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§47-565.


§47-565.
   
   The Commission may deny an application for a license, or revoke or
   suspend a license or impose a fine not to exceed Ten Thousand Dollars
   ($10,000.00) against a manufacturer or distributor or a fine not to
   exceed Five Hundred Dollars ($500.00) against a dealer for each day
   that any provision of Sections 561 through 567, 572, 578, 579, and
   579.1 of this title is violated or for any of the following reasons:
   
   1. On satisfactory proof of unfitness of the applicant in any
   application for any license under the provisions of this act;
   
   2. For any material misstatement made by an applicant in any
   application for any license under the provisions of this act;
   
   3. For any failure to comply with any provision of this act or any
   rule or regulation adopted and promulgated by the Commission under
   authority vested in it by this act;
   
   4. A change of condition after license is granted resulting in failure
   to maintain the qualifications for license;
   
   5. Being a new motor vehicle dealer or new motor vehicle salesperson
   who:
   
   a. has required a purchaser of a new motor vehicle, as a condition of
   sale and delivery thereof, to also purchase special features,
   appliances, accessories or equipment not desired or requested by the
   purchaser and installed by the dealer,
   
   b. uses any false or misleading advertising in connection with his
   business as such new motor vehicle dealer or vehicle salesperson,
   
   c. has committed any unlawful act which resulted in the revocation of
   any similar license in another state,
   
   d. has failed or refused to perform any written agreement with any
   retail buyer involving the sale of a motor vehicle,
   
   e. has been convicted of a crime involving moral turpitude,
   
   f. has committed a fraudulent act in selling, purchasing, or otherwise
   dealing in new motor vehicles or has misrepresented the terms and
   conditions of a sale, purchase, or contract for sale or purchase of a
   new motor vehicle or any interest therein including an option to
   purchase such vehicle, or
   
   g. has failed to meet or maintain the conditions and requirements
   necessary to qualify for the issuance of a license;
   
   6. Being a new motor vehicle salesperson who is not employed as such
   by a licensed new motor vehicle dealer;
   
   7. Being a new motor vehicle dealer who:
   
   a. does not have an established place of business,
   
   b. does not provide for a suitable repair shop separate from the
   display room with ample space to repair or recondition one or more
   vehicles at the same time, and which is equipped with such parts,
   tools and equipment as may be requisite for the servicing of motor
   vehicles in such a manner as to make them comply with the safety laws
   of this state and to properly fulfill the dealer's or manufacturer's
   warranty obligation,
   
   c. does not hold a franchise in effect with a manufacturer or
   distributor of new or unused motor vehicles for the sale of the same
   and is not authorized by the manufacturer or distributor to render
   predelivery preparation of such vehicles sold to purchasers and to
   perform any authorized post-sale work pursuant to the manufacturer's
   or distributor's warranty,
   
   d. employs unlicensed salespersons, or employs or utilizes the
   services of used motor vehicle lots or dealers or other unlicensed
   persons in connection with the sale of new motor vehicles,
   
   e. does not properly service a new motor vehicle before delivery of
   same to the original purchaser thereof, or
   
   f. fails to order and stock a reasonable number of new motor vehicles
   necessary to meet customer demand for each of the new motor vehicles
   included in the new motor vehicle dealer's franchise agreement, unless
   the new motor vehicles are not readily available from the manufacturer
   or distributor due to limited production;
   
   8. Being a manufacturer, distributor, distributor branch or factory
   branch, or officer, agent or other representative thereof, who has:
   
   a. either induced or attempted to induce by means of coercion or
   intimidation, any new motor vehicle dealer:
   
   (1) to accept delivery of any motor vehicle or vehicles, parts or
   accessories therefor, or any other commodities including advertising
   material which shall not have been ordered by said new motor vehicle
   dealer,
   
   (2) to order or accept delivery of any motor vehicle with special
   features, appliances, accessories or equipment not included in the
   list price of said motor vehicles as publicly advertised by the
   manufacturer thereof, or
   
   (3) to order or accept delivery of any parts, accessories, equipment,
   machinery, tools, appliances or any commodity whatsoever, or
   
   b. induced under threat or discrimination by the withholding from
   delivery to a motor vehicle dealer certain models of motor vehicles,
   changing or amending unilaterally the dealer's allotment of motor
   vehicles and/or withholding and delaying delivery of such vehicles out
   of the ordinary cause of business, in order to induce by such coercion
   any such dealer to participate or contribute to any local or national
   advertising fund controlled directly or indirectly by the manufacturer
   or for any other purposes such as contest, "give-aways" or other
   so-called sales promotional devices and/or change of quotas in any
   sales contest; or has required motor vehicle dealers, as a condition
   to receiving their vehicle allotment, to order a certain percentage of
   the vehicles with optional equipment not specified by the new motor
   vehicle dealer; however, nothing in this section shall prohibit a
   manufacturer from supporting an advertising association which is open
   to all dealers on the same basis;
   
   9. Being a manufacturer, distributor, distributor branch or factory
   branch, or officer, agent or other representative thereof, who:
   
   a. has attempted to coerce or has coerced any new motor vehicle dealer
   to enter into any agreement or to cancel any agreement, or fails to
   act in good faith and in a fair, equitable and nondiscriminatory
   manner; or has directly or indirectly coerced, intimidated, threatened
   or restrained any motor vehicle dealer; or has acted dishonestly, or
   has failed to act in accordance with the reasonable standards of fair
   dealing,
   
   b. has failed to compensate its dealers for the work and services they
   are required to perform in connection with the dealer's delivery and
   preparation obligations according to the agreements on file with the
   Commission which must be found by the Commission to be reasonable, or
   fail to adequately and fairly compensate its dealers for labor, parts
   and other expenses incurred by such dealer to perform under and comply
   with manufacturer's warranty agreements. In determining whether the
   warranty compensation is adequate and fair, the Commission shall
   consider the amount that is charged by the dealer or dealers in their
   areas of responsibility to their nonwarranty work of like kind. All
   claims made by dealers for compensation for delivery, preparation and
   warranty work shall be paid within thirty (30) days after approval and
   shall be approved or disapproved within thirty (30) days after
   receipt. When any claim is disapproved, the dealer shall be notified
   in writing of the grounds for disapproval. The dealer's delivery,
   preparation and warranty obligations as filed with the Commission
   shall constitute the dealer's sole responsibility for product
   liability as between the dealer and manufacturer. A manufacturer or
   distributor may reasonably and periodically audit a new motor vehicle
   dealer to determine the validity of paid claims for dealer
   compensation or any charge-backs for warranty parts or service
   compensation. Audits of warranty payments shall only be for the
   one-year period immediately following the date of the payment. A
   manufacturer shall reserve the right to reasonable, periodic audits to
   determine the validity of paid claims for dealer compensation or any
   charge-backs for consumer or dealer incentives. Audits of incentive
   payments shall only be for a two-year period immediately following the
   date of the payment. These limitations shall not apply if the
   manufacturer or distributor reasonably suspects fraud, or
   
   c. unreasonably fails or refuses to offer to its same line-make
   franchised dealers all models manufactured for that line-make, or
   unreasonably requires a dealer to pay any extra fee, purchase
   unreasonable advertising displays or other materials, or remodel,
   renovate, or recondition the dealer's existing facilities as a
   prerequisite to receiving a model or series of vehicles. However, this
   subparagraph shall not apply to recreational vehicles or limited
   production model vehicles.
   

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