An Act To Protect Maine Citizens and Franchised New Motor Vehicle Dealers
Maine Legislature, Session 124, LD 1337
Committee Amendment CA_A_S262 (Senate)

COMMITTEE AMENDMENT "Pc " to S.P. 483, L.D. 1337, Bill, "An Act To 
Protect Maine Citizens and Franchised New Motor Vehicle Dealers" 
Amend the bill in the emergency preamble by striking out all of the 5th paragraph 
(page 1, lines 11 and 12 in L.D.) 
Amend the bill in the emergency preamble in the 6th paragraph in the 2nd line (page 
1, line 14 in L.D.) by striking out the following: "both current economic conditions and 
the decision making of manufacturers" and inserting the following: 'current economic 
conditions' 
Amend the bill in section 1 in subsection 9-B in the last 3 lines (page 1, lines 27 to 29 
in L.D.) by striking out the following: "or that are substantially similar in their design and 
specifications or are manufactured in the same facility or facilities" 
Amend the bill by inserting after section 1 the following: 
'Sec. 2. 10 MRS A §1174, sub-§3, ~, as enacted by PL 1981, c. 331, §6, is 
amended to read: 
N. 
To require any new motor vehicle dealer to change the location of the new motor 
vehicle dealership or during the course of the agreement or as a condition of renewal 
of a franchise agreement to make any substantial alterations to the dealership 
premises when to do so would be unreasonable;' 
Amend the bill in section 2 in paragraph P in subparagraph (1) in division (a) in the 
last 2 lines (page 2, lines 16 and 17 in L.D.) by striking out the following: "6 months" and 
inserting the following: '6 months 180 days' 
Amend the bill in section 2 in paragraph P in subparagraph (1) in division (b) in the 
2nd line (page 2, line 19 in L.D.) by inserting after the following: "cancellation" the 
following: " noncontinuance' 
Amend the bill in section 2 in paragraph P by striking out all of subparagraph (3) 
(page 2, lines 24 to 27 in L.D.) and inserting the following: 
COMMITTEE AMENDMENT 
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COMMITIEE AMENDMENT ,ft" to S.P. 483, L.D. 1337 
'(3) 
The dealer and the manufacturer or distributor agree not to renew the 
franchise, although the dealer is entitled to the protections set forth in paragraph 
S in any termination, cancelIation, nonrenewal or noncontinuance, whether by the 
manufacturer or the dealer; however, a termination, cancelIation, nonrenewal or 
noncontinuance resulting from a sale of the assets or stock of the dealer or when 
a franchisee of motor homes, as defined in Title 29-A, section 101, subsection 40, 
voluntarily terminates a motor home franchise is exempt from the requirements 
of paragraph S; sF 
Amend the bill in section 3 by striking out alI of paragraph S (page 2, lines 32 to 40 
and page 3, lines 1 to 26 in L.D.) and inserting the folIowing: 
'S. To cancel, terminate, fail to renew or refuse to continue any franchise relationship 
with a licensed new motor vehicle dealer without providing fair and reasonable 
compensation to the licensed new motor vehicle dealer for: 
(1) AlI unsold new model motor vehicle inventory of the current and previous 
model year purchased from the manufacturer; 
(2) Supplies and parts purchased from the manufacturer or its approved sources 
that are listed in the current parts catalog or identical to a part in the current parts 
catalog except for the number assigned to the part, and that can be used for 
repairs under the terms of a manufacturer's new motor vehicle warranty; 
(3) Equipment and furnishings purchased from the manufacturer or its approved 
sources less a reasonable alIowance for normal wear and tear; and 
(4) Special tools and automotive service equipment owned by the dealer that 
were designated as special tools or equipment and required by and purchased 
from the manufacturer or its approved sources, if the tools and equipment are in 
useable and good condition, normal wear and tear excepted. 
If Except for a termination related to a conviction and imprisonment for a felony 
involving moral turpitude that is substantialIy related to the involuntary termination, 
cancellation or nonrene'Nal is due to a failure of perfomlance of the ne'i'~r motor 
vehicle dealer in sales or service and qualifications, functions or duties of a 
franchisee, if the new motor vehicle dealer is leasing the dealership facilities from a 
lessor other than the manufacturer, the manufacturer shall pay the new motor vehicle 
dealer a sum equivalent to the rent for the unexpired teml of the lease or one year's 
rent, whichever is less, or, if the new motor vehicle dealer owns the facilities, the 
manufacturer shall pay the new motor vehicle dealer a sum equivalent to the 
reasonable rental value of the facilities for one year, prorated for each line make at 
the facility based on total sales volume of each line make at the facility for the 
calendar year prior to the involuntary termination, cancellation, noncontinuance or 
nonrenewal. 
