vehicle17
dealer to enter into any agreement with such manufacturer, distributor, wholesaler,18
distributor branch or factory branch or representative thereof, or to do any other act19
unfair to said dealer.20
(w)(i) To coerce or attempt to coerce any retail motor vehicle dealer or21
prospective retail motor vehicle dealer to offer to sell or sell any extended service22
contract or extended maintenance plan or gap product offered, sold, backed by, or23
sponsored by the manufacturer or distributor or affiliate or sell, assign, or transfer24
any retail installment sales contract or lease obtained by the dealer in connection25
with the sale or lease by him of motor vehicles manufactured or sold by the26
manufacturer or distributor, to a specified finance company or class of finance27
companies, leasing company or class of leasing companies, or to any other specified28
persons by any of the following:29
(aa) By any statement, promise, or threat that the manufacturer or distributor30 SB NO. 360 ENROLLED
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will in any manner benefit or injure the dealer, whether the statement, suggestion,1
threat, or promise is express or implied or made directly or indirectly.2
(bb) By any act that will benefit or injure the dealer.3
(cc) By any contract, or any express or implied offer of contract, made4
directly or indirectly to the dealer, for handling the motor vehicle on the condition5
that the dealer shall offer to sell or sell any extended service contract or extended6
maintenance plan offered, sold, backed by, or sponsored by the manufacturer or7
distributor or that the dealer sell, assign, or transfer his retail installment sales8
contract on or lease of the vehicle, to a specified finance company or class of finance9
companies, leasing company or class of leasing companies, or to any other specified10
person.11
(dd) Any such statements, threats, promises, acts, contracts, or offers of12
contracts, when their effect may be to lessen or eliminate competition.13
(ii) Nothing contained in this Subparagraph shall prohibit a manufacturer or14
distributor from offering or providing incentive benefits or bonus programs to a retail15
motor vehicle dealer or prospective retail motor vehicle dealer who makes the16
voluntary decision to offer to sell or sell any extended service contract or extended17
maintenance plan offered, sold, backed, or sponsored by the manufacturer or18
distributor or to sell, assign, or transfer any retail installment sale or lease by him of19
motor vehicles manufactured or sold by the manufacturer or distributor to a specified20
finance company or leasing company.21
(2) For a motor vehicle dealer, specialty vehicle dealer, recreational product22
dealer, used motor vehicle dealer, or a motor vehicle salesman:23
(a) To require a purchaser of a vehicle, as a condition of sale and delivery24
thereof, to also purchase special features, appliances, accessories, or equipment not25
desired or requested by the purchaser; however, this prohibition shall not apply as26
to special features, appliances, accessories, or equipment which are permanently27
affixed to the vehicle.28
(b) To represent and sell as a new vehicle any vehicle, the legal title of which29
has been transferred by a manufacturer, distributor, or dealer to an ultimate30 SB NO. 360 ENROLLED
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purchaser.1
(c) To resort to or use any false or misleading advertisement in connection2
with his business as such vehicle dealer or motor vehicle salesman.3
(d) To sell or offer to sell makes, models, or classifications of new vehicles4
for which no franchise and license to sell is held.5
(e) Except as otherwise approved by the commission, to sell or offer to sell6
a vehicle from an unlicensed location.7
(f) To deliver to a prospective purchaser a new or a used vehicle on a sale8
conditioned on financing, i.e., a spot delivery, except on the following terms and9
conditions which shall be in writing and shall be a part of the conditional sales10
contract or other written notification signed by the purchaser:11
(i) That if the sale is not concluded by the financing of the sale to the12
purchaser within twenty-five days of the delivery, the sale contract shall be null and13
void.14
(ii) That the vehicle being offered for trade-in by the purchaser shall not be15
sold by the dealer until the conditional sale is complete.16
(iii) That there shall be no charge to the purchaser should the conditional sale17
not be completed, including but not limited to mileage charges or charges to18
refurbish the vehicle offered for trade-in. However, the purchaser shall be19
responsible for any and all damages to the vehicle or other vehicles damaged by the20
fault of the purchaser and any and all liability incurred by the purchaser during the21
purchaser's custody of the vehicle to the extent provided for in R.S. 22:1296.22
(iv) That if the conditional sale is not completed, the dealer shall immediately23
refund to the purchaser upon return of the vehicle all sums placed with the dealership24
as a deposit or any other purpose associated with the attempted sale of the vehicle.25
(v) That the prospective purchaser shall return the vehicle to the dealership26
within forty-eight hours of notification by the dealer that the conditional sale will not27
be completed. If the prospective purchaser does not return the vehicle to the28
dealership within forty-eight hours of notification by the dealer, an authorized agent29
of the dealer shall have the right to recover the vehicle without the necessity of30 SB NO. 360 ENROLLED
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judicial process, provided that such recovery can be accomplished without1
unauthorized entry into a closed dwelling, whether locked or unlocked and without2
a breach of peace.3
(g) To pay a fee to any person in return for the solicitation, procurement, or4
production by that person of prospective purchasers for new and used vehicles,5
except to a salesman licensed under the provisions of this Chapter.6
(h) To fail to fully and completely explain each charge listed on a retail7
buyer's order or vehicle invoice prior to the purchase of a vehicle.8
(i) When selling a vehicle to a consumer, to assess any consumer services9
fees, which shall include fees for treating the interior upholstery of the vehicle, oil10
changes, roadside assistance, dealer inspections, or any other service offered by the11
dealer, without allowing the buyer to refuse such services and be exempt from12
payment for such services. The provisions of this Subparagraph shall not apply to13
dealer-added options or accessories which are permanently affixed to the vehicle.14
(j) To fail to disclose to a purchaser, in writing, which components of a15
specialty vehicle are subject to a manufacturer's or distributor's warranty agreement16
and which components are subject to a specialty vehicle dealer's or other warranty17
agreement. The specialty vehicle dealer shall identify in writing the location of the18
two nearest authorized manufacturer or distributor warranty service providers.19
School bus warranty repair work, except for engine and transmission repair work,20
may also be performed by repair facilities, authorized by the manufacturer or21
distributor, which are not school bus dealers. Further, nothing in this Chapter shall22
prohibit a manufacturer of school buses licensed by the Louisiana Motor Vehicle23
Commission from authorizing warranty and other repair or maintenance services to24
be performed at any location of a motor vehicle dealer licensed under this Chapter25
which holds a franchise from any affiliate or subsidiary of the school bus26
manufacturer.27
(k)(i) To fail to disclose to a purchaser in writing on the sales contract,28
buyer's order, or any other document that the dealer may be participating in finance29
charges associated with the sale.30 SB NO. 360 ENROLLED
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(ii) To participate in a finance charge that would result in a difference1
between the buy rate and the contract rate of more than three percentage points.2
(iii) The provisions of this Subparagraph shall apply only to transactions3
subject to the Louisiana Motor Vehicle Sales Finance Act.4
(3) For a motor vehicle or recreational product lessor or motor vehicle lessor5
agent:6
(a) To represent and sell as a new vehicle any vehicle which has been used7
or intended to be used and operated for leasing and rental purposes.8
(b) To resort to or use any false or misleading advertising in connection with9
the business of leasing or renting vehicles.10
(c) To lease, rent, sell, or offer to sell a vehicle from a location not licensed11
for such activity.12
(d) To rent or lease any vehicle which has been located within this state for13
a period of thirty days or more, unless such vehicle has been issued a Louisiana14
license plate by, and all license fees and taxes have been paid to, this state.15
(e) To pay a fee to any person in return for the solicitation, procurement, or16
production by that person of prospective lessees of vehicles, unless the person17
receiving the fee is a lease facilitator who holds a valid license as provided by this18
Chapter and a valid appointment from the motor vehicle lessor as provided by R.S.19
32:1266(B)(1). The fees prohibited by this Subparagraph shall not include amounts20
paid to a dealer as part of the consideration for the sale or assignment of a lease or21
leased vehicle or other amounts paid to the dealer who transfers the title on the22
vehicle or assigns the lease contract to the motor vehicle lessor.23
(f) To fail to fully and completely explain each charge listed on a retail24
buyer's or lessee's order or vehicle invoice or leasing agreement prior to the lease of25
a vehicle.26
(g) When leasing a vehicle to a consumer, to assess any consumer services27
fees, which shall include fees for treating the interior upholstery of the vehicle, oil28
changes, roadside assistance, dealer inspections, or any other service offered by the29
motor vehicle lessor, without allowing the consumer to refuse such services and be30 SB NO. 360 ENROLLED
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exempt from payment for such services. The provisions of this Subparagraph shall1
not apply to motor vehicle lessor-added options or accessories which are2
permanently affixed to the vehicle.3
(4) For a lease facilitator:4
(a) To hold himself out to any person as a "leasing company", "leasing5
agent", "lease facilitator", or similar title, directly or indirectly engaged in the6
business of a lease facilitator, or otherwise engaged in the solicitation or procurement7
of prospective lessees for vehicles not titled in the name of and registered to the lease8
facilitator, without holding a valid lease facilitator license and being in compliance9
with the terms of this Chapter.10
(b) To sell or offer to sell a new vehicle.11
(c) To accept a fee from a dealer or consumer.12
(d) To sign a vehicle manufacturer's statement of origin to a vehicle, accept13
an assignment of a manufacturer's statement of origin to a vehicle, or otherwise14
assume any element of title to a new vehicle.15
(e) To procure or solicit prospective lessees for or on behalf of any person16
other than a motor vehicle lessor.17
(f) To act in the capacity of or engage in the business of a lease facilitator18
without a valid appointment from a motor vehicle lessor to act on behalf of the motor19
vehicle lessor in soliciting prospective lease clients or customers as provided by this20
Chapter.21
(5) For a broker:22
(a) To hold himself out to any person as a "broker", "purchasing company",23
"sales agent", or similar title, engaged in the business of broker, or otherwise24
engaged in the solicitation or procurement of prospective purchasers for vehicles not25
titled in the name of and registered to the broker, unless the broker holds a valid26
broker license and is in compliance with the terms of this Chapter.27
(b) To sell, or offer to sell, or display a new vehicle.28
(c) To be paid a fee by a dealer.29
(d) To sign a vehicle manufacturer's statement of origin to a vehicle, accept30 SB NO. 360 ENROLLED
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an assignment of a manufacturer's statement of origin to a vehicle, or otherwise1
assume any element of title to a new vehicle.2
(e) To act in the capacity of or engage in the business of a broker without a3
valid license issued as provided by this Chapter and a valid appointment from a4
motor vehicle lessor to act on behalf of the motor vehicle lessor in soliciting5
prospective lease clients or customers as provided by this Chapter.6
(f) To fail to execute a written brokering agreement and provide a completed7
copy to both of the following:8
(i) Any consumer entering into the brokering agreement. The completed copy9
shall be provided prior to the consumer's signing an agreement for the purchase of10
the vehicle described in the brokering agreement, or, prior to accepting one hundred11
dollars or more from that consumer, whichever comes first.12
(ii) The selling dealer. The completed copy shall be provided prior to the13
selling dealer's entering into a purchase agreement with the consumer at the time of14
delivery.15
(g) To accept a purchase deposit from any consumer that exceeds two point16
five percent of the selling price of the vehicle described in the brokering agreement.17
(h) To fail to refund any purchase money, including purchase deposits, upon18
demand by a consumer at any time prior to the consumer's signing a vehicle purchase19
agreement with a selling dealer of the vehicle described in the brokering agreement.20
(i) To fail to cancel a brokering agreement and refund, upon demand, any21
money paid by a consumer, including any brokerage fee, under any of the following22
circumstances:23
(i) When the final price of the brokered vehicle exceeds the purchase price24
listed in the brokering agreement.25
(ii) When the vehicle delivered is not as described in the brokering26
agreement.27
(iii) When the brokering agreement expires prior to the customer's being28
presented with a purchase agreement from a selling dealer arranged through the29
brokering dealer that contains a purchase price at or below the price listed in the30 SB NO. 360 ENROLLED
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brokering agreement.1
(j) To act as a seller and provide brokering services, both in the same2
transaction.3
(k) To fail to disclose to the consumer the dollar amount of any fee that the4
consumer is obligated to pay to the broker. This arrangement shall be confirmed in5
a brokering agreement.6
(l) To fail to maintain, for a minimum of three years, a copy of the executed7
brokering agreement and other notices and documents related to each brokered8
transaction.9
(m) To fail to advise the consumer, prior to accepting any money, that a full10
refund will be given if the motor vehicle ordered through the broker is not obtained11
for the consumer.12
(6) For any person or other licensee:13
(a)(i) To modify a franchise during the term of the agreement or upon its14
renewal if the modification substantially and adversely affects the franchisee's rights,15
obligations, investment, or return on investment without giving sixty days written16
notice of the proposed modification to the licensee and the commission which17
includes the grounds upon which the modification is based, unless the modification18
is required by law, court order, or the commission. Within the sixty day notice period19
the licensee may file with the commission a complaint for a determination whether20
there is good cause for permitting the proposed modification. The party seeking to21
modify or replace an agreement shall demonstrate by a preponderance of the22
evidence that there is good cause for the modification or replacement. The23
commission shall schedule a hearing within sixty days to decide the matter. Multiple24
complaints pertaining to the same proposed modifications shall be consolidated for25
hearing. The proposed modification may not take effect pending the determination26
of the matter.27
(ii) With respect to recreational products, to modify a franchise during the28
term of the agreement or upon its renewal if the modification substantially and29
adversely affects the franchisee's rights, obligations, investment, or return on30 SB NO. 360 ENROLLED
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investment without giving sixty-day written notice of the proposed modification to1
the licensee and the commission unless the modifications are required by law, court2
order, or the commission. Within the sixty-day notice period the licensee may file3
with the commission a complaint for a determination whether there is good cause for4
permitting the proposed modification. The party seeking to modify or replace an5
agreement shall demonstrate by a preponderance of the evidence that there is good6
cause for the modification or replacement. The commission shall schedule a hearing7
within sixty days to decide the matter. Multiple complaints pertaining to the same8
proposed modifications shall be consolidated for hearing. The proposed modification9
may not take effect pending the determination of the matter.10
