Section 218.0133. Termination benefits.

 

(1)  In this section:

(a) “Dealership facilities" means that part of a motor vehicle dealer's place of business that is used to conduct business under an agreement between a grantor and the motor vehicle dealer.

(b) “Grantor" means a manufacturer on direct dealership, a distributor on indirect dealership or an importer on direct dealership that has entered into an agreement with a motor vehicle dealer.

(c) “Motorcycle grantor" means a manufacturer of motorcycles on direct dealership, a distributor of motorcycles on indirect dealership, or an importer of motorcycles on direct dealership, with respect to a dealer of the manufacturer's, importer's, or distributor's motorcycles, that has entered into an agreement with a motor vehicle dealer.

(2)  

(a) Except as provided in sub. (5) and subject to sub. (3) , when a motorcycle grantor or a dealer of its motorcycles terminates, cancels, or does not renew an agreement, the motorcycle grantor shall pay the dealer all of the termination benefits under pars. (b) to (e) , and when a grantor that is not a motorcycle grantor or a dealer of its motor vehicles terminates, cancels, or does not renew a franchise, the grantor shall pay the motor vehicle dealer all of the termination benefits under pars. (b) to (e) . When a grantor that is not a motorcycle grantor terminates, cancels, or does not renew a franchise, the grantor shall pay the motor vehicle dealer the termination benefits under par. (f) .

(b)

1. A grantor shall repurchase from the motor vehicle dealer any unsold new motor vehicle that meets all of the following criteria:

a. The motor vehicle has not been structurally modified by a motor vehicle dealer.

b. If the grantor is a motorcycle grantor, the motor vehicle has not been operated more than 300 miles for manufacturer's tests, predelivery tests, and motor vehicle dealer exchange in addition to operation required for motor vehicle delivery from the grantor. If the grantor is not a motorcycle grantor, the motor vehicle has not been operated more than 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.

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.

2. A motorcycle grantor may not be required to repurchase a motor vehicle under this paragraph unless 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 or is within 18 months of the date on which the grantor terminates, cancels, or does not renew an agreement. A grantor that is not a motorcycle 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 a franchise or is within 18 months of the date on which the grantor terminates, cancels, or does not renew a franchise.

3. The repurchase price for a new motor vehicle shall be the motor vehicle invoice price from the grantor, plus destination, delivery or distribution charges and sales taxes incurred by the motor vehicle dealer, less allowances paid or credited to the motor vehicle dealer by the grantor. A grantor may subtract from a new motor vehicle repurchase price an amount equal to the diminution in wholesale value caused by damages to a new motor vehicle before the motor vehicle dealer delivers the new motor vehicle to the grantor.

(c)

1. A grantor shall repurchase from the motor vehicle dealer any unused, undamaged and unsold parts and accessories and unopened appearance and maintenance materials and paints if those items meet all of the following criteria:

a. The items are in the motor vehicle dealer's inventory or subject to a noncancelable order to the grantor on the effective date of the termination, cancellation or nonrenewal and are in original packaging, or, if sheet metal or body panels, are in a comparable substitute for original packaging.

b. The items were acquired by the motor vehicle dealer from the grantor or from the motor vehicle dealer's predecessor motor vehicle dealer and the items are listed for sale in the grantor's price schedules in effect on the effective date of the termination, cancellation or nonrenewal, the items are part of the motor vehicle dealer's original inventory acquired from the grantor or the items were acquired by the motor vehicle dealer from the grantor within 4 years before the effective date of the termination, cancellation or nonrenewal.

2. A grantor may not be required to repurchase items that are not listed for sale in the grantor's price schedules in effect on the effective date of the termination, cancellation or nonrenewal if, within 2 years before the effective date of the termination, cancellation or nonrenewal, the grantor permitted a motor vehicle dealer to return obsolete parts and accessories, or a reasonable percentage of parts and accessories, for an amount that is equal to or greater than the price at which those items were listed for sale, less any allowances, at the time the return was permitted.