The manufacturer shall pay the new motor vehicle dealer the sum 
equivalent to the rent or the reasonable rental value of the facilities when possible 
within 90 days of the effective date of the termination, cancellation, non continuance 
or nonrenewal if the new motor vehicle dealer has notified the manufacturer of the 
amount of rent or reasonable rental value to which the dealer is entitled. 
COMMITTEE AMENDMENT 
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COMMITIEE AMENDMENT "A" to S.P. 483, L.D. 1337 
The fair and reasonable compensation for the items listed in subparagraphs (1) to (4) 
may in no instance be less than the acquisition price and must be paid by the 
manufacturer when possible within 90 days of the effective date of the termination, 
cancellation, noncontinuance or nonrenewal, provided that the new motor vehicle 
dealer has clear title to the inventory arid other items and is in a position to convey 
that title to the manufacturer. These items must be paid for by the manufacturer when 
possible within 90 days of the effective date of the termination, cancellation, 
noncontinuance or nonrenewal. 
In order to be entitled to rental assistance from the manufacturer, the dealer is 
obligated to mitigate rental assistance by listing the dealership facilities for lease or 
sublease with a licensed real estate agent within 30 days after the effective date of the 
termination of the franchise and thereafter by reasonably cooperating with the real 
estate agent in the performance of the agent's duties and responsibilities. In the event 
that the dealer is able to lease or sublease the dealership facilities on terms that are 
consistent with local zoning requirements to preserve the right to sell motor vehicles 
from the dealership facilities and the terms of the dealer's lease, the dealer is required 
to pay the manufacturer the net revenue received from such mitigation, but only 
following receipt of rental assistance payments pursuant to this paragraph and 'only 
up to the total amount of rental assistance payments that the dealer has received. If 
the facility is used for the operations of more than one franchise, the dealer does not 
have a duty to list the dealership facilities, and the reasonable rental assistance must 
be paid based upon the portion of the facility used by the franchise being terminated, 
cancelled, noncontinued ornonrenewed for one year unless th.e space is filled with 
another product line, in which case no rental payments are required. 
In lieu of any injunctive relief or any other damages, if the manufacturer fails to 
prove there was good cause for the termination, cancellation, noncontinuance or 
nonrenewal, or if the manufacturer fails to prove that it acted in good faith, then the 
manufacturer may pay the new motor vehicle dealer fair and reasonable 
compensation for the value of the dealership as an ongoing business; 61" 
Amend the bill in section 5 by striking out all of paragraph U (page 3, lines 31 to 43 
and page 4, line,s 1 to 33 in L.D.) and inserting the following: 
'U. 
To cancel, terminate, fail to renew or refuse to continue any franchise 
relationship with a licensed new motor vehicle dealer not less than 180 days prior to 
the effective date of such termination, cancellation, noncontinuance or nonrenewal 
that occurs in whole or in part as a result of any change in ownership, operation or 
control of all or any part of the business of the manufacturer, whether by sale or 
transfer of assets, corporate stock or other equity interest, assignment, merger, 
consolidation, combination, joint venture, redemption, operation of law or otherwise; 
or the termination, suspension or cessation of a part or all of the business operations 
of the manufacturer; or discontinuance of the sale of the product line or a change in 
distribution system by the manufacturer, whether through a change in distributors or 
the manufacturer's decision to cease conducting business through a distributor 
altogether. 
In addition to any other payments or requirements in this chapter, if a termination, 
cancellation, noncontinuance or nonrenewal was premised in whole or in part upon 
COMMITTEE AMENDMENT 
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COMlviITTEE AME~DMENT "4" to S.P. 483, L.D. 1337 
any of the occurrences set forth in this paragraph, the manufacturer is liable to the 
licensed new motor vehicle dealer in an amount at least equivalent to the fair market 
value of the franchise arising from the termination, cancellation, noncontinuance- or 
nonrenewal of the franchise. 
