Skip to main content Skip to office menu Skip to footer
Minnesota Legislature

Office of the Revisor of Statutes

Key: (1) language to be deleted (2) new language

  

                         Laws of Minnesota 1988 

                        CHAPTER 502-S.F.No. 2384 
           An act relating to trade practices; providing for 
          payment to farm implement retailer by successor in 
          interest of the manufacturer, wholesaler, or 
          distributor who repurchases stock and inventory; 
          amending Minnesota Statutes 1986, sections 325E.05; 
          and 325E.06, subdivisions 1, 4, and 5, and by adding a 
          subdivision. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
    Section 1.  Minnesota Statutes 1986, section 325E.05, is 
amended to read:  
    325E.05 [AGRICULTURAL IMPLEMENT DEALERSHIPS; RETURN OF 
STOCK.] 
    If a franchised agricultural machinery or implement 
dealership is discontinued for economic reasons, the firm, 
company, or person, or successor in interest issuing the 
franchise to the dealer shall purchase all listed parts in the 
dealer's stock purchased originally from firm, company, or 
person issuing franchise at a price agreeable to the franchised 
dealer and such firm, company, or person, or successor in 
interest.  
    Sec. 2.  Minnesota Statutes 1986, section 325E.06, 
subdivision 1, is amended to read:  
    Subdivision 1.  [OBLIGATION TO REPURCHASE.] Whenever any 
person, firm, or corporation engaged in the business of selling 
and retailing farm implements and repair parts for farm 
implements enters into a written contract, sales agreement or 
security agreement whereby the retailer agrees with any 
wholesaler, manufacturer, or distributor of farm implements, 
machinery, attachments or repair parts to maintain a stock of 
parts or complete or whole machines, or attachments, and 
thereafter the written contract, sales agreement or security 
agreement is terminated, canceled or discontinued, then the 
wholesaler, manufacturer, or distributor shall pay to the 
retailer or credit to the retailer's account, if the retailer 
has outstanding any sums owing the wholesaler, manufacturer, or 
distributor, unless the retailer should desire and has a 
contractual right to keep such merchandise, a sum equal to 100 
percent of the net cost of all unused complete farm implements, 
machinery and attachments in new condition which have been 
purchased by the retailer from the wholesaler, manufacturer or 
distributor within the 24 months immediately preceding 
notification by either party of intent to cancel or discontinue 
the contract, including transportation charges which have been 
paid by the retailer, or invoiced to retailer's account by the 
wholesaler, manufacturer or distributor and 80 85 percent of the 
current net prices on repair parts, including superseded parts 
listed in current price lists or catalogs in use by the 
wholesaler, manufacturer or distributor on the date of 
cancellation or discontinuance of the contract, which parts had 
previously been purchased by the retailer from the wholesaler, 
manufacturer, or distributor and are held by the retailer on the 
date of the cancellation or discontinuance of the contract or 
thereafter received by the retailer from the wholesaler, 
manufacturer or distributor.  The wholesaler, manufacturer, or 
distributor shall also pay the retailer or credit to the 
retailer's account a sum equal to five percent of the current 
net price of all parts returned for the handling, packing, and 
loading of the parts back to the wholesaler, manufacturer, or 
distributor unless the wholesaler, manufacturer or distributor 
elects to perform inventorying, packing and loading of the parts 
itself.  Upon the payment or allowance of credit to the 
retailer's account of the sum required by this subdivision, the 
title to the farm implements, farm machinery, attachments or 
repair parts shall pass to the manufacturer, wholesaler or 
distributor making the payment or allowing the credit and the 
manufacturer, wholesaler or distributor shall be entitled to the 
possession of the farm implements, machinery, attachments or 
repair parts.  However, this section shall not in any way affect 
any security interest which the wholesaler, manufacturer or 
distributor may have in the inventory of the retailer.  
    Payment required to be made under this subdivision must be 
made not later than 90 days from the date the farm implements, 
machinery, attachments, and repair parts are returned by the 
retailer, and if not by then paid, the amount payable by the 
wholesaler, manufacturer, or distributor bears interest at the 
rate of 1-1/2 percent per month from the date the contract was 
terminated, canceled, or discontinued until the date payment is 
received by the retailer. 
    Sec. 3.  Minnesota Statutes 1986, section 325E.06, 
subdivision 4, is amended to read:  
    Subd. 4.  [FAILURE TO PAY SUMS SPECIFIED ON CANCELLATION OF 
CONTRACTS; LIABILITY.] In the event that any manufacturer, 
wholesaler, or distributor of farm implements, machinery, 
attachments and repair parts, upon the cancellation of a 
contract by either a retailer or such manufacturer, wholesaler 
or distributor, fails or refuses to make payment to the dealer 
or the dealer's heir or heirs as required by this section, the 
manufacturer, wholesaler or distributor shall be liable in a 
civil action to be brought by the retailer or the retailer's 
heir or heirs for (a) 100 percent of the net cost of the farm 
implements, machinery and attachments, (b) transportation 
charges which have been paid by the retailer, (c) 80 85 percent 
of the current net price of repair parts, and (d) five percent 
for handling, packing and loading, if applicable.  
    Sec. 4.  Minnesota Statutes 1986, section 325E.06, 
subdivision 5, is amended to read:  
    Subd. 5.  [EXCEPTIONS.] This section shall not require the 
repurchase from a retailer of a repair part where the retailer 
previously has failed to return the repair part to the 
wholesaler, manufacturer or distributor after being offered a 
reasonable opportunity to return the repair part at a price not 
less than 80 85 percent of the net price of the repair part as 
listed in the then current price list or catalog.  This section 
shall not require the repurchase from a retailer of repair parts 
which have a limited storage life or are otherwise subject to 
deterioration, such as rubber items, gaskets and batteries; 
repair parts in broken or damaged packages; single repair parts 
priced as a set of two or more items; and repair parts which 
because of their condition are not resalable as new parts 
without new packaging or reconditioning.  
    Sec. 5.  Minnesota Statutes 1986, section 325E.06, is 
amended by adding a subdivision to read: 
    Subd. 7.  [SUCCESSOR IN INTEREST.] The obligations under 
this section of a wholesaler, manufacturer, or distributor apply 
to its successor in interest or assignee.  A successor in 
interest includes a purchaser of assets or stock, a surviving 
corporation resulting from a merger or liquidation, a receiver, 
and a trustee of the original wholesaler, manufacturer, or 
distributor. 
    Sec. 6.  [EFFECTIVE DATE.] 
    The provisions of sections 1 to 5 are effective the day 
after enactment and apply to contracts now in effect that have 
no expiration date and are a continuing contract, and all other 
contracts entered into or renewed after the day of enactment.  
Any contract in force and effect on the day of enactment, which 
by its terms will terminate on a date subsequent thereto and 
which is not renewed is governed by the law as it existed before 
the day of enactment. 
    Approved April 12, 1988