3. The repurchase price for parts, accessories, materials and paints repurchased under subd. 1. shall be the price at which those items are listed for sale in the grantor's price schedules in effect on the effective date of the termination, cancellation or nonrenewal, or, if an item is not listed, the motor vehicle dealer's original invoice cost, plus destination, delivery or distribution charges, and sales taxes incurred by the motor vehicle dealer, less allowances paid or credited to the motor vehicle dealer by the grantor. If a motor vehicle dealer inventories, handles and packages repurchased items for delivery to the grantor, the grantor shall reimburse the motor vehicle dealer an additional amount equal to 2 percent of the repurchase price under this paragraph.

(d)

1. A grantor shall purchase from the motor vehicle dealer undamaged signs at a fair market price, if a sign bears a common name, trade name or trademark of the grantor, the grantor required that the motor vehicle dealer acquire the sign and the sign was acquired by the motor vehicle dealer from the grantor or from a source approved by the grantor. In addition, a grantor shall purchase from the motor vehicle dealer at a fair market price poles or other hardware used to erect a sign if the grantor required that the sign be free standing and not include a trademark or trade name other than that of the grantor. Fair market price is presumed to be equal to the motor vehicle dealer's original cost, reduced by one-tenth of the original cost for each year of ownership. The grantor or motor vehicle dealer may rebut the presumption.

2. If the dealer leases a sign from the grantor or an entity controlled by the grantor, the grantor, except a motorcycle grantor, shall terminate or arrange for the termination of the lease.

3. The grantor, except a motorcycle 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.

(e) The grantor shall purchase from the motor vehicle dealer special tools, equipment and furnishings at a fair market price, if the motor vehicle dealer acquired the tool, equipment or furnishing from the grantor or from a source approved by the grantor and the grantor required that the motor vehicle dealer acquire the tool, equipment or furnishing. Fair market price is presumed to be equal to the motor vehicle dealer's original cost, reduced by one-seventh of the original cost for each year of ownership. The grantor or motor vehicle dealer may rebut the presumption.

(f) The grantor, except a motorcycle 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 18 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.

(3)  

(a) The grantor shall provide a list of the motor vehicles, parts, accessories, materials and paints, signs, tools, equipment and furnishings that the motor vehicle dealer is authorized to return to the grantor within 30 days after the grantor receives a written inventory of the property that the motor vehicle dealer intends to return or within 30 days after the effective date of the termination, cancellation or nonrenewal, whichever is later. Within 60 days after the property is actually returned by the motor vehicle dealer to the grantor, f.o.b. dealership facilities, the grantor shall pay the motor vehicle dealer the reimbursement amount under sub. (2) (b) to (e) , except that the grantor may apply the reimbursement amount first to pay any amount owed by the motor vehicle dealer to the grantor.

(b) If a repurchase price under sub. (2) depends on a purchase date or original cost or includes an associated cost, the motor vehicle dealer shall have the burden of proving by documentary evidence the purchase date, original cost or associated cost.

(4)  

(a) Except as provided in sub. (5) and subject to pars. (d) and (f) , when a grantor except a motorcycle grantor terminates, cancels, or does not renew a franchise a grantor shall, upon request, pay a motor vehicle dealer the termination benefits under par. (b) or (c) and under par. (e) , and when a motorcycle grantor terminates, cancels, or does not renew an agreement, a motorcycle grantor shall, upon request, pay a dealer the termination benefits under par. (b) or (c) . 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.

(b) If a motor vehicle dealer leases its dealership facilities, a grantor shall, upon request, pay the motor vehicle dealer an amount equal to the dealership facilities' rent for one year or for the unexpired term of the lease, whichever is less.

(c) If a motor vehicle dealer owns its dealership facilities, a grantor shall, upon request, pay the motor vehicle dealer an amount equal to the reasonable rental value of the dealership facilities for one year or until the dealership facilities are sold or leased, whichever is less.

