2023 Connecticut General Statutes › Title 42 - Business, Selling, Trading and Collection Practices › Chapter 739 - Trading Stamps, Mail Orders, Franchises, Credit Programs and Subscriptions › Section 42-133w. - Manufacturer or distributor to compensate dealer upon termination, nonrenewal or cancellation.

(a) Upon the termination, nonrenewal or cancellation of any franchise under sections 42-133r to 42-133ee, inclusive, initiated by the manufacturer, distributor or dealer, the dealer shall be allowed fair and reasonable compensation by the manufacturer or distributor for: (1) The new current model year motor vehicles and the prior model year motor vehicles acquired not later than twelve months preceding such termination, with fewer than three hundred miles registered on the odometer, acquired from the manufacturer, distributor or a same line-make dealer, in the ordinary course of business, limited to vehicles in such inventory that are (A) unaltered, except for the addition of customary manufacturer-approved accessories, and (B) undamaged. The compensation for motor vehicles pursuant to this subdivision shall not be less than the dealer's net acquisition price, including all transportation or destination charges, less all allowances paid by the manufacturer or distributor to the dealer; (2) all new, unused and undamaged parts listed in the current parts catalog acquired from a manufacturer or distributor or its approved or recommended sources at the dealer price listed in such catalog, less applicable allowances plus five per cent of the catalog price of the part for the cost of packing and returning the parts to the manufacturer or distributor; (3) supplies and furnishings if purchased from the manufacturer or distributor or its approved sources; and (4) any special tools or equipment offered for sale during the three years preceding termination, nonrenewal or cancellation and each trademark or trade name bearing sign which was required by the manufacturer or distributor at fair market value at the time of notice of termination. The compensation required pursuant to subdivisions (3) and (4) of this subsection shall be in an amount equal to the dealer's cost less a thirty-three per cent straight-line depreciation for each year following the dealer's purchase of the items listed in said subdivisions.
(b) Compensation under subsection (a) of this section shall be paid by the manufacturer or distributor not later than ninety days after the effective date of termination, cancellation or nonrenewal if the dealer has title to the vehicle inventory and other items and is able to convey title to the manufacturer or distributor.
(c) The provisions of this section shall not apply in the event of a sale of the assets or stock of a motor vehicle dealership.
(P.A. 82-445, S. 6, 15; P.A. 83-198, S. 6, 11; P.A. 95-245, S. 2, 3; P.A. 05-288, S. 145; P.A. 09-50, S. 3; P.A. 15-191, S. 2.)
History: P.A. 83-198 subjected distributors to the provisions of this section; P.A. 95-245 amended Subsec. (a) to insert new language as Subdiv. (2) allowing dealers to be compensated for all new, unused and undamaged parts listed in current parts catalog at dealer price with allowances and adjustments, renumbering the remaining Subdivs. accordingly, and to insert new language as Subdiv. (4) allowing dealers to be compensated for equipment offered for sale during three years preceding termination, nonrenewal or cancellation and for each trademark or trade name bearing sign at fair market value and amended Subsec. (b) to insert “vehicle” before “inventory”, effective July 1, 1995; P.A. 05-288 made a technical change in Subsec. (b), effective July 13, 2005; P.A. 09-50 amended Subsec. (a) to insert “initiated by the manufacturer, distributor or dealer”, add requirements re motor vehicles acquired not later than 12 months preceding termination of franchise and make conforming changes in Subdiv. (1) and delete “recommended or” in Subdiv. (4), made technical change in Subsec. (b) and added Subsec. (c) re exemption of sale of dealership assets or stock, effective May 8, 2009; P.A. 15-191 amended Subsec. (a) by adding provision re compensation calculation for motor vehicles in Subdiv. (1) and adding provision re compensation calculation pursuant to Subdivs. (3) and (4).