CHAPTER 2352. BOAT MANUFACTURERS, DISTRIBUTORS, AND DEALERS

State Codes and Statutes

Statutes > Texas > Occupations-code > Title-14-regulation-of-motor-vehicles-and-transportation > Chapter-2352-boat-manufacturers-distributors-and-dealers

OCCUPATIONS CODE

TITLE 14. REGULATION OF MOTOR VEHICLES AND TRANSPORTATION

SUBTITLE B. REGULATIONS RELATED TO VESSELS

CHAPTER 2352. BOAT MANUFACTURERS, DISTRIBUTORS, AND DEALERS

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 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, Sec. 5, eff. June 1,

2003.

SUBCHAPTER B. DEALER AGREEMENTS

Sec. 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, Sec. 5, eff. June 1,

2003.

Sec. 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, Sec. 5, eff. June 1,

2003.

Sec. 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.

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, Sec. 5, eff. June 1,

2003.

SUBCHAPTER C. REGULATION OF MANUFACTURERS, DISTRIBUTORS, AND

DEALERS

Sec. 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, Sec. 5, eff. June 1,

2003.

Sec. 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, Sec. 5, eff. June 1,

2003.

Sec. 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, Sec. 5, eff. June 1,

2003.

Sec. 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, Sec. 5, eff. June 1,

2003.

Sec. 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.

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, Sec. 5, eff. June 1,

2003.

Sec. 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, Sec. 5, eff. June 1,

2003.

Sec. 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.

(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, Sec. 5, eff. June 1,

2003.

SUBCHAPTER D. ENFORCEMENT PROVISIONS

Sec. 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, Sec. 5, eff. June 1,

2003.

Sec. 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, Sec. 5, eff. June 1,

2003.

Sec. 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, Sec. 5, eff. June 1,

2003.

State Codes and Statutes

State Codes and Statutes

State Codes and Statutes

State Codes and Statutes

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