AB132: Bill Text

AB132, s. 14 Section 14. 218.0125 (1) of the statutes is renumbered 218.0125 (1) (intro.) and amended to read:

AB132,8,20 218.0125 (1) (intro.) In this section, "dealer:

AB132,8,23 (a) "Dealer cost" means the wholesale cost for a part as listed in the manufacturer's, importer's or distributor's current price schedules or, if the part is not so listed, the dealer's original invoice cost for the part.

AB132, s. 15 Section 15. 218.0125 (1) (b) of the statutes is created to read:

AB132,9,4 218.0125 (1) (b) "Qualifying nonwarranty repairs" means nonwarranty repairs that would be covered by the warranty of a manufacturer, importer, or distributor if the vehicle being repaired was covered by the warranty. The term does not include routine maintenance.

AB132, s. 16 Section 16. 218.0125 (2) of the statutes is amended to read:

AB132,9,24 218.0125 (2) A manufacturer, importer, or distributor shall, for the protection of the buying public, specify the delivery and preparation obligations of its dealers before delivery of new motor vehicles to retail buyers. A copy of the delivery and preparation obligations of its dealers shall be filed with the department of transportation by every licensed motor vehicle manufacturer, importer , or distributor and shall constitute the dealer's only responsibility for product liability as between the dealer and the manufacturer, importer, or distributor. Any mechanical, body, or parts defects arising from any express or implied warranties of the manufacturer, importer, or distributor shall constitute the manufacturer's, importer's, or distributor's product or warranty liability. The manufacturer, importer or distributor shall reasonably compensate any authorized dealer who performs work to rectify the manufacturer's, importer's or distributor's product or warranty defects or delivery and preparation obligations or who performs any other work required, requested or approved by the manufacturer, importer or distributor or for which the manufacturer, importer or distributor has agreed to pay, including compensation for labor at a labor rate equal to the effective labor rate charged all customers and for parts at an amount not less than the amount the dealer charges its other retail service customers for parts used in performing similar work by the dealer.

AB132, s. 17 Section 17. 218.0125 (3) of the statutes is repealed and recreated to read:

AB132,10,8 218.0125 (3) (a) Subject to sub. (4), a manufacturer, importer, or distributor shall reasonably compensate a dealer who performs work to rectify the product or warranty defects of the manufacturer, importer, or distributor or to satisfy delivery and preparation obligations of the manufacturer, importer, or distributor or who performs any other work required, requested, or approved by the manufacturer, importer, or distributor or for which the manufacturer, importer, or distributor has agreed to pay. The manufacturer, importer, or distributor may not otherwise recover its costs for compensating a dealer for labor and parts under this section.

AB132,10,14 (b) Reasonable compensation under par. (a) for labor is equal to the dealer's effective nonwarranty labor rate multiplied by the number of hours allowed for the repair under the manufacturer's, importer's, or dealer's time allowances used in compensating the dealer for warranty work. Reasonable compensation under par. (a) for parts is equal to the dealer's cost for the parts multiplied by the sum of 1 and the dealer's average percentage markup over dealer cost for parts.

AB132,10,20 (c) 1. The effective nonwarranty labor rate is determined, using the submitted substantiating orders under sub. (4) (a) 2., by dividing the total customer labor charges for qualifying nonwarranty repairs in the repair orders by the total number of hours that would be allowed for the repairs if the repairs were made under the manufacturer's, importer's, or distributor's time allowances used in compensating the dealer for warranty work.

AB132,10,24 2. A dealer's average percentage markup over dealer cost for parts is determined, using the submitted substantiating orders under sub. (4) (a) 2., by dividing total charges for parts in the repair orders by the total dealer cost for the parts.

AB132, s. 18 Section 18. 218.0125 (4) of the statutes is repealed and recreated to read:

AB132,11,3 218.0125 (4) (a) To be eligible for compensation for labor or parts under sub. (3), a dealer shall submit to the manufacturer, importer, or distributor all of the following:

AB132,11,5 1. A written notice of the claimed effective nonwarranty labor rate or average percentage markup over dealer cost for parts.

