SB 287 — RECREATIONAL VEHICLE MANUFACTURE & DEALER ACT

u [ G.

"franchise" means an oral or written arrangement .228930.1 - 4 - for a definite or indefinite period in which a manufacturer, distributor or representative grants to a motor vehicle dealer a license to use a trade name, service mark or related characteristic and in which there is a community of interest in the marketing of motor vehicles or services related to marketing, service or repair of motor vehicles at wholesale, retail, leasing or otherwise;

H.

"fraud" includes, in addition to its normal legal connotation, the following:

(1) a misrepresentation in any manner, whether intentionally false or due to gross negligence, of a material fact;

(2) a promise or representation not made honestly and in good faith;

and (3) an intentional failure to disclose a material fact;

e t 17 I.

"inventory" means new or unused motorcycles, w l n d 18 motor vehicles, motorcycle attachments and motorcycle and motor = = 19 a l vehicle repair parts that are provided by a manufacturer or i a e r 20 distributor to a dealer under a franchise agreement and that a t m m 21 are purchased within thirty-six months of the termination of d r e 22 the franchise or are listed in the manufacturer's or c e s k 23 distributor's current sales manual or price list at the time e a n b 24 that the franchise is terminated;

u [ J.

"manufacturer" means any person who manufactures .228930.1 - 5 - or assembles new motor vehicles either within or outside of this state and may include a predecessor manufacturer or a successor manufacturer;

K.

"motorcycle" means any motor vehicle used on or off a public highway that has an unladen weight of less than one thousand five hundred pounds;

L.

"motor vehicle" means every self-propelled vehicle, having two or more wheels, by which a person or property may be transported on a public highway [and includes recreational vehicles];

M.

"motor vehicle dealer" or "dealer" means a person who sells or solicits or advertises the sale of new or used motor vehicles and is licensed as a dealer pursuant to the Motor Vehicle Code.

"Motor vehicle dealer" or "dealer" shall not include:

(1) receivers, trustees, administrators, e t 17 executors, guardians or other persons appointed by or acting w l n d 18 under judgment, decree or order of any court;

= = 19 a l (2) public officers while performing their i a e r 20 duties as such officers;

a t m m 21 (3) persons making casual sales of their own d r e 22 vehicles duly registered and licensed to them by the state;

or c e s k 23 (4) finance companies, banks and other lending e a n b 24 institutions covering sales of repossessed vehicles;

u [ N.

"person" means every natural person, .228930.1 - 6 - partnership, corporation, association, trust, estate or any other legal entity;

O.

"predecessor manufacturer" means a manufacturer that is acquired, succeeded by or assumed by a successor manufacturer;

P.

"prospective purchaser" means a person who has a bona fide written agreement to purchase a franchise;

Q.

"recall claim" includes a claim for reimbursement for the parts and labor required for a dealer to repair a motor vehicle subject to a do not drive order or stop sale order;

R.

"recreational vehicle" means [any motor vehicle with a camping body that either has its own motive power or is drawn by another vehicle] a vehicle that is either self- propelled or towed by a consumer-owned tow vehicle and that is designed to provide temporary living quarters for recreational, e t 17 camping or travel use, and includes motor homes, travel w l n d 18 trailers, fifth wheel travel trailers, truck campers and = = 19 a l folding camping trailers;

i a e r 20 S.

"relevant market area" means an area of a size a t m m 21 specified in this subsection around an existing motor vehicle d r e 22 dealer's place of business.

The size of the area shall be the c e s k 23 greater of the area of responsibility specified in the dealer's e a n b 24 franchise or a circle with a center at the dealer's place of u [ business and a radius of:

.228930.1 - 7 - (1) seven miles, if the population of the county in which the dealership is located is two hundred fifty thousand or more;

(2) fifteen miles, if the population of the county in which the dealership is located is less than two hundred fifty thousand but is thirty-five thousand or more;

or (3) twenty miles in all other cases.

If the existing and proposed dealerships are in different counties, the lesser of the applicable mileage limitations shall be used.

For purposes of this subsection, the population of any area shall be determined in accordance with the most recent decennial census or the most recent population update from the national planning data corporation or other similar recognized source, whichever is later;

T.

"representative" means any person who is or acts as an agent, employee or representative of a manufacturer or e t 17 distributor and who performs any duties in this state relating w l n d 18 to promoting the distribution or sale of new or used motor = = 19 a l vehicles or contacts dealers in this state on behalf of a i a e r 20 manufacturer or distributor;

a t m m 21 U.

