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SENATE BILL 287
57
TH LEGISLATURE
-
STATE
OF
NEW
MEXICO
-
FIRST SESSION
,
2025
INTRODUCED BY
Linda M. Trujillo
AN ACT
RELATING TO TRADE PRACTICES; EXEMPTING FROM THE PROVISIONS OF
CHAPTER 57, ARTICLE 16 NMSA 1978 DEALERS, MANUFACTURERS AND
DISTRIBUTORS THAT MANUFACTURE OR SELL NEW RECREATIONAL
VEHICLES; ENACTING THE RECREATIONAL VEHICLE MANUFACTURER AND
DEALER ACT; REQUIRING A MANUFACTURER-DEALER AGREEMENT TO SELL A
NEW RECREATIONAL VEHICLE; PROVIDING REQUIREMENTS FOR
MANUFACTURER-DEALER AGREEMENTS; PROVIDING LIMITATIONS TO THE
TERMINATION, CANCELLATION OR NONRENEWAL OF A MANUFACTURER-
DEALER AGREEMENT AND REQUIRING WRITTEN NOTICE; REQUIRING NOTICE
FOR THE TRANSFER OF DEALER OWNERSHIP AND PROVIDING A PROCEDURE
FOR OBJECTION TO TRANSFER OF OWNERSHIP; PROVIDING WARRANTY
OBLIGATIONS ON THE WARRANTOR AND DEALER; PROVIDING INSPECTION
AND REJECTION PROCEDURES FOR DAMAGED RECREATIONAL VEHICLES;
REQUIRING ALTERNATIVE DISPUTE RESOLUTION PRIOR TO AN INJURED
PARTY BRINGING A CIVIL ACTION FOR A VIOLATION OF THE
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RECREATIONAL VEHICLE MANUFACTURER AND DEALER ACT; PROVIDING
PENALTIES; REPEALING A SECTION OF CHAPTER 57, ARTICLE 16 NMSA
1978 THAT APPLIES TO MANUFACTURERS AND DISTRIBUTORS OF
RECREATIONAL VEHICLES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. Section 57-16-2 NMSA 1978 (being Laws 1973,
Chapter 6, Section 2) is amended to read:
"57-16-2. APPLICATION OF ACT.--
A. Except as provided in Subsection B of this
section, the provisions of [this act ] Chapter 57, Article 16
NMSA 1978 shall apply to all persons, manufacturers,
representatives, distributors and dealers and to all written or
oral agreements between the manufacturer, distributor or
representative with a motor vehicle dealer, including [but not
limited to] the franchise offering, the franchise agreement,
sales of goods, services or advertising, leases or mortgages of
real or personal property, promises to pay, security interest,
pledges, insurance contracts, advertising contracts,
construction or installation contracts, servicing contracts and
all other such agreements in which the manufacturer,
distributor or representative has any direct or indirect
interest.
B. The provisions of Chapter 57, Article 16 NMSA
1978 shall not apply to a dealer, manufacturer, component
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manufacturer or distributor that manufactures or sells new
recreational vehicles. "
SECTION 2. Section 57-16-3 NMSA 1978 (being Laws 1973,
Chapter 6, Section 3, as amended) is amended to read:
"57-16-3. DEFINITIONS.--As used in Chapter 57, Article 16
NMSA 1978:
A. "current price" means an amount equal to the
price listed in the manufacturer's or distributor's printed
price list in effect when the franchise is terminated, less
applicable trade and cash discounts;
B. "dealer cost" means an amount equal to the sum
of the original invoice price that the dealer paid for
inventory and the cost of the delivery of the inventory from
the manufacturer or distributor to the dealer, less applicable
discounts;
C. "designated family member" means a spouse,
child, grandchild, parent, brother or sister of a deceased or
incapacitated dealer who is entitled to inherit the dealer's
ownership interest in the dealership under the terms of a will
or the laws of intestate succession in this state. In the case
of an incapacitated dealer, the term means the person appointed
by a court as the legal representative of the dealer's
property. The term also includes the appointed and qualified
personal representative and the testamentary trustee of a
deceased dealer. However, the term shall be limited to mean
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only that individual designated by a dealer in a written
document filed with the manufacturer, distributor or
representative in the event that such a document has been
filed;
D. "distributor" means any person who distributes
or sells new or used motor vehicles to dealers and who is not a
manufacturer;
E. "do not drive order" means a notice advising a
motor vehicle dealer or an owner of a motor vehicle not to
drive the vehicle until the vehicle has been repaired because
the vehicle has a safety defect, fails to comply with a federal
motor vehicle safety standard or fails to comply with a federal
requirement;
F. "former franchisee":
(1) means a dealer that has entered into a
franchise agreement with a manufacturer and that has:
(a) entered into a termination agreement
or deferred termination agreement with the manufacturer related
to the franchise; or
(b) has had the franchise canceled,
terminated or otherwise ended; and
(2) includes the designated successor of the
former franchisee in the event the former franchisee is
deceased or disabled;
G. "franchise" means an oral or written arrangement
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for a definite or indefinite period in which a manufacturer,
distributor or representative grants to a motor vehicle dealer
a license to use a trade name, service mark or related
characteristic and in which there is a community of interest in
the marketing of motor vehicles or services related to
marketing, service or repair of motor vehicles at wholesale,
retail, leasing or otherwise;
H. "fraud" includes, in addition to its normal
legal connotation, the following:
(1) a misrepresentation in any manner, whether
intentionally false or due to gross negligence, of a material
fact;
(2) a promise or representation not made
honestly and in good faith; and
(3) an intentional failure to disclose a
material fact;
I. "inventory" means new or unused motorcycles,
motor vehicles, motorcycle attachments and motorcycle and motor
vehicle repair parts that are provided by a manufacturer or
distributor to a dealer under a franchise agreement and that
are purchased within thirty-six months of the termination of
the franchise or are listed in the manufacturer's or
distributor's current sales manual or price list at the time
that the franchise is terminated;
J. "manufacturer" means any person who manufactures
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or assembles new motor vehicles either within or outside of
this state and may include a predecessor manufacturer or a
successor manufacturer;
K. "motorcycle" means any motor vehicle used on or
off a public highway that has an unladen weight of less than
one thousand five hundred pounds;
L. "motor vehicle" means every self-propelled
vehicle, having two or more wheels, by which a person or
property may be transported on a public highway [and includes
recreational vehicles ];
M. "motor vehicle dealer" or "dealer" means a
person who sells or solicits or advertises the sale of new or
used motor vehicles and is licensed as a dealer pursuant to the
Motor Vehicle Code. "Motor vehicle dealer" or "dealer" shall
not include:
(1) receivers, trustees, administrators,
executors, guardians or other persons appointed by or acting
under judgment, decree or order of any court;
(2) public officers while performing their
duties as such officers;
(3) persons making casual sales of their own
vehicles duly registered and licensed to them by the state; or
(4) finance companies, banks and other lending
institutions covering sales of repossessed vehicles;
N. "person" means every natural person,
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partnership, corporation, association, trust, estate or any
other legal entity;
O. "predecessor manufacturer" means a manufacturer
that is acquired, succeeded by or assumed by a successor
manufacturer;
P. "prospective purchaser" means a person who has a
bona fide written agreement to purchase a franchise;
Q. "recall claim" includes a claim for
reimbursement for the parts and labor required for a dealer to
repair a motor vehicle subject to a do not drive order or stop
sale order;
R. "recreational vehicle" means [any motor vehicle
with a camping body that either has its own motive power or is
drawn by another vehicle ] a vehicle that is either self-
propelled or towed by a consumer-owned tow vehicle and that is
designed to provide temporary living quarters for recreational,
camping or travel use, and includes motor homes, travel
trailers, fifth wheel travel trailers, truck campers and
folding camping trailers ;
S. "relevant market area" means an area of a size
specified in this subsection around an existing motor vehicle
dealer's place of business. The size of the area shall be the
greater of the area of responsibility specified in the dealer's
franchise or a circle with a center at the dealer's place of
business and a radius of:
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(1) seven miles, if the population of the
county in which the dealership is located is two hundred fifty
thousand or more;
(2) fifteen miles, if the population of the
county in which the dealership is located is less than two
hundred fifty thousand but is thirty-five thousand or more; or
(3) twenty miles in all other cases.
If the existing and proposed dealerships are in different
counties, the lesser of the applicable mileage limitations
shall be used. For purposes of this subsection, the population
of any area shall be determined in accordance with the most
recent decennial census or the most recent population update
from the national planning data corporation or other similar
recognized source, whichever is later;
T. "representative" means any person who is or acts
as an agent, employee or representative of a manufacturer or
distributor and who performs any duties in this state relating
to promoting the distribution or sale of new or used motor
vehicles or contacts dealers in this state on behalf of a
manufacturer or distributor;
U. "sale" includes:
(1) the issuance, transfer, agreement for
transfer, exchange, pledge, hypothecation or mortgage in any
form, whether by transfer in trust or otherwise, of any motor
vehicle or interest therein or of any franchise related
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thereto; and
(2) any option, subscription or other contract
or solicitation looking to a sale or offer or attempt to sell
in any form, whether spoken or written. A gift or delivery of
any motor vehicle or franchise with respect thereto with, or
as, a bonus on account of the sale of anything shall be deemed
a sale of such motor vehicle or franchise;
V. "stop sale order" means a notice prohibiting a
motor vehicle dealer from leasing or selling and delivering at
wholesale or retail a used motor vehicle in the inventory of
the dealer until the vehicle has been repaired because the
vehicle has a safety defect, fails to comply with a federal
motor vehicle safety standard or fails to comply with a federal
requirement;
W. "successor manufacturer" means a motor vehicle
manufacturer that, on or after January 1, 2010, acquires,
succeeds to or assumes any part of the business of a
predecessor manufacturer as the result of:
(1) a change in ownership, operation or
control of the predecessor manufacturer;
(2) the termination, suspension or cessation
of all or a part of the business operation of the predecessor
manufacturer;
(3) the discontinuance of the sale of a
product line; or
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(4) a change in the distribution system by the
predecessor manufacturer, whether through a change in
distributor or the predecessor manufacturer's decision to cease
conducting business through a distributor; and
X. "value of the used motor vehicle" means the
average trade-in value indicated in an independent third party
guide for a used motor vehicle of the same year, make and
model."
SECTION 3. [NEW MATERIAL] SHORT TITLE.--Sections 3
through 13 of this act may be cited as the "Recreational
Vehicle Manufacturer and Dealer Act".
SECTION 4. [NEW MATERIAL] DEFINITIONS.--As used in the
Recreational Vehicle Manufacturer and Dealer Act:
A. "area of sales responsibility" means the
geographical area agreed to by a dealer and a manufacturer in a
manufacturer-dealer agreement within which the dealer has the
exclusive right to display or sell the manufacturer's new
recreational vehicles of a particular line-make;
B. "coercion" means threatening to terminate,
cancel or not renew a manufacturer-dealer agreement without
good cause or threatening to withhold product lines or delay
product delivery as an inducement to amending the agreement;
C. "component manufacturer" means a person,
corporation or business entity that engages in the
manufacturing of components, accessories or parts used in
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manufacturing recreational vehicles;
D. "dealer" means a person, corporation or business
entity licensed or required to be licensed to sell new
recreational vehicles under the Motor Vehicle Code;
E. "distributor" means a person, corporation or
business entity that purchases new recreational vehicles for
resale to dealers;
F. "factory campaign" means the effort of a
warrantor to contact recreational vehicle owners or dealers to
address an issue with a part or equipment;
G. "family member" means a spouse, child,
grandchild, parent, sibling, niece or nephew;
H. "line-make" means a specific series of
recreational vehicle products that:
(1) are targeted to a particular market
segment, as determined by decor, features, equipment, size,
weight and price range;
(2) have lengths and interior floor plans that
distinguish the recreational vehicles from other recreational
vehicles with substantially the same decor, features,
equipment, weight and price; and
(3) belong to a single, distinct
classification of recreational vehicle product type having a
substantial degree of commonality in the construction of the
chassis, frame and body;
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I. "manufacturer" means a person, corporation or
business entity that engages in the manufacturing of
recreational vehicles;
J. "manufacturer-dealer agreement" means a written
agreement or contract entered into between a manufacturer and a
dealer that fixes the rights and responsibilities of the
parties and pursuant to which the dealer sells new recreational
vehicles;
K. "model" means a subset of a line-make that
consists of a series of recreational vehicle products
identified by a common series trade name or trademark;
L. "proprietary part" means any part manufactured
by or for and sold exclusively by a manufacturer;
M. "recreational vehicle" means a vehicle that is
either self-propelled or towed by a consumer-owned tow vehicle
and that is designed to provide temporary living quarters for
recreational, camping or travel use, and includes motor homes,
travel trailers, fifth wheel travel trailers, truck campers and
folding camping trailers;
N. "transient customer" means a customer who is
temporarily traveling through a dealer's area of sales
responsibility; and
O. "warrantor" means a person, corporation or
business entity that gives a warranty in connection with a new
recreational vehicle or parts, accessories or components of a
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recreational vehicle, and excludes service contracts, insurance
or extended warranties sold for separate consideration by a
dealer or person not controlled by a manufacturer.
SECTION 5. [NEW MATERIAL] MANUFACTURER-DEALER AGREEMENT--
REQUIREMENTS--AREA OF SALES RESPONSIBILITY.--
A. A manufacturer or distributor shall not sell a
new recreational vehicle to or through a dealer without first
entering into a manufacturer-dealer agreement with the dealer.
B. A dealer shall not sell a new recreational
vehicle without first entering into a manufacturer-dealer
agreement with a manufacturer or distributor.
C. A manufacturer-dealer agreement shall state the
duration of the terms of the agreement and designate an area of
sales responsibility exclusively assigned to a dealer. For the
duration of the manufacturer-dealer agreement, the area of
sales responsibility shall not change, and the manufacturer or
distributor shall not contract with another dealer for sale of
the same model or line-make, as specified in the manufacturer-
dealer agreement, in the designated area of sales
responsibility, unless agreed to by written consent of all
parties to the agreement.
D. A manufacturer, distributor or dealer shall not
issue a policy or procedure that violates or substantially
alters a provision of the manufacturer-dealer agreement during
the duration of the agreement, unless agreed to by written
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consent of all parties to the agreement.
E. A manufacturer or distributor shall:
(1) distribute new recreational vehicles to
its dealers in a fair and equitable manner;
(2) if requested by a dealer, provide
information on its manner of distribution; and
(3) if requested by a dealer, provide a dealer
pursuant to a manufacturer-dealer agreement with adequate
technical data to perform proper service and repairs.
F. When taking on an additional recreational
vehicle of a particular line-make, a dealer shall notify in
writing a manufacturer or distributor with which the dealer has
a manufacturer-dealer agreement of the same line-make at least
thirty days prior to entering into a new manufacturer-dealer
agreement with the manufacturer or distributor of the
additional recreational vehicle.
SECTION 6. [NEW MATERIAL] TERMINATION, CANCELLATION AND
NONRENEWAL OF A MANUFACTURER-DEALER AGREEMENT--GOOD CAUSE--
NOTICE--REQUIRED REPURCHASE.--
A. A manufacturer or distributor, directly or
through an officer, agent or employee, shall terminate, cancel
or fail to renew a model, line-make or manufacturer-dealer
agreement only with good cause, and upon renewal, shall not
require additional inventory stocking requirements or increased
retail sales targets in excess of the market growth in the
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dealer's area of sales responsibility. For the purposes of
determining whether there is good cause for an action to
terminate, cancel or fail to renew a model, line-make or
manufacturer-dealer agreement, the following factors may be
considered:
(1) the extent of the affected dealer's
penetration in the relevant market area for the relevant model
or line-make;
(2) the nature and extent of the dealer's
investment in the dealer's business;
(3) the adequacy of the dealer's service
facilities, equipment, parts, supplies and personnel;
(4) the effect of the proposed action on the
relevant community;
(5) the extent and quality of the dealer's
service under recreational vehicle warranties;
(6) any failures by the dealer to follow
procedures or standards of operation pursuant to the
manufacturer-dealer agreement and the law; and
(7) a dealer's violation of the terms of the
manufacturer-dealer agreement or the Recreational Vehicle
Manufacturer and Dealer Act.
B. Except as otherwise provided in this section and
unless the reason for termination, cancellation or nonrenewal
of a model, line-make or manufacturer-dealer agreement is
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insolvency, bankruptcy or the occurrence of an assignment for
the benefit of creditors, a manufacturer or distributor shall
provide a dealer with at least one hundred twenty days of
written notice of termination, cancellation or nonrenewal of a
model, line-make or manufacturer-dealer agreement. The written
notice shall state all reasons for the proposed termination,
cancellation or nonrenewal.
C. If, within thirty days following receipt of a
notice pursuant to Subsection B of this section, the dealer
provides to the manufacturer or distributor a written notice of
intent to cure all stated deficiencies, the dealer shall have
one hundred twenty days following receipt of the notice to
rectify the deficiencies.
D. The notice period for a manufacturer's or
distributor's termination, cancellation or nonrenewal may be
reduced to thirty days if the grounds for termination,
cancellation or nonrenewal are due to:
(1) a dealer or one of the dealer's owners
being convicted of or entering a plea of nolo contendere to a
felony;
(2) a dealer abandoning or closing business
operations for at least ten consecutive business days, unless
the abandoning or closing is due to force majeure or a strike,
labor difficulty or other cause over which the dealer has no
control;
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(3) a misrepresentation by the dealer that
materially affects the business relationship;
(4) a material violation by the dealer of a
provision of the Recreational Vehicle Manufacturer and Dealer
Act that is not cured within thirty days after written notice;
or
(5) a suspension or revocation of the dealer's
license, or the refusal to renew the dealer's license, by the
taxation and revenue department.
E. A dealer may terminate, cancel or not renew a
model, line-make or manufacturer-dealer agreement with a
manufacturer or distributor with or without good cause at any
time by giving thirty days of written notice to the
manufacturer or distributor. If the termination, cancellation
or nonrenewal is for good cause, the dealer shall state all
reasons for the proposed termination, cancellation or
nonrenewal and has the burden of showing good cause. The
following factors may be considered for the purposes of
determining whether there is good cause:
(1) a manufacturer or distributor being
convicted of or entering a plea of nolo contendere to a felony;
(2) a manufacturer or distributor abandoning
or closing business operations for at least ten consecutive
business days, unless the closing is due to force majeure or a
strike, labor difficulty or other cause over which the
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manufacturer or distributor has no control;
(3) a misrepresentation by a manufacturer or
distributor that materially affects the business relationship;
(4) a material violation of a provision of the
Recreational Vehicle Manufacturer and Dealer Act that is not
cured within thirty days after written notice by the dealer to
the manufacturer or distributor;
(5) a declaration by the manufacturer or
distributor of bankruptcy or insolvency or the occurrence of
an assignment by the manufacturer or distributor for the
benefit of creditors or bankruptcy;
(6) a material violation by the manufacturer
or distributor of the manufacturer-dealer agreement that is
not cured within one hundred twenty days after written notice
is provided by the dealer to the manufacturer or distributor;
and
(7) coercion of the dealer by the manufacturer
or distributor.
SECTION 7. [NEW MATERIAL] REQUIRED REPURCHASE--
TERMINATION, CANCELLATION AND NONRENEWAL OF A MANUFACTURER-
DEALER AGREEMENT.--
A. If a manufacturer-dealer agreement is
terminated, canceled or not renewed by a dealer for good cause,
the manufacturer or distributor shall, at the election of the
dealer within forty-five days after the termination,
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cancellation or nonrenewal, repurchase:
(1) new, untitled recreational vehicles that
were sold to the dealer within the eighteen months prior to the
date of the notice of termination, cancellation or nonrenewal
that have not been used, except for demonstration purposes, and
that have not been altered or damaged, at one hundred percent
of the original invoice cost, including transportation, less
applicable rebates and discounts to the dealer. If a vehicle
repurchased is damaged, the amount paid to the dealer shall be
reduced by the cost to repair the damaged vehicle. Damage
prior to the original delivery to the dealer does not
disqualify repurchase pursuant to this subsection;
(2) undamaged accessories and proprietary
parts that were sold to the dealer for resale within the twelve
months prior to the termination, cancellation or nonrenewal if
accompanied by the original invoice, at one hundred five
percent of the original invoice cost; and
(3) properly functioning diagnostic equipment,
special tools, current signage and other equipment and
machinery that were sold to the dealer within the five years
prior to the termination, cancellation or nonrenewal at one
hundred percent of the original invoice cost plus the dealer's
freight, destination, delivery and distribution charges and
sales taxes, if any, if the diagnostic equipment, special
tools, current signage and other equipment can no longer
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be used in the normal course of the dealer's ongoing business.
B. If the manufacturer-dealer agreement is
terminated, canceled or not renewed by the manufacturer or
distributor without good cause, in violation of Subsection A of
this section, the manufacturer or distributor shall repurchase
vehicles, accessories and equipment in accordance with this
section.
C. A vehicle, accessory or equipment that is
repurchased pursuant to this section shall be paid for in full
before it is removed from dealer's premises, and upon payment,
must be immediately surrendered to the manufacturer or
distributor.
D. A dealer is not prohibited from selling the
remaining in-stock inventory of a particular model or line-make
after a dealer agreement has been terminated, canceled or not
renewed by the manufacturer, including recreational vehicles of
a model or line-make subject to the manufacturer-dealer
agreement that are not repurchased or required to be
repurchased by the manufacturer.
SECTION 8. [NEW MATERIAL] TRANSFER OF OWNERSHIP--FAMILY
SUCCESSION--OBJECTIONS--WRITTEN NOTICE.--
A. If a dealer desires to make a change in dealer
ownership by the sale of the business assets, stock transfer or
otherwise, the dealer shall provide written notice to a
manufacturer or distributor with which the dealer has an active
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manufacturer-dealer agreement at least ten business days before
the closing, including all supporting documentation as may be
reasonably required by the manufacturer or distributor to
determine if an objection to the sale may be made.
B. In the absence of a breach by a selling dealer
of a manufacturer-dealer agreement or the provisions of the
Recreational Vehicle Manufacturer and Dealer Act, a
manufacturer or distributor shall not object to a proposed
change in ownership unless the manufacturer or distributor has
previously terminated with good cause a manufacturer-dealer
agreement with the prospective owner or the prospective owner:
(1) has been convicted of a felony or any
crime of fraud, deceit or moral turpitude;
(2) lacks a license required by law;
(3) does not have an active line of credit
sufficient to purchase a manufacturer's or distributor's
product; or
(4) has undergone in the last ten years
bankruptcy, insolvency, a general assignment for the benefit of
creditors or the appointment of a receiver, trustee or
conservator to take possession of the prospective owner's
business or property.
C. If the manufacturer or distributor objects to a
proposed change of ownership, the manufacturer or distributor
shall provide written notice to the dealer stating the reasons
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pursuant to Subsection B of this section within seven business
days after receipt of the dealer's notification and
documentation. The manufacturer or distributor bears the
burden of proving its objection.
D. A manufacturer or distributor shall provide a
dealer an opportunity to designate in writing a family member
as a successor to the dealership in the event of the death,
incapacity or retirement of the dealer, and a manufacturer or
distributor shall honor the succession unless the manufacturer
or distributor provides to the dealer or the dealer's successor
written notice of its objections within ten business days after
receipt of the dealer's succession plan. A manufacturer or
distributor shall only object for the reasons listed pursuant
to Subsection B of this section or if the succession involves a
relocation of the dealer's business or an alteration of the
terms and conditions of the manufacturer-dealer agreement.
SECTION 9. [NEW MATERIAL] DEALER INSPECTION AND
REJECTION--DAMAGED RECREATIONAL VEHICLE--NEW RECREATIONAL
VEHICLE ODOMETER.--
A. If a new recreational vehicle is damaged prior
to transit to the dealer or is damaged in transit to the dealer
when the carrier or means of transportation has been selected
by the manufacturer or distributor, the dealer shall notify the
manufacturer or distributor of the damage within the time frame
specified in the manufacturer-dealer agreement and:
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(1) request from the manufacturer or
distributor authorization to replace the damaged components,
parts or accessories or otherwise correct the damage; or
(2) reject the damaged vehicle within the time
frame specified in the manufacturer-dealer agreement, which
shall not be less than two business days after physical
delivery of the recreational vehicle.
B. If a manufacturer or distributor refuses or
fails to authorize repair of the damage in accordance with the
provisions of Subsection A of this section within ten days
after receipt of notification or if a dealer rejects the
recreational vehicle because of damage, ownership of the new
recreational vehicle shall revert to the manufacturer or
distributor.
C. A dealer may reject a manufacturer's or
distributor's new recreational vehicle that has, at the time of
delivery to the dealer, an unreasonable amount of miles on its
odometer, as determined by the dealer. An unreasonable amount
of miles shall not be equal to an amount less than the distance
between the dealer and the manufacturer's factory or a
distributor's point of distribution, plus one hundred miles.
If a dealer rejects a new recreational vehicle pursuant to this
subsection, ownership of the recreational vehicle shall revert
to the manufacturer or distributor.
D. A dealer shall exercise due care in custody of a
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damaged or rejected recreational vehicle but shall have no
other obligations, financial or otherwise, with respect to that
recreational vehicle.
SECTION 10. [NEW MATERIAL] COERCION OF DEALER
PROHIBITED.--
A. A manufacturer or distributor shall not coerce
or attempt to coerce a dealer to:
(1) purchase a product that the dealer did not
order;
(2) enter into an agreement with the
manufacturer or distributor;
(3) take any illegal action or action that is
unfair or unreasonable to the dealer;
(4) enter into an agreement that requires the
dealer to submit its disputes to binding arbitration or
otherwise waive rights or responsibilities provided under the
Recreational Vehicle Manufacturer and Dealer Act; or
(5) forego exercising a right authorized by a
manufacturer-dealer agreement or any law governing the
relationship between the manufacturer or distributor and the
dealer.
B. A dealer bears the burden of proving unlawful
coercion pursuant to this section.
SECTION 11. [NEW MATERIAL] WARRANTY OBLIGATIONS.--
A. A warrantor shall:
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(1) specify in writing to its dealers any
obligations for preparation, delivery and warranty service on
its products;
(2) provide a dealer with the warrantor's
schedule of compensation to be paid and reasonable time
allowances for the diagnosis and performance of any work and
service. The schedule of compensation shall include reasonable
compensation for diagnostic work and warranty labor. If the
schedule of compensation does not include a particular repair,
the warrantor shall reimburse the dealer for warranty service
for the actual time expended unless the warrantor demonstrates
that the actual time was not reasonable, in which case the
warrantor shall pay a reasonable sum based on industry averages
for pay rate and time;
(3) compensate its dealers for warranty
service covered by the warranty in accordance with the provided
schedule and time allowances if the service is performed in a
timely and competent manner;
(4) compensate its dealers for authorized
repairs effected by the dealer of merchandise damaged in
manufacture or transit to the dealer if the carrier is
designated by the warrantor, factory branch, distributor or
distributor branch;
(5) compensate a dealer for warranty labor in
an amount not less than the lowest retail labor rate actually
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charged by the dealer in the ordinary course of business for
like nonwarranty labor; provided that the rate is reasonable;
(6) reimburse a dealer for any warranty part,
accessory or complete component at actual wholesale cost plus a
minimum thirty percent handling charge and any cost of freight
to return the part to the warrantor or, if a part is sent to
the dealer at no cost, reimburse the dealer in an amount equal
to thirty percent of the wholesale cost of the part from the
warrantor as a handling charge, with a maximum handling charge
for a part of three hundred dollars ($300);
(7) conduct warranty audits of dealer records
on a reasonable basis;
(8) not deny dealer claims for warranty
compensation except for good cause, such as performance of
nonwarranty repairs, material noncompliance with the
warrantor's published policies and procedures, lack of material
documentation, fraud or misrepresentation;
(9) approve or disapprove of warranty claims
in writing within forty-five days after the date of submission
by a dealer;
(10) include, in written notices of factory
campaigns to recreational vehicle owners and dealers, the
expected date by which necessary parts and equipment, including
tires and chassis or chassis parts, will be available to
dealers to perform the factory campaign work. A warrantor may
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ship parts to a dealer to affect the factory campaign work,
and, if such parts are in excess of the dealer's requirements,
the dealer may return unused parts to the warrantor for credit
after completion of the factory campaign;
(11) not intentionally misrepresent to
purchasers of recreational vehicles that warranties with
respect to the manufacture, performance or design of the
vehicle are made by the dealer as warrantor or co-warrantor;
(12) not require its dealers to make
warranties to customers in any manner related to the
manufacture of the recreational vehicle; and
(13) perform its warranty obligations with
respect to its warranted products.
B. A dealer shall:
(1) submit warranty claims within forty-five
days after completing work;
(2) notify a warrantor as soon as is
reasonably possible, verbally or in writing, if the dealer is
unable or unwilling to perform material or repetitive warranty
repairs;
(3) perform pre-delivery inspection functions,
as specified by the warrantor, in a competent and timely
manner;
(4) perform warranty service work authorized
by the warrantor in a competent and timely manner on any
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transient customer's vehicle of the same line-make unless the
dealer determines that the customer is acting in a manner
detrimental to its business;
(5) track actual time spent performing
warranty work not governed by time allowances in the
warrantor's schedule of compensation;
(6) not claim an agency relationship with a
warrantor or manufacturer; and
(7) not misrepresent the terms of any
warranty.
C. Warranty claims not specifically disapproved by
a warrantor in writing within forty-five days after the date of
submission by a dealer shall be construed to be approved and
shall be paid within sixty days; provided that the dealer
submits the warranty claim in the manner and form prescribed by
the warrantor.
D. Notwithstanding the terms of any manufacturer-
dealer agreement, a warrantor shall indemnify, defend and hold
harmless its dealers against any losses or damages to the
extent such losses or damages are caused by the negligence or
willful misconduct of the warrantor, including a dealer that
fails to discover, disclose or remedy a defect in the design or
manufacture of the relevant recreational vehicle. A dealer
shall provide to the warrantor a copy of any suit in which
allegations are made pursuant to this subsection within ten
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days after receiving the suit. This subsection shall continue
to apply even after a recreational vehicle is titled.
E. Notwithstanding the terms of any manufacturer-
dealer agreement, a dealer shall indemnify, defend and hold
harmless its warrantor against any losses or damages to the
extent such losses or damages are caused by the negligence or
willful misconduct of the dealer. The warrantor shall provide
to the dealer a copy of any suit in which allegations are made
pursuant to this subsection within ten days after receiving the
suit. This subsection shall continue to apply even after a
recreational vehicle is titled.
F. Indemnification pursuant to Subsection D or E of
this section shall include court costs, reasonable attorney
fees and expert witness fees incurred by the dealer or
warrantor.
SECTION 12. [NEW MATERIAL] DISPUTE RESOLUTION--MEDIATION
REQUIRED BEFORE CIVIL ACTION--VENUE--RELIEF.--
A. A dealer, manufacturer, distributor or warrantor
injured by another party's violation of the Recreational
Vehicle Manufacturer and Dealer Act may bring a civil action to
recover actual damages. The court shall award attorney fees
and costs to the prevailing party. Venue for any civil action
authorized by this section shall be in the county in which the
dealership is located. In an action involving more than one
dealer, venue may be in any county in which a dealer that is
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party to the action is located.
B. Prior to bringing suit for an alleged violation
pursuant to this section, a party shall make a good faith
effort to mediate the dispute, including serving upon the
responding party a written demand for mediation, selecting a
mediator, scheduling a mediation and participating in the
mediation. This provision does not apply to a proceeding for
injunctive relief.
C. A written demand for mediation shall contain a
brief statement of the dispute and the relief sought by the
party filing the demand, and the written demand for mediation
shall be served upon the responding party via certified mail at
the address stated in the agreement between the parties or, if
the address is not contained in the agreement or the address is
no longer valid, the address on the responding party's license
filed with the state. In the event of a civil action between
two dealers, the demand shall be mailed to the address on the
dealer's license filed with the state.
D. Within thirty days after the date a demand for
mediation is served, the parties shall mutually select an
independent mediator and meet with the mediator for the purpose
of attempting to resolve the dispute. The mediator shall
select a location in New Mexico, and the mediator may extend
the date of the meeting for good cause shown by either party or
upon stipulation of both parties.
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E. If a responding party does not reply within
thirty days after the demand for mediation is served, the party
initiating the action may proceed to a civil action without
mediating.
F. The service of a demand for mediation pursuant
to this subsection stays the time for the filing of any
complaint, petition, protest or action pursuant to the
Recreational Vehicle Manufacturer and Dealer Act until
representatives of the involved parties complete a mediation
with a mutually selected mediator for the purpose of attempting
to resolve the dispute. If a complaint, petition, protest or
action is filed before the mediation, a court shall enter an
order suspending the proceeding or action until the meeting has
occurred and may, upon written stipulation of all parties to
the proceeding or action that the parties wish to continue to
mediate pursuant to this subsection, enter an order suspending
the proceeding or action for as long a period as the court
considers appropriate. The suspension order issued may be
revoked by the court.
G. The parties to a mediation pursuant to this
section shall bear their own costs for attorney fees and divide
equally the cost of the mediator.
H. In addition to the remedies provided by this
section and notwithstanding the existence of any additional
remedy at law, a dealer, manufacturer or distributor may apply
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to the relevant court for the grant, upon a hearing and for
cause shown, of a temporary or permanent injunction to restrain
a person from acting as a dealer, manufacturer or distributor
without being properly licensed or from violating the
provisions of the Recreational Vehicle Manufacturer and Dealer
Act. The injunction shall be issued without bond.
SECTION 13. [NEW MATERIAL] PENALTIES.--
A. If the taxation and revenue department finds
that a dealer, manufacturer or distributor has violated a
provision of the Recreational Vehicle Manufacturer and Dealer
Act, the department may suspend or revoke the license of the
dealer, manufacturer or distributor.
B. If the taxation and revenue department finds
that a person has violated a provision of the Recreational
Vehicle Manufacturer and Dealer Act, the department may assess
and collect an administrative penalty against the person in an
amount not to exceed one thousand dollars ($1,000) for each
violation.
C. A person, dealer, manufacturer or distributor
aggrieved by a decision of the taxation and revenue department
made pursuant to the provisions of this section may appeal to
the administrative hearings office for a hearing. A person,
dealer, manufacturer or distributor that continues to be
aggrieved after the decision made by a hearing officer may
appeal that decision to a district court pursuant to the
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provisions of Section 39-3-1.1 NMSA 1978.
SECTION 14. REPEAL.--Section 57-16-6.2 NMSA 1978 (being
Laws 1995, Chapter 19, Section 2, as amended) is repealed.
SECTION 15. EFFECTIVE DATE.--The effective date of the
provisions of this act is January 1, 2026.
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