Court Opinion

ID: 9518001
Source: CourtListenerOpinion
Date Created: 2023-08-07 00:40:17.543888+00
Date Added: 2024-06-11T12:26:45.945666
License: Public Domain

JUSTICE KARMEIER, dissenting: The majority opinion implicitly recognizes that the Act itself fails to provide a serviceable definition of “good cause” and “commercial reasonableness,” and it casts about in search of one (see 224 Ill. 2d at 15-16), but a coherent and workable definition is never found or applied. The court touts a definition of “commercial reasonableness” it derives, not from a franchising context, but from a California case dealing with bulk sales and California’s Uniform Commercial Code (224 Ill. 2d at 16, citing Gifford v. J. & A. Holdings, 54 Cal. App. 4th 996, 63 Cal. Rptr. 2d 253 (1997)), defining “commercial reasonableness” as “commonly accepted commercial practices of responsible businesses which afford all parties fair treatment” (see 224 Ill. 2d at 16, quoting Gifford, 54 Cal. App. 4th at 1005-06, 63 Cal. Rptr. 2d at 259); however, I see no evidence that the court has utilized even that standard in its review of this matter. Perhaps that is because the standard is so vague that it provides no meaningful guidance to either the parties whom it affects, the administrative body charged with implementing it, or courts which must review the administrative action. Perhaps it is because the definition has no real utility in the context of an Act whose sole purpose is to protect only one group: motor vehicle franchisees. With respect to the first possibility, I would acknowledge that the legislature may delegate authority to an administrative body to perform certain functions; however, in order to properly delegate such authority, the legislature must provide sufficient standards to guide the administrative body in the exercise of its functions. See East St. Louis Federation of Teachers, Local 1220 v. East St. Louis School District No. 189 Financial Oversight Panel, 178 Ill. 2d 399, 423 (1997). A law vesting discretionary power in an administrative body or officer must properly define the terms under which the discretion is to be exercised (In re Application for Judgment & Sale of Delinquent Properties for the Tax Year 1989, 167 Ill. 2d 161, 176 (1995)) and provide intelligible standards (Hoogasian v. Regional Transportation Authority, 58 Ill. 2d 117, 130 (1974)). Similarly, in order to provide adequate notice to those whom it affects, the statute must be explicit enough to serve as a guide to those who must comply with it. Ardt v. Illinois Department of Professional Regulation, 154 Ill. 2d 138, 157 (1992). A statute is considered unconstitutionally vague if its terms are so ill-defined that the ultimate decision as to its meaning rests on the opinions and whims of the trier of fact rather than any objective criteria or facts. People ex rel. Sherman v. Cryns, 203 Ill. 2d 264, 291 (2003). In my opinion, the Act does not satisfy the applicable criteria. Thus, I believe that the Act is an improper delegation of the legislature’s authority and unconstitutionally vague. The majority’s reliance upon the term “good cause” and the “11 circumstances” set forth in section 12(c) of the Act (815 ILCS 710/12(c) (West 2004)) does not persuade me otherwise. With the exception of subsections (5) and (8), those factors address only the interests of the protesting dealers, only one of the groups whose interests are at stake. As for subsections (5) and (8), they speak only of “the public welfare” and the “public interest,” without providing any substantive guidance as to what those vague concepts mean, or even who is subsumed in “the public.” This court has previously observed that “the Act does not state or identify what the overall or ultimate public interest is.” Fields Jeep-Eagle, Inc. v. Chrysler Corp., 163 Ill. 2d 462, 478 (1994). As far as I am aware, no legislative action has been taken since Fields to remedy that deficiency. It is that deficiency which brings the discussion to the second possibility I previously mentioned. I believe the majority never again discusses its imported definition of “commercial reasonableness” because the majority at some level recognizes that the Act, and its “11 circumstances,” display very little in the way of genuine concern for the interests of the manufacturer, its citizen-shareholders, or consumers generally, and it essentially provides no guidance as to how their interests might be identified and weighed. The disingenuously benevolent language of the Act’s “Declaration of purpose” (815 ILCS 710/1.1 (West 2004) (purporting to promote, inter alia, “the public interest and welfare” and that of “consumers generally”)) rings hollow when the substantive provisions of the Act are applied. In practice, the Act benefits neither manufacturers — and the many