2007 Minnesota Statutes

80E.06 CANCELLATIONS, TERMINATIONS, OR NONRENEWALS.
    Subdivision 1. Requirements. Notwithstanding the terms of any franchise agreement or
waiver to the contrary, no manufacturer shall cancel, terminate, or fail to renew any franchise
relationship with a licensed new motor vehicle dealer unless the manufacturer has:
(a) satisfied the notice requirement of section 80E.08;
(b) acted in good faith as defined in section 80E.03, subdivision 9; and
(c) good cause for the cancellation, termination, or nonrenewal.
For the purposes of sections 80E.06 to 80E.09, a manufacturer includes a distributor. Any
action by a manufacturer terminating a contractual relationship with a distributor is not effective
to terminate existing valid franchises running from the distributor to new motor vehicle dealers
unless the manufacturer follows the provisions of sections 80E.06 to 80E.09.
    Subd. 2. Circumstances constituting good cause. Notwithstanding the terms of any
franchise agreement or waiver to the contrary, good cause exists for the purposes of a termination,
cancellation, or nonrenewal, when the new motor vehicle dealer fails to comply with a provision
of the franchise which is both reasonable and of material significance to the franchise relationship;
provided, that the dealer has been notified in writing of the failure within 180 days after the
manufacturer first acquired knowledge of the failure.
If failure by the new motor vehicle dealer relates to the performance of the new motor vehicle
dealer in sales or service, then good cause shall be defined as the failure of the new motor vehicle
dealer to comply with reasonable performance criteria established by the manufacturer; provided,
that the new motor vehicle dealer was apprised by the manufacturer in writing of the failure; the
notification stated that notice was provided for failure of performance pursuant to sections 80E.01
to 80E.17; the new motor vehicle dealer was afforded a reasonable opportunity in no event
less than six months to comply with the criteria; and the dealer did not demonstrate substantial
progress toward compliance with the manufacturer's performance criteria during the period.
To rebut allegations of good cause for a proposed termination, a dealer may present
evidence including, but not limited to, a showing that the grounds for termination resulted from
acts or circumstances beyond the control of the dealer and which were communicated to the
manufacturer, or that in evaluating the dealer's compliance with reasonable sales criteria, the
manufacturer failed to consider the dealer's sales of factory program vehicles. For the purposes of
this subdivision, "factory program vehicle" means a vehicle of the current model year offered for
sale and resold by the manufacturer directly or at a factory sponsored or authorized auction and
purchased by a dealer holding a current franchise from the manufacturer for that same line make.
History: 1981 c 59 s 7; 1985 c 34 s 2; 1988 c 611 s 4; 1991 c 69 s 4