(b) In making a determination of whether there is good cause for permitting11
a proposed modification, the commission may consider any relevant factor including:12
(i) The reasons for the proposed modification.13
(ii) Whether the proposed modification is applied to or affects all licensees14
in a nondiscriminating manner.15
(iii) The degree to which the proposed modification will have a substantial16
and adverse effect upon the licensee's investment or return on investment.17
(iv) Whether the proposed modification is in the public interest.18
(v) The degree to which the proposed modification is necessary to the orderly19
and profitable distribution of vehicles and other services by the licensee.20
(vi) Whether the proposed modification is offset by other modifications21
beneficial to the licensee.22
(c) The decision of the commission shall be in writing and shall contain23
findings of fact and a determination of whether there is good cause for permitting the24
proposed modification. The commission shall deliver copies of the decision to the25
parties personally or by registered mail.26
(7) For any employee of a licensee while acting in the scope of his27
employment, to accept any payment, commission, fee, or compensation of any kind28
from any person other than the employing licensee, unless such payment is fully29
disclosed to and approved by the employing licensee.30 SB NO. 360 ENROLLED
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B. The provisions of this Section shall not apply to a dealer,1
manufacturer, distributor, wholesaler, distributor branch, factory branch, or2
convertor of marine products, motorcycles or all-terrain vehicles, or3
recreational vehicles, or any officer, agent, or other representative thereof.4
§1261.1. Indemnification of franchised dealers5
A. Notwithstanding the terms of any franchise agreement, each manufacturer6
or converter shall indemnify and hold harmless its franchised dealers against any7
judgment for damages, including but not limited to court costs and reasonable8
attorney fees of the dealer, arising out of complaints, claims, or lawsuits including9
but not limited to strict liability, negligence, misrepresentation, express or implied10
warranty, or rescission of sale to the extent that the judgment arises out of alleged11
defective or negligent manufacture, assembly, or design of motor vehicles, speciality12
vehicle, recreational product, parts, or accessories, or other functions by the13
manufacturer of converter, which are beyond the control of the dealer.14
B. The provisions of this Section shall not apply to a franchised15
recreational vehicle dealer, marine dealer, or motorcycle or all-terrain vehicle16
dealer.17
* * *18
§1262. Warranty; compensation; audits of dealer records19
* * *20
C. The provisions of this Section shall not apply to a dealer,21
manufacturer, distributor, wholesaler, distributor branch, or factory branch of22
marine products, motorcycles or all-terrain vehicles, or recreational vehicles,23
or any officer, agent, or other representative thereof.24
§1263. Motor vehicle repairs25
A. Suppliers of mechanical repairs and services for any vehicle subject to26
regulation pursuant to this Chapter shall provide each consumer with an itemized bill27
indicating repairs and services performed, parts replaced, or materials used, the total28
labor charge, and the identity of the mechanic, repairman, or supplier who performed29
the work. However, nothing in this Section shall prohibit a supplier of mechanical30 SB NO. 360 ENROLLED
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repairs and services from charging a service fee for the use of shop supplies such as1
rags, fender covers, small amounts of fluid, or other items which are not itemized,2
provided that such fee does not exceed five percent of the total invoice for3
mechanical repairs or thirty-five dollars, whichever is less.4
B. The provisions of this Section shall not apply to suppliers of5
mechanical repairs and services for any recreational vehicle subject to6
regulation of this Chapter.7
§1264. Damage disclosure8
* * *9
D. The provisions of this Section shall not apply to marine products,10
motorcycle or all-terrain vehicles, or recreational vehicles.11
* * *12
§1267. Succession; right of first refusal13
* * *14
C. The provisions of this Section shall not apply to the succession of any15
marine dealer, motorcycle or all-terrain vehicle, or recreational vehicle.16
§1268. Requirements upon termination; penalty; indemnity17
* * *18
D. Notwithstanding any provision of law to the contrary, the provisions19
of this Section shall not apply to a marine dealer, motorcycle or all-terrain20
vehicle dealer, or recreational vehicle dealer.21
* * *22
PART II. PROVISIONS SPECIFIC TO MARINE PRODUCTS23
§1270. Establishment of new marine dealerships or relocations; protests;24
procedure25
A. Whenever the commission receives an application for a recreational26
products dealer's license that would add a new marine dealership, it shall first27
notify the existing licensed marine dealership or dealerships selling the same-28
line makes, models, or classifications if the new dealership's proposed location29
is within the existing dealer's area of responsibility. Any same-line makes,30 SB NO. 360 ENROLLED
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models, or classifications dealership whose area of responsibility includes the1
location of the proposed new marine dealership may object to the granting of2
the license.3
B. Whenever the commission receives an application for a recreational4
products dealer's license which would relocate an existing marine dealership,5
it shall first notify the existing licensed marine dealership or dealerships selling6
the same-line makes, models, or classifications if the dealership's proposed new7
location is within the existing dealer's area of responsibility. The existing same-8
line makes, models, or classifications dealership or dealerships shall have the9
right to object to the granting of the license only if the proposed relocation is10
within a radius of seven miles of its facility. However, without regard to11
distance, whenever the commission receives an application for the relocation of12
a marine dealership which would add an additional marine dealership to an13
existing same-line makes, models, or classifications dealership's area of14
responsibility, the affected dealership shall have the right to object.15
C. The objection shall be in writing and shall be received by the16
commission within a fifteen-day period after receipt of the notice. The fifteen-17
day objection period shall be waived upon written notification to the18
commission from all licensees entitled to object that the licensees have no19
objections to the proposed change or addition for which the notice of intent was20
issued. If a timely objection is lodged, and prior to the issuance of the license,21
the commission shall hold a hearing within thirty days after receipt of the22
objection and issue its decision within ninety days after date of the hearing.23
Notice of hearing and an opportunity to participate therein shall be given to the24
manufacturer or distributor, the applicant for the license as a marine dealer,25
and to the protesting dealership or dealerships.26
D. Whenever the commission receives an objection pursuant to the27
provisions of Subsection A of this Section, or whenever the commission receives28
an objection pursuant to the assignment of the marine dealer's area of principal29
sales and service responsibility, the commission shall consider the following and30 SB NO. 360 ENROLLED
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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 its 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
to sell the marine motor or engine separate from the boat package, and the30 SB NO. 360 ENROLLED
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marine dealer shall not hold itself out to be a full-line or loose marine motor or1
engine dealership.2
§1270.1. Unauthorized acts; marine products3
It shall be a violation of this Part:4
(1) For a manufacturer, a distributor, a wholesaler, distributor branch,5
or factory branch of marine products or any officer, agent, or other6
representative thereof:7
(a) To induce or coerce, or attempt to induce or coerce, any licensee.8
(i) To order or accept delivery of any marine product, appliances,9
equipment, parts or accessories therefor, or any other commodity or10
commodities which shall not have been voluntarily ordered.11
(ii) To order for any person any parts, accessories, equipment,12
machinery, tools, appliances, or any commodity whatsoever.13
(iii) 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 involving a manufacturer, distributor,17
wholesaler, distributor branch or factory branch, or officer, agent, or other18
representative thereof.19
(iv) To enter into a franchise with a licensee or during the franchise20
term, use any written instrument, agreement, release, assignment, novation,21
estoppel, or waiver, to attempt to nullify or modify any provision of this22
Chapter, or to require any controversy between a marine dealer and a23
manufacturer to be referred to any person or entity other than the commission,24
or duly constituted courts of this state or the United States, if such referral25
would be binding upon the dealer. Such instruments are null and void, unless26
done in connection with a settlement agreement to resolve a matter pending a27
commission hearing or pending litigation.28
(v) To waive the right to a jury trial.29
(vi) To participate in an advertising group or to participate monetarily30 SB NO. 360 ENROLLED
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in an advertising campaign or contest or to purchase any promotional1
materials, showroom, or other display decorations or materials at the expense2
of such marine dealer.3
(vii) To adhere to performance standards that are not applied uniformly4
to other similarly situated marine dealers. Any such performance standards5
shall be fair, reasonable, equitable, and based on accurate information. If6
marine dealership performance standards are based on a survey, the7
manufacturer, distributor, wholesaler, distributor branch, or factory branch8
shall establish the objectivity of the survey process and provide this information9
to any marine dealer of the same-line make covered by the survey request. Each10
response to a survey used by a manufacturer in preparing an evaluation or11
performance-rating of a marine dealer shall be made available to that marine12
dealer, or it cannot be used by the manufacturer. However, if a customer13
requests that the manufacturer or distributor not disclose the consumer's14
identity to the dealer, the manufacturer may withhold the consumer's identity15
in providing the survey response to the dealer, and the manufacturer may use16
the response. Any survey used must have the following characteristics:17
(aa) It was designed by experts.18
(bb) The proper universe was examined.19
(cc) A representative sample was chosen.20
(dd) The data was accurately reported.21
(viii) To release, convey, or otherwise provide customer information, if22
to do so is unlawful or if the customer objects in writing. This does not include23
information that is necessary for the manufacturer to meet its obligations to the24
marine dealer or consumers in regard to contractual responsibilities, marine25
product recalls, or other requirements imposed by state or federal law. The26
manufacturer is further prohibited from providing any consumer information27
received from the marine dealer to any unaffiliated third party.28
(ix) To pay the attorney fees of the manufacturer or distributor related29
to hearings and appeals brought under this Chapter.30 SB NO. 360 ENROLLED
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(x) To order or accept delivery of any vehicle with special features,1
appliances, accessories, or equipment not included in the list price of the vehicle2
as publicly advertised.3
(b) To refuse to deliver to any licensee having a franchise or contractual4
arrangement for the retail sale of marine products sold or distributed by such5
manufacturer, distributor, wholesaler, distributor branch or factory branch,6
any marine product, publicly advertised for immediate delivery, within sixty7
days after such marine dealer's order shall have been received.8
(c) To threaten to cancel any franchise existing between such9
manufacturer, distributor, wholesaler, distributor branch or factory branch10
and the marine dealer for any reason.11
(d) To unfairly, without just cause and due regard to the equities of the12
marine dealer, cancel the franchise of the licensee. The nonrenewal of a13
franchise with a marine dealer or his successor without just provocation or14
cause, or the refusal to approve a qualified transferee or qualified successor to15
the dealer-operator as provided for in the selling agreement, shall be deemed16
a violation of this Subparagraph and shall constitute an unfair cancellation,17
regardless of the terms or provisions of such franchise. However, at least ninety18
days notice shall be given to the dealer of a cancellation or nonrenewal of a19
franchise except for a cancellation arising out of fraudulent activity of the20
dealer principal which results in the conviction of a crime punishable by21
imprisonment.22
(e) To refuse to extend to a licensee the privilege of determining the mode23
or manner of available transportation facility that such marine dealer desires24
to be used or employed in making deliveries of marine products to him or it.25
(f) To ship or sell marine products to a licensee prior to the licensee26
having been granted a license by the commission to sell such products.27
(g) To unreasonably withhold consent to the sale, transfer, or exchange28
of the dealership to a qualified transferee capable of being licensed as a marine29
dealer in this state, provided the transferee meets the criteria generally applied30 SB NO. 360 ENROLLED
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by the manufacturer in approving new marine dealers and agrees to be bound1
by all the terms and conditions of the standard franchises.2
(h) To fail to respond in writing to a written request for consent as3
specified in Subparagraph (g) of this Paragraph within sixty days of receipt of4
a written request on the forms, if any, generally utilized by the manufacturer5
or distributor for such purposes and containing the information required6
therein. Failure to respond shall be deemed to be consent to the request.7
(i)(i) To sell or offer to sell a new or unused marine product directly to8
a consumer except as provided in this Chapter, or to compete with a licensee in9
the same-line makes, models, or classifications operating under an agreement10
from the aforementioned manufacturer. A manufacturer shall not, however, be11
deemed to be competing when any one of the following conditions are met:12
(aa) Operating a marine dealership temporarily for a reasonable period,13
not to exceed two years.14
(bb) Operating a bona fide retail marine dealership that is for sale to any15
qualified independent person at a fair and reasonable price, not to exceed two16
years.17
(cc) Operating in a bona fide relationship in which a person independent18
of a manufacturer has made a significant investment subject to loss in the19
marine dealership, and can reasonably expect to acquire full ownership of such20
dealership on reasonable terms and conditions.21
(ii) After any of the conditions have been met under Subitems (i)(aa) and22
(bb) of this Subparagraph, the commission shall allow the manufacturer to23
compete with licensees of the same-line makes, models, or classifications under24
an agreement from the manufacturer for longer than two years when, in the25
discretion of the commission, the best interest of the manufacturer, consuming26
public, and licensees are best served.27
(j) To fail to compensate its marine dealers for the work and services28
they are required to perform in connection with the marine dealer's delivery29
and preparation obligations according to the terms of compensation that shall30 SB NO. 360 ENROLLED
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be filed with the commission on or before October first of each year. The1
commission shall find the compensation to be reasonable or the manufacturer2
shall remedy any deficiencies.3
(k) To fail to designate and provide to the commission in writing the4
community or territory assigned to a licensee.5
(l) To unreasonably discriminate among competing, similarly situated,6
same-line make dealers in the sales of the marine products, in the availability7
of such marine products, in the terms of incentive programs or sales promotion8
plans, or in other similar programs.9
(m) To use any subsidiary, affiliate, or any other controlled person or10
entity, or to employ the services of a third party, to accomplish what would11
otherwise be illegal conduct under this Chapter on the part of the manufacturer12
or distributor.13
(n) To make a change in the area of responsibility described in the14
franchise or sales and service agreement of a dealer, without the manufacturer15
or distributor giving the marine dealer and the commission no less than sixty16
