2019 Indiana Code
Title 9. Motor Vehicles
Article 32. Dealer Services
Chapter 13. Unfair Practices
9-32-13-27. Canceling, terminating, or refusing to renew franchise; renewal, replacement, or succeeding franchise
Sec. 27. (a) It is an unfair practice for a manufacturer or distributor to do the following:
(1) Cancel or terminate a franchise of a franchisee, or fail or refuse to extend or renew a franchise upon the franchise's expiration, without good cause and notice to the franchisee by certified mail, return receipt requested:
(A) at least ninety (90) days before the cancellation or termination; or
(B) at least ten (10) days before the cancellation or termination if any of the following apply:
(i) The franchisee has abandoned business operations or otherwise failed to conduct sales and service operations during regular business hours for at least seven (7) consecutive business days, unless the abandonment or closure is due to an act of God or another act over which the franchisee has no control.
(ii) The franchisee or another operator of the franchise has been convicted of or pled guilty to an offense punishable by at least one (1) year of imprisonment.
(iii) The dealer files for bankruptcy or enters into receivership.
(iv) The license of the dealer is revoked under IC 9-32-11 or IC 9-32-16.
(v) The dealer commits fraud.
(2) Offer a renewal, replacement, or succeeding franchise that substantially changes or modifies the sales and service obligations, facilities standards, capital requirements, or other terms of the original franchise or agreement of a franchisee without notice to the franchisee by certified mail, return receipt requested, at least ninety (90) days before the expiration or termination of the original franchise or agreement.
(3) Terminate a dealer for the dealer's failure to meet a performance standard that is not statistically valid, reliable, and reasonable.
Notice provided under this subsection must include a detailed statement setting forth the specific grounds for the proposed action.
(b) For purposes of subsection (a)(1), the following do not constitute good cause, provided that no unfair practice is committed under IC 9-32-13-12 and no transfer, sale, or assignment is made in violation of IC 9-32-13-22:
(1) A change of ownership or executive management of a dealership.
(2) Requiring the appointment of an individual to an executive management position in a dealership.
(3) Ownership of, investment in, participation in the management of, or holding a license for the sale of any line make of new motor vehicles by a franchisee or an owner of an interest in a franchise.
(c) Good cause exists under subsection (a)(1) with respect to all franchisees of a line make if the manufacturer of the line make permanently discontinues the manufacture or assembly of the line make.
(d) Not more than thirty (30) days after a franchisee receives notice under subsection (a), the franchisee may protest the proposed action by bringing a declaratory judgment action before the division.
(e) If a franchisee makes a timely and proper request under subsection (d) for declaratory judgment to protest a proposed action under subsection (a)(1), the division shall schedule an administrative hearing. The administrative hearing must comply with IC 4-21.5. The declaratory judgment action must include a determination of whether good cause exists for the proposed action.
As added by P.L.152-2013, SEC.3. Amended by P.L.174-2016, SEC.106.