"sale" includes:

d r e 22 (1) the issuance, transfer, agreement for c e s k 23 transfer, exchange, pledge, hypothecation or mortgage in any e a n b 24 form, whether by transfer in trust or otherwise, of any motor u [ vehicle or interest therein or of any franchise related .228930.1 - 8 - thereto;

and (2) any option, subscription or other contract or solicitation looking to a sale or offer or attempt to sell in any form, whether spoken or written.

A gift or delivery of any motor vehicle or franchise with respect thereto with, or as, a bonus on account of the sale of anything shall be deemed a sale of such motor vehicle or franchise;

V.

"stop sale order" means a notice prohibiting a motor vehicle dealer from leasing or selling and delivering at wholesale or retail a used motor vehicle in the inventory of the dealer until the vehicle has been repaired because the vehicle has a safety defect, fails to comply with a federal motor vehicle safety standard or fails to comply with a federal requirement;

W.

"successor manufacturer" means a motor vehicle manufacturer that, on or after January 1, 2010, acquires, e t 17 succeeds to or assumes any part of the business of a w l n d 18 predecessor manufacturer as the result of:

= = 19 a l (1) a change in ownership, operation or i a e r 20 control of the predecessor manufacturer;

a t m m 21 (2) the termination, suspension or cessation d r e 22 of all or a part of the business operation of the predecessor c e s k 23 manufacturer;

e a n b 24 (3) the discontinuance of the sale of a u [ product line;

or .228930.1 - 9 - (4) a change in the distribution system by the predecessor manufacturer, whether through a change in distributor or the predecessor manufacturer's decision to cease conducting business through a distributor;

and X.

"value of the used motor vehicle" means the average trade-in value indicated in an independent third party guide for a used motor vehicle of the same year, make and model." SECTION 3.

[NEW MATERIAL] SHORT TITLE.--Sections 3 through 13 of this act may be cited as the "Recreational Vehicle Manufacturer and Dealer Act".

SECTION 4.

"component manufacturer" means a person, e a n b 24 corporation or business entity that engages in the u [ manufacturing of components, accessories or parts used in .228930.1.231176.2 - 102 - STBTC/SB 287 manufacturing recreational vehicles;

w l n d 18 (2) have lengths and interior floor plans that = = 19 a l distinguish the recreational vehicles from other recreational a l i a e r 20 vehicles with substantially the same decor, features, a t m m 21 equipment, weight and price;

.228930.1.231176.2 - 113 - STBTC/SB 287 I.

"recreational vehicle" means a vehicle that is either self-propelled or towed by a consumer-owned tow vehicle and that is designed to provide temporary living quarters for e t 17 recreational, camping or travel use, and includes motor homes, w l n d 18 travel trailers, fifth wheel travel trailers, truck campers and = = 19 a l folding camping trailers;

a l i a e r 20 N.

"warrantor" means a person, corporation or e a n b 24 business entity that gives a warranty in connection with a new u [ recreational vehicle or parts, accessories or components of a .228930.1.231176.2 - 124 - STBTC/SB 287 recreational vehicle, and excludes service contracts, insurance or extended warranties sold for separate consideration by a dealer or person not controlled by a manufacturer.

SECTION 5.3.

For the duration of the manufacturer-dealer agreement, the area of sales responsibility shall not change, and the manufacturer or e t 17 distributor shall not contract with another dealer for sale of w l n d 18 the same model or line-make, as specified in the manufacturer- = = 19 a l dealer agreement, in the designated area of sales a l i a e r 20 responsibility, unless agreed to by written consent of all a t m m 21 parties to the agreement.

A manufacturer, distributor or dealer shall not c e s k 23 issue a policy or procedure that violates or substantially e a n b 24 alters a provision of the manufacturer-dealer agreement during u [ the duration of the agreement, unless agreed to by written .228930.1.231176.2 - 135 - STBTC/SB 287 consent of all parties to the agreement.

e t 17 SECTION 6.4.

[NEW MATERIAL] TERMINATION, CANCELLATION AND w l n d 18 NONRENEWAL OF A MANUFACTURER-DEALER AGREEMENT--GOOD CAUSE-- = = 19 a l NOTICE--REQUIRED REPURCHASE.-- a l i a e r 20 A.

A manufacturer or distributor, directly or a t m m 21 through an officer, agent or employee, shall terminate, cancel d r e 22 or fail to renew a model, line-make or manufacturer-dealer c e s k 23 agreement only with good cause, and upon renewal, shall not e a n b 24 require additional inventory stocking requirements or increased u [ retail sales targets in excess of the market growth in the .228930.1.231176.2 - 146 - STBTC/SB 287 dealer's area of sales responsibility.

e t 17 (6) any failures by the dealer to follow w l n d 18 procedures or standards of operation pursuant to the = = 19 a l manufacturer-dealer agreement and the law;

and a l i a e r 20 (7) a dealer's violation of the terms of the a t m m 21 manufacturer-dealer agreement or the Recreational Vehicle d r e 22 Manufacturer and Dealer Act.