days prior written notice by certified or registered mail.17
(2) For a marine dealer, used marine product dealer, marine product18
salesman:19
(a) To require a purchaser of a marine product, as a condition of sale20
and delivery thereof, to also purchase special features, appliances, accessories,21
or equipment not desired or requested by the purchaser; however, this22
prohibition shall not apply as to special features, appliances, accessories, or23
equipment which are permanently affixed to the marine product.24
(b) To represent and sell as a new marine product any marine product,25
the legal title of which has been transferred by a manufacturer, distributor, or26
dealer to an ultimate purchaser.27
(c) To use any false or misleading advertisement in connection with his28
business as such marine dealer or marine product salesman.29
(d) To sell or offer to sell makes, models, or classifications of new marine30 SB NO. 360 ENROLLED
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products for which no franchise and license to sell is held.1
(e) Except as otherwise approved by the commission, to sell or offer to2
sell a marine product from an unlicensed location.3
(f) To deliver to a prospective purchaser a new or a used marine product4
on a sale conditioned on financing, i.e., a spot delivery, except on the following5
terms and conditions which shall be in writing and shall be a part of the6
conditional sales contract or other written notification signed by the purchaser:7
(i) That if the sale is not concluded by the financing of the sale to the8
purchaser within twenty-five days of the delivery, the sale contract shall be null9
and void.10
(ii) That the marine product being offered for trade-in by the purchaser11
shall not be sold by the marine dealer until the conditional sale is complete.12
(iii) That there shall be no charge to the purchaser should the conditional13
sale not be completed, including but not limited to mileage charges or charges14
to refurbish the marine product offered for trade-in. However, the purchaser15
shall be responsible for any and all damages to the marine product or other16
marine products damaged by the fault of the purchaser and any and all liability17
incurred by the purchaser during the purchaser's custody of the marine18
product to the extent provided for in R.S. 22:1296.19
(iv) That if the conditional sale is not completed, the marine dealer shall20
immediately refund to the purchaser upon return of the marine product all21
sums placed with the dealership as a deposit or any other purpose associated22
with the attempted sale of the marine product.23
(v) That the prospective purchaser shall return the marine product to the24
dealership within forty-eight hours of notification by the marine dealer that the25
conditional sale will not be completed. If the prospective purchaser does not26
return the marine product to the dealership within forty-eight hours of27
notification by the marine dealer, an authorized agent of the marine dealer shall28
have the right to recover the marine product without the necessity of judicial29
process, provided that such recovery can be accomplished without unauthorized30 SB NO. 360 ENROLLED
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entry into a closed dwelling, whether locked or unlocked and without a breach1
of peace.2
(g) To pay a fee to any person in return for the solicitation, procurement,3
or production by that person of prospective purchasers for new and used4
marine products, except to a salesman licensed under the provisions of this5
Chapter.6
(h) To fail to fully and completely explain each charge listed on a retail7
buyer's order or marine product invoice prior to the purchase of a marine8
product.9
(i) When selling a marine product to a consumer, to assess any consumer10
services fees, which shall include fees for treating the interior upholstery of the11
marine product, oil changes, roadside assistance, dealer inspections, or any12
other service offered by the dealer, without allowing the buyer to refuse such13
services and be exempt from payment for such services. The provisions of this14
Subparagraph shall not apply to dealer-added options or accessories which are15
permanently affixed to the marine product.16
(3)(a) For any person or other licensee to modify a franchise during the17
term of the agreement or upon its renewal if the modification substantially and18
adversely affects the dealer's rights, obligations, investment, or return on19
investment without giving a sixty-day written notice of the proposed20
modification to the licensee and the commission unless the modifications are21
required by law, court order, or the commission. Within the sixty-day notice22
period, the licensee may file with the commission a complaint for a23
determination whether there is good cause for permitting the proposed24
modification. The party seeking to modify or replace an agreement shall25
demonstrate by a preponderance of the evidence that there is good cause for the26
modification or replacement. The commission shall schedule a hearing within27
sixty days to decide the matter. Multiple complaints pertaining to the same28
proposed modifications shall be consolidated for hearing. The proposed29
modification may not take effect pending the determination of the matter.30 SB NO. 360 ENROLLED
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(b) In making a determination of whether there is good cause for1
permitting a proposed modification, the commission may consider any relevant2
factor including:3
(i) The reasons for the proposed modification.4
(ii) Whether the proposed modification is applied to or affects all5
licensees in a nondiscriminating manner.6
(iii) The degree to which the proposed modification will have a7
substantial and adverse effect upon the licensee's investment or return on8
investment.9
(iv) Whether the proposed modification is in the public interest.10
(v) The degree to which the proposed modification is necessary to the11
orderly and profitable distribution of marine products and other services by the12
licensee.13
(vi) Whether the proposed modification is offset by other modifications14
beneficial to the licensee.15
(c) The decision of the commission shall be in writing and shall contain16
findings of fact and a determination of whether there is good cause for17
permitting the proposed modification. The commission shall deliver copies of18
the decision to the parties personally or by registered mail.19
(4) For any employee of a licensee while acting in the scope of his20
employment, to accept any payment, commission, fee, or compensation of any21
kind from any person other than the employing licensee, unless such payment22
is fully disclosed to and approved by the employing licensee.23
§1270.2. Warranty; compensation; audits of marine dealer records24
A.(1) It shall be a violation of this Chapter for a manufacturer,25
distributor, wholesaler, distributor branch, or factory branch of marine26
products or any officer, agent or other representative thereof to fail to27
adequately and fairly compensate its marine dealer for labor, parts, and other28
expenses incurred by such dealer to perform under and comply with a29
manufacturer's or a distributor's warranty agreement.30 SB NO. 360 ENROLLED
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(2) In no event shall any manufacturer or distributor pay its marine1
dealer at a price or rate for warranty work that is less than that charged by the2
marine dealer to the retail customers of the marine dealer for nonwarranty3
work of like kind.4
(3) Warranty work includes parts and labor performed.5
(4) All claims made by the marine dealer for compensation under this6
Subsection shall be paid within thirty days after approval and shall be approved7
or denied within thirty days after receipt. When any claim is denied, the marine8
dealer shall be notified in writing of the grounds for denial.9
(5) The obligations set forth in this Subsection may be modified by10
contract.11
B.(1) Notwithstanding the terms of any franchise, warranty and sales,12
incentive, audits of marine dealer records may be conducted by the13
manufacturer, distributor, distributor branch, or factory branch. Any audit for14
warranty parts or service compensation shall be for the twelve-month period15
immediately following the date of the payment of the claim by the manufacturer16
or distributor. However, a marine dealer shall not be held liable by virtue of an17
audit for failure to retain parts for a period in excess of six months. Any audit18
for sales incentives, service incentives, rebates, or other forms of incentive19
compensation shall be only for the twelve-month period immediately following20
the date of the final payment to the marine dealer under a promotion, event,21
program, or activity. In no event shall the manufacturer, distributor,22
distributor branch, or factory branch fail to allow the marine dealer to make23
corrections to the sales data in less than one hundred twenty days from the24
program period. Additionally, no penalty other than amounts advanced on a25
marine product reported incorrectly shall be due in connection with the audit.26
With respect to marine products sold during the time period subject to the27
audit, but submitted incorrectly to the manufacturer, distributor, or wholesale28
distributor branch or factory branch, the marine dealer shall be charged back29
for the amount reported incorrectly and credited with the amount due, if30 SB NO. 360 ENROLLED
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anything, on the actual sale date.1
(2) No claim which has been approved and paid may be charged back to2
the marine dealer unless it can be shown that one of the following applies:3
(a) The claim was false or fraudulent.4
(b) The repairs were not properly made.5
(c) The repairs were unnecessary to correct the defective condition under6
generally accepted standards of workmanship.7
(d) The marine dealer failed to reasonably substantiate the repair in8
accordance with reasonable written requirements of the manufacturer or9
distributor, if the marine dealer was notified of the requirements prior to the10
time the claim arose and if the requirements were in effect at the time the claim11
arose.12
(3) A manufacturer or distributor shall not deny a claim solely based on13
a marine dealer's incidental failure to comply with a specific claim processing14
requirement, or a clerical error, or other 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
marine dealer more frequently than two sales-related and two service-related22
audits in a twelve-month period. Nothing in this Subsection shall limit a23
manufacturer's or distributor's ability to perform routine claim reviews in the24
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
§1270.3. Sale of water-damaged marine products28
A. No person shall sell, transfer, or convey any new or used marine29
product to any person without notifying the buyer or receiver of the marine30 SB NO. 360 ENROLLED
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product in writing of the extent of any water damage from flooding which1
occurred to the marine product prior to the transaction.2
B. If a sale, transfer, or conveyance of a new or used marine product3
occurs in violation of Subsection A of this Section, the person receiving4
ownership and title to the marine product who is not otherwise aware of the5
damage at the time of the transaction may bring an action to set aside the6
transaction within one year from the date of the transaction and receive all7
monies or other property given as consideration for the marine product less a8
reasonable assessment for wear and tear.9
C. For the purposes of this Section, a "water-damaged marine product"10
means any marine product whose power train, computer, or electrical system11
has been damaged by flooding.12
§1270.4. Succession; right of first refusal; marine dealers13
A. The terms of the franchise notwithstanding, any marine dealer may14
appoint by will, or other written instrument, a designated successor to succeed15
in the ownership interest of the marine dealer in the marine dealership upon the16
death or incapacity of the marine dealer.17
B. Unless good cause exists for refusal to honor the succession on the18
part of the manufacturer or distributor, any designated successor of a deceased19
or incapacitated marine dealer of a marine dealership may succeed to the20
ownership of the marine dealership under the existing franchise if:21
(1) The designated successor gives the manufacturer or distributor22
written notice of his intention to succeed to the ownership of the marine dealer23
within sixty days of the marine dealer's death or incapacity.24
(2) The designated successor agrees to be bound by all the terms and25
conditions of the franchise.26
C. The manufacturer or distributor may request, and the designated27
successor shall provide, promptly upon such request, personal and financial28
data reasonably necessary to determine whether the succession should be29
honored.30 SB NO. 360 ENROLLED
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D. If a manufacturer or distributor believes that good cause exists for1
refusing to honor the succession of a deceased or incapacitated marine dealer,2
the manufacturer or distributor may, not more than sixty days following receipt3
of notice of the designated successor's intent to succeed and receipt of such4
personal or financial data, serve upon the designated successor notice of its5
refusal to honor the succession and of its intent to discontinue the existing6
franchise with the marine dealer not earlier than six months from the date such7
notice is served.8
E. The notice must state the specific grounds for the refusal to honor the9
succession.10
F. If notice of refusal and discontinuance is not timely served upon the11
designated successor, the franchise shall continue in effect subject to12
termination only as otherwise permitted by this Part.13
G. In determining whether good cause for the refusal to honor the14
succession exists, the manufacturer or distributor has the burden of proving15
that the designated successor is not of good moral character or does not16
otherwise meet the manufacturer's or distributor's reasonable standards as a17
marine dealer.18
H. If a manufacturer or distributor refuses to honor the succession to19
the ownership interest of a deceased or incapacitated owner for good cause, then20
and in such event the manufacturer or distributor shall allow the designated21
successor a reasonable period of time which shall not be less than six months in22
which to consummate a sale of the marine dealership. Any such sale shall be23
subject to R.S. 32:1270.1(2)(d).24
§1270.5. Manufacturer, distributor, or wholesaler repurchase; marine dealer;25
products26
A. If any marine dealer enters into a franchise with a manufacturer,27
distributor, or wholesaler wherein the marine dealer agrees to maintain an28
inventory of marine products or repair parts, the manufacturer, distributor, or29
wholesaler shall not terminate or fail to renew such franchise unless there is a30 SB NO. 360 ENROLLED
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breach of the franchise by the marine dealer and until ninety days after notice1
of such intention to terminate, including the breach of the franchise, has been2
sent by certified mail, return receipt requested, or commercial delivery service3
with verification of receipt, to the marine dealer and the marine dealer has4
failed to correct the breach within such period.5
B. If the franchise is terminated as a result of any action by the marine6
dealer and the manufacturer, distributor, or wholesaler has not given due cause,7
as provided in this Section, for termination of such franchise, the manufacturer,8
distributor, or wholesaler shall not be required to repurchase the inventory as9
provided in this Section; however, if the franchise is terminated as a result of10
any action by the marine dealer and the manufacturer, distributor, or11
wholesaler has given the marine dealer due cause, as provided in this Section,12
to terminate the franchise, the manufacturer, distributor, or wholesaler shall13
be required to repurchase that inventory previously purchased from them,14
including any new and unused marine products of the current and immediate15
prior model or program year and new and unused parts inventory as provided16
in this Section.17
C. It shall be unlawful for the manufacturer, wholesaler, or distributor,18
without due cause and pursuant to its own initiating action, to terminate or fail19
to renew a franchise, unless the manufacturer, wholesaler, or distributor20
repurchases the new and unused inventory as provided for in this Section.21
D. It shall not be unlawful for the marine dealer with due cause and22
pursuant to the marine dealer's own initiating action to terminate or fail to23
renew a franchise with a manufacturer, wholesaler, or distributor, and the24
manufacturer, wholesaler, or distributor shall repurchase inventory as provided25
by this Section. To determine what constitutes due cause for a marine dealer to26
terminate or fail to renew a franchise, the following factors regarding the27
manufacturer, wholesaler, distributor or representative of one of the so named28
