2005 Texas Occupations Code CHAPTER 2352. BOAT MANUFACTURERS, DISTRIBUTORS, AND DEALERS

OCCUPATIONS CODE

CHAPTER 2352. BOAT MANUFACTURERS, DISTRIBUTORS, AND DEALERS

SUBCHAPTER A. GENERAL PROVISIONS


	§ 2352.001. DEFINITIONS.  In this chapter:                                  
		(1)  "Agreement" means a written agreement between a 
manufacturer or distributor and a dealer for the purchase and sale 
of new boats or new outboard motors.
		(2)  "Boat" means:                                                            
			(A)  a motorboat;  or                                                        
			(B)  any other vessel that is more than 14 feet in 
length and is designed to be propelled by a sail.
		(3)  "Dealer" has the meaning assigned by Section 
31.003, Parks and Wildlife Code.
		(4)  "Distributor" means a person who:                                        
			(A)  offers for sale, sells, or distributes new 
boats or new outboard motors to dealers;  or
			(B)  controls a person described by Subdivision 
(A).                       
		(5)  "Manufacturer" has the meaning assigned by Section 
31.003, Parks and Wildlife Code.
		(6)  "Motorboat" has the meaning assigned by Section 
31. 003, Parks and Wildlife Code.
		(7)  "New" has the meaning assigned by Section 31.003, 
Parks and Wildlife Code.
		(8)  "Outboard motor" has the meaning assigned by 
Section 31.003, Parks and Wildlife Code.
		(9)  "Vessel" has the meaning assigned by Section 
31.003, Parks and Wildlife Code.

Added by Acts 2001, 77th Leg., ch. 1421, § 5, eff. June 1, 2003.           

SUBCHAPTER B. DEALER AGREEMENTS


	§ 2352.051. AGREEMENT REQUIRED.  A manufacturer or 
distributor contracting with a dealer may not sell or offer for 
sale, and a dealer may not purchase or offer to purchase, a new boat 
or a new outboard motor unless the manufacturer or distributor and 
the dealer enter into an agreement that complies with this chapter.

Added by Acts 2001, 77th Leg., ch. 1421, § 5, eff. June 1, 2003.           


	§ 2352.052. TERMS OF AGREEMENT.  (a) An agreement under 
this chapter must include:
		(1)  the dealer's location, territory, or market area;                        
		(2)  the length of the agreement;                                             
		(3)  any performance or marketing standards;                                  
		(4)  any working capital, inventory, facility, 
equipment, or tool standards;
		(5)  provisions for termination or nonrenewal of the 
agreement and the designation of a successor dealer in the event of 
the dealer's death or disability;
		(6)  the obligations of the manufacturer, distributor, 
and dealer in the preparation and delivery of and warranty service 
on new boats and new outboard motors;
		(7)  the obligations of the manufacturer, distributor, 
and dealer on termination of the agreement, including inventory of 
new boats and new outboard motors, parts inventory, equipment, 
furnishings, special tools, and required signs;  and
		(8)  dispute resolution procedures.                                           
	(b)  Notwithstanding the terms of a dealer agreement, a 
dealer agreement and any transaction subject to this chapter must 
comply with the requirements of this section.

Added by Acts 2001, 77th Leg., ch. 1421, § 5, eff. June 1, 2003.           