Except as otherwise provided in this section and e a n b 24 unless the reason for termination, cancellation or nonrenewal u [ of a model, line-make or manufacturer-dealer agreement is .228930.1.231176.2 - 157 - STBTC/SB 287 insolvency, bankruptcy or the occurrence of an assignment for the benefit of creditors, a manufacturer or distributor shall provide a dealer with at least one hundred twenty days of written notice of termination, cancellation or nonrenewal of a model, line-make or manufacturer-dealer agreement.

w l n d 18 (1) a dealer or one of the dealer's owners = = 19 a l being convicted of or entering a plea of nolo contendere to a a l i a e r 20 felony;

.228930.1.231176.2 - 168 - STBTC/SB 287 (3) a misrepresentation by the dealer that materially affects the business relationship;

The w l n d 18 following factors may be considered for the purposes of = = 19 a l determining whether there is good cause:

a l i a e r 20 (1) a manufacturer or distributor being a t m m 21 convicted of or entering a plea of nolo contendere to a felony;

d r e 22 (2) a manufacturer or distributor abandoning c e s k 23 or closing business operations for at least ten consecutive e a n b 24 business days, unless the closing is due to force majeure or a u [ strike, labor difficulty or other cause over which the .228930.1.231176.2 - 179 - STBTC/SB 287 manufacturer or distributor has no control;

= = 19 a l SECTION 7.5.

[NEW MATERIAL] REQUIRED REPURCHASE-- a l i a e r 20 TERMINATION, CANCELLATION AND NONRENEWAL OF A MANUFACTURER- a t m m 21 DEALER AGREEMENT.-- d r e 22 A.

If a manufacturer-dealer agreement is c e s k 23 terminated, canceled or not renewed by a dealer for good cause, e a n b 24 the manufacturer or distributor shall, at the election of the u [ dealer within forty-five days after the termination, .228930.1.231176.2 - 1810 - STBTC/SB 287 cancellation or nonrenewal, repurchase:

and w l n d 18 (3) properly functioning diagnostic equipment, = = 19 a l special tools, current signage and other equipment and a l i a e r 20 machinery that were sold to the dealer within the five years a t m m 21 prior to the termination, cancellation or nonrenewal at one d r e 22 hundred percent of the original invoice cost plus the dealer's c e s k 23 freight, destination, delivery and distribution charges and e a n b 24 sales taxes, if any, if the diagnostic equipment, special u [ tools, current signage and other equipment can no longer .228930.1.231176.2 - 1911 - STBTC/SB 287 be used in the normal course of the dealer's ongoing business.

A dealer is not prohibited from selling the remaining in-stock inventory of a particular model or line-make after a dealer agreement has been terminated, canceled or not renewed by the manufacturer, including recreational vehicles of e t 17 a model or line-make subject to the manufacturer-dealer w l n d 18 agreement that are not repurchased or required to be = = 19 a l repurchased by the manufacturer.

a l i a e r 20 SECTION 8.6.

If a dealer desires to make a change in dealer c e s k 23 ownership by the sale of the business assets, stock transfer or e a n b 24 otherwise, the dealer shall provide written notice to a u [ manufacturer or distributor with which the dealer has an active .228930.1.231176.2 - 2012 - STBTC/SB 287 manufacturer-dealer agreement at least ten business days before the closing, including all supporting documentation as may be reasonably required by the manufacturer or distributor to determine if an objection to the sale may be made.

or w l n d 18 (4) has undergone in the last ten years = = 19 a l bankruptcy, insolvency, a general assignment for the benefit of a l i a e r 20 creditors or the appointment of a receiver, trustee or a t m m 21 conservator to take possession of the prospective owner's d r e 22 business or property.

If the manufacturer or distributor objects to a e a n b 24 proposed change of ownership, the manufacturer or distributor u [ shall provide written notice to the dealer stating the reasons .228930.1.231176.2 - 2113 - STBTC/SB 287 pursuant to Subsection B of this section within seven business days after receipt of the dealer's notification and documentation.

e t 17 SECTION 9.7.

[NEW MATERIAL] DEALER INSPECTION AND w l n d 18 REJECTION--DAMAGED RECREATIONAL VEHICLE--NEW RECREATIONAL = = 19 a l VEHICLE ODOMETER.-- a l i a e r 20 A.