shall include whether the manufacturer, wholesaler, distributor, or one of the29
so named:30 SB NO. 360 ENROLLED
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(1) Has made a material misrepresentation in accepting or acting under1
the franchise.2
(2) Has engaged in an unfair business practice.3
(3) Has engaged in conduct which is injurious or detrimental to public4
welfare.5
(4) Has failed to comply with any applicable Section of this Chapter.6
(5) Has been convicted of a crime, the effect of which would be7
detrimental to the marine dealership or dealer.8
(6) Has violated the Louisiana marine dealers area of responsibility.9
(7) Has failed to operate in the normal course of business for thirty10
consecutive days.11
(8) Has failed to comply with the terms of the franchise with the marine12
dealer.13
(9) Has materially misrepresented the performance or fitness for sale or14
use of a product line or products covered by the franchise.15
E. If a manufacturer, distributor, or wholesaler does not intend to renew16
a franchise, the manufacturer, distributor, or wholesaler shall give the marine17
dealer ninety days written notice prior to the effective date by certified mail,18
return receipt requested, or commercial delivery service with verification of19
receipt.20
F. As required by this Section, the manufacturer, distributor, or21
wholesaler shall repurchase the inventory which can be verified as previously22
purchased from them, including all new and unused marine products of the23
current and immediate prior model or program year and new and unused parts24
on hand and held by the marine dealer on the date of termination of the25
contract. The manufacturer, distributor, or wholesaler shall pay an amount26
equivalent to the cost actually paid by the marine dealer, including discounts27
given and rebates paid per unit for any new, unused, undamaged, and unaltered28
from original invoice and delivery, and complete marine product. The29
manufacturer, distributor, or wholesaler shall also pay an amount equal to the30 SB NO. 360 ENROLLED
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price paid by the marine dealer for any new, unused, and undamaged repair1
parts and accessories which are listed in the manufacturer's, distributor's, or2
wholesaler's prevailing parts list or were delivered in the past forty-eight3
months and are in their original packaging.4
G. The provisions of this Section shall not require the repurchase from5
a marine dealer of:6
(1) Any repair part which has a limited storage life or is otherwise7
subject to deterioration.8
(2) Any single repair part which is priced and packaged as a set of two9
or more items.10
(3) Any repair part which, because of its condition, is not resalable as a11
new part without repackaging or reconditioning.12
(4) Any inventory for which the marine dealer cannot provide good title,13
free and clear of all claims, liens, and encumbrances.14
(5) Any inventory which the marine dealer desires to keep, provided that15
the marine dealer has a contractual right to do so.16
(6) Any marine product which is not in new, unused, undamaged, and17
complete condition.18
(7) Any repair parts which are not in new, unused, and undamaged19
condition.20
(8) Any inventory which was ordered by the marine dealer on or after21
the date of receipt of the notification of termination of the franchise.22
(9) Any inventory which was acquired by the marine dealer from any23
source other than the manufacturer, distributor, or wholesaler, or its immediate24
predecessor.25
(10) Any marine product that has been altered substantially from26
original delivery.27
H. Upon termination of the franchise, the marine dealer shall submit a28
final inventory of marine products and parts on hand to the manufacturer,29
distributor, or wholesaler by certified mail, return receipt requested, or30 SB NO. 360 ENROLLED
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commercial delivery service with verification of receipt. If a manufacturer,1
distributor, or wholesaler fails or refuses to repurchase as required by this2
Section within thirty days of the receipt of the inventory, without just cause, the3
manufacturer, distributor, or wholesaler shall be subjected to a penalty of the4
marine dealer's reasonable attorney fees, court costs, and interest on the5
inventory value of returnable marine products and parts required to be6
purchased computed at the rate of one and one-half percent per month from the7
thirty-first day, as long as such repurchase is not made.8
I. Notwithstanding any other provision of law to the contrary, it shall be9
unlawful for a manufacturer, distributor, or wholesaler, either by contract or10
practice, to assess repurchase or restocking charges, freight charges except for11
return charges, reimbursement of interest charges paid, and any similar12
charges to the marine dealer.13
J. If a marine dealer completes a bona fide, orderly, and permanent14
closure of the marine dealership, which does not involve a sale of the dealership,15
and provides at least ninety days notice to the manufacturer, wholesaler, or16
distributor, the marine products and parts inventory shall be repurchased by17
the manufacturer, wholesaler, or distributor in the manner provided for in this18
Section, when a franchise is terminated as result of action by the manufacturer,19
wholesaler, or distributor.20
K. In the event of the death or incapacity of the marine dealer or the21
majority owner of a person operating as a marine dealer, the manufacturer,22
distributor, or wholesaler shall, at the option of the heirs, if the marine dealer23
died intestate, or the legatees or transferees under the terms of the deceased24
marine dealer's last will and testament if the marine dealer died testate,25
repurchase the inventory from the heirs, legatees, or transferees as if the26
manufacturer, distributor, or wholesaler had terminated the contract, and the27
inventory repurchase provisions of this Section shall apply. The heirs or legatees28
shall have until the end of the contract term or one year from the date of the29
death of the marine dealer or majority owner of a person, whichever comes30 SB NO. 360 ENROLLED
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first, to exercise their option pursuant to this Section. However, nothing in this1
Section shall require the repurchase of inventory if the heirs, legatees, or2
transferees and the manufacturer, distributor, or wholesaler enter into a new3
franchise to operate the marine dealership.4
§1270.6. Manufacturer termination of line-make; manufacturer bankruptcy;5
license6
Notwithstanding the terms of any franchise or provision of law, if the7
termination, cancellation, or nonrenewal of a licensee's selling agreement is the8
result of the termination, elimination, or cessation of a line-make by the9
manufacturer, distributor, or factory branch, whether by bankruptcy or10
otherwise, the license issued by the commission may remain in effect at the11
discretion of the commission pursuant to its rules.12
§1270.7. Indemnification of marine dealers13
Notwithstanding the terms of any franchise agreement, each14
manufacturer or converter shall indemnify and hold harmless its franchised15
marine dealers against any judgment for damages, including but not limited to16
court costs and reasonable attorney fees of the marine dealer, arising out of17
complaints, claims, or lawsuits including but not limited to strict liability,18
negligence, misrepresentation, express or implied warranty, or rescission of sale19
to the extent that the judgment arises out of alleged defective or negligent20
manufacture, assembly, or design of marine products, parts, or accessories, or21
other functions by the manufacturer or converter, which are beyond the control22
of the marine dealer.23
§1270.8. Marine products repairs24
Suppliers of mechanical repairs and services for any marine product25
subject to regulation pursuant to this Part shall provide each consumer with an26
itemized bill indicating repairs and services performed, parts replaced, or27
materials used, the total labor charge, and the identity of the mechanic,28
repairman, or supplier who performed the work. However, nothing in this29
Section shall prohibit a supplier of mechanical repairs and services from30 SB NO. 360 ENROLLED
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charging a service fee for the use of shop supplies such as rags, fender covers,1
small amounts of fluid, or other items which are not itemized, provided that2
such fee does not exceed five percent of the total invoice for mechanical repairs3
or thirty-five dollars, whichever is less.4
§1270.9. Damage disclosure5
A. Whenever a new marine product subject to regulation pursuant to6
this Chapter is sold to any person, the seller shall notify the purchaser of any7
body damage or mechanical damage which the marine product has sustained8
that exceeds six percent of the manufacturer's suggested retail price. Such9
notice shall be in writing and a copy thereof shall be delivered to the purchaser10
prior to or simultaneous with transfer of the vehicle title.11
B. This Section shall apply to all instances of vehicular body or12
mechanical damage to marine products and to all actions involving such13
damage, notwithstanding the application of other codal, statutory, or regulatory14
provisions, including but not limited to Civil Code Articles 2520 et seq.15
PART III. PROVISIONS SPECIFIC TO MOTORCYCLES AND16
ALL-TERRAIN VEHICLES17
§1270.10. Establishment of new motorcycle or all-terrain vehicle dealerships or18
relocations; protests; procedure19
A. Whenever the commission receives an application for a recreational20
products dealer's license which would add a new motorcycle or all-terrain21
vehicle dealership, it shall first notify the existing licensed motorcycle or all-22
terrain vehicle dealership or dealerships selling the same-line makes, models,23
or classifications if the new dealership's proposed location is within the existing24
dealer's area of responsibility. Any same-line makes, models, or classifications25
dealership whose area of responsibility includes the location of the proposed26
new motorcycle or all-terrain vehicle dealership may object to the granting of27
the license.28
B. Whenever the commission receives an application for a recreation29
products dealer's license which would relocate an existing motorcycle or all-30 SB NO. 360 ENROLLED
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terrain vehicle dealership, it shall first notify any existing licensed motorcycle1
or all-terrain vehicle dealership selling the same-line makes, models, or2
classifications if the dealership's proposed new location is within the existing3
dealer's area of responsibility. Any existing same-line makes, models, or4
classifications dealership shall have the right to object to the granting of the5
license only if the proposed relocation is within a radius of seven miles of its6
facility. However, without regard to distance, whenever the commission receives7
an application for the relocation of a motorcycle or all-terrain vehicle8
dealership which would add an additional franchise to an existing same-line9
makes, models, or classifications dealership's area of responsibility, the affected10
motorcycle or all-terrain vehicle dealership shall have the right to object.11
C. The objection shall be in writing and shall be received by the12
commission within a fifteen-day period after receipt of the notice. The fifteen-13
day objection period shall be waived upon written notification to the14
commission from all licensees entitled to object that the licensees have no15
objections to the proposed change or addition for which the notice of intent was16
issued. If timely objection is lodged, and prior to the issuance of the license, the17
commission shall hold a hearing within thirty days after receipt of the objection18
and issue its decision within ninety days after date of the hearing. Notice of19
hearing and an opportunity to participate therein shall be given to the20
manufacturer or distributor, the applicant for the license as a motorcycle or all-21
terrain vehicle dealer, and to the protesting motorcycle or all-terrain vehicle22
dealership or dealerships.23
D. Whenever the commission receives an objection pursuant to the24
provisions of Subsection A of this Section, the commission shall consider the25
following and may consider any other relevant factors in determining whether26
there is good cause to issue a license:27
(1) Whether the community or territory can support an additional28
motorcycle or all-terrain vehicle dealership.29
(2) The financial impact on both the applicant and the existing30 SB NO. 360 ENROLLED
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words in boldface type and underscored are additions.
motorcycle or all-terrain vehicle dealership or dealerships.1
(3) Whether the existing motorcycle or all-terrain vehicle dealerships of2
the same-line makes, models, or classifications in the dealership's area of3
responsibility are providing adequate representation, competition, and4
convenient consumer care for the motorcycle or all-terrain vehicles of the same-5
line makes, models, or classifications located within that area.6
(4) Whether the issuance of the license would increase competition, or be7
in the public interest, or both.8
§1270.11. Unauthorized acts9
It shall be a violation of this Part:10
(1) For a manufacturer, distributor, wholesaler, distributor branch,11
factory branch, converter or officer, agent, or other representative thereof:12
(a) To induce or coerce, or attempt to induce or coerce, any licensee:13
(i) To order or accept delivery of any motorcycle or all-terrain vehicle,14
appliances, equipment, parts or accessories therefor, or any other commodity15
or commodities which shall not have been voluntarily ordered.16
(ii) To order or accept delivery of any motorcycle or all-terrain vehicle17
with special features, appliances, accessories, or equipment not included in the18
list price of the vehicle as publicly advertised.19
(iii) To order for any person any parts, accessories, equipment,20
machinery, tools, appliances, or any commodity whatsoever.21
(iv) To assent to a release, assignment, novation, waiver, or estoppel22
which would relieve any person from liability to be imposed by law, unless done23
in connection with a settlement agreement to resolve a matter pending a24
commission hearing or pending litigation between a manufacturer, distributor,25
wholesaler, distributor branch or factory branch, or officer, agent, or other26
representative thereof.27
(v) To enter into a franchise with a licensee or during the franchise term,28
use any written instrument, agreement, release, assignment, novation, estoppel,29
or waiver, to attempt to nullify or modify any provision of this Chapter, or to30 SB NO. 360 ENROLLED
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require any controversy between a dealer and a manufacturer to be referred to1
any person or entity other than the commission, or duly constituted courts of2
this state or the United States, if such referral would be binding upon the3
motorcycle or all-terrain vehicle dealer. Such instruments are null and void,4
unless done in connection with a settlement agreement to resolve a matter5
pending a commission hearing or pending litigation.6
(vi) To waive the right to a jury trial.7
(vii) To release, convey, or otherwise provide customer information, if8
to do so is unlawful or if the customer objects in writing. This does not include9
information that is necessary for the manufacturer to meet its obligations to the10
motorcycle or all-terrain vehicle dealer or consumers in regard to contractual11
responsibilities, motorcycle or all-terrain vehicle recalls, or other requirements12
imposed by state or federal law. The manufacturer is further prohibited from13
providing any consumer information received from the motorcycle or all-14
terrain vehicle dealer to any unaffiliated third party.15
(viii) To pay the attorney fees of the manufacturer or distributor related16
to hearings and appeals brought under this Chapter.17
(b) To threaten to cancel any franchise or any contractual agreement18
existing between such manufacturer, distributor, wholesaler, distributor branch19
or factory branch and the motorcycle or all-terrain vehicle dealer for any20
reason.21
(c) To unfairly, without just cause and due regard to the equities of the22
motorcycle or all-terrain vehicle dealer, cancel the franchise of the licensee. The23
nonrenewal of a franchise with such dealer or his successor without just24
provocation or cause, or the refusal to approve a qualified transferee or25
qualified successor to the dealer-operator as provided for in the franchise shall26
be deemed a violation of this Subparagraph and shall constitute an unfair27
cancellation, regardless of the terms or provisions of such franchise. However,28
at least ninety days notice shall be given to the dealer of a cancellation or29
nonrenewal of franchise except for a cancellation arising out of fraudulent30 SB NO. 360 ENROLLED
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activity of the dealer principal which results in the conviction of a crime1
punishable by imprisonment.2