(d) Paragraphs (b) and (c) apply only to dealership facilities that are used in performing sales and service obligations under an agreement before the motor vehicle dealer receives notice of the termination, cancellation or nonrenewal of the agreement.

(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 except a motorcycle 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.

(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. This paragraph does not apply to a motorcycle grantor.

(5)  

(a) Subsections (2) and (4) do not apply to any of the following:

1. A motor vehicle dealer if a court, a licensor or the division of hearings and appeals determines that the motor vehicle dealer engaged in fraud or theft against the grantor in connection with the operation or management of its dealership under an agreement.

2. A motor vehicle dealer who terminates or cancels an agreement with a motorcycle grantor without giving the grantor 60 days' notice or the notice required under the agreement, whichever is less or who terminates or cancels a franchise with a grantor that is not a motorcycle grantor without giving the grantor 60 days' notice or the notice required under the agreement, whichever is less.

3. A motor vehicle dealer who does not give the grantor a written request for termination benefits that specifies the benefits sought within 60 days after the effective date of the termination, cancellation or nonrenewal.

4. A motor vehicle dealer who sells its dealership assets to a 3rd party who becomes a successor motor vehicle dealer under an agreement with the grantor.

4d. A motor vehicle dealer who has any license that is required to operate its dealership revoked. This subdivision does not apply to a motorcycle grantor or a dealer of its motorcycles with respect to the motorcycle grantor.

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. This subdivision does not apply to a motorcycle grantor or a dealer of its motorcycles with respect to the motorcycle grantor.

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. This subdivision does not apply to a motorcycle grantor or a dealer of its motorcycles with respect to the motorcycle grantor.

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. This subdivision does not apply to a motorcycle grantor or a dealer of its motorcycles with respect to the motorcycle grantor.

5. A motor vehicle dealer who terminates, cancels or fails to renew an agreement to sell motor homes, as defined in s. 340.01 (33m) , unless a court, a licensor or the division of hearings and appeals determines that the grantor has not acted in good faith or has materially violated the agreement or a provision of ss. 218.0101 to 218.0163 and determines that the motor vehicle dealer has not acted in bad faith or has not violated the agreement or a provision of ss. 218.0101 to 218.0163 .

6. An agreement under which a motor vehicle dealer sells a camping trailer, as defined in s. 340.01 (6m) , or a trailer, as defined in s. 340.01 (71) , but only to the extent that the agreement covers camping trailers or trailers.

(b) Subsection (2) does not apply to a motor vehicle dealer who is unable to convey clear title to property under sub. (2) (b) to (e) on the date on which the grantor takes delivery of the property.

(c) Subsection (2) does not apply to property under sub. (2) (b) to (e) that is acquired by a motor vehicle dealer from another motor vehicle dealer if the property is acquired after the motor vehicle dealer receives or gives notice of termination, cancellation or nonrenewal or if the property was acquired other than in the ordinary course of the motor vehicle dealer's business.

(d) Subsection (4) does not apply if a motorcycle grantor terminates, cancels, or fails to renew an agreement 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 if a grantor that is not a motorcycle grantor terminates, cancels, or fails to renew 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.

(6)  

(a) This section does not restrict the right of a motor vehicle dealer to pursue any other remedy available against a grantor who terminates, cancels or does not renew an agreement.

(b) A motorcycle grantor may not make the termination benefits payments under sub. (2) or (4) contingent on the motor vehicle dealer releasing or waiving any rights, claims, or remedies and a grantor that is not a motorcycle grantor may not make the termination benefits payments under sub. (2) , (4) , or (7) contingent on the motor vehicle dealer releasing or waiving any rights, claims, or remedies.

(7)  If a grantor except a motorcycle 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.

1999 a. 31 ss. 210 to 234 ; 2011 a. 91 .