Law:Title 4. Business Opportunities And Agreements from Chapter 55. Farm, Industrial, Off-road Construction, Forestry (Texas)

From Law Delta

Revision as of 20:59, 28 September 2011 by Admin (Talk | contribs)
(diff) ← Older revision | Latest revision (diff) | Newer revision → (diff)
Jump to: navigation, search


Contents

Chapter 55. Farm, Industrial, Off-road Construction, Forestry

HARVESTING, AND OUTDOOR POWER EQUIPMENT DEALER AGREEMENTS


Subchapter A. General Provisions

Section 55.001.  Definitions.

In this chapter:

(1)  "Controlling interest" means 50 percent or more ownership of or a managing interest in a dealership.

(2)  "Current price" means an amount equal to the price listed in the supplier's printed price list in effect when a dealer agreement is terminated, less applicable trade and cash discounts.

(3)  "Dealer" means a person in the business of the retail sale of equipment.  The term does not include an individual, partnership, or corporation who:

(A)  is primarily engaged in the retail sale and service of off-road construction and earth-moving equipment;

(B)  has purchased 75 percent or more of the dealer's total new product inventory from a single supplier under all agreements with that supplier; and

(C)  has a total annual average sales volume in excess of $100 million for the preceding three years with that single supplier for the territory for which the dealer is responsible in this state.

(4)  "Dealer agreement" means an oral or written contract, of definite or indefinite duration, between a supplier and a dealer, that states the rights and obligations of the parties with respect to the purchase or sale of equipment.

(5)  "Dealer cost" means an amount equal to the sum of the original invoice price that the dealer paid for inventory and the cost to the dealer of the inventory's delivery from the supplier to the dealer, less applicable discounts.

(6)  "Dealership" means the retail sale business engaged in by a dealer under a dealer agreement.

(7)  "Equipment" means farm tractors, farm implements, utility tractors, industrial tractors, forklifts, material-handling equipment, forestry harvesting equipment, off-road construction equipment, and outdoor power equipment and any attachments to or repair parts for those items.

(8)  "Inventory" means new or unused equipment that is provided by a supplier to a dealer under a dealer agreement and that was:

(A)  purchased within the 30-month period preceding the date of the termination of the dealership; or

(B)  listed in the supplier's current sales manual on the date of termination.

(9)  "Outdoor power equipment" means machinery operated by an engine or electric power and used in the landscaping or cultivation of land for nonagricultural purposes. The term includes lawn and garden implements.

(10)  "Supplier" means:

(A)  a person engaged in the manufacture, assembly, or wholesale distribution of equipment; or

(B)  the person's successor in interest, including a purchaser of assets or stock and a surviving corporation resulting from a merger, liquidation, or reorganization.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.002.  Security Interest.

This chapter does not affect a supplier's security interest in inventory.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.003.  Waiver Of Chapter.

An attempted waiver of a provision of this chapter is void.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Subchapter B. Provisions Regarding Dealer Agreement Or Dealership

Section 55.051.  Supplementary Agreement.

A supplier may not coerce or compel a dealer to enter into a written or oral agreement supplementing a dealer agreement with the supplier unless the supplementary agreement is imposed on all other similarly situated dealers in this state.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.052.  Change In Competitive Circumstances.

A supplier may not substantially change the competitive circumstances of a dealer agreement without cause.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.053.  Interest In Dealership By Sale Or Transfer.

(a) A supplier may not prevent, by contract or otherwise, a dealer or an officer, member, partner, or shareholder of a dealer from selling or transferring a noncontrolling interest in the dealership to another person.

(b)  A supplier may prevent a person from selling or transferring a controlling interest in a dealership without the supplier's written consent.  A supplier may not unreasonably withhold the supplier's consent to a sale or transfer of a controlling interest.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.054.  Transfer Of Controlling Interest In Dealership By Succession.

(a) In this section, "family member" means an individual related within the second degree by consanguinity or affinity to an individual owning a controlling interest.

(b)  A supplier and a dealer may provide by written agreement for succession rights to a controlling interest in a dealership on the death of an individual owning the controlling interest.

(c)  If not otherwise determined by a written agreement between the dealer and supplier, on the death of an individual owning a controlling interest in a dealership, the family member to whom the interest passes by will or intestate succession may request that the supplier consent to a transfer of the ownership interest to the family member.

(d)  The supplier shall consent to a transfer described by Subsection (c) if the family member meets the reasonable financial, business experience, and character standards of the supplier.  Before the 91st day after the date the supplier receives the family member's request, the supplier shall send a written response to the family member that:

(1)  grants the supplier's consent; or

(2)  states the supplier's refusal to consent and the specific reasons for the refusal.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.055.  Continuation Of Agreement.

Section 55.053 or 55.054 does not require a supplier to continue a dealer agreement if the supplier determines that the dealer's area of responsibility or trade area lacks sufficient sales potential to reasonably support continuation of the agreement.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.056.  Cause Required For Termination.

A supplier may not terminate, cancel, or fail to renew a dealer agreement without cause.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.057.  Renovation Or Additional Space.