AB132,11,9 2. Either 100 sequential repair orders for qualifying nonwarranty repairs or all repair orders for qualifying nonwarranty repairs performed in a 90-day period, whichever is less. All repair orders under this subdivision must be for repairs made no more than 180 days before the submission.

AB132,11,19 (b) Not more than 30 days after receiving a submission under par. (a), the manufacturer, importer, or distributor shall begin compensating the dealer based on the effective nonwarranty labor rate or average percentage markup over dealer cost for parts that is substantiated by the submission. If the manufacturer, importer, or distributor disputes the dealer's claimed labor rate or markup, the manufacturer, importer, or distributor shall notify the dealer in writing that it disputes the labor rate or markup. A notice under this paragraph shall include a written explanation of the reason for the dispute, including the labor rate or markup that the manufacturer, importer, or distributor has determined is substantiated by the submission.

AB132, s. 19 Section 19. 218.0125 (5) of the statutes is amended to read:

AB132,12,3 218.0125 (5) A manufacturer, importer, or distributor who fails to compensate a dealer for parts at an amount not less than the amount the dealer charges its other retail service customers for parts used to perform similar work shall not be found to have violated this section if the manufacturer, importer, or distributor shows that the amount is not reasonably competitive to the amounts charged to retail service customers by other similarly situated franchised motor vehicle dealers in this state for the same parts when used by those dealers to perform similar work in performing qualifying nonwarranty repairs.

AB132, s. 20 Section 20. 218.0128 of the statutes is created to read:

AB132,12,16 218.0128 Product liability. A manufacturer, importer, or distributor shall defend, indemnify, and hold harmless a dealer against any claim, judgment, or settlement for damages, court costs, expert witness fees, attorney fees, or other expenses arising out of a complaint, claim, or lawsuit to the extent that the complaint, claim, or lawsuit is caused by alleged defective or negligent manufacture, assembly, or design of a motor vehicle, part, or accessory by the manufacturer, importer, or distributor. If a complaint, claim, or lawsuit involves acts or omissions of both the manufacturer, importer, or distributor and the dealer, the manufacturer, importer, or distributor is not obligated to defend the dealer against a claim arising out of the dealer's alleged acts or omissions and is not obligated to indemnify the dealer against any part of a judgment or settlement that arises out of the dealer's alleged acts or omissions.

AB132, s. 21 Section 21. 218.0133 (title) of the statutes is amended to read:

AB132,12,18 218.0133 (title) Agreement Franchise termination benefits.

AB132, s. 22 Section 22. 218.0133 (2) (a) of the statutes is amended to read:

AB132,12,23 218.0133 (2) (a) Except as provided in sub. (5) and subject to sub. (3), when a grantor or motor vehicle dealer terminates, cancels or does not renew an agreement a franchise a grantor shall pay a motor vehicle dealer all of the termination benefits under pars. (b) to (e) (f).

AB132, s. 23 Section 23. 218.0133 (2) (b) 1. b. of the statutes is amended to read:

AB132,13,4 218.0133 (2) (b) 1. b. The motor vehicle has not been operated more than 300 500 miles for manufacturer's tests, predelivery tests , and motor vehicle dealer exchange in addition to operation required for motor vehicle delivery from the grantor or another dealer of the same line make.

AB132, s. 24 Section 24. 218.0133 (2) (b) 1. c. of the statutes is amended to read:

AB132,13,9 218.0133 (2) (b) 1. c. The motor vehicle was acquired as part of the motor vehicle dealer's original inventory or from the grantor or in the ordinary course of business from another motor vehicle dealer of the same line make who acquired the motor vehicle from the grantor.

