Dealer contracts -- Cancellation, nonrenewal, substantial change

Checkout our iOS App for a better way to browser and research.

    (a)    A supplier may not directly or through an officer, agent, or employee terminate, cancel, fail to renew, or substantially change the competitive circumstances of a contract without good cause.

    (b)    (1)    Except as provided in paragraph (2) of this subsection, a supplier who terminates, cancels, fails to renew, or substantially changes the competitive circumstances of a contract with good cause is not required to provide any notice or the right to cure a deficiency to a dealer.

        (2)    If a supplier terminates, cancels, fails to renew, or substantially changes the competitive circumstances of a contract based upon the dealer’s failure to capture the share of the market required in the contract and the supplier has worked with the dealer for a minimum of 12 months to gain the desired market share, the supplier shall provide a dealer with at least 90 days’ written notice of the termination of the agreement and a 60 day right to cure.

    (c)    Notwithstanding any agreement to the contrary, a dealer who terminates a contract with a supplier shall notify the supplier of the termination within 90 days prior to the effective date of the termination.

    (d)    Each notification required under this section shall:

        (1)    Be in writing;

        (2)    Contain:

            (i)    A statement of intention to terminate the contract;

            (ii)    A statement of the reasons for the termination; and

            (iii)    The date on which the termination takes effect; and

        (3)    Be delivered to the supplier or dealer by:

            (i)    Certified mail; or

            (ii)    Personal delivery.


Download our app to see the most-to-date content.