.228930.1.231176.2 - 2214 - STBTC/SB 287 (1) request from the manufacturer or distributor authorization to replace the damaged components, parts or accessories or otherwise correct the damage;

An unreasonable amount = = 19 a l of miles shall not be equal to an amount less than the distance a l i a e r 20 between the dealer and the manufacturer's factory or a a t m m 21 distributor's point of distribution, plus one hundred miles.

A dealer shall exercise due care in custody of a .228930.1.231176.2 - 2315 - STBTC/SB 287 damaged or rejected recreational vehicle but shall have no other obligations, financial or otherwise, with respect to that recreational vehicle.

SECTION 10.8.

or w l n d 18 (5) forego exercising a right authorized by a = = 19 a l manufacturer-dealer agreement or any law governing the a l i a e r 20 relationship between the manufacturer or distributor and the a t m m 21 dealer.

e a n b 24 SECTION 11.9.

.228930.1.231176.2 - 2416 - STBTC/SB 287 (1) specify in writing to its dealers any obligations for preparation, delivery and warranty service on its products;

= = 19 a l (4) compensate its dealers for authorized a l i a e r 20 repairs effected by the dealer of merchandise damaged in a t m m 21 manufacture or transit to the dealer if the carrier is d r e 22 designated by the warrantor, factory branch, distributor or c e s k 23 distributor branch;

e a n b 24 (5) compensate a dealer for warranty labor in u [ an amount not less than the lowest retail labor rate actually .228930.1.231176.2 - 2517 - STBTC/SB 287 charged by the dealer in the ordinary course of business for like nonwarranty labor;

w l n d 18 (9) approve or disapprove of warranty claims = = 19 a l in writing within forty-five days after the date of submission a l i a e r 20 by a dealer;

A warrantor may .228930.1.231176.2 - 2618 - STBTC/SB 287 ship parts to a dealer to affect the factory campaign work, and, if such parts are in excess of the dealer's requirements, the dealer may return unused parts to the warrantor for credit after completion of the factory campaign;

e t 17 (2) notify a warrantor as soon as is w l n d 18 reasonably possible, verbally or in writing, if the dealer is = = 19 a l unable or unwilling to perform material or repetitive warranty a l i a e r 20 repairs;

e a n b 24 (4) perform warranty service work authorized u [ by the warrantor in a competent and timely manner on any .228930.1.231176.2 - 2719 - STBTC/SB 287 transient customer's vehicle of the same line-makeline-make; unless the dealer determines that the customer is acting in a manner detrimental to its business;

e t 17 D.

Notwithstanding the terms of any manufacturer- w l n d 18 dealer agreement, a warrantor shall indemnify, defend and hold =e =t 1917 a l harmless its dealers against any losses or damages to the iw al en rd 2018 extent such losses or damages are caused by the negligence or a= t= m19 m 21 willful misconduct of the warrantor, including a dealer that da rl i a e 22r 20 fails to discover, disclose or remedy a defect in the design or ca et sm km 2321 manufacture of the relevant recreational vehicle.

A dealer ed ar ne b22 24 shall provide to the warrantor a copy of any suit in which uc [e s k 23 allegations are made pursuant to this subsection within ten .228930.1e -a 28n -b 24 days after receiving the suit.

This subsection shall continue u [ to apply even after a recreational vehicle is titled.

.231176.2 - 20 - STBTC/SB 287 E.

SECTION 12.10.

[NEW MATERIAL] DISPUTEDEALER RESOLUTION--MEDIATIONREQUIREMENTS--RETAIL eBUYER tPROTECTION--RIGHT 17OF REQUIREDACTION--DAMAGES BEFOREAND CIVILAWARDS--VENUE-- ACTION--VENUE--RELIEF.--LIMITATIONS.-- we lt n17 d 18 A.

A dealer,dealer manufacturer,shall distributornot: or warrantor = = 19 a l injured by another party's violation of the Recreational i a e r 20 Vehicle Manufacturer and Dealer Act may bring a civil action to a t m m 21 recover actual damages.

Thew courtl shalln awardd attorney18 fees(1) drequire ra eretail 22buyer of a new = = 19 recreational vehicle, as a condition of sale and costsdelivery a l i a e r 20 thereof, to thepurchase prevailingspecial party.features, equipment, parts or a t m m 21 accessories not ordered or desired by the buyer;

Venueprovided forthat anyd civilr actione 22 the features, equipment, parts or accessories are not already c e s k 23 authorizedinstalled byon thisthe sectionnew shallrecreational bevehicle inwhen thereceived countyby in which the e a n b 24 dealershipdealer; is located.

