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AB-2436 Recreational vehicles: dealer agreements.(2007-2008)

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Assembly Bill No. 2436
CHAPTER 743

An act to amend Section 11713.22 of, and to add Sections 331.3 and 11713.23 to, the Vehicle Code, relating to vehicles.

[ Approved by Governor  September 30, 2008. Filed with Secretary of State  September 30, 2008. ]

LEGISLATIVE COUNSEL'S DIGEST


AB 2436, Emmerson. Recreational vehicles: dealer agreements.
(1) Existing law, with regard to dealer and manufacturer agreements involving recreational vehicles, prohibits a licensed manufacturer, manufacturer branch, distributor, or distributor branch, upon mutual agreement of the parties to enter into a dealer agreement, from failing or refusing to provide a written dealer agreement to the recreational vehicle dealer that complies with statutory franchise requirements. A violation of these provisions is a crime.
This bill would instead provide that under these circumstances, failing or refusing to provide a recreational vehicle franchise, as defined by the bill, that complies with requirements established for that agreement, to the recreational vehicle dealer would be prohibited. The bill additionally would prohibit a licensed recreational vehicle manufacturer, manufacturer branch, distributor, or distributor branch from selling new recreational vehicles in this state to or through a dealer without having first entered into a written recreational vehicle franchise with that recreational vehicle dealer, signed by both parties. A recreational vehicle dealer would be prohibited from selling new recreational vehicles in this state without a written recreational vehicle franchise with a licensed recreational vehicle manufacturer, manufacturer branch, distributor, or distributor branch signed by both parties.
The bill would also prohibit, on or after January 1, 2009, a recreational vehicle manufacturer, manufacturer branch, distributor, or distributor branch from shipping to a recreational vehicle dealer, and a recreational vehicle dealer would be prohibited from receiving from one of those entities, a new recreational vehicle on or after January 1, 2009, without a recreational vehicle franchise signed by both parties. The bill would authorize a new recreational vehicle inventory purchased by a recreational vehicle dealer, or shipped by a recreational vehicle manufacturer, manufacturer branch, distributor, or distributor branch, before January 1, 2009, to be sold without a recreational vehicle franchise. This bill would also define recreational vehicle franchise.
Because a violation of this prohibition would be a crime, this bill would impose a state-mandated local program.
(2) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: YES  

The people of the State of California do enact as follows:


SECTION 1.

 Section 331.3 is added to the Vehicle Code, to read:

331.3.
 A “recreational vehicle franchise” is a written agreement between two or more persons having both of the following conditions:
(a) A commercial relationship of definite duration or continuing indefinite duration.
(b) The franchisee is granted the right to offer for sale or lease, or to sell or lease at retail, new recreational vehicles, as defined in subdivision (a) of Section 18010 of the Health and Safety Code, that are manufactured or distributed by the franchisor, or the right to perform authorized warranty repairs and service, or the right to perform any combination of these activities.

SEC. 2.

 Section 11713.22 of the Vehicle Code is amended to read:

11713.22.
 (a) Upon mutual agreement of the parties to enter into a recreational vehicle franchise, it is unlawful and a violation of this code for a manufacturer, manufacturer branch, distributor, or distributor branch licensed under this code to fail or refuse to provide a recreational vehicle dealer with a written recreational vehicle franchise that complies with the requirements of Section 331.3.
(b) Notwithstanding Section 331.3, a recreational vehicle franchise described in this section shall include, but not be limited to, provisions regarding dealership transfer, dealership termination, sales territory, and reimbursement for costs incurred by the dealer for work related to the manufacturer’s warranty for each line-make of recreational vehicle covered by the agreement.
(c) This section applies only to a dealer and manufacturer agreement involving recreational vehicles, as defined in subdivision (a) of Section 18010 of the Health and Safety Code, but does not include an agreement with a dealer who deals exclusively in truck campers.

SEC. 3.

 Section 11713.23 is added to the Vehicle Code, to read:

11713.23.
 (a) A recreational vehicle manufacturer, manufacturer branch, distributor, or distributor branch licensed under this code shall not sell a new recreational vehicle in this state to or through a recreational vehicle dealer without having first entered into a written recreational vehicle franchise with that recreational vehicle dealer, that complies with the requirements of Section 331.3 and that has been signed by both parties.
(b) A recreational vehicle dealer shall not sell a new recreational vehicle in this state without having first entered into a written recreational vehicle franchise, that complies with the requirements of Section 331.3, with a recreational vehicle manufacturer, manufacturer branch, distributor, or distributor branch licensed under this code, that has been signed by both parties.
(c) (1) A recreational vehicle manufacturer, manufacturer branch, distributor, or distributor branch shall not ship a new recreational vehicle to a recreational dealer on or after January 1, 2009, without a recreational vehicle franchise that has been signed by both parties.
(2) A recreational vehicle dealer shall not receive a new recreational vehicle from a recreational vehicle manufacturer, manufacturer branch, distributor, or distributor branch on or after January 1, 2009, without a recreational vehicle franchise that has been signed by both parties.
(d) Any new recreational vehicle inventory that has been purchased by a recreational vehicle dealer, or shipped by a manufacturer, manufacturer branch, distributor, or distributor branch, before January 1, 2009, may be sold at any time without a recreational vehicle franchise.
(e) This section applies only to a dealer and manufacturer agreement involving recreational vehicles, as defined in subdivision (a) of Section 18010 of the Health and Safety Code, but does not include an agreement with a dealer who deals exclusively in truck campers.

SEC. 4.

 No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.