AB132, s. 25 Section 25. 218.0133 (2) (b) 2. of the statutes is amended to read:

AB132,13,16 218.0133 (2) (b) 2. A grantor may not be required to repurchase a motor vehicle under this paragraph unless the vehicle is of the current or one-year prior model year or the date on the original dealer invoice is within 12 months of the date on which the motor vehicle dealer terminates, cancels, or does not renew an agreement a franchise or is within 18 months of the date on which the grantor terminates, cancels, or does not renew an agreement a franchise.

AB132, s. 26 Section 26. 218.0133 (2) (d) of the statutes is renumbered 218.0133 (2) (d) 1.

AB132, s. 27 Section 27. 218.0133 (2) (d) 2. of the statutes is created to read:

AB132,13,21 218.0133 (2) (d) 2. If the dealer leases a sign from the grantor or an entity controlled by the grantor, the grantor shall terminate or arrange for the termination of the lease.

AB132, s. 28 Section 28. 218.0133 (2) (d) 3. of the statutes is created to read:

AB132,13,24 218.0133 (2) (d) 3. The grantor is responsible for the removal of a sign subject to subd. 1. or 2. from the dealership facility and shall bear the costs of the removal.

AB132, s. 29 Section 29. 218.0133 (2) (f) of the statutes is created to read:

AB132,14,8 218.0133 (2) (f) The grantor shall reimburse the motor vehicle dealer for the amount of any obligations that extend beyond the effective date of the termination, cancellation, or nonrenewal under contracts for computer hardware, software, maintenance, or other related service entered into by the dealer and required by the grantor for 24 months or the remaining term of the contracts, whichever is less, unless the computer hardware, software, maintenance, or other related service was used to support the operations of a franchise other than the franchise that was terminated, cancelled, or not renewed.

AB132, s. 30 Section 30. 218.0133 (4) (a) of the statutes is amended to read:

AB132,14,16 218.0133 (4) (a) Except as provided in sub. (5) and subject to par. pars. (d) and (f), when a grantor terminates, cancels, or does not renew an agreement a franchise a grantor shall, upon request, pay a motor vehicle dealer the termination benefits under par. (b) or (c) and under par. (e). If a motor vehicle dealer receives benefits under par. (b) or (c) and par. (f) does not apply, the grantor shall be entitled to the possession and use of the dealership facilities for the period that the termination benefits payment covers.

AB132, s. 31 Section 31. 218.0133 (4) (e) of the statutes is created to read:

AB132,15,2 218.0133 (4) (e) If a dealer completed construction or renovation of its dealership facilities not more than 24 months before receiving the notice of the franchise termination, cancellation, or nonrenewal and the construction or renovation was required by the grantor, the grantor shall pay the dealer an amount equal to the dealer's actual cost for the construction or renovation, less any allowances or credits provided to the dealer by the grantor for the construction or renovation and less any tax savings accruing to the dealer's benefit prior to the notice of the franchise termination, cancellation, or nonrenewal from depreciation write-offs related to the construction or renovation.

AB132, s. 32 Section 32. 218.0133 (4) (f) of the statutes is created to read:

AB132,15,8 218.0133 (4) (f) If the termination, cancellation, or nonrenewal relates to fewer than all of the franchises operated by a dealer at a single location, the amount of the termination benefit under this subsection shall be based on the percentage of total square footage attributed to the franchise being terminated, cancelled, or not renewed at the effective date of the termination, cancellation, or nonrenewal.

AB132, s. 33 Section 33. 218.0133 (5) (a) 2. of the statutes is amended to read:

AB132,15,12 218.0133 (5) (a) 2. A motor vehicle dealer who terminates or cancels an agreement a franchise without giving the grantor 60 days' notice or the notice required under the agreement, whichever is less.

AB132, s. 34 Section 34 . 218.0133 (5) (a) 4d. of the statutes is created to read:

AB132,15,15 218.0133 (5) (a) 4d. A motor vehicle dealer who has any license that is required to operate its dealership revoked.