(d) To refuse to extend to a licensee the privilege of determining the3
mode or manner of available transportation facility that the motorcycle or all-4
terrain vehicle dealer desires to be used or employed in making deliveries of5
motorcycles or all-terrain vehicles to him or it.6
(e) To ship or sell motorcycles or all-terrain vehicles to a licensee prior7
to the licensee having been granted a license by the commission to sell8
motorcycles or all-terrain vehicles.9
(f) To unreasonably withhold consent to the sale, transfer, or exchange10
of the franchise to a qualified transferee capable of being licensed as a11
motorcycle or all-terrain vehicle dealer in this state, provided the transferee12
meets the criteria generally applied by the manufacturer in approving new13
motorcycle or all-terrain vehicle dealers and agrees to be bound by all the terms14
and conditions of the standard franchises.15
(g) To fail to respond in writing to a written request for consent as16
specified in Subparagraph (f) of this Paragraph within sixty days of receipt of17
a written request on the forms, if any, generally utilized by the manufacturer18
or distributor for such purposes and containing the information required19
therein. Failure to respond shall be deemed to be consent to the request.20
(h)(i) To sell or offer to sell a new or unused motorcycle or all-terrain21
vehicle directly to a consumer except as provided in this Chapter, or to compete22
with a licensee in the same-line makes, models, or classifications operating23
under an agreement or franchise from the aforementioned manufacturer. A24
manufacturer shall not, however, be deemed to be competing when any one of25
the following conditions are met:26
(aa) Operating a motorcycle or all-terrain vehicle dealership temporarily27
for a reasonable period, not to exceed two years.28
(bb) Operating a bona fide retail dealership which is for sale to any29
qualified independent person at a fair and reasonable price, not to exceed two30 SB NO. 360 ENROLLED
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years.1
(cc) Operating in a bona fide relationship in which a person independent2
of a manufacturer has made a significant investment subject to loss in the3
dealership, and can reasonably expect to acquire full ownership of such4
dealership on reasonable terms and conditions.5
(ii) After any of the conditions have been met under Subitems (i)(aa) and6
(bb) of this Subparagraph, the commission shall allow the manufacturer to7
compete with licensees of the same-line makes, models, or classifications under8
an agreement or franchise from the manufacturer for longer than two years9
when, in the discretion of the commission, the best interest of the manufacturer,10
consuming public, and licensees are best served.11
(i) To fail to compensate its motorcycle or all-terrain vehicle dealers for12
the work and services they are required to perform in connection with the13
motorcycle or all-terrain vehicle dealer's delivery and preparation obligations14
according to the terms of compensation that shall be filed with the commission15
on or before October first of each year. The commission shall find the16
compensation to be reasonable or the manufacturer shall remedy any17
deficiencies.18
(j) To fail to designate and provide to the commission in writing the19
community or territory assigned to a licensee.20
(k) To unreasonably discriminate among competing, similarly situated,21
same-line make dealers in the sales of motorcycles or all-terrain vehicles, in the22
availability of motorcycles or all-terrain vehicles, in the terms of incentive23
programs or sales promotion plans, or in other similar programs.24
(l) To use any subsidiary, affiliate, or any other controlled person or25
entity, or to employ the services of a third party, to accomplish what would26
otherwise be illegal conduct under this Chapter on the part of the manufacturer27
or distributor.28
(m) To make a change in the area of responsibility described in the29
franchise agreement or sales and service agreement of a motorcycle or all-30 SB NO. 360 ENROLLED
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terrain vehicle dealer, without the franchisor, converter, or manufacturer1
giving the motorcycle or all-terrain vehicle dealer and the commission no less2
than sixty days prior written notice by certified or registered mail.3
(n) To refuse to deliver to any licensee having a franchise or contractual4
arrangement for the retail sale of motorcycles or all-terrain vehicles sold or5
distributed by such manufacturer, distributor, wholesaler, distributor branch6
or factory branch, any motorcycle or all-terrain vehicle, publicly advertised for7
immediate delivery, within sixty days after such dealer's order shall have been8
received.9
(2) For a motorcycle or all-terrain vehicle dealer, used motorcycle or all-10
terrain vehicle dealer, or a motorcycle or all-terrain vehicle salesman:11
(a) To require a purchaser of a motorcycle or all-terrain vehicle, as a12
condition of sale and delivery thereof, to also purchase special features,13
appliances, accessories, or equipment not desired or requested by the14
purchaser; however, this prohibition shall not apply as to special features,15
appliances, accessories, or equipment which are permanently affixed to the16
motorcycle or all-terrain vehicle.17
(b) To represent and sell as a new motorcycle or all-terrain vehicle any18
motorcycle or all-terrain vehicle, the legal title of which has been transferred19
by a manufacturer, distributor, or dealer to an ultimate purchaser.20
(c) To use any false or misleading advertisement in connection with his21
business as a motorcycle or all-terrain vehicle dealer or motorcycle or all-22
terrain vehicle salesman.23
(d) To sell or offer to sell makes, models, or classifications of new24
motorcycles or all-terrain vehicles for which no franchise and license to sell is25
held.26
(e) Except as otherwise approved by the commission, to sell or offer to27
sell a motorcycle or all-terrain vehicle from an unlicensed location.28
(f) To deliver to a prospective purchaser a new or a used motorcycle or29
all-terrain vehicle on a sale conditioned on financing, i.e., a spot delivery, except30 SB NO. 360 ENROLLED
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on the following terms and conditions which shall be in writing and shall be a1
part of the conditional sales contract or other written notification signed by the2
purchaser:3
(i) That if the sale is not concluded by the financing of the sale to the4
purchaser within twenty-five days of the delivery, the sale contract shall be null5
and void.6
(ii) That the motorcycle or all-terrain vehicle being offered for trade-in7
by the purchaser shall not be sold by the motorcycle or all-terrain vehicle dealer8
until the conditional sale is complete.9
(iii) That there shall be no charge to the purchaser should the conditional10
sale not be completed, including but not limited to mileage charges or charges11
to refurbish the motorcycle or all-terrain vehicle offered for trade-in. However,12
the purchaser shall be responsible for any and all damages to the motorcycle or13
all-terrain vehicle or other motorcycles or all-terrain vehicles damaged by the14
fault of the purchaser and any and all liability incurred by the purchaser during15
the purchaser's custody of the vehicle to the extent provided for in R.S. 22:1296.16
(iv) That if the conditional sale is not completed, the motorcycle or all-17
terrain vehicle dealer shall immediately refund to the purchaser upon return18
of the motorcycle or all-terrain vehicle all sums placed with the dealership as19
a deposit or any other purpose associated with the attempted sale of the20
motorcycle or all-terrain vehicle.21
(v) That the prospective purchaser shall return the motorcycle or all-22
terrain vehicle to the dealership within forty-eight hours of notification by the23
dealer that the conditional sale will not be completed. If the prospective24
purchaser does not return the motorcycle or all-terrain vehicle to the dealership25
within forty-eight hours of notification by the motorcycle or all-terrain vehicle26
dealer, an authorized agent of the motorcycle or all-terrain vehicle dealer shall27
have the right to recover the motorcycle or all-terrain vehicle without the28
necessity of judicial process, provided that such recovery can be accomplished29
without unauthorized entry into a closed dwelling, whether locked or unlocked30 SB NO. 360 ENROLLED
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and without a breach of peace.1
(g) To pay a fee to any person in return for the solicitation, procurement,2
or production by that person of prospective purchasers for new and used3
motorcycles or all-terrain vehicles, except to a motorcycle or all-terrain vehicle4
salesman licensed under the provisions of this Chapter.5
(h) To fail to fully and completely explain each charge listed on a retail6
buyer's order or motorcycle or all-terrain vehicle invoice prior to the purchase7
of a motorcycle or all-terrain vehicle.8
(i) When selling a motorcycle or all-terrain vehicle to a consumer, to9
assess any consumer services fees, which shall include fees for treating the10
interior upholstery of the vehicle, oil changes, roadside assistance, dealer11
inspections, or any other service offered by the dealer, without allowing the12
buyer to refuse such services and be exempt from payment for such services.13
The provisions of this Subparagraph shall not apply to dealer-added options or14
accessories which are permanently affixed to the motorcycle or all-terrain15
vehicle.16
(j)(i) To fail to disclose to a purchaser in writing on the sales contract,17
buyer's order, or any other document that the motorcycle or all-terrain vehicle18
dealer may be participating in finance charges associated with the sale.19
(ii) To participate in a finance charge that would result in a difference20
between the buy rate and the contract rate of more than three percentage21
points.22
(iii) The provisions of this Subparagraph shall apply only to transactions23
subject to the Louisiana Motor Vehicle Sales Finance Act.24
(3)(a) For any person or other licensee to modify a franchise during the25
term of the agreement or upon its renewal if the modification substantially and26
adversely affects the franchisee's rights, obligations, investment, or return on27
investment without giving a sixty-day written notice of the proposed28
modification to the licensee and the commission unless the modifications are29
required by law, court order, or the commission. Within the sixty-day notice30 SB NO. 360 ENROLLED
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period, the licensee may file with the commission a complaint for a1
determination whether there is good cause for permitting the proposed2
modification. The party seeking to modify or replace an agreement shall3
demonstrate by a preponderance of the evidence that there is good cause for the4
modification or replacement. The commission shall schedule a hearing within5
sixty days to decide the matter. Multiple complaints pertaining to the same6
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 vehicles and other services by the licensee.20
(vi) Whether the proposed modification is offset by other modifications21
beneficial to the licensee.22
(c) The decision of the commission shall be in writing and shall contain23
findings of fact and a determination of whether there is good cause for24
permitting the proposed modification. The commission shall deliver copies of25
the decision to the parties personally or by registered mail.26
(4) For any employee of a licensee while acting in the scope of his27
employment, to accept any payment, commission, fee, or compensation of any28
kind from any person other than the employing licensee, unless such payment29
is fully disclosed to and approved by the employing licensee.30 SB NO. 360 ENROLLED
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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 or 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
compensation under this Subsection shall be paid within thirty days after30 SB NO. 360 ENROLLED
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approval and shall be approved or denied within thirty days after receipt. When1
any claim is denied, the motorcycle or all-terrain vehicle dealer shall be notified2
in writing of the grounds for denial.3
(5) The obligations in this Subsection as they relate to motorcycles or all-4
terrain vehicles may be modified by contract.5
B.(1) Notwithstanding the terms of any franchise, warranty, and sales6
incentive, audits of motorcycle or all-terrain vehicle dealer records may be7
conducted by the manufacturer, distributor, distributor branch, or factory8
branch. Any audit for warranty parts or service compensation shall be for the9
twelve-month period immediately following the date of the payment of the claim10
by the manufacturer or distributor. However, a motorcycle or all-terrain11
vehicle dealer shall not be held liable by virtue of an audit for failure to retain12
parts for a period in excess of six months. Any audit for sales incentives, service13
incentives, rebates, or other forms of incentive compensation shall be only for14
the twelve-month period immediately following the date of the final payment to15
the motorcycle or all-terrain vehicle dealer under a promotion, event, program,16
or activity. In no event shall the manufacturer, distributor, distributor branch,17
or factory branch fail to allow the motorcycle or all-terrain vehicle dealer to18
make corrections to the sales data in less than one hundred twenty days from19
the program period. Additionally, no penalty other than amounts advanced on20
a motorcycle or all-terrain vehicle reported incorrectly shall be due in21
connection with the audit. With respect to motorcycles or all-terrain vehicles22
sold during the time period subject to the audit, but submitted incorrectly to the23
manufacturer, distributor, or wholesale distributor branch or factory branch,24
the motorcycle or all-terrain vehicle dealer shall be charged back for the25
amount reported incorrectly and credited with the amount due, if anything, on26
the actual sale date.27
(2) No claim which has been approved and paid may be charged back to28
the motorcycle or all-terrain vehicle dealer unless it can be shown that one of29
the following applies:30 SB NO. 360 ENROLLED
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(a) The claim was false or fraudulent.1
(b) The repairs were not properly made.2
(c) The repairs were unnecessary to correct the defective condition under3
generally accepted standards of workmanship.4
(d) The motorcycle or all-terrain vehicle dealer failed to reasonably5
substantiate the repair in accordance with reasonable written requirements of6
the manufacturer or distributor, if the motorcycle or all-terrain vehicle dealer7
was notified of the requirements prior to the time the claim arose and if the8
requirements were in effect at the time the claim arose.9
(3) A manufacturer or distributor shall not deny a claim solely based on10
a motorcycle or all-terrain vehicle dealer's incidental failure to comply with a11
specific claim processing requirement, or a clerical error, or other12
administrative technicality.13
(4) Limitations on warranty parts or service compensation, sales14
incentive audits, rebates, or other forms of incentive compensation, chargebacks15
for warranty parts or service compensation, and service incentives and16
chargebacks for sales compensation only shall not be effective in the case of17
intentionally false or fraudulent claims.18
(5) It shall be deemed an unfair act pursuant to this Chapter to audit a19
motorcycle or all-terrain vehicle dealer more frequently than two sales-related20
and two service-related audits in a twelve-month period. Nothing in this21
Subsection shall limit a manufacturer's or distributor's ability to perform22
routine claim reviews in the normal course of business.23
(6) No claim may be rejected as late if it has been submitted within sixty24
days of the date the repair order was written.25
§1270.14. Damage disclosure26
A. Whenever a new motorcycle or all-terrain vehicle subject to27
regulation pursuant to this Chapter is sold to any person, the seller shall notify28
the purchaser of any body damage or mechanical damage which the motorcycle29
or all-terrain vehicle has sustained that exceeds six percent of the30 SB NO. 360 ENROLLED
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manufacturer's suggested retail price or, in the case of recreational vehicles, six1
percent of the manufacturer's wholesale price. Such notice shall be in writing2
and a copy thereof shall be delivered to the purchaser prior to or simultaneous3
with transfer of the motorcycle or all-terrain vehicle title.4
B. This Section shall apply to all instances of vehicular body or5
mechanical damage to motorcycles or all-terrain vehicles and to all actions6
involving such damage, notwithstanding the application of other codal,7
statutory, or regulatory provisions, including but not limited to Civil Code8
Articles 2520 et seq.9
§1270.15. Sale of water-damaged motorcycles or all-terrain vehicles10
A. No person shall sell, transfer, or convey any new or used motorcycle11