citizens who have invested in them— nor consumers. This court has acknowledged as much: “The several statutory purposes and goals stated in this section are consistent with neither each other nor with various of the competing interests expressed in section 12(c). Protecting the private economic interests of dealers in their dealership investments and properties may, for example, militate against the allowance of an additional dealership and thereby frustrate the goal of protecting consumer interests by ensuring competition and convenience for consumers. Conversely, the allowance of an ad- ditional dealership which has the capability of offering lower prices and better service than an existing dealership may benefit consumers but result in a loss of business or even the entire investment of the existing dealer. *** [T]he Act does not state or identify what the overall or ultimate public interest is.” Fields Jeep-Eagle, 163 Ill. 2d at 478. The “standards” of the Act are inadequate to provide the guidance necessary to achieve the purported goals of section 1.1. Thus, the “assessment” of the administrative body becomes the “standard” itself. See 224 Ill. 2d at 14. Beyond that deficiency, and notwithstanding its seemingly lofty purpose of protecting “the public interest and welfare” and “consumers generally,” this Act is clearly nothing more than a protectionist measure favoring existing motor vehicle dealerships, and it should be acknowledged as such. In my opinion, there is no rational basis to justify a distinction between the class the statute benefits and the class outside its scope. In short, it is special legislation. As Justice Cook noted in his insightful appellate court dissent: “Motor Vehicle Franchise Acts *** were justified on the basis of a ‘disparity in bargaining power between automobile manufacturers and their dealers.’ [New Motor Vehicle Board v. Orrin W. Fox Co., 439 U.S. 96, 100, 58 L. Ed. 2d 361, 370, 99 S. Ct. 403, 407 (1978).]” 361 Ill. App. 3d at 293 (Cook, EJ, dissenting). As the Supreme Court noted in New Motor, at the time of that decision, “ ‘there exist[ed] only 5 passenger-car manufacturers, 3 of which produce[d] in excess of 95 percent of all passenger cars sold in the United States.’ ” New Motor, 439 U.S. at 100 n.4, 58 L. Ed. 2d at 370 n.4, 99 S. Ct. at 407 n.4, quoting S. Rep. No. 2073, 84th Cong., 2d Sess., 2 (1956). That is no longer the case. As Justice Cook observes: “We now five in a world of franchises. Motor vehicle dealers are given special treatment not enjoyed by other franchisees, who must protect themselves by the contracts they sign. Motor vehicle manufacturers from around the world now compete in the United States. New manufacturers can put dealers wherever they want them. Established manufacturers, such as General Motors, cannot.” 361 Ill. App. 3d at 293 (Cook, EJ., dissenting). Indeed, the contract is a well-known and time-honored device particularly suited to establishing the legal rights of parties before they enter into agreements and governing the nature and conditions of their relationship thereafter. If dealerships wish to limit the geographical proximity of other franchises, that would be a matter for negotiation before an agreement is concluded, when the parties’ expectations are on the table. I fail to see how motor vehicle franchises differ in any significant respect from franchises for food service, home improvement or gas stations, just to name a few. All may have citizen investors who believe they stand to lose business and money when other franchises are granted in their area. Perhaps I am unaware of franchise laws protecting them; my belief is that they protect themselves through the contracts they sign. As for any claimed disparity in bargaining power between automobile manufacturers and their dealers, I agree with Justice Cook’s observation that the world has indeed changed since the Supreme Court’s 1978 decision in New Motor, a development of which GMC is no doubt well aware. Three manufacturers no longer dominate the American market, as automobile manufacturers struggle for market share, profitability, and in some instances survival. In such a business climate it seems implausible that a manufacturer would want to add dealerships that are not viable or purposefully risk disruption in the chain of distribution by undermining its existing dealerships. I simply fail to see how motor vehicle franchisees are in a less favorable position, vis-á-vis their franchisers, than other franchisees are with respect to theirs. The majority’s one-paragraph rejection of GMC’s special legislation argument offers no explanation. Because I believe the majority opinion offers no meaningful standard of review, and because I believe the Motor Vehicle Franchise Act is unconstitutional, I respectfully dissent.