In an action involving more than one u [ dealer,(2) venueuse mayfalse, bedeceptive inor anymisleading county.231176.2 in- which21 a- dealerSTBTC/SB that287 isadvertising .228930.1in -connection 29with - party to the actiondealer's isbusiness; located.

B.(3) willfully defraud any retail buyer to the buyer's damage;

Prior(4) fail to bringingperform suitobligations forplaced anon allegedthe violationdealer pursuantby to this section, a partymanufacturer's shallpreparation makeand adelivery goodagreements faithwith effortregard to mediate the dispute,delivery includingand servingpreparation uponof the responding party a writtennew demandrecreational vehicle for mediation,retail selectingsale; a mediator, scheduling a mediation and participating in the mediation.

This(5) provisionfail doesto notperform applythe toobligations aplaced proceedingon forthe injunctivedealer relief.in connection with the manufacturer's warranty agreements;

(6) represent or sell as a new recreational vehicle any motor vehicle that has been used and operated for demonstration purposes or that is otherwise a used recreational vehicle;

or (7) intentionally fail to perform any written agreement with a retail buyer.

e t 17 B.

A person aggrieved by a violation of this w l n d 18 section may bring a civil action in a district court of = = 19 competent jurisdiction for any appropriate relief, including a l i a e r 20 actual damages sustained by that person, the cost of bringing a t m m 21 suit and reasonable attorney fees.

d r e 22 C.

When there are reasonable grounds to believe c e s k 23 that a person has violated, is violating or is about to violate e a n b 24 a provision of this section, an aggrieved person may bring a u [ civil action for preventive relief, including a permanent or .231176.2 - 22 - STBTC/SB 287 temporary injunction or restraining order, in a district court of competent jurisdiction.

D.

In addition to money damages, a court may award:

(1) punitive damages not to exceed three times the actual damages if a defendant acted maliciously;

or (2) attorney fees or costs to a party charged with a violation, if the action is frivolous or brought in bad faith.

E.

Venue for a civil action authorized by this section shall be in the county where the defendant resides or in the county where the violation or threat of violation occurs.

F.

An action rising out of any provision of this section shall be commenced within four years after the cause of action accrues;

provided that, if a person potentially liable under this section conceals the cause of action from the e t 17 knowledge of a person entitled to bring it, the period prior to w l n d 18 the discovery of the cause of action shall be excluded in = = 19 determining the time limited for the commencement of the a l i a e r 20 action.

If a cause of action accrues during the pendency of a a t m m 21 civil, criminal or administrative proceeding against a person d r e 22 brought by the United States, or any of its agencies, under the c e s k 23 antitrust laws, the Federal Trade Commission Act or any other e a n b 24 federal act or the laws of the state related to antitrust laws u [ or to franchising, such actions may be commenced within one .231176.2 - 23 - STBTC/SB 287 year after the final disposition of such civil, criminal or administrative proceeding.

G.

Nothing in this section shall be construed to limit the rights and remedies available to a complainant under any other law.

SECTION 11.

[NEW MATERIAL] DISPUTE RESOLUTION--MEDIATION REQUIRED BEFORE CIVIL ACTION--VENUE--RELIEF.-- A.

A dealer, manufacturer, distributor or warrantor injured by another party's violation of the Recreational Vehicle Manufacturer and Dealer Act, except for violations of the provisions of Section 10 of that act, may bring a civil action in a district court of competent jurisdiction to recover actual damages or for preventive relief, including a permanent or temporary injunction or restraining order.

The court shall award attorney fees and costs to the prevailing party.

Venue for any civil action authorized by this section shall be in the e t 17 county in which the dealership is located.

In an action w l n d 18 involving more than one dealer, venue may be in any county in = = 19 which a dealer that is party to the action is located.

a l i a e r 20 B.

Prior to bringing suit for an alleged violation a t m m 21 pursuant to this section, a party shall make a good faith d r e 22 effort to mediate the dispute, including serving upon the c e s k 23 responding party a written demand for mediation, selecting a e a n b 24 mediator, scheduling a mediation and participating in the u [ mediation.

This provision does not apply to a proceeding for .231176.2 - 24 - STBTC/SB 287 injunctive relief.

In the event of a civil action between e t 17 two dealers, the demand shall be mailed to the address on the w l n d 18 dealer's license filed with the state.

= = 19 a l D.

