Opinion ID: 1192553
Heading Depth: 3
Heading Rank: 2

Heading: Comparable Legislation

Text: The Act was modeled after its federal counterpart, the Automobile Dealer Suits Against Manufacturers, 15 U.S.C. §§ 1221-1225 (1994), which was enacted by Congress in 1956. See H.R. No. 2850, 84th Cong., 2nd Sess. (1956), reprinted in 1956 U.S.C.C.A.N. 4596. The federal counterpart protects motor vehicle dealers from injury because of an inequality in their bargaining power relative to automobile manufacturers. Id. It is shorter, more narrowly defined, and specifically regulates dealings only between car dealers and manufacturers. See 15 U.S.C. § 1222; Stansifer v. Chrysler Motors Corp., 487 F.2d 59, 63 (9th Cir.1973) (It is obvious that the Act does not apply until a manufacturer-dealer relationship has been created.); see also Colonial Ford, Inc. v. Ford Motor Co. 592 F.2d 1126, 1128 (10th Cir.) (improper and coercive demands made on prospective franchisee prior to formal execution of contract were deemed involved in the franchise in order to provide protection under the federal statute, notwithstanding timing of execution), certs. denied, 444 U.S. 837, 100 S.Ct. 73, 62 L.Ed.2d 48 (1979). Unlike its federal counterpart, New Mexico's Act protects consumers, manufacturers, and dealers. General Motors Acceptance Corp., 103 N.M. at 76, 703 P.2d at 173. Given its declared policy, the Act may be thought of both as a dealer protection act akin to the federal law and a consumer protection act. We agree with the Court of Appeals majority that the above-stated policy, coupled with the broad language of Sections 57-16-13 (person) and 57-16-2 (franchise offering), evinces a legislative intent to make remedies available to a wide range of potential plaintiffs. Key, 119 N.M. at 271, 889 P.2d at 879. Nevertheless, we do not believe that the Act's provisions provide unlimited standing to prospective franchisees. In several other jurisdictions courts have denied standing to prospective purchasers of automobile franchises. See Statewide Rent-A-Car, Inc. v. Subaru of Am., 704 F.Supp. 183, 184-85 (D.Mont.1988); Knauz, 720 F.Supp. at 1328-31; Beard Motors, Inc. v. Toyota Motor Distrib., Inc., 395 Mass. 428, 480 N.E.2d 303, 305-07 (1985); Roberts v. General Motors Corp., 138 N.H. 532, 643 A.2d 956, 958-60 (1994); Tynan v. General Motors Corp., 248 N.J.Super. 654, 591 A.2d 1024, 1027-31, certification denied, 127 N.J. 548, 606 A.2d 362 (1991), modified on other grounds, 127 N.J. 269, 604 A.2d 99 (1992) (per curiam). The Court of Appeals majority concluded that other states' statutes involve standing provisions containing more limiting language than New Mexico's, thus lessening the instructive value of these statutes and the cases interpreting them. Key, 119 N.M. at 272, 889 P.2d at 880. We agree. In Illinois, Massachusetts, Montana, and New Jersey, statutory provisions characterize the right of action as belonging to franchisees or motor vehicle dealers. See 815 Ill.Comp.Stat. 710/13 (Smith-Hurd 1994); Mass.Ann.Laws ch. 93B, § 12A (Law.Co-op.1994); Mont.Code Ann. § 61-4-210 (1995); N.J.Stat.Ann. § 56:10-29 (West 1989). Thus, in these states, the Legislature appears to have limited the cause of action to existing franchises. The New Hampshire Supreme Court, construing a statute that granted a right of action to any person so injured, denied standing on the ground that the plaintiff's injury was not within the Legislature's intent in drafting the statutes. Roberts, 643 A.2d at 960 (the claim based on the Dealership Act was properly dismissed for lack of standing). The court specifically noted that [t]he clear intent of the non-consumer-oriented provisions is to protect the investment and property interests of those who are already dealers. Id. 643 A.2d at 959. On the other hand, comparable legislation in Florida grants a right of action to any person. Fla.Stat. ch. 320.697 (1993). Additionally, the Florida Act specifically addresses the prospective franchisee of a franchise. See Fla.Stat. ch. 320.643 (1993). Accordingly, the federal court, interpreting the Florida statute, granted a prospective franchisee standing. See Mike Smith Pontiac, GMC, Inc. v. Mercedes-Benz of N. Am., Inc., 32 F.3d 528, 531 (11th Cir.1994), cert. denied, ___ U.S. ___, 116 S.Ct. 702, 133 L.Ed.2d 659 (1996). Similarly, in Pennsylvania the federal district court granted standing to the plaintiff based upon a statutory right conferred to any person. 63 Pa. Cons.Stat.Ann. § 818.20 (Supp.Pamp.1995); Big Apple BMW, Inc. v. BMW of N. Am., Inc., 974 F.2d 1358, 1382-83 (3rd Cir.1992), cert. denied, 507 U.S. 912, 113 S.Ct. 1262, 122 L.Ed.2d 659 (1993). We conclude that comparable legislation provides no conclusive answer and only uncertain direction. We next review more inclusive legislation.