13-14-307.5 - Termination, cancellation, or nonrenewal of a recreational vehicle franchise agreement.
13-14-307.5. Termination, cancellation, or nonrenewal of a recreational vehiclefranchise agreement.
(1) This section applies only to a recreational vehicle franchisee's termination,cancellation, or nonrenewal of:
(a) a recreational vehicle franchise; or
(b) a recreational vehicle line-make.
(2) (a) A recreational vehicle franchisee may, at any time and with or without goodcause, terminate, cancel, or not renew its recreational vehicle franchise agreement or arecreational vehicle line-make by giving 30 days' prior written notice to the recreational vehiclefranchisor.
(b) A franchisee has the burden of showing that a termination, cancellation, ornonrenewal is for good cause.
(c) Good cause for a franchisee's termination, cancellation, or nonrenewal is consideredto exist if:
(i) the franchisor is convicted of or enters a plea of nolo contendere to a felony;
(ii) the business operations of the franchisor are:
(A) abandoned; or
(B) closed for 10 consecutive business days, unless the closing is due to an act of God, astrike, a labor difficulty, or another cause over which the franchisor has no control;
(iii) the franchisor makes a misrepresentation that materially and adversely affects thebusiness relationship with the recreational vehicle franchisee;
(iv) a material violation of this chapter is not cured within 30 days after the franchiseegives 30 days' written notice of the violation to the recreational vehicle franchisor; or
(v) the recreational vehicle franchisor:
(A) becomes insolvent;
(B) declares bankruptcy; or
(C) makes an assignment for the benefit of creditors.
(3) If the franchisee terminates, cancels, or does not renew the recreational vehiclefranchise agreement or line-make for cause, the franchisor shall, at the franchisee's election andwithin 45 days after termination, cancellation, or nonrenewal, repurchase:
(a) (i) all new, unaltered recreational vehicles, including demonstrators, that thefranchisee acquired from the franchisor within 18 months before the date of the termination,cancellation, or nonrenewal; and
(ii) for a repurchase price equal to 100% of the original net invoice cost, includingtransportation, reduced by:
(A) any applicable rebates and discounts to the franchisee; and
(B) the cost to repair any damage to a repurchased recreational vehicle, if the vehicle isdamaged after delivery to the franchisee but before repurchase occurs;
(b) (i) all undamaged accessories and proprietary parts sold by the recreational vehiclefranchisor to the franchisee within one year before termination, cancellation, or nonrenewal, ifaccompanied by the original invoice; and
(ii) for a repurchase price equal to 100% of the original net invoice cost, plus anadditional 5% of the original net invoice cost to compensate the franchisee for packing andshipping the returned accessories and parts to the franchisor; and
(c) (i) any properly functioning diagnostic equipment, special tools, current signage, and
other equipment and machinery that:
(A) the franchisee purchased:
(I) from the franchisor within five years before termination, cancellation, or nonrenewal;and
(II) at the franchisor's request or because of the franchisor's requirement; and
(B) are no longer usable in the normal course of the franchisee's ongoing business, as thefranchisee reasonably determines; and
(ii) for a repurchase price equal to 100% of the original net cost that the franchisee paid,plus any applicable shipping charges and sales taxes.
(4) A recreational vehicle franchisor shall pay the franchisee all money due underSubsection (3) within 30 days after the franchisor's receipt of the repurchased items.
Enacted by Chapter 33, 2010 General Session