2020 New Mexico Statutes
Chapter 60 - Business Licenses
Article 8A - Trade Practices
Section 60-8A-10 - Franchises; actions; defense.

In any action brought by a wholesaler against a supplier for termination, cancellation or failure to renew a franchise in violation of Sections 60-8A-7 through 60-8A-11 NMSA 1978, it is a complete defense for the supplier to prove that the termination, cancellation or failure to renew was done in good faith and for good cause. It shall not be a defense to any action brought by a wholesaler against a supplier under the provisions of Sections 60-8A-7 through 60-8A-11 NMSA 1978 for the supplier to claim that the laws of another state control over those provisions or in any way make the cited provisions not applicable.

History: Laws 1981, ch. 39, § 57; 1993, ch. 57, § 3.

The 1993 amendment, effective June 18, 1993, substituted "60-8A-7 through 60-8A-11 NMSA 1978" for "54 through 58 of the Liquor Control Act" and added the second sentence.

Evidence warranting appointment of second distributor. — The court's findings of fact support conclusion that supplier acted in good faith and for good cause in appointing a second distributor in New Mexico and that distributor's cause of action for violation of the franchise statutes fails where distributor consistently failed to meet sales expectations, followed a market philosophy contrary to that of supplier, failed to take sufficient steps as promised to improve its performance, and, in supplier's business judgment, failed to adequately represent supplier's product in New Mexico in light of supplier's repeated notifications of its substandard performance and attempts to anticipate improvements. State Distribs., Inc. v. Glenmore Distilleries Co., 738 F.2d 405 (10th Cir. 1984)(decided prior to 1987 amendment of Section 60-8A-7 NMSA 1978, defining "good faith").