or all-terrain vehicle to any person without notifying the buyer or receiver of12
the motorcycle or all-terrain vehicle in writing of the extent of any water13
damage from flooding which occurred to the motorcycle or all-terrain vehicle14
prior to the transaction.15
B. If a sale, transfer, or conveyance of a new or used motorcycle or all-16
terrain vehicle occurs in violation of Subsection A of this Section, the person17
receiving ownership and title to the motorcycle or all-terrain vehicle who is not18
otherwise aware of the damage at the time of the transaction may bring an19
action to set aside the transaction within one year from the date of the20
transaction and receive all monies or other property given as consideration for21
the motorcycle or all-terrain vehicle less a reasonable assessment for miles22
driven.23
C. For the purposes of this Section, a "water-damaged motorcycle or all-24
terrain vehicle" means any motorcycle or all-terrain vehicle whose power train,25
computer, or electrical system has been damaged by flooding.26
§1270.16. Succession; right of first refusal27
A. The terms of the franchise notwithstanding, any motorcycle or all-28
terrain vehicle dealer may appoint by will, or other written instrument, a29
designated successor to succeed in the ownership interest of the motorcycle or30 SB NO. 360 ENROLLED
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all-terrain vehicle dealer in the dealership upon the death or incapacity of the1
motorcycle or all-terrain vehicle dealer.2
B. Unless good cause exists for refusal to honor the succession on the3
part of the manufacturer or distributor, any designated successor of a deceased4
or incapacitated motorcycle or all-terrain vehicle dealer of a dealership may5
succeed to the ownership of the dealership under the existing franchise if:6
(1) The designated successor gives the manufacturer or distributor7
written notice of his intention to succeed to the ownership of the motorcycle or8
all-terrain vehicle dealer within sixty days of the motorcycle or all-terrain9
vehicle dealer's death or incapacity.10
(2) The designated successor agrees to be bound by all the terms and11
conditions of the franchise.12
C. The manufacturer or distributor may request, and the designated13
successor shall provide, promptly upon such request, personal and financial14
data reasonably necessary to determine whether the succession should be15
honored.16
D. If a manufacturer or distributor believes that good cause exists for17
refusing to honor the succession of a deceased or incapacitated motorcycle or18
all-terrain vehicle dealer, the manufacturer or distributor may, not more than19
sixty days following receipt of notice of the designated successor's intent to20
succeed and receipt of such personal or financial data, serve upon the21
designated successor notice of its refusal to honor the succession and of its intent22
to discontinue the existing franchise with the motorcycle or all-terrain vehicle23
dealer not earlier than six months from the date such notice is served.24
E. The notice must state the specific grounds for the refusal to honor the25
succession.26
F. If notice of refusal and discontinuance is not timely served upon the27
designated successor, the franchise shall continue in effect subject to28
termination only as otherwise permitted by this Chapter.29
G. In determining whether good cause for the refusal to honor the30 SB NO. 360 ENROLLED
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succession exists, the manufacturer or distributor has the burden of proving1
that the designated successor is not of good moral character or does not2
otherwise meet the manufacturer's or distributor's reasonable standards as a3
franchisee.4
H. If a manufacturer or distributor refuses to honor the succession to5
the ownership interest of a deceased or incapacitated owner for good cause, then6
and in such event:7
(1) The manufacturer or distributor shall allow the designated successor8
a reasonable period of time which shall not be less than six months in which to9
consummate a sale of the dealership. Any such sale shall be subject to R.S.10
32:1270.11(1)(c).11
(2) Upon termination of the franchise pursuant to such refusal, the12
provisions of R.S. 32:1270.17 shall apply.13
§1270.17. Requirements upon termination; penalty; indemnity; motorcycle or14
all-terrain vehicle dealers15
A.(1) In the event the licensee ceases to engage in the business of being16
a motorcycle or all-terrain vehicle dealer, or ceases to sell a particular make of17
motorcycle or all-terrain vehicle and after notice to the manufacturer,18
converter, distributor, or representative by certified mail or commercial19
delivery service with verification of receipt, within thirty days of the receipt of20
the notice by the manufacturer, converter, distributor, or representative, the21
manufacturer, converter, distributor, or representative shall repurchase:22
(a) All new motorcycles or all-terrain vehicles of the current and last23
prior model year delivered to the licensee and parts on hand that have not been24
damaged or substantially altered to the prejudice of the manufacturer while in25
the possession of the licensee. As to motorcycle or all-terrain vehicle dealers,26
the repurchase of parts shall be limited to those listed in the manufacturer's27
price book. The motorcycle or all-terrain vehicles and parts shall be28
repurchased at the cost to the licensee which shall include without limitation29
freight and advertising costs, less all allowances paid to the motorcycle or all-30 SB NO. 360 ENROLLED
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terrain vehicle dealer.1
(b) At fair market value, each undamaged sign owned by the motorcycle2
or all-terrain vehicle dealer which bears a trademark or trade name used or3
claimed by the manufacturer, converter, distributor, or representative if the4
sign was purchased from or purchased at the request of the manufacturer,5
distributor, or representative. Fair market value shall be no less than cost of6
acquisition of the sign by the motorcycle or all-terrain vehicle dealer.7
(c) At fair market value, all special tools and automotive service8
equipment owned by the motorcycle or all-terrain vehicle dealer which were9
recommended in writing and designated as special tools and equipment and10
purchased from or purchased at the request of the manufacturer, converter,11
distributor, or representative, if the tools and equipment are in usable and good12
condition except for reasonable wear and tear. Fair market value shall be no13
less than cost of acquisition of special tools and automotive service equipment14
by the motorcycle or all-terrain vehicle dealer.15
(2) The manufacturer, converter, distributor, or representative shall pay16
to the motorcycle or all-terrain vehicle dealer the costs of transporting,17
handling, packing, and loading of motorcycles or all-terrain vehicles, or parts,18
signs, tools, and equipment subject to repurchase.19
(3) The manufacturer or converter shall make the required repurchase20
after the dealer terminates his franchise and within sixty days of the submission21
to it, by certified mail, return receipt requested, or commercial delivery service22
with verification of receipt, of a final inventory of motorcycles, all-terrain23
vehicles, and parts on hand.24
B. Failure to make such repurchase without just cause shall subject the25
manufacturer or converter to a penalty of one and one-half percent per month,26
or fraction thereof, of the inventory value or returnable motorcycles or all-27
terrain vehicles, and parts, signs, special tools, and automotive service28
equipment, payable to the dealer, as long as the repurchase is not made.29
§1270.18. Manufacturer termination of line-make; manufacturer bankruptcy;30 SB NO. 360 ENROLLED
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license; motorcycle or all-terrain vehicle franchise1
Notwithstanding the terms of any franchise or provision of law, if the2
termination, cancellation, or nonrenewal of a licensee's franchise is the result3
of the termination, elimination, or cessation of a line-make by the manufacturer,4
distributor, or factory branch, whether by bankruptcy or otherwise, the license5
issued by the commission may remain in effect at the discretion of the6
commission pursuant to its rules.7
§1270.19. Motorcycle or all-terrain vehicle repairs8
Suppliers of mechanical repairs and services for any motorcycle or all-9
terrain vehicle subject to regulation pursuant to this Chapter shall provide each10
consumer with an itemized bill indicating repairs and services performed, parts11
replaced, or materials used, the total labor charge, and the identity of the12
mechanic, repairman, or supplier who performed the work. However, nothing13
in this Section shall prohibit a supplier of mechanical repairs and services from14
charging a service fee for the use of shop supplies such as rags, fender covers,15
small amounts of fluid, or other items which are not itemized, provided that16
such fee does not exceed five percent of the total invoice for mechanical repairs17
or thirty-five dollars, whichever is less.18
PART IV. PROVISIONS SPECIFIC TO RECREATIONAL VEHICLES19
§1270.20. Unauthorized acts; recreational vehicles20
It shall be a violation of this Chapter:21
(1) For a manufacturer, a distributor, a wholesaler, factory branch, or22
officer, agent, or other representative thereof:23
(a) To induce or coerce, or attempt to induce or coerce, any licensee:24
(i) To order or accept delivery of any recreational vehicles, appliances,25
equipment, parts or accessories therefor, or any other commodity or26
commodities which shall not have been voluntarily ordered.27
(ii) To order or accept delivery of any recreational vehicle with special28
features, appliances, accessories, or equipment not included in the list price of29
the recreational vehicle as publicly advertised.30 SB NO. 360 ENROLLED
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(iii) To order for any person any parts, accessories, equipment,1
machinery, tools, appliances, or any commodity whatsoever.2
(iv) To assent to a release, assignment, novation, waiver, or estoppel3
which would relieve any person from liability to be imposed by law, unless done4
in connection with a settlement agreement to resolve a matter pending a5
commission hearing or pending litigation between a manufacturer, distributor,6
wholesaler, or factory branch, or officer, agent, or other representative thereof.7
(v) To enter into a franchise with a licensee or during the franchise term,8
use any written instrument, agreement, release, assignment, novation, estoppel,9
or waiver, to attempt to nullify or modify any provision of this Chapter, or to10
require any controversy between a recreational vehicle dealer and a11
manufacturer to be referred to any person or entity other than the commission,12
or duly constituted courts of this state or the United States, if such referral13
would be binding upon the recreational dealer. Such instruments are null and14
void, unless done in connection with a settlement agreement to resolve a matter15
pending a commission hearing or pending litigation.16
(vi) To waive the right to a jury trial.17
(vii) To participate in an advertising group or to participate monetarily18
in an advertising campaign or contest or to purchase any promotional19
materials, showroom, or other display decorations or materials at the expense20
of such recreational vehicle dealer.21
(viii) To release, convey, or otherwise provide customer information, if22
to do so is unlawful or if the customer objects in writing. This does not include23
information that is necessary for the manufacturer to meet its obligations to the24
recreational vehicle dealer or consumers in regard to contractual25
responsibilities, recreational vehicle recalls, or other requirements imposed by26
state or federal law. The manufacturer is further prohibited from providing any27
consumer information received from the recreational vehicle dealer to any28
unaffiliated third party.29
(ix) To pay the attorney fees of the manufacturer or distributor related30 SB NO. 360 ENROLLED
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to hearings and appeals brought under this Chapter.1
(b) To refuse to deliver to any licensee having a franchise or contractual2
arrangement for the retail sale of recreational vehicles sold or distributed by3
such manufacturer, distributor, wholesaler, or factory branch, any recreational4
vehicle, publicly advertised for immediate delivery, within sixty days after such5
recreational vehicle dealer's order shall have been received.6
(c) To threaten to cancel any franchise or any contractual agreement7
existing between such manufacturer, distributor, wholesaler, or factory branch8
and the recreational vehicle dealer for any reason.9
(d) To unfairly, without just cause and due regard to the equities of such10
recreational vehicle dealer, cancel the franchise of any licensee. The11
nonrenewal of a franchise with such recreational vehicle dealer or his successor12
without just provocation or cause, or the refusal to approve a qualified13
transferee or qualified successor to the dealer-operator as provided for in the14
franchise agreement, shall be deemed a violation of this Paragraph and shall15
constitute an unfair cancellation, regardless of the terms or provisions of such16
franchise. However, at least ninety-days notice shall be given to the recreational17
vehicle dealer of any cancellation or nonrenewal of a franchise except for a18
cancellation arising out of the financial default of the recreational vehicle dealer19
or fraudulent activity of the recreational vehicle dealer principal which results20
in the conviction of a crime punishable by imprisonment.21
(e) To refuse to extend to a licensee the privilege of determining the mode22
or manner of available transportation facility that such recreational vehicle23
dealer desires to be used or employed in making deliveries of recreational24
vehicles to him or it.25
(f) To use any false or misleading advertisement in connection with his26
business as such manufacturer of recreational vehicles, distributor, wholesaler,27
or factory branch, or officer, agent, or other representative thereof.28
(g) To delay, refuse, or fail to deliver recreational vehicles in reasonable29
quantities relative to the licensee's facilities and sales potential in the relevant30 SB NO. 360 ENROLLED
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market area. This Subparagraph shall not be valid, however, if such failure is1
caused by acts or causes beyond the control of the manufacturer, distributor,2
or other such party.3
(h) To ship or sell recreational vehicles to a licensee prior to the licensee4
having been granted a license by the commission to sell such recreational5
vehicles.6
(i) To unreasonably withhold consent to the sale, transfer, or exchange7
of the franchise to a qualified transferee capable of being licensed as a8
recreational vehicle dealer in this state, provided the transferee meets the9
criteria generally applied by the manufacturer in approving new recreational10
vehicle dealers and agrees to be bound by all the terms and conditions of the11
standard franchises.12
(j) To fail to respond in writing to a written request for consent as13
specified in Subparagraph (i)of this Paragraph within sixty days of receipt of14
a written request on the forms, if any, generally utilized by the manufacturer15
or distributor for such purposes and containing the information required16
therein. Failure to respond shall be deemed to be consent to the request.17
(k)(i) To sell or offer to sell a new or unused recreational vehicle directly18
to a consumer except as provided in this Chapter, or to compete with a licensee19
in the same-line makes, models, or classifications operating under an agreement20
or franchise from the aforementioned manufacturer. A manufacturer shall not,21
however, be deemed to be competing when any one of the following conditions22
are met:23
(aa) Operating a dealership temporarily for a reasonable period, not to24
exceed two years.25
(bb) Operating a bona fide retail dealership which is for sale to any26
qualified independent person at a fair and reasonable price, not to exceed two27
years.28
(cc) Operating in a bona fide relationship in which a person independent29
of a manufacturer has made a significant investment subject to loss in the30 SB NO. 360 ENROLLED
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dealership, and can reasonably expect to acquire full ownership of such1
dealership on reasonable terms and conditions.2
(ii) After any of the conditions have been met under Subitems (i)(aa) and3
(bb) of this Subparagraph, the commission shall allow the manufacturer to4
compete with licensees of the same-line makes, models, or classifications under5
an agreement or franchise from the manufacturer for longer than two years6
when, in the discretion of the commission, the best interest of the manufacturer,7
consuming public, and licensees are best served.8
(l) To condition the renewal or extension of a franchise on a new9
recreational vehicle dealer's substantial renovation of the recreational vehicle10
dealer's place of business or on the construction, purchase, acquisition, or rental11