AB132, s. 35 Section 35. 218.0133 (5) (a) 4h. of the statutes is created to read:

AB132,15,22 218.0133 (5) (a) 4h. A termination, cancellation or nonrenewal based on the motor vehicle dealer's failure to conduct its customary sales and service operations during its customary business hours for 7 consecutive business days unless the failure is caused by an act of God, work stoppage or delays due to strikes or labor disputes, an order of the department of transportation or the division of hearings and appeals, or other circumstances beyond the dealer's control.

AB132, s. 36 Section 36. 218.0133 (5) (a) 4p. of the statutes is created to read:

AB132,16,3 218.0133 (5) (a) 4p. A termination, cancellation, or nonrenewal based on the conviction of a motor vehicle dealer of a crime involving theft, dishonesty, or false statement, or any other crime punishable by imprisonment for greater than one year.

AB132, s. 37 Section 37 . 218.0133 (5) (a) 4t. of the statutes is created to read:

AB132,16,7 218.0133 (5) (a) 4t. A termination, cancellation, or nonrenewal based on the motor vehicle dealer being subject to a bankruptcy or receivership filing unless the petition is dismissed not more than 30 days after the filing date.

AB132, s. 38 Section 38. 218.0133 (5) (d) of the statutes is amended to read:

AB132,16,13 218.0133 (5) (d) Subsection (4) does not apply if a grantor terminates, cancels, or fails to renew an agreement a franchise in compliance with s. 218.0116 (1) (i), unless the primary ground for termination, cancellation, or nonrenewal is inadequate sales performance by the motor vehicle dealer or termination, cancellation, or discontinuation of a motor vehicle line make.

AB132, s. 39 Section 39. 218.0133 (6) (b) of the statutes is amended to read:

AB132,16,17 218.0133 (6) (b) A grantor may not make the termination benefits payments under sub. (2) or, (4), or (7) contingent on the motor vehicle dealer releasing or waiving any rights, claims, or remedies.

AB132, s. 40 Section 40. 218.0133 (7) of the statutes is created to read:

AB132,17,2 218.0133 (7) If a grantor cancels or fails to renew a franchise under s. 218.0132 (2), in addition to the termination benefits provided in subs. (2) and (4), the grantor shall compensate the dealer in an amount not less than the fair market value of the franchise terminated or not renewed on the date immediately preceding the date the manufacturer, importer, or distributor publicly announced the termination, cancellation, or discontinuation of the line make that resulted in the franchise cancellation or nonrenewal. The manufacturer, importer, or distributor shall provide the compensation under this subsection not more than 90 days after the effective date of the cancellation or nonrenewal.

AB132, s. 41 Section 41. 218.0163 (1) (a) of the statutes is amended to read:

AB132,17,6 218.0163 (1) (a) A violation by any other licensee of s. 218.0116 (1) (bm), (f), (h), (hm), (i), (km), (L), (Lm), (mm), (pm), (q), (qm), (r), (rm), (s), (sm), (t), (u), (um), (v), (vm), (w), or (wm), (x), (xm), (y), (ym), or (ys).

AB132, s. 42 Section 42 . 425.202 (2) of the statutes is amended to read:

AB132,17,8 425.202 (2) "Motor vehicle" has the meaning given in s. 218.0101 (22) (a).

AB132, s. 43 Section 43. 429.104 (19) of the statutes is amended to read:

AB132,17,10 429.104 (19) "Motor vehicle" has the meaning given in s. 218.0101 (22) (a).

AB132, s. 44 Section 44 . 779.85 (3) of the statutes is amended to read:

AB132,17,13 779.85 (3) "Goods" has the meaning set forth in s. 402.105 (1) (c) except that this term does not include a "motor vehicle" as defined in s. 218.0101 (22) (a).

AB132, s. 45 Section 45. Initial applicability.

AB132,17,16 (1) This act first applies to an agreement that exists or is entered into on the effective date of this subsection.

AB132,17,17 (End)