A supplier may not require as a condition of renewal or extension of a dealer agreement that the dealer complete substantial renovation of the dealer's place of business or acquire new or additional space to serve as the dealer's place of business, unless the supplier gives the dealer:

(1)  one year's written notice of the requirement that states all grounds for the requirement; and

(2)  reasonable time to complete the renovation or acquisition.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Subchapter C. Warranties

Section 55.101.

  APPLICABILITY OF

Subchapter

. This subchapter applies only to a warranty claim submitted by a dealer:

(1)  while the dealer agreement is in effect; or

(2)  after the termination of the dealer agreement, if the claim is for work performed before the effective date of the termination.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.102.  Acceptance Or Rejection Of Warranty Claim.

(a) Not later than the 30th day after the date a supplier receives a warranty claim from a dealer, the supplier shall accept or reject the claim.  A claim not rejected before that date is considered accepted.

(b)  Not later than the 30th day after the date a warranty claim is accepted or rejected, the supplier shall:

(1)  pay the accepted claim; or

(2)  send the dealer written notice of the grounds for rejecting the claim.

(c)  A supplier, including a supplier of an electric engine or motor, who pays a claim may not pay less than the hourly labor rate and other expenses involved in the work that the dealer regularly charges to a retail customer who does not assert a warranty and the dealer's net price plus 15 percent for parts.  The number of hours of labor claimed may not exceed 1-1/2 times the supplier's recommended hours for the work.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.103.  Supplier's Recovery Of Warranty Claim.

After paying a warranty claim, a supplier may not charge back, set off, or otherwise attempt to recover all or part of the amount of the claim unless:

(1)  the claim was fraudulent;

(2)  the work for which the claim was made was not properly performed or was unnecessary to comply with the warranty; or

(3)  the dealer did not substantiate the claim according to the supplier's written requirements in effect when the claim arose.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.104.  Purchaser's Warranty Agreement.

A dealer or supplier authorized to sell new farm, industrial, or outdoor power equipment shall give the purchaser a written warranty agreement including replacement or cash refund.  If the dealer determines the equipment cannot be made usable, the manufacturer is liable to the purchaser for the replacement or cash refund.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Subchapter D. Delivery, Sale, And Return Of Equipment

Section 55.151.  Coerced Orders, Deliveries, Or Refusals To Purchase Prohibited.

A supplier may not coerce or compel a dealer to:

(1)  order or accept delivery of equipment with a special feature or accessory not included in the base list price of the equipment as publicly advertised by the supplier unless the special feature or accessory is a safety feature or accessory required by the supplier or by applicable law; or

(2)  refuse to purchase equipment manufactured by another manufacturer.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.152.  Discrimination Among Dealers.

(a) A supplier may not discriminate among dealers in the supplier's delivery, in reasonable quantities and within a reasonable time after receipt of a dealer's order, of equipment covered by the dealer agreement and specifically represented by the supplier as available for immediate delivery.

(b)  Subsection (a) does not apply if the discrimination is because of:

(1)  the supplier's restrictions on extending credit to the dealer;

(2)  the dealer's default under a dealership agreement; or

(3)  an act of God, work stoppage or delay because of a strike or labor difficulty, bona fide shortage of materials, freight embargo, or other cause over which the supplier has no control.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.153.  Late Delivery Of Back-ordered Seasonal Demand Item.

(a) Unless the supplier notifies a dealer of the status of a back-ordered item before shipment of the item to the dealer, a dealer may reject the delivery of an item of equipment other than a repair part or attachment from a supplier if:

(1)  the item has special value in a particular time of year because of predictable seasonal demand and is less marketable and less valuable after the seasonal demand period ends;

(2)  the item was back-ordered and delivery is made after the seasonal demand period ends; and

(3)  the dealer sends written notice of the rejection to the supplier before the 11th day after the delivery of the item.

(b)  The supplier shall pay the costs of the return of an item the delivery of which is rejected under Subsection (a).

(c)  A supplier may not coerce or compel a dealer to accept late delivery of back-ordered seasonal demand equipment other than repair parts or attachments.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.154.  Sales To Affiliated Dealer.

(a) In this section, "affiliated dealer" means a dealer in which a supplier has an ownership interest.

(b)  Except as provided by Subsection (c), a supplier may not:

(1)  sell or offer to sell new or unused equipment to an affiliated dealer at a price lower than the price for a sale of the same equipment, identically equipped, to a nonaffiliated dealer; or

(2)  use a sales promotion plan or other program or device that results in a sale or offer of sale of new or unused equipment to an affiliated dealer at an actual price that is:

(A)  lower than the price for a nonaffiliated dealer; or

(B)  fixed and predetermined solely by the supplier.

(c)  This section does not apply to sales made to a dealer for resale to:

(1)  a unit, agency, or political subdivision of the United States or this state;

(2)  a major fleet account; or

(3)  an organization for testing or demonstrating the equipment.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.155.  Return Of Inventory; Responsibility For Costs.

