N.Y. General Business Law § 696-c: Termination and non-renewal of dealer agreements

§ 696-c. Termination and non-renewal of dealer agreements. 1. Except

where a grounds for termination or non-renewal of a dealer agreement are

contained in paragraph (a), (b), (c), (d), (e) or (f) of subdivision two

of this section, a supplier shall give a dealer ninety days' written

notice of the supplier's intent to terminate, cancel or not renew a

dealer agreement. The contractual term of the dealer agreement shall not

expire, without the written consent of the dealer, prior to the

expiration of at least ninety days following such notice. Nothing in

this section shall prohibit a dealer from terminating a dealer agreement

with cause provided, however, that the dealer notify the supplier in

writing at least ninety days prior to the effective date of such

termination with the reasons for such termination. This notice will not

apply for grounds of termination in following paragraphs (a) through (f)

of subdivision two of this section.

2. As used in this article, a termination by a supplier of a dealer

agreement shall be with cause when the dealer has:

(a) transferred a controlling ownership interest in the dealership

without the supplier's consent;

(b) made a material misrepresentation in applying for the dealer

agreement;

(c) filed a voluntary petition in bankruptcy or has had an involuntary

petition in bankruptcy filed against the dealer which has not been

discharged within sixty days after the filing; is in default under the

provisions of a security agreement in effect with the supplier; or is

insolvent or in receivership;

(d) been convicted of a crime, punishable for a term of imprisonment

for one year or more;

(e) failed to operate in the normal course of business for ten

consecutive business days or has terminated said business;

(f) Significantly relocated the dealer's place of business without

supplier's consent; or

(g) consistently engaged in business practices which are detrimental

to the consumer or supplier by way of excessive pricing, misleading

advertising, failure to provide service and replacement parts or perform

warranty obligations;

(h) inadequately represented supplier over a measured period causing

lack of performance in sales, service or warranty areas and failed to

achieve market penetration at levels consistent with similary located

dealerships based on available recorded information compiled by industry

associations regarded as the authorities in this area both in local and

national standards;

(i) consistently failed to meet building and housekeeping

requirements, or has failed to provide adequate sales, service or parts

personnel commensurate with the dealer agreement;

(j) consistently failed to comply with the applicable licensing laws

pertaining to the products and services being represented for and on

supplier's behalf;

(k) consistently failed to comply with the terms of the dealership

agreement.

3. No supplier shall base its decision to terminate, cancel or not to

renew a dealer agreement on any of the paragraphs of subdivision two of

this section except paragraph (a), (b), (c), (d), (e) or (f) thereof

unless such supplier can demonstrate, through written documentation, the

alleged misconduct and/or lack of performance by the dealer, and

furthermore, such supplier shall also show that the reason for the

decision to terminate, cancel or not to renew the dealer agreement was

in no way caused by such supplier.