Within thirty days after the date a demand for i a e r 20 mediation is served, the parties shall mutually select an a t m m 21 independent mediator and meet with the mediator for the purpose d r e 22 of attempting to resolve the dispute.

The mediator shall c e s k 23 select a location in New Mexico, and the mediator may extend e at n17 b 24 the date of the meeting for good cause shown by either party or uw [l n d 18 upon stipulation of both parties.

.228930.1= -= 3019 - E.

If a responding party does not reply within a l i a e r 20 thirty days after the demand for mediation is served, the party a t m m 21 initiating the action may proceed to a civil action without d r e 22 mediating.

c e s k 23 F.

The service of a demand for mediation pursuant e a n b 24 to this subsection stays the time for the filing of any u [ complaint, petition, protest or action pursuant to the .231176.2 - 25 - STBTC/SB 287 Recreational Vehicle Manufacturer and Dealer Act until representatives of the involved parties complete a mediation with a mutually selected mediator for the purpose of attempting to resolve the dispute.

If a complaint, petition, protest or action is filed before the mediation, a court shall enter an order suspending the proceeding or action until the meeting has occurred and may, upon written stipulation of all parties to the proceeding or action that the parties wish to continue to mediate pursuant to this subsection, enter an order suspending e t 17 the proceeding or action for as long a period as the court w l n d 18 considers appropriate.

The suspension order issued may be = = 19 a l revoked by the court.

i a e r 20 G.

The parties to a mediation pursuant to this a t m m 21 section shall bear their own costs for attorney fees and divide d r e 22 equally the cost of the mediator.

c e s k 23 H.

In addition to the remedies provided by this e at n17 b 24 section and notwithstanding the existence of any additional uw [l n d 18 remedy at law, a dealer, manufacturer or distributor may apply .228930.1= -= 3119 - to the relevant court for the grant, upon a hearing and for a l i a e r 20 cause shown, of a temporary or permanent injunction to restrain a t m m 21 a person from acting as a dealer, manufacturer or distributor d r e 22 without being properly licensed or from violating the c e s k 23 provisions of the Recreational Vehicle Manufacturer and Dealer e a n b 24 Act.

u [ SECTION 13.12.

[NEW MATERIAL] PENALTIES.-- .231176.2 - 26 - STBTC/SB 287 A.

If the taxation and revenue department finds that a dealer,dealer manufacturer or distributor has violated a provision of the Recreational Vehicle Manufacturer and Dealer Act, the department may suspend or revoke the license of the dealer,dealer. manufacturer or distributor.

If the taxation and revenue department finds that a person has violated a provision of the Recreational Vehicle Manufacturer and Dealer Act, the department may assess and collect an administrative penalty against the person in an e t 17 amount not to exceed one thousand dollars ($1,000) for each w l n d 18 violation.

= = 19 a l C.

A person,person dealer, manufacturer or distributordealer i a e r 20 aggrieved by a decision of the taxation and revenue department a t m m 21 made pursuant to the provisions of this section may appeal to d r e 22 the administrative hearings office for a hearing.

A person,person c e s k 23 dealer, manufacturer or distributordealer that continues to be e a n b 24 aggrieved after the decision made by a hearing officer may u [ appeal that decision to a district court pursuant toe thet .228930.117 -to 32the - provisions of Section 39-3-1.1 NMSA 1978.

w l n d 18 SECTION 14.13.

REPEAL.--SectionSection 57-16-6.257-16-2 NMSA 1978 (being Laws 1995,1973, = = 19 Chapter 19,6, Section 2,2) asis amended)amended isto repealed.read:

SECTIONa 15.l i a e r 20 "57-16-2.

EFFECTIVEAPPLICATION DATE.--TheOF effectiveACT.-- datea oft them provisionsm of21 thisA. act is January 1, 2026.

-Except 33as -provided 8in 10Subsection 12B 14of 16this ed tr 17e w22 lsection, nthe dprovisions 18of =[this =act] 19Chapter a57, lArticle i16 ac e rs 20k a23 tNMSA m1978 mshall 21apply dto rall persons, manufacturers, e 22a cn eb s24 krepresentatives, 23distributors eand adealers nand bto 24all written or u [ .228930.1oral agreements between the manufacturer, distributor or .231176.2 - 27 - STBTC/SB 287 representative with a motor vehicle dealer, including [but not limited to] the franchise offering, the franchise agreement, sales of goods, services or advertising, leases or mortgages of real or personal property, promises to pay, security interest, pledges, insurance contracts, advertising contracts, construction or installation contracts, servicing contracts and all other such agreements in which the manufacturer, distributor or representative has any direct or indirect interest.

B.

