2011 Louisiana Laws
Revised Statutes
TITLE 51 — Trade and commerce
RS 51:482 — Terminations or cancellations

§482. Terminations or cancellations

A.(1) No agent, directly through an officer or an employee, may terminate, cancel, fail to renew, or substantially change the competitive circumstances of a dealership agreement or contract without good cause.

(2) "Good cause" shall mean failure by a dealer to substantially comply with essential and reasonable requirements imposed upon the dealer by the dealership contract or agreement, if such requirements are not different from those imposed on other dealers similarly situated, either by its terms or the manner of enforcements.

B. Good cause exists whenever:

(1) An individual proprietor, partner, or major shareholder of the dealership has withdrawn.

(2) There has been a substantial reduction in interest of a substantial partner or major stockholder.

(3) The dealer has filed or had filed against it a petition in bankruptcy that has not been discharged within sixty days after the filing, has been sold a substantial part of the dealer's assets related to the equipment business, or has commenced dissolution or liquidation.

(4) The dealer has changed its principal place of business without prior approval of the agent, which shall not be unreasonably withheld.

(5) The equipment dealer has substantially defaulted under chattel mortgage or other security agreement between the dealer and the agent, or there has been a revocation or discontinuance of a guarantee of a present or future obligation to the agent.

(6) The equipment dealer has failed to operate in the normal course of business for fourteen days.

(7) The dealer has pleaded guilty to or has been convicted of a felony substantially affecting the relationship between the dealer and the agent.

(8) The dealer has engaged in conduct which is substantially injurious or detrimental to the dealer's customers or to the public.

(9) After receiving at least twelve months' notice from the agent of its specific and achievable requirements for reasonable market penetration based on the agent's contemporaneous experience in other comparable marketing areas, the dealer has consistently failed to meet the agent's reasonable market penetration requirements.

C. Except as otherwise provided herein, an agent shall provide a dealer with at least ninety days' written notice of termination, cancellation, or nonrenewal of the dealership agreement. The notice shall state all reasons constituting good cause for the action and shall provide that the dealer has sixty days in which to cure any claimed deficiency, specifying the action that must be taken in order to cure the deficiency. If the deficiency is rectified within sixty days, the notice is void. The notice and the right to cure provisions under this Subsection are not required if the reason for termination, cancellation, or nonrenewal is a violation under the provisions of R.S. 51:482(B)(1) through (8).

Acts 1991, No. 627, §1; Acts 1992, No. 372, §1.