	§ 2352.053. TERMINATION OR NONRENEWAL OF AGREEMENT;  
NOTICE.  (a) A manufacturer or distributor may not terminate an 
agreement unless there is good cause for the termination and:
		(1)  the manufacturer or distributor gives the dealer 
written notice of termination in clear and concise terms;
		(2)  the notice states the reasons for termination;  
and                    
		(3)  the dealer has been given 30 days to make a good 
faith effort to cure the reasons for termination stated in the 
notice.
	(b)  Good cause is not required for the nonrenewal of an 
agreement other than an agreement having an original term of less 
than one year.
	(c)  The fact that a dealer holds an agreement involving 
another line, make, or brand of new boat or new outboard motor does 
not constitute good cause.
	(d)  A manufacturer or distributor may terminate an 
agreement on written notice if the dealer:
		(1)  financially defaults to the manufacturer, the 
distributor, or a financing source;
		(2)  becomes subject to an order for relief, as that 
term is used in Title 11, United States Code;
		(3)  engages in fraudulent conduct in:                                        
			(A)  conducting the dealer's business;  or                                   
			(B)  performing the agreement;                                               
		(4)  is a corporation that ceases to exist;                                   
		(5)  becomes insolvent or takes or fails to take any 
action that constitutes an admission of inability to pay debts as 
the debts mature;
		(6)  makes a general assignment for the benefit of 
creditors to an agent authorized to liquidate any substantial 
amount of assets;  or
		(7)  applies to a court for the appointment of a 
receiver for any assets or properties.

Added by Acts 2001, 77th Leg., ch. 1421, § 5, eff. June 1, 2003.           

SUBCHAPTER C. REGULATION OF MANUFACTURERS, DISTRIBUTORS, AND 
DEALERS


	§ 2352.101. DELIVERY REQUIREMENTS.  (a) A manufacturer or 
distributor who publicly advertises a new boat, new outboard motor, 
or part as available for immediate delivery shall deliver the boat, 
outboard motor, or part in reasonable quantities and within a 
reasonable time after receipt of an order from a dealer who has an 
agreement with the manufacturer or distributor applicable to the 
advertised boat, outboard motor, or part.
	(b)  Subsection (a) does not apply if circumstances beyond 
the control of the manufacturer or distributor prevent the 
delivery.

Added by Acts 2001, 77th Leg., ch. 1421, § 5, eff. June 1, 2003.           


	§ 2352.102. SALE, TRANSFER, OR PASSAGE OF TITLE.  A 
manufacturer or distributor may not unreasonably withhold approval 
of a sale, transfer, or passage of title of a dealer, agreement, 
management of the dealer, or designation of a successor dealer if:
		(1)  the dealer complies with any provisions in the 
agreement for the sale, transfer, or passage of title;
		(2)  the transferee meets the criteria:                                       
			(A)  stated in the agreement;  or                                            
			(B)  generally applied by the manufacturer or 
distributor in similar situations;  and
		(3)  the transferee agrees to be bound by the terms and 
conditions of the manufacturer's or distributor's standard 
agreement.

Added by Acts 2001, 77th Leg., ch. 1421, § 5, eff. June 1, 2003.           


	§ 2352.103. FINANCING.  (a) A manufacturer or distributor 
may not require a dealer to finance through a particular financing 
source a new boat or new outboard motor sold by the dealer.
	(b)  A manufacturer or distributor may not require a dealer 
to act as the manufacturer's or distributor's agent in securing:
		(1)  a promissory note and security agreement in 
connection with the sale or purchase of a new boat or new outboard 
motor;  or
		(2)  an insurance policy on the operation of a new boat 
or new outboard motor.

Added by Acts 2001, 77th Leg., ch. 1421, § 5, eff. June 1, 2003.           


	§ 2352.104. SALE OF PARTS AND ACCESSORIES AFTER 
TERMINATION OF AGREEMENT.  (a) After a manufacturer or distributor 
terminates an agreement, the former dealer may continue to purchase 
parts and accessories to service the products covered by the 
agreement until the first anniversary of the date of termination.  
The manufacturer or distributor shall sell parts and accessories 
under this subsection at the same price offered to a current dealer.
	(b)  Subsection (a) does not apply if the manufacturer or 
distributor terminates the agreement:
		(1)  based on quality of service;  or                                         
		(2)  for a reason justifying immediate termination 
under Section 2352.053(d).

Added by Acts 2001, 77th Leg., ch. 1421, § 5, eff. June 1, 2003.           