(a) If on termination of a dealer agreement the dealer delivers to the supplier or a person designated by the supplier inventory purchased from the supplier and held by the dealer on the date of the termination, the supplier shall pay to the dealer:

(1)  the dealer cost of new, unsold, undamaged, and complete equipment, other than repair parts, returned by the dealer; and

(2)  an amount equal to:

(A)  85 percent of the current price of new, undamaged repair parts returned by the dealer, if the supplier handles, packs, and loads the parts; or

(B)  90 percent of the current price of new, undamaged repair parts returned by the dealer, if the supplier does not handle, pack, or load the parts.

(b)  Before returning inventory under this section and not later than the 120th day after the effective date of termination, the dealer shall submit to the supplier a list of the inventory the dealer intends to return, including, to the extent possible, each item's trade name, description, and serial number.  Not later than the 60th day after the date the supplier receives the list, the supplier shall notify the dealer in writing of:

(1)  each item that the supplier claims is not subject to reimbursement under this section; and

(2)  the destination for each item the dealer is to deliver to a person designated by the supplier.

(c)  The supplier may subtract from the amount owed under Subsection (a) the amount of debt owed by the dealer to the supplier.

(d)  The supplier and dealer are each responsible for one-half of the cost of delivering the inventory to the supplier or a person designated by the supplier, except that if the dealer delivers an item to a person designated by the supplier the dealer is not responsible for the amount that exceeds the amount for which the dealer would have been responsible if the item had been delivered to the supplier.

(e)  The supplier shall pay the amount owed under this section:

(1)  before the 91st day after the date the supplier or person designated by the supplier receives inventory from the dealer; and

(2)  after the dealer has furnished proof that the inventory was purchased from the supplier.

(f)  On payment of the amount owed under this section, title to the inventory is transferred to the supplier or person designated by the supplier.

(g)  A supplier and dealer may by agreement alter the time limits provided by this section.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.156.  Return Of Data Processing Or Peripheral Equipment, Software, Or Certain Tools; Responsibility For Costs.

(a) If on termination of a dealer agreement the dealer delivers to the supplier data processing or peripheral equipment, software, or specialized repair tools that the supplier required the dealer to purchase or lease, the supplier shall:

(1)  assume any responsibilities of the dealer under the lease for that equipment or software; and

(2)  pay the dealer:

(A)  an amount equal to the fair market value of the data processing or peripheral equipment or software purchased by the dealer and delivered to the supplier; and

(B)  an amount equal to 75 percent of the cost to the dealer of the specialized repair tools purchased by the dealer and delivered to the supplier.

(b)  The supplier and dealer are each responsible for one-half of the cost of delivering the data processing or peripheral equipment, software, or specialized repair tools to the supplier.

(c)  The supplier shall assume the responsibilities under the lease and pay the amount required by this section before the 61st day after the date the supplier receives the data processing or peripheral equipment, software, or specialized repair tools.

(d)  On payment of the amount required by this section, title or the right of possession to the data processing or peripheral equipment or specialized repair tools purchased or leased by the dealer is transferred to the supplier.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.157.  Supplier's Liability For Late Payment.

A supplier who does not make a payment required by Section 55.155 or 55.156 before the 61st day after the date the supplier receives the final shipment of the inventory, data processing or peripheral equipment, software, or specialized repair tools from the dealer is liable to the dealer for:

(1)  the greater of the dealer cost or current price of any inventory;

(2)  any cost to the dealer of the data processing or peripheral equipment, software, or specialized repair tools;

(3)  any expense incurred by the dealer in returning the inventory, data processing or peripheral equipment, software, or specialized repair tools to the supplier;

(4)  interest on any amounts owed under Subdivision (1), (2), or (3), at the rate applicable to a judgment of a court of this state, beginning on the 61st day after the date the supplier received the inventory, data processing or peripheral equipment, software, or specialized repair tools;

(5)  reasonable attorney's fees; and

(6)  court costs.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Section 55.158.  Exceptions To Supplier's Repurchase, Purchase, Or Assumption Responsibility.

(a) A supplier is not required to repurchase:

(1)  inventory:

(A)  that the dealer orders after the dealer receives notice of the termination of the dealer agreement from the supplier;  or

(B)  for which the dealer cannot furnish evidence of clear title that is satisfactory to the supplier; or

(2)  a repair part that:

(A)  has a limited storage life and was purchased from the supplier more than two years before the date of termination of the dealer agreement;

(B)  is in a broken or damaged package;

(C)  is usually sold as part of a set, if the part is separated from the set; or

(D)  cannot be sold without reconditioning or repackaging.

(b)  A supplier is not required to purchase or assume the responsibilities under the lease for:

(1)  data processing or peripheral equipment or software that the dealer purchased that was not specifically required by the supplier; or

(2)  a specialized repair tool that:

(A)  is not unique to the supplier's product line;

(B)  is not in complete and salable condition; or

(C)  was not purchased by the dealer within the three-year period preceding the date of termination of the dealer agreement.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.



Subchapter E. Enforcement

Section 55.201.  Action For Violation Of Chapter.

A person injured by a violation of this chapter may bring an action for:

(1)  an injunction to prevent further violation;

(2)  damages;

(3)  reasonable attorney's fees; and

(4)  costs.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 885, Sec. 2.01, eff. April 1, 2009.


Personal tools
Laws
Variants
Actions
Navigation
Toolbox