Opinion ID: 1798341
Heading Depth: 1
Heading Rank: 4

Heading: Legislative Expressions

Text: There is no statute, State or Federal, which says that an automobile dealer franchise agreement is specifically enforceable in whole or in part. Nevertheless, in considering whether equitable relief is available in a case of this kind, as distinguished from cases involving contract relationships between manufacturers and distributors generally, we can ascertain whether there have been legislative expressions which manifest a public policy on the subject. In 1955 (L.1955, c. 626, § 1) a law was enacted in Minnesota, which, as amended, now appears as Minn.St. 168.27, subd. 14, and reads as follows: It shall be unlawful for any manufacturer or distributor of motor vehicles, or for any officer, employee, agent or representative of such manufacturer or distributor: (1) To induce or coerce or attempt to induce or coerce any retail dealer:       (c) To enter into any agreement with such manufacturer or distributor or to do any other act by threatening to cancel any franchise or contractual agreement existing between such manufacturer or distributor and said retail dealer.       (3) To cancel or refuse to renew the franchise of any retail dealer or any contractual arrangement between such manufacturer or distributor and the retail dealer without just cause. See, Willys Motors v. Northwest Kaiser-Willys (D.Minn.) 142 F.Supp. 469. The automobile dealers' Day In Court Act enacted by Congress on August 8, 1956, provides in part: An automobile dealer may bring suit against any automobile manufacturer engaged in commerce, in any district court of the United States in the district in which said manufacturer resides, or is found, or has an agent, without respect to the amount in controversy, and shall recover the damages by him sustained and the cost of suit by reason of the failure of said automobile manufacturer from and after August 8, 1956 to act in good faith in performing or complying with any of the terms or provisions of the franchise, or in terminating, canceling, or not renewing the franchise with said dealer: Provided, That in any such suit the manufacturer shall not be barred from asserting in defense of any such action the failure of the dealer to act in good faith. 15 U.S.C.A. § 1222. [18] In Bateman v. Ford Motor Co. (E.D. Pa.) 202 F.Supp. 595, the Federal District Court held that the dealers' Day In Court Act does not provide for injunctive relief and therefore plaintiff's application for a temporary injunction to prevent cancellation of his franchise should be denied. On appeal the Circuit Court of Appeals reversed and remanded the case saying that under the general powers of a court of equity the district court has power to enter a preliminary injunction although the Act made no provision for injunctive relief, and the court could enjoin the manufacturer from canceling the franchise. Bateman v. Ford Motor Co. (3 Cir.) 302 F.2d 63. However, there are federal decisions which point the other direction. See, Bethlehem Engineering Export Co. v. Christie (2 Cir.) 105 F.2d 933; Bateman v. Ford Motor Co. (E.D.Pa.) 214 F.Supp. 222. A discussion of these and similar laws will be found in such articles as 41 Minn. L.Rev. 479; Brown and Conwill, Automobile ManufacturerDealer Legislation, 57 Col.L.Rev. 219; Kessler, Automobile Dealer Franchises: Vertical Integration by Contract, 66 Yale L.J. 1135. We must assume for present purposes that legislative placement of the relationship between automobile manufacturers and dealers in a special category constitutes a reasonable classification. [19] The considerations which make this classification a reasonable one for legislative purposes may, if established in this case during the course of a trial on the merits, be a sufficient reason why the decision in the Reichert case should not control disposition of the claims made by plaintiffs. There is no controlling Minnesota precedent dealing specifically with these problems of equitable relief in the automobile manufacturer dealer situation. We are not now prepared, and do not intend, to intimate what the views of this court will be if a permanent injunction issues and we are called upon to review it.