(l) If liability is based on the fair market value of the franchise, which must 
include diminution in value of the facilities leased or owned by the dealer as a 
result of the loss of the franchise to operate in the facilities, the fair market value 
must be computed on the date in divisions (a) to (c) that yields the highest fair 
market value: 
(a) 
The date the manufacturer announces the action that results In 
termination, cancellation, noncontinuance or nonrenewal; 
eb) 
The date the action that results in termination, cancellation, 
non continuance or nonrenewal first becomes general knowledge; or 
ec) The date 12 months prior to the date on which the notice of termination, 
cancellation, noncontinuance or nonrenewal is issued. 
If the termination, cancellation, noncontinuance or nonrenewal is due to the 
manufacturer's change in distributors, the manufacturer may avoid paying fair market 
value to the licensed new motor vehicle dealer if the new distributor or the 
manufacturer offers the dealer a franchise agreement with terms acceptable to the 
dealer. 
If an entity other than the original manufacturer of a I ihe make becomes the 
manufacturer for the line make and intends to distribute motor vehicles of that line 
make in this State, that entity shall honor the franchise agreements of the original 
manufacturer and its licensed new motor vehicle dealers or offer those dealers of that 
line make, or of motor vehicles historically of that line make that are substantially 
similar in their design and specifications and are manufactured in the same facility or 
facilities, a new franchise agreement with substantially similar terms and conditions; 
and' 
Amend the bill by relettering or renumbering any nonconsecutive Part letter or 
section number to read consecutively. 
SUMMARY 
This amendment makes the following changes to the bill. 
1. 
It removes provisions in the emergency preamble that reference manufacturers' 
conduct. 
2. 
It removes the reference to motor vehicles that are substantially similar in design 
and specifications and manufactured in the same facility from the definition of "line 
make" and instead amends the provision of law that prohibits interference in a dealer's 
business to require that, if an entity other than the original manufacturer of a line make 
becomes the manufacturer for the line make and intends to distribute motor vehicles of 
that line make in this State, that entity must honor the franchise agreements of the original 
manufacturer and its licensed new motor vehicle dealers or offer those dealers of that 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT 'If " 
to S.P. 483, L.D. 1337 
same line make, or of motor vehicles historically of that line make that are substantially 
similar in their design and specifications and are manufactured in the same facility or 
facilities, a new franchise agreement with substantially similar tenns and conditions. 
3. 
It provides that modifications to dealership facilities as a condition of renewal are 
precluded when unreasonable. 
4. 
It provides that termination benefits are precluded if the new motor vehicle 
dealership stock or assets are otherwise sold. 
5. 
It provides that supplies and parts payments in the event of a termination, 
cancellation, non continuance or nonrenewal are limited to parts in the current parts 
catalog or parts used in relation to new motor vehicle warranty repairs; equipment and 
furnishings and special tools payments, which are subject to a reasonable allowance for 
wear and tear; and special tools and automotive service equipment owned by the dealer 
that were designated as special tools or equipment and required by and purchased from 
the manufacturer or its approved sources, if the tools and equipment are in useable and 
good condition, normal wear and tear excepted. 
6. 
It provides for rental assistance for a term of one year for dealership facilities in 
all tennination, cancellation, noncontinuance and nonrenewal cases, except for those 
cases when the dealer is convicted and imprisoned for a felony involving moral turpitude 
that is substantially related to the qualifications, functions or duties of the franchisee. 
7. 
It makes technical changes to include the term "noncontinuance." 
8. 
It provides that rental assistance is subject to a requirement by the dealer to list 
the dealership facilities with a real estate agent except in those instances when the 
facilities are used for more than. one franchise. 
9. 
It removes all provisions proposing to allow pecuniary loss as a measure of the 
value of a franchise and provisions relating to factory finance terms. 
FISCAL NOTE REQUIRED 
(See attached) 
COMMITTEE AMENDMENT 
Approved: OS/20/09 ,Mac:.. 
LD 1337 
LR 1399(02) 
An Act To Protect Maine Citizens and Franchised New Motor Vehicle Dealers 
Fiscal Note for Bill as Amended by Committee Amendment ,fI" 
Committee: Business, Research and Economic Development 
Fiscal Note Required: Yes 
Fiscal Note 
Minor cost increase - General Fund 
Minor revenue increase - General Fund 
Correctional and Judicial Impact Statements 
Increases the number of civil suits. 
The collection of additional fines may also increase General Fund revenue by minor amounts. 
LR1399(02) - Fiscal Note - Page I of I 
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