of a new place of business by the new recreational vehicle dealer, unless the12
manufacturer has advised the new recreational vehicle dealer in writing of its13
intent to impose such a condition within a reasonable time prior to the effective14
date of the proposed date of renewal or extension, but in no case less than one15
hundred eighty days, and provided the manufacturer demonstrates the need for16
such demand in view of the need to service the public and the economic17
conditions existing in the recreational vehicle industry at the time such action18
would be required of the new recreational vehicle dealer. As part of any such19
condition, the manufacturer shall agree, in writing, to supply the recreational20
vehicle dealer with an adequate supply and marketable model mix of21
recreational vehicles to meet the sales levels necessary to support the increased22
overhead incurred by the recreational vehicle dealer by reason of such23
renovation, construction, purchase, or rental of a new place of business.24
(m) To fail to compensate its recreational vehicle dealers for the work25
and services they are required to perform in connection with the recreational26
vehicle dealer's delivery and preparation obligations according to the terms of27
compensation that shall be filed with the commission on or before October first28
of each year. The commission shall find the compensation to be reasonable or29
the manufacturer shall remedy any deficiencies.30 SB NO. 360 ENROLLED
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(n) To fail to designate and provide to the commission in writing the1
community or territory assigned to a licensee.2
(o) To unreasonably discriminate among competing, similarly situated,3
same-line make dealers in the sales of recreational vehicles, in the availability4
of such recreational vehicles, in the terms of incentive programs or sales5
promotion plans, or in other similar programs.6
(p) To terminate, cancel, or refuse to continue any franchise agreement7
based upon the fact that the recreational vehicle dealer owns, has an investment8
in, participates in the management of, or holds a franchise agreement for the9
sale or service of another make or line of new recreational vehicles at a different10
dealership location, or intends to or has established another make or line of new11
recreational vehicles in the same dealership facilities of the manufacturer or12
distributor.13
(q) To demand compliance with facilities requirements that include any14
requirements that a recreational vehicle dealer establish or maintain exclusive15
office, parts, service or body shop facilities, unless such requirements would be16
reasonable and justified by business considerations. The burden of proving that17
such requirements are reasonable and justified by business considerations is on18
the manufacturer. If the franchise agreement of the manufacturer or19
distributor requires the approval of the manufacturer or distributor for facility20
uses or modifications, the manufacturer or distributor shall approve or deny the21
request in writing within sixty days of receipt of such request.22
(r) To use any subsidiary, affiliate, or any other controlled person or23
entity, or to employ the services of a third party, to accomplish what would24
otherwise be illegal conduct under this Chapter on the part of the manufacturer25
or distributor.26
(s) To make a change in the area of responsibility described in the27
franchise agreement or sales and service agreement of a recreational vehicle28
dealer, without the franchisor or manufacturer giving the recreational vehicle29
dealer and the commission no less than sixty days prior written notice by30 SB NO. 360 ENROLLED
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certified or registered mail.1
(t) To induce or coerce, or attempt to induce or coerce, any recreational2
vehicle dealer to enter into any agreement with such manufacturer, distributor,3
wholesaler, distributor branch or factory branch or representative thereof, or4
to do any other act unfair to the recreational vehicle dealer.5
(u)(i) To coerce or attempt to coerce any retail recreational vehicle6
dealer or prospective retail recreational vehicle dealer to offer to sell or sell any7
extended service contract or extended maintenance plan or gap product offered,8
sold, backed by, or sponsored by the manufacturer or distributor or affiliate or9
sell, assign, or transfer any retail installment sales contract or lease obtained by10
the dealer in connection with the sale or lease by him of recreational vehicles11
manufactured or sold by the manufacturer or distributor, to a specified finance12
company or class of finance companies, leasing company or class of leasing13
companies, or to any other specified persons by any of the following:14
(aa) By any statement, promise, or threat that the manufacturer or15
distributor will in any manner benefit or injure the dealer, whether the16
statement, suggestion, threat, or promise is express or implied or made directly17
or indirectly.18
(bb) By any act that will benefit or injure the dealer.19
(cc) By any contract, or any express or implied offer of contract, made20
directly or indirectly to the dealer, for handling the recreational vehicle on the21
condition that the recreational vehicle dealer shall offer to sell or sell any22
extended service contract or extended maintenance plan offered, sold, backed23
by, or sponsored by the manufacturer or distributor or that the dealer sell,24
assign, or transfer his retail installment sales contract on or lease of the25
recreational vehicle, to a specified finance company or class of finance26
companies, leasing company or class of leasing companies, or to any other27
specified person.28
(dd) Any such statements, threats, promises, acts, contracts, or offers of29
contracts, when their effect may be to lessen or eliminate competition.30 SB NO. 360 ENROLLED
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(ii) Nothing contained in this Subparagraph shall prohibit a1
manufacturer or distributor from offering or providing incentive benefits or2
bonus programs to a retail recreational vehicle dealer or prospective retail3
recreational vehicle dealer who makes the voluntary decision to offer to sell or4
sell any extended service contract or extended maintenance plan offered, sold,5
backed, or sponsored by the manufacturer or distributor or to sell, assign, or6
transfer any retail installment sale or lease by him of recreational vehicles7
manufactured or sold by the manufacturer or distributor to a specified finance8
company or leasing company.9
(2) For a recreational vehicle dealer or a recreational vehicle salesman:10
(a) To require a purchaser of a recreational vehicle, as a condition of sale11
and delivery thereof, to also purchase special features, appliances, accessories,12
or equipment not desired or requested by the purchaser; however, this13
prohibition shall not apply as to special features, appliances, accessories, or14
equipment which are permanently affixed to the recreational vehicle.15
(b) To represent and sell as a new recreational vehicle any vehicle, the16
legal title of which has been transferred by a manufacturer, distributor, or17
dealer to an ultimate purchaser.18
(c) To use any false or misleading advertisement in connection with his19
business as such recreational vehicle dealer or recreational vehicle salesman.20
(d) To sell or offer to sell makes, models, or classifications of new21
recreational vehicles for which no franchise and license to sell is held.22
(e) Except as otherwise approved by the commission, to sell or offer to23
sell a recreational vehicle from an unlicensed location.24
(f) To deliver to a prospective purchaser a new recreational vehicle on25
a sale conditioned on financing, i.e., a spot delivery, except on the following26
terms and conditions which shall be in writing and shall be a part of the27
conditional sales contract or other written notification signed by the purchaser:28
(i) That if the sale is not concluded by the financing of the sale to the29
purchaser within twenty-five days of the delivery, the sale contract shall be null30 SB NO. 360 ENROLLED
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and void.1
(ii) That the recreational vehicle being offered for trade-in by the2
purchaser shall not be sold by the recreational vehicle dealer until the3
conditional sale is complete.4
(iii) That there shall be no charge to the purchaser should the conditional5
sale not be completed, including but not limited to mileage charges or charges6
to refurbish the recreational vehicle offered for trade-in. However, the7
purchaser shall be responsible for any and all damages to the recreational8
vehicle or other vehicles damaged by the fault of the purchaser and any and all9
liability incurred by the purchaser during the purchaser's custody of the10
recreational vehicle to the extent provided for in R.S. 22:1296.11
(iv) That if the conditional sale is not completed, the recreational vehicle12
dealer shall immediately refund to the purchaser upon return of the13
recreational vehicle all sums placed with the dealership as a deposit or any14
other purpose associated with the attempted sale of the vehicle.15
(v) That the prospective purchaser shall return the recreational vehicle16
to the dealership within forty-eight hours of notification by the recreational17
vehicle dealer that the conditional sale will not be completed. If the prospective18
purchaser does not return the recreational vehicle to the dealership within19
forty-eight hours of notification by the recreational vehicle dealer, an20
authorized agent of the recreational vehicle dealer shall have the right to21
recover the recreational vehicle without the necessity of judicial process,22
provided that such recovery can be accomplished without unauthorized entry23
into a closed dwelling, whether locked or unlocked, and without a breach of24
peace.25
(g) To pay a fee to any person in return for the solicitation, procurement,26
or production by that person of prospective purchasers for new and used27
recreational vehicles, except to a recreational vehicle salesman licensed under28
the provisions of this Chapter.29
(h) To fail to fully and completely explain each charge listed on a retail30 SB NO. 360 ENROLLED
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buyer's order or recreational vehicle invoice prior to the purchase of a1
recreational vehicle.2
(i) When selling a recreational vehicle to a consumer, to assess any3
consumer services fees, which shall include fees for treating the interior4
upholstery of the recreational vehicle, oil changes, roadside assistance, dealer5
inspections, or any other service offered by the recreational vehicle dealer,6
without allowing the buyer to refuse such services and be exempt from payment7
for such services. The provisions of this Subparagraph shall not apply to dealer-8
added options or accessories which are permanently affixed to the recreational9
vehicle.10
(j)(i) To fail to disclose to a purchaser in writing on the sales contract,11
buyer's order, or any other document that the recreational vehicle dealer may12
be participating in finance charges associated with the sale.13
(ii) To participate in a finance charge that would result in a difference14
between the buy rate and the contract rate of more than three percentage15
points.16
(iii) The provisions of this Subparagraph shall apply only to transactions17
subject to the Louisiana Motor Vehicle Sales Finance Act.18
(3)(a) For any person or other licensee to modify a franchise during the19
term of the agreement or upon its renewal if the modification substantially and20
adversely affects the franchisee's rights, obligations, investment, or return on21
investment without giving a sixty-day written notice of the proposed22
modification to the licensee and the commission unless the modifications are23
required by law, court order, or the commission. Within the sixty-day notice24
period, the licensee may file with the commission a complaint for a25
determination whether there is good cause for permitting the proposed26
modification. The party seeking to modify or replace an agreement shall27
demonstrate by a preponderance of the evidence that there is good cause for the28
modification or replacement. The commission shall schedule a hearing within29
sixty days to decide the matter. Multiple complaints pertaining to the same30 SB NO. 360 ENROLLED
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proposed modifications shall be consolidated for hearing. The proposed1
modification may not take effect pending the determination of the matter.2
(b) In making a determination of whether there is good cause for3
permitting a proposed modification, the commission may consider any relevant4
factor including:5
(i) The reasons for the proposed modification.6
(ii) Whether the proposed modification is applied to or affects all7
licensees in a nondiscriminating manner.8
(iii) The degree to which the proposed modification will have a9
substantial and adverse effect upon the licensee's investment or return on10
investment.11
(iv) Whether the proposed modification is in the public interest.12
(v) The degree to which the proposed modification is necessary to the13
orderly and profitable distribution of recreational vehicles and other services14
by the licensee.15
(vi) Whether the proposed modification is offset by other modifications16
beneficial to the licensee.17
(c) The decision of the commission shall be in writing and shall contain18
findings of fact and a determination of whether there is good cause for19
permitting the proposed modification. The commission shall deliver copies of20
the decision to the parties personally or by registered mail.21
(4) For any employee of a licensee while acting in the scope of his22
employment, to accept any payment, commission, fee, or compensation of any23
kind from any person other than the employing licensee, unless such payment24
is fully disclosed to and approved by the employing licensee.25
§1270.21. Indemnification of franchised recreational vehicle dealers26
Notwithstanding the terms of any franchise agreement, each27
manufacturer or converter shall indemnify and hold harmless its franchised28
recreational vehicle dealers against any judgment for damages, including but29
not limited to court costs and reasonable attorney fees of the recreational30 SB NO. 360 ENROLLED
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vehicle dealer, arising out of complaints, claims, or lawsuits including but not1
limited to strict liability, negligence, misrepresentation, express or implied2
warranty, or rescission of sale to the extent that the judgment arises out of3
alleged defective or negligent manufacture, assembly, or design of recreational4
vehicles, parts, or accessories, or other functions by the manufacturer of5
converter, which are beyond the control of the recreational vehicle dealer.6
§1270.22. Payment to recreational vehicles dealers; penalties7
It shall be a violation of this Chapter for a recreational vehicle8
manufacturer, distributor, wholesaler, factory branch, officer, agent or other9
representative thereof, to fail to pay a recreational vehicle dealer all monies due10
the recreational vehicle dealer, except manufacturer hold-back amounts, within11
thirty days of the date of completion of the transactions or submissions of the12
claims giving rise to the payments to the recreational vehicle dealers. Failure to13
make payments shall subject the manufacturer, distributor, wholesaler, factory14
branch, officer, agent, or other representative thereof, to a penalty of the one15
and one-half percent interest per month, or fraction thereof, until sums due the16
recreational vehicle dealer are fully paid.17
§1270.23. Warranty; compensation; audits of recreational vehicle dealer18
records19
A.(1) It shall be a violation of this Chapter for a manufacturer, a20
distributor, a wholesaler, or factory branch, or officer, agent or other21
representative thereof, to fail to adequately and fairly compensate its22
recreational vehicle dealers for labor, parts, and other expenses incurred by23
such dealer to perform under and comply with a manufacturer's or a24
distributor's warranty agreement.25
(2) In no event shall any manufacturer or distributor pay its recreational26
vehicle dealers at a price or rate for warranty work that is less than that27
charged by the recreational vehicle dealer to the retail customers of the28
recreational vehicle dealer for nonwarranty work of like kind.29
(3) Warranty work includes parts and labor performed.30 SB NO. 360 ENROLLED
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(4) All claims made by the recreational vehicle dealer for compensation1
under this Subsection shall be paid within thirty days after approval and shall2
be approved or denied within thirty days after receipt. When any claim is3
denied, the recreational vehicle dealer shall be notified in writing of the grounds4
for denial.5
(5) The obligations in this Subsection may be modified by contract.6
B.(1) Notwithstanding the terms of any franchise agreement, warranty,7
and sales incentive, audits of recreational vehicle dealer records may be8
conducted by the manufacturer, distributor, or factory branch. Any audit for9