The provisions of Chapter 57, Article 16 NMSA 1978 shall not apply to a dealer, manufacturer, component manufacturer or distributor that manufactures or sells new recreational vehicles." SECTION 14.

Section 57-16-3 NMSA 1978 (being Laws 1973, Chapter 6, Section 3, as amended) is amended to read:

"57-16-3.

DEFINITIONS.--As used in Chapter 57, Article 16 e t 17 NMSA 1978:

w l n d 18 A.

"current price" means an amount equal to the = = 19 price listed in the manufacturer's or distributor's printed a l i a e r 20 price list in effect when the franchise is terminated, less a t m m 21 applicable trade and cash discounts;

d r e 22 B.

"dealer cost" means an amount equal to the sum c e s k 23 of the original invoice price that the dealer paid for e a n b 24 inventory and the cost of the delivery of the inventory from u [ the manufacturer or distributor to the dealer, less applicable .231176.2 - 28 - STBTC/SB 287 discounts;

C.

"designated family member" means a spouse, child, grandchild, parent, brother or sister of a deceased or incapacitated dealer who is entitled to inherit the dealer's ownership interest in the dealership under the terms of a will or the laws of intestate succession in this state.

In the case of an incapacitated dealer, the term means the person appointed by a court as the legal representative of the dealer's property.

The term also includes the appointed and qualified personal representative and the testamentary trustee of a deceased dealer.

However, the term shall be limited to mean only that individual designated by a dealer in a written document filed with the manufacturer, distributor or representative in the event that such a document has been filed;

D.

"distributor" means any person who distributes e t 17 or sells new or used motor vehicles to dealers and who is not a w l n d 18 manufacturer;

= = 19 E.

"do not drive order" means a notice advising a a l i a e r 20 motor vehicle dealer or an owner of a motor vehicle not to a t m m 21 drive the vehicle until the vehicle has been repaired because d r e 22 the vehicle has a safety defect, fails to comply with a federal c e s k 23 motor vehicle safety standard or fails to comply with a federal e a n b 24 requirement;

u [ F.

"former franchisee":

.231176.2 - 29 - STBTC/SB 287 (1) means a dealer that has entered into a franchise agreement with a manufacturer and that has:

(a) entered into a termination agreement or deferred termination agreement with the manufacturer related to the franchise;

or (b) has had the franchise canceled, terminated or otherwise ended;

and (2) includes the designated successor of the former franchisee in the event the former franchisee is deceased or disabled;

G.

"franchise" means an oral or written arrangement for a definite or indefinite period in which a manufacturer, distributor or representative grants to a motor vehicle dealer a license to use a trade name, service mark or related characteristic and in which there is a community of interest in the marketing of motor vehicles or services related to e t 17 marketing, service or repair of motor vehicles at wholesale, w l n d 18 retail, leasing or otherwise;

= = 19 H.

"fraud" includes, in addition to its normal a l i a e r 20 legal connotation, the following:

a t m m 21 (1) a misrepresentation in any manner, whether d r e 22 intentionally false or due to gross negligence, of a material c e s k 23 fact;

e a n b 24 (2) a promise or representation not made u [ honestly and in good faith;

and .231176.2 - 30 - STBTC/SB 287 (3) an intentional failure to disclose a material fact;

I.

"inventory" means new or unused motorcycles, motor vehicles, motorcycle attachments and motorcycle and motor vehicle repair parts that are provided by a manufacturer or distributor to a dealer under a franchise agreement and that are purchased within thirty-six months of the termination of the franchise or are listed in the manufacturer's or distributor's current sales manual or price list at the time that the franchise is terminated;

J.

"manufacturer" means any person who manufactures or assembles new motor vehicles either within or outside of this state and may include a predecessor manufacturer or a successor manufacturer;

K.

"motorcycle" means any motor vehicle used on or off a public highway that has an unladen weight of less than e t 17 one thousand five hundred pounds;

w l n d 18 L.

"motor vehicle" means every self-propelled = = 19 vehicle, having two or more wheels, by which a person or a l i a e r 20 property may be transported on a public highway [and includes a t m m 21 recreational vehicles];

d r e 22 M.

"motor vehicle dealer" or "dealer" means a c e s k 23 person who sells or solicits or advertises the sale of new or e a n b 24 used motor vehicles and is licensed as a dealer pursuant to the u [ Motor Vehicle Code.

"Motor vehicle dealer" or "dealer" shall .231176.2 - 31 - STBTC/SB 287 not include:

(1) receivers, trustees, administrators, executors, guardians or other persons appointed by or acting under judgment, decree or order of any court;

(2) public officers while performing their duties as such officers;

(3) persons making casual sales of their own vehicles duly registered and licensed to them by the state;

or (4) finance companies, banks and other lending institutions covering sales of repossessed vehicles;

N.

"person" means every natural person, partnership, corporation, association, trust, estate or any other legal entity;

O.

"predecessor manufacturer" means a manufacturer that is acquired, succeeded by or assumed by a successor manufacturer;

e t 17 P.

"prospective purchaser" means a person who has a w l n d 18 bona fide written agreement to purchase a franchise;

= = 19 Q.

"recall claim" includes a claim for a l i a e r 20 reimbursement for the parts and labor required for a dealer to a t m m 21 repair a motor vehicle subject to a do not drive order or stop d r e 22 sale order;

c e s k 23 R.

"recreational vehicle" means [any motor vehicle e a n b 24 with a camping body that either has its own motive power or is u [ drawn by another vehicle] a vehicle that is either self- .231176.2 - 32 - STBTC/SB 287 propelled or towed by a consumer-owned tow vehicle and that is designed to provide temporary living quarters for recreational, camping or travel use, and includes motor homes, travel trailers, fifth wheel travel trailers, truck campers and folding camping trailers;

S.

"relevant market area" means an area of a size specified in this subsection around an existing motor vehicle dealer's place of business.

The size of the area shall be the greater of the area of responsibility specified in the dealer's franchise or a circle with a center at the dealer's place of business and a radius of:

(1) seven miles, if the population of the county in which the dealership is located is two hundred fifty thousand or more;

(2) fifteen miles, if the population of the county in which the dealership is located is less than two e t 17 hundred fifty thousand but is thirty-five thousand or more;

or w l n d 18 (3) twenty miles in all other cases.

= = 19 If the existing and proposed dealerships are in different a l i a e r 20 counties, the lesser of the applicable mileage limitations a t m m 21 shall be used.

For purposes of this subsection, the population d r e 22 of any area shall be determined in accordance with the most c e s k 23 recent decennial census or the most recent population update e a n b 24 from the national planning data corporation or other similar u [ recognized source, whichever is later;

.231176.2 - 33 - STBTC/SB 287 T.

"representative" means any person who is or acts as an agent, employee or representative of a manufacturer or distributor and who performs any duties in this state relating to promoting the distribution or sale of new or used motor vehicles or contacts dealers in this state on behalf of a manufacturer or distributor;

U.

"sale" includes:

(1) the issuance, transfer, agreement for transfer, exchange, pledge, hypothecation or mortgage in any form, whether by transfer in trust or otherwise, of any motor vehicle or interest therein or of any franchise related thereto;

and (2) any option, subscription or other contract or solicitation looking to a sale or offer or attempt to sell in any form, whether spoken or written.

A gift or delivery of any motor vehicle or franchise with respect thereto with, or e t 17 as, a bonus on account of the sale of anything shall be deemed w l n d 18 a sale of such motor vehicle or franchise;

= = 19 V.

"stop sale order" means a notice prohibiting a a l i a e r 20 motor vehicle dealer from leasing or selling and delivering at a t m m 21 wholesale or retail a used motor vehicle in the inventory of d r e 22 the dealer until the vehicle has been repaired because the c e s k 23 vehicle has a safety defect, fails to comply with a federal e a n b 24 motor vehicle safety standard or fails to comply with a federal u [ requirement;

.231176.2 - 34 - STBTC/SB 287 W.

"successor manufacturer" means a motor vehicle manufacturer that, on or after January 1, 2010, acquires, succeeds to or assumes any part of the business of a predecessor manufacturer as the result of:

(1) a change in ownership, operation or control of the predecessor manufacturer;

(2) the termination, suspension or cessation of all or a part of the business operation of the predecessor manufacturer;

(3) the discontinuance of the sale of a product line;

or (4) a change in the distribution system by the predecessor manufacturer, whether through a change in distributor or the predecessor manufacturer's decision to cease conducting business through a distributor;

and X.

"value of the used motor vehicle" means the e t 17 average trade-in value indicated in an independent third party w l n d 18 guide for a used motor vehicle of the same year, make and = = 19 model." a l i a e r 20 SECTION 15.

REPEAL.--Section 57-16-6.2 NMSA 1978 (being a t m m 21 Laws 1995, Chapter 19, Section 2, as amended) is repealed.

d r e 22 SECTION 16.

EFFECTIVE DATE.--The effective date of the c e s k 23 provisions of this act is January 1, 2026.

e a n b 24 - 35 - u [ .231176.2