	§ 2352.105. COMPENSATION FOR WARRANTY SERVICE.  (a) A 
manufacturer or distributor shall fairly compensate a dealer for 
the work and services the dealer performs and for expenses the 
dealer incurs to comply with a manufacturer's or distributor's 
warranty.
	(b)  Except as provided by Subsection (c), a manufacturer or 
distributor may not pay a dealer a labor rate for warranty work that 
is less than the rate the dealer charges retail customers for 
nonwarranty work of the same kind by similar technicians.
	(c)  A manufacturer or distributor who has a warranty program 
that reimburses a dealer at 100 percent of the dealer's retail labor 
rate if the dealer complies with reasonable and objective criteria 
shall pay the dealer the labor rate provided by the terms of the 
program or a rate equal to 80 percent of the dealer's retail labor 
rate, whichever rate is higher.
	(d)  A manufacturer or distributor shall approve or 
disapprove a dealer's claim for warranty work within a reasonable 
time.  If the claim is approved, the manufacturer or distributor 
shall pay the claim within a reasonable time.  If the claim is 
disapproved, the manufacturer or distributor shall notify the 
dealer of the grounds for disapproval.

Added by Acts 2001, 77th Leg., ch. 1421, § 5, eff. June 1, 2003.           


	§ 2352.106. REFUNDS, REBATES, AND DISCOUNTS.  A dealer 
may not pay or assume a part of a refund, rebate, discount, or other 
financial adjustment made by the manufacturer or distributor to a 
customer or a dealer unless the dealer voluntarily agrees to make 
the payment or assumption.

Added by Acts 2001, 77th Leg., ch. 1421, § 5, eff. June 1, 2003.           


	§ 2352.107. REPURCHASE BY MANUFACTURER OR 
DISTRIBUTOR.  (a) A manufacturer or distributor who terminates an 
agreement shall repurchase on demand from the dealer any of the 
following items, purchased by the dealer from the manufacturer or 
distributor, that are free and clear of a lien or encumbrance:
		(1)  a new, unsold, retailable, undamaged, and complete 
boat, with accessories and packaged trailers sold with the boat, 
and any outboard motor that:
			(A)  is in the dealer's inventory;  and                                      
			(B)  was purchased within one year preceding the 
date of the termination;  and
		(2)  any new, current, unsold, undamaged, and unused 
parts or accessories for boats or outboard motors in the original 
resalable merchandising package. 
	(b)  A demand for repurchase must be made in writing not 
later than the 30th day after the date the manufacturer or 
distributor terminates the agreement.  The dealer must provide the 
manufacturer or distributor with a complete list of the items to be 
repurchased.  The manufacturer or distributor shall complete the 
repurchase within a reasonable time.
	(c)  The manufacturer or distributor shall:                                    
		(1)  repurchase an item described by Subsection (a)(1) 
at the dealer's invoiced cost, less any allowance paid to the 
dealer;
		(2)  repurchase an item described by Subsection (a)(2) 
at the dealer's invoiced cost;  and
		(3)  pay the cost incurred by the dealer to transport an 
item described by Subsection (a) to the manufacturer.

Added by Acts 2001, 77th Leg., ch. 1421, § 5, eff. June 1, 2003.           

SUBCHAPTER D. ENFORCEMENT PROVISIONS


	§ 2352.201. CIVIL LIABILITY.  A person who violates this 
chapter or an agreement regulated by this chapter is liable to an 
injured party for:
		(1)  the actual damages caused by the violation;  and                         
		(2)  reasonable legal fees and court costs if 
litigation is commenced in connection with the violation.

Added by Acts 2001, 77th Leg., ch. 1421, § 5, eff. June 1, 2003.           


	§ 2352.202. VENUE FOR DISPUTE.  Venue for a dispute under 
an agreement is in the county of the dealer's principal place of 
business as stated in the agreement.

Added by Acts 2001, 77th Leg., ch. 1421, § 5, eff. June 1, 2003.           


	§ 2352.203. ARBITRATION.  A dealer may not be required to 
submit to arbitration on an issue between the dealer and the 
manufacturer or distributor at a location that is out of state or an 
unreasonable distance from the dealer's principal place of 
business.

Added by Acts 2001, 77th Leg., ch. 1421, § 5, eff. June 1, 2003.