warranty parts or service compensation shall be for the twelve-month period10
immediately following the date of the payment of the claim by the manufacturer11
or distributor. However, a recreational vehicle dealer shall not be held liable by12
virtue of an audit for failure to retain parts for a period in excess of six months.13
Any audit for sales incentives, service incentives, rebates, or other forms of14
incentive compensation shall be only for the twelve-month period immediately15
following the date of the final payment to the recreational vehicle dealer under16
a promotion, event, program, or activity. In no event shall the manufacturer,17
distributor, or factory branch fail to allow the recreational vehicle dealer to18
make corrections to the sales data in less than one hundred twenty days from19
the program period. Additionally, no penalty other than amounts advanced on20
a recreational vehicle reported incorrectly shall be due in connection with the21
audit. With respect to recreational vehicles sold during the time period subject22
to the audit, but submitted incorrectly to the manufacturer, distributor, or23
wholesale distributor branch or factory branch, the recreational vehicle dealer24
shall be charged back for the amount reported incorrectly and credited with the25
amount due, if anything, on the actual sale date.26
(2) No claim which has been approved and paid may be charged back to27
the recreational vehicle dealer unless it can be shown that one of the following28
applies:29
(a) The claim was false or fraudulent.30 SB NO. 360 ENROLLED
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(b) The repairs were not properly made.1
(c) The repairs were unnecessary to correct the defective condition under2
generally accepted standards of workmanship.3
(d) The recreational vehicle dealer failed to reasonably substantiate the4
repair in accordance with reasonable written requirements of the manufacturer5
or distributor, if the recreational vehicle dealer was notified of the requirements6
prior to the time the claim arose and if the requirements were in effect at the7
time the claim arose.8
(3) A manufacturer or distributor shall not deny a claim solely based on9
a recreational vehicle dealer's incidental failure to comply with a specific claim10
processing requirement, or a clerical error, or other administrative technicality.11
(4) Limitations on warranty parts or service compensation, sales12
incentive audits, rebates, or other forms of incentive compensation, chargebacks13
for warranty parts or service compensation, and service incentives and14
chargebacks for sales compensation only shall not be effective in the case of15
intentionally false or fraudulent claims.16
(5) It shall be deemed an unfair act pursuant to this Chapter to audit a17
recreational vehicle dealer more frequently than two sales-related and two18
service-related audits in a twelve-month period. Nothing in this Subsection shall19
limit a manufacturer's or distributor's ability to perform routine claim reviews20
in the normal course of business.21
(6) No claim may be rejected as late if it has been submitted within sixty22
days of the date the repair order was written.23
§1270.24. Recreational vehicle repairs24
Suppliers of mechanical repairs and services for any recreational vehicle25
subject to regulation pursuant to this Chapter shall provide each consumer with26
an itemized bill indicating repairs and services performed, parts replaced, or27
materials used, the total labor charge, and the identity of the mechanic,28
repairman, or supplier who performed the work. However, nothing in this29
Section shall prohibit a supplier of mechanical repairs and services from30 SB NO. 360 ENROLLED
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charging a service fee for the use of shop supplies such as rags, fender covers,1
small amounts of fluid, or other items which are not itemized, provided that2
such fee does not exceed five percent of the total invoice for mechanical repairs3
or thirty-five dollars, whichever is less.4
§1270.25. Damage disclosure; recreational vehicles5
A. Whenever a new recreational vehicle subject to regulation pursuant6
to this Part is sold to any person, the seller shall notify the purchaser of any7
body damage or mechanical damage which the recreational vehicle has8
sustained that exceeds six percent of the manufacturer's wholesale price. Such9
notice shall be in writing and a copy thereof shall be delivered to the purchaser10
prior to or simultaneous with transfer of the recreational vehicle title.11
B. Replacement of a new recreational vehicle's instrument panels,12
appliances, furniture, cabinetry, televisions, audio equipment, or similar13
residential components shall not be deemed "damage" pursuant to this Section14
if such items are replaced with original manufacturers' parts and materials.15
C. This Section shall apply to all instances of vehicular body or16
mechanical damage to recreational vehicles and to all actions involving such17
damage, notwithstanding the application of other codal, statutory, or regulatory18
provisions, including but not limited to Civil Code Articles 2520 et seq.19
§1270.26. Notice regarding recalls; recreational vehicles20
It shall be a violation of this Part for a recreational vehicle dealer to sell21
a new recreational vehicle without first supplying a prospective buyer with the22
following notice: "A new recreational vehicle may have been subject to a23
National Highway Traffic Safety Administration required recall which would24
be repaired in accordance with manufacturer standards approved by the25
National Highway Traffic Safety Administration. If such a repair is a concern26
before you purchase, please ask for a copy of the recall notice, if applicable, to27
the recreational vehicle being sold." This notice shall be included on the buyer's28
order in a box and in bold print which is signed by the buyer and the seller or29
his representative next to the box. If the buyer requests the recall notice, the30 SB NO. 360 ENROLLED
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recall notice shall be included in the sales transaction. If the selling recreational1
vehicle dealer performed the repair, the documents supporting the repair shall2
also be included in the sales transaction.3
§1270.27. Sale of water-damaged recreational vehicles4
A. No person shall sell, transfer, or convey any new or used recreational5
vehicle to any person without notifying the buyer or receiver of the recreational6
vehicle in writing of the extent of any water damage from flooding which7
occurred to the recreational vehicle prior to the transaction.8
B. If a sale, transfer, or conveyance of a new or used recreational vehicle9
occurs in violation of Subsection A of this Section, the person receiving10
ownership and title to the recreational vehicle who is not otherwise aware of the11
damage at the time of the transaction may bring an action to set aside the12
transaction within one year from the date of the transaction and receive all13
monies or other property given as consideration for the vehicle less a reasonable14
assessment for miles driven.15
C. For the purposes of this Section, a "water-damaged vehicle" means16
any recreational vehicle whose power train, computer, or electrical system has17
been damaged by flooding.18
§1270.28. Succession; right of first refusal; recreational vehicle dealer19
A.(1) The terms of the franchise notwithstanding, any recreational20
vehicle dealer may appoint by will, or other written instrument, a designated21
successor to succeed in the ownership interest of the recreational vehicle dealer22
in the dealership upon the death or incapacity of the recreational vehicle dealer.23
(2) Unless good cause exists for refusal to honor the succession on the24
part of the manufacturer or distributor, any designated successor of a deceased25
or incapacitated recreational vehicle dealer of a dealership may succeed to the26
ownership of the dealership under the existing franchise if:27
(a) The designated successor gives the manufacturer or distributor28
written notice of his intention to succeed to the ownership of the recreational29
vehicle dealer within sixty days of the recreational vehicle dealer's death or30 SB NO. 360 ENROLLED
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incapacity.1
(b) The designated successor agrees to be bound by all the terms and2
conditions of the franchise.3
(3) The manufacturer or distributor may request, and the designated4
successor shall provide, promptly upon such request, personal and financial5
data reasonably necessary to determine whether the succession should be6
honored.7
(4) If a manufacturer or distributor believes that good cause exists for8
refusing to honor the succession of a deceased or incapacitated recreational9
vehicle dealer, the manufacturer or distributor may, not more than sixty days10
following receipt of notice of the designated successor's intent to succeed and11
receipt of such personal or financial data, serve upon the designated successor12
notice of its refusal to honor the succession and of its intent to discontinue the13
existing franchise with the dealer not earlier than six months from the date such14
notice is served.15
(5) The notice must state the specific grounds for the refusal to honor the16
succession.17
(6) If notice of refusal and discontinuance is not timely served upon the18
designated successor, the franchise shall continue in effect subject to19
termination only as otherwise permitted by this Chapter.20
(7) In determining whether good cause for the refusal to honor the21
succession exists, the manufacturer or distributor has the burden of proving22
that the designated successor is not of good moral character or does not23
otherwise meet the manufacturer's or distributor's reasonable standards as a24
franchisee.25
(8) If a manufacturer or distributor refuses to honor the succession to the26
ownership interest of a deceased or incapacitated owner for good cause, then27
and in such event:28
(a) The manufacturer or distributor shall allow the designated successor29
a reasonable period of time which shall not be less than six months in which to30 SB NO. 360 ENROLLED
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consummate a sale of the dealership. Any such sale shall be subject to R.S.1
32:1270.20(1)(d).2
(b) Upon termination of the franchise pursuant to such refusal, the3
provisions of R.S. 32:1270.29 shall apply.4
B. In the event of a proposed sale or transfer of a recreational vehicle5
dealership and if the franchise agreement has a right of first refusal in favor of6
the manufacturer or distributor, then, notwithstanding the terms of the7
franchise agreement, the manufacturer or distributor shall be permitted to8
exercise a right of first refusal to acquire the recreational vehicle dealer's assets9
or ownership if all of the following requirements are met:10
(1) In order to exercise its right of first refusal, the manufacturer or11
distributor shall notify the recreational vehicle dealer in writing within sixty12
days of his receipt of the completed proposal for the proposed sale or transfer13
and all related agreements.14
(2) The applicability of R.S. 32:1270.20(1)(l) shall not be expanded or15
changed.16
(3) The exercise of the right of first refusal will result in the recreational17
vehicle dealer receiving the same or greater consideration as he has contracted18
to receive in connection with the proposed change of ownership or transfer.19
(4) The proposed sale or transfer of the dealership's assets does not20
involve the transfer or sale to a member or members of the family of one or21
more recreational vehicle dealers, or to a qualified manager with at least two22
years management experience at the dealership of one or more of these23
recreational vehicle dealers, or to a partnership or corporation controlled by24
such persons.25
(5)(a) The manufacturer or distributor agrees to pay the reasonable26
expenses, including attorney fees which do not exceed the usual, customary, and27
reasonable fees charged for similar work done for other clients, incurred by the28
proposed owner or transferee prior to the manufacturer's or distributor's29
exercise of its right of first refusal in negotiating and implementing the contract30 SB NO. 360 ENROLLED
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for the proposed sale or transfer of the dealership or dealership assets. Such1
expenses and attorney fees shall be paid to the proposed new owner or2
transferee at the time of closing of the sale or transfer for which the3
manufacturer or distributor exercised its right of first refusal.4
(b) No payment of such expenses and attorney fees shall be required if5
the new owner or transferee has not submitted or caused to be submitted an6
accounting of those expenses within thirty days of the recreational vehicle7
dealer's receipt of the manufacturer's or distributor's written request for such8
an accounting. A manufacturer or distributor may request such accounting9
before exercising his right of first refusal.10
(6) The recreational vehicle dealer shall not have any liability to any11
person as a result of a manufacturer's exercising its right of first refusal and the12
manufacturer or distributor shall assume the defense of the selling dealer for13
any claim by the proposed owner or transferee arising from the exercise of the14
right of first refusal.15
§1270.29. Requirements upon termination; penalty; indemnity; recreational16
vehicles17
A.(1) In the event the licensee ceases to engage in the business of being18
a recreational vehicle dealer, or ceases to sell a particular recreational vehicle,19
and after notice to the manufacturer, converter, distributor, or representative20
by certified mail or commercial delivery service with verification of receipt,21
within thirty days of the receipt of the notice by the manufacturer, converter,22
distributor, or representative, the manufacturer, converter, distributor, or23
representative shall repurchase:24
(a) All new recreational vehicles of the current and last prior model year25
delivered to the licensee and parts limited to those listed in the manufacturer's26
price book. The recreational vehicles and parts shall be repurchased at the cost27
to the licensee which shall include without limitation freight and advertising28
costs, less all allowances paid to the recreational vehicle dealer.29
(b) At fair market value, each undamaged sign owned by the recreational30 SB NO. 360 ENROLLED
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vehicle dealer which bears a trademark or trade name used or claimed by the1
manufacturer, distributor, or representative if the sign was purchased from or2
purchased at the request of the manufacturer, distributor, or representative.3
Fair market value shall be no less than cost of acquisition of the sign by the4
recreational vehicle dealer.5
(c) At fair market value, all special tools and automotive service6
equipment owned by the recreational vehicle dealer which were recommended7
in writing and designated as special tools and equipment and purchased from8
or purchased at the request of the manufacturer, converter, distributor, or9
representative, if the tools and equipment are in usable and good condition10
except for reasonable wear and tear. Fair market value shall be no less than cost11
of acquisition of special tools and automotive service equipment by the12
recreational vehicle dealer.13
(2) The manufacturer, converter, distributor, or representative shall pay14
to the recreational vehicle dealer the costs of transporting, handling, packing,15
and loading of recreational vehicles, or parts, signs, tools, and equipment16
subject to repurchase.17
(3) The manufacturer or converter shall make the required repurchase18
after the recreational vehicle dealer terminates his franchise and within sixty19
days of the submission to it, by certified mail, return receipt requested, or20
commercial delivery service with verification of receipt, of a final inventory of21
recreational vehicles and parts on hand.22
B. Failure to make such repurchase without just cause shall subject the23
manufacturer or converter to a penalty of one and one-half percent per month,24
or fraction thereof, of the inventory value or returnable recreational vehicles,25
and parts, signs, special tools, and automotive service equipment, payable to the26
dealer, as long as the repurchase is not made.27
C.(1) Upon the involuntary termination, nonrenewal, or cancellation of28
any franchise by the manufacturer or converter, except for termination,29
nonrenewal, or cancellation resulting from a felony conviction, notwithstanding30 SB NO. 360 ENROLLED
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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 was 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 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
Part I of Chapter 6 of Title 32 of the Louisiana Revised Statues of 1950. Part I shall be30 SB NO. 360 ENROLLED
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entitled "GENERAL PROVISIONS APPLICABLE TO MOTOR VEHI CLES AND1
RECREATIONAL PRODUCTS".2
PRESIDENT OF THE SENATE
SPEAKER OF THE HOUSE OF REPRESENTATIVES
GOVERNOR OF THE STATE OF LOUISIANA
APPROVED: