Texas 2017 - 85th Regular

Texas House Bill HB3404 Compare Versions

Only one version of the bill is available at this time.

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1	1	By: Kuempel H.B. No. 3404
2	2
3	3
4	4	A BILL TO BE ENTITLED
5	5	AN ACT
6	6	relating to the regulation and sale of certain trailers, including
7	7	cargo and livestock trailers, and cargo and livestock trailers with
8	8	living quarters.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Chapter 2301, Occupations Code, is amended by
11	11	adding Subchapter S to read as follows:
12	12	SUBCHAPTER S. MANUFACTURERS, DISTRIBUTORS, AND DEALERS OF CARGO OR
13	13	LIVESTOCK TRAILERS OR CARGO OR LIVESTOCK TRAILERS WITH LIVING
14	14	QUARTERS
15	15	Sec. 2301.901. DEFINITIONS. Notwithstanding Sections
16	16	2301.002(7) and (19), in this subchapter:
17	17	(1) "Agreement" means a written agreement between a
18	18	manufacturer or distributor and a dealer for the purchase and sale
19	19	of new cargo or livestock trailers, and cargo or livestock trailers
20	20	with living quarters.
21	21	(2) "Dealer" means a person engaged in the business of
22	22	buying, selling, selling on consignment, displaying for sale, or
23	23	exchanging at least five cargo or livestock trailers or cargo or
24	24	livestock trailers with living quarters in a calendar year.
25	25	(3) "Cargo or livestock trailer, and cargo or
26	26	livestock trailer with living quarters" means a towable
27	27	recreational vehicle that is also designed, constructed, or used to
28	28	transport animals or cargo.
29	29	(4) "Manufacturer" means a person or entity engaged in
30	30	the business of manufacturing cargo or livestock trailers and cargo
31	31	or livestock trailers with living quarters for the purpose of sale
32	32	or trade.
33	33	(5) "Territory" means:
34	34	(A) for the sale of a manufacturer's cargo or
35	35	livestock trailer and cargo or livestock trailers with living
36	36	quarters, a defined geographical area within which a dealer is
37	37	appointed by the manufacturer as the sole authorized dealer; or
38	38	(B) for the sale of all other manufacturer
39	39	products, a market area within which a dealer is appointed by the
40	40	manufacturer as an authorized dealer.
41	41	Sec. 2301.902. AGREEMENT REQUIRED. A manufacturer or
42	42	distributor contracting with a dealer may not sell or offer for
43	43	sale, and a dealer may not purchase or offer to purchase, a new
44	44	cargo or livestock trailer or a cargo or livestock trailer with
45	45	living quarters unless the manufacturer or distributor and the
46	46	dealer enter into an agreement that complies with this subchapter.
47	47	Sec. 2301.903. TERMS OF AGREEMENT. (a) An agreement under
48	48	this subchapter must include:
49	49	(1) the dealer's defined territory and permitted
50	50	dealership locations;
51	51	(2) the length of the agreement, which may not be less
52	52	than two years;
53	53	(3) provisions for termination or nonrenewal of the
54	54	agreement;
55	55	(4) the obligations of the manufacturer, distributor,
56	56	and dealer in the preparation and delivery of and warranty service
57	57	on new cargo or livestock trailers and cargo or livestock trailers
58	58	with living quarters; and
59	59	(5) the obligations of the manufacturer, distributor,
60	60	and dealer on termination of the agreement, including with respect
61	61	to unsold inventory of new cargo or livestock trailers and cargo or
62	62	livestock trailers with living quarters.
63	63	(b) Notwithstanding Subsection (a)(2), an initial agreement
64	64	between a manufacturer or distributor and a dealer may not have a
65	65	term of less than two years. An extension or renewal of the initial
66	66	agreement or a subsequent agreement under this subchapter between
67	67	the same manufacturer or distributor and dealer must be for a term
68	68	of two or more years.
69	69	Sec. 2301.904. DEALER TERRITORY. (a) A dealer agreement
70	70	must describe a dealer's territory in terms of:
71	71	(1) a radius measured in miles from the dealer's place
72	72	of business; or
73	73	(2) identification of one or more counties in this
74	74	state.
75	75	(b) During the term of an agreement, a manufacturer may not
76	76	appoint another authorized dealer for the sale of the
77	77	manufacturer's cargo or livestock trailers and cargo or livestock
78	78	trailers with living quarters in a dealer's territory.
79	79	(c) Except for purposes of advertising without an
80	80	advertised price or with a manufacturer's suggested retail price, a
81	81	dealer may not advertise or promote the sale of the manufacturer's
82	82	cargo or livestock trailers, and cargo or livestock trailers with
83	83	living quarters outside the dealer's territory, including through
84	84	the Internet.
85	85	(d) A dealer may not use a broker or dealer in another
86	86	dealer's territory to sell a manufacturer's cargo or livestock
87	87	trailers and cargo or livestock trailer's with living quarters.
88	88	(e) This subchapter does not prohibit a dealer from selling
89	89	a cargo or livestock trailer and cargo or livestock trailers with
90	90	living quarters to a customer residing outside of the dealer's
91	91	territory who independently visits the dealership and seeks to
92	92	purchase a cargo or livestock trailer and cargo or livestock
93	93	trailer with living quarters from the dealer.
94	94	Sec. 2301.905. COMPENSATION FOR WARRANTY SERVICE. (a) A
95	95	manufacturer or distributor shall fairly compensate a dealer for
96	96	the work and services the dealer performs and for expenses the
97	97	dealer incurs to comply with a manufacturer's or distributor's
98	98	warranty.
99	99	(b) Except as provided by Subsection (c), a manufacturer or
100	100	distributor may not pay a dealer a labor rate for warranty work that
101	101	is less than the rate the dealer charges retail customers for
102	102	nonwarranty work of the same kind by similar technicians.
103	103	(c) A manufacturer or distributor who has a warranty program
104	104	shall reimburses a dealer at 100 percent of the dealer's retail
105	105	labor rate if the dealer complies with reasonable and objective
106	106	criteria
107	107	(d) A manufacturer or distributor shall approve or deny a
108	108	dealer's written claim for warranty work not later than the second
109	109	business day after the date of receipt of the claim. If the claim is
110	110	approved, the manufacturer or distributor shall pay the claim not
111	111	later than the 30th day after the date of receipt of the dealer's
112	112	written invoice or written proof of completion of the warranty
113	113	work. If the claim is denied, the manufacturer or distributor shall
114	114	notify the dealer of the grounds for denial.
115	115	(e) A manufacturer or distributor may not audit a claim
116	116	filed for warranty work after the first anniversary of the date the
117	117	claim is submitted.
118	118	(f) A manufacturer shall act as the single source of contact
119	119	for the dealer for the manufacturer's component part product
120	120	warranties, other than engine-related product warranties.
121	121	Sec. 2301.906. REPURCHASE BY MANUFACTURER OR DISTRIBUTOR.
122	122	(a) A manufacturer or distributor who terminates or non renews an
123	123	agreement shall repurchase on demand from the dealer any of the
124	124	following items, purchased by the dealer from the manufacturer or
125	125	distributor, that are free and clear of a lien or encumbrance
126	126	notwithstanding floorplans:
127	127	(1) a new, unsold, and complete cargo or livestock
128	128	trailer and cargo or livestock trailer with living quarters, with
129	129	accessories and packaged trailers sold with the trailer, that:
130	130	(A) is in the dealer's inventory; and
131	131	(B) was purchased during the two years preceding
132	132	the date of the termination; and
133	133	(2) any new, current, unsold, and undamaged parts or
134	134	accessories purchased from the manufacturer in the original,
135	135	resalable package.
136	136	(b) A demand for repurchase must be made in writing not
137	137	later than the 90th day after the date the manufacturer or
138	138	distributor terminates the agreement. The dealer shall provide the
139	139	manufacturer or distributor with a complete list of the items to be
140	140	repurchased. The manufacturer or distributor shall complete the
141	141	repurchase not later than the 30th day after the date the dealer
142	142	demands the repurchase.
143	143	(c) The manufacturer or distributor shall:
144	144	(1) repurchase an item described by Subsection (a)(1)
145	145	at the dealer's invoiced cost plus freight, less any allowance paid
146	146	to the dealer;
147	147	(2) repurchase an item described by Subsection (a) (2)
148	148	at the dealer's invoiced cost; and
149	149	(3) it shall be the responsibility of the manufacturer
150	150	or distributor to remove the trailers from the dealership and to pay
151	151	the cost incurred to remove all products from the dealership and to
152	152	transport an item described by Subsection (a) to the
153	153	manufacturer
154	154	or distributor.
155	155	Sec. 2301.907. CIVIL LIABILITY. A person who violates this
156	156	subchapter or an agreement regulated by this subchapter is liable
157	157	to an injured party for:
158	158	(1) the actual damages caused by the violation; and
159	159	(2) reasonable legal fees and court costs if
160	160	litigation is commenced in connection with the violation.
161	161	Sec. 2301.908. VENUE FOR DISPUTE. Venue for a dispute under
162	162	an agreement is in the county of the dealer's principal place of
163	163	business as stated in the agreement.
164	164	SECTION 2. Section 501.002(17), Transportation Code, is
165	165	amended to read as follows:
166	166	(17) "Motor vehicle" means:
167	167	(A) any motor driven or propelled vehicle
168	168	required to be registered under the laws of this state;
169	169	(B) a trailer or semitrailer, other than
170	170	manufactured housing [, that has a gross vehicle weight that
171	171	exceeds 4,000 pounds];
172	172	(C) a travel trailer;
173	173	(D) an all-terrain vehicle or a recreational
174	174	off-highway vehicle, as those terms are defined by Section 502.001,
175	175	designed by the manufacturer for off-highway use that is not
176	176	required to be registered under the laws of this state; or
177	177	(E) a motorcycle, motor-driven cycle, or moped
178	178	that is not required to be registered under the laws of this state.
179	179	SECTION 3. Section 501.004(b), Transportation Code, is
180	180	amended to read as follows:
181	181	(b) This chapter does not apply to:
182	182	(1) a [trailer or] semitrailer used only for the
183	183	transportation of farm products if the products are not transported
184	184	for hire;
185	185	(2) the filing or recording of a lien that is created
186	186	only on an automobile accessory, including a tire, radio, or
187	187	heater;
188	188	(3) a motor vehicle while it is owned or operated by
189	189	the United States; or
190	190	(4) a new motor vehicle on loan to a political
191	191	subdivision of the state for use only in a driver education course
192	192	conducted by an entity exempt from licensure under Section
193	193	1001.002, Education Code.
194	194	SECTION 4. Section 501.037, Transportation Code, is
195	195	repealed.
196	196	SECTION 5. Subchapter S, Chapter 2301, Occupations Code, as
197	197	added by this Act, applies only to an agreement, as defined by
198	198	Section 2301.901, Occupations Code, as added by this Act, entered
199	199	into on or after the effective date of this Act. An agreement
200	200	entered into before the effective date of this Act is governed by
201	201	the law in effect on the date the agreement was entered into, and
202	202	the former law is continued in effect for that purpose.
203	203	SECTION 6. This Act takes effect September 1, 2017.