§ 696-B — Dealer agreements; unlawful acts and practices

New York § 696-B

• Jurisdiction: New York
• Law GBS: General Business
• Art. 33-A: Dealer Agreements For the Sale of Farm Equipment

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§ 696-b. Dealer agreements; unlawful acts and practices. It shall be a\nviolation of this article for a supplier:\n 1. To coerce, compel, or attempt to coerce or compel any dealer to\norder or accept delivery of any equipment or parts, or any equipment\nwith special features or accessories not included in the base list price\nof such equipment as publicly advertised by the supplier which the\ndealer has not voluntarily ordered; or\n 2. To coerce or compel any dealer to enter into any agreement, whether\nwritten or oral, supplementary to an existing dealer agreement with such\nsupplier; or\n 3. To coerce or compel, any dealer to refuse to purchase equipment\nfrom another supplier, however it shall not be a violation of this\nsection to require separate facilities, financial statements or sales\nstaff for major competing lines provided that the dealer is given at\nleast thirty-six months notice of such requirements; or\n 4. To refuse to deliver in reasonable quantities and within a\nreasonable time after receipt of the dealer's order to any dealer having\na dealer agreement for the retail sale of new equipment sold or\ndistributed by such supplier, equipment covered by such dealer agreement\nspecifically advertised or represented by such supplier to be available\nfor immediate delivery. However, the failure to deliver any such\nequipment shall not be considered a violation of this article if such\nfailure is due to prudent and reasonable restriction on extension of\ncredit by the supplier to the dealer, an act of God, work stoppage or\ndelay due to a strike or labor difficulty, a bona fide shortage of\nmaterials, freight embargo, or other cause over which the supplier has\nno control; or\n 5. To terminate or cancel the dealer agreement of any such dealer\nwithout due cause; or\n 6. To condition the renewal or extension of a dealer agreement on the\ndealer's substantial renovation of the dealer's place of business or on\nthe construction, purchase, acquisition, or rental of a new place of\nbusiness by the dealer unless the supplier has advised the dealer in\nwriting of its demand for such renovation, construction, purchase,\nacquisition or rental within a reasonable time prior to the effective\ndate of the proposed date of renewal or extensions, but in no case less\nthan one year, and provided the supplier demonstrates the need for such\nchange in the place of business and the reasonableness of such demand in\nview of the need to service the public and economic conditions existing\nat the time and, provided further, that the dealer makes a good faith\neffort to complete such construction or renovation plans within one\nyear; or\n 7. To sell or offer to sell any new equipment to any other dealer at a\nlower actual price therefor than the actual price sold or offered to any\nother dealer for the same equipment identically equipped or to utilize\nany device including, but not limited to, sale promotion plans or\nprograms which result in such lesser actual price, or result in a fixed\nprice predetermined solely by the supplier provided, however, the\nprovisions of this subdivision shall not apply to sales to a dealer for\nresale to any unit or agency of the United States government, the state,\nor any of its political subdivisions or any municipality located within\nthis state; and provided, further, that the provisions of this\nsubdivision shall not apply so long as a supplier sells or offers to\nsell such new equipment to all of its dealers at an equal price; or\n 8. To willfully discriminate, either directly or indirectly, in price,\nprograms, or terms of sale offered to dealers, where the effect of such\ndiscrimination may be to substantially lessen competition or give to one\nholder of a dealer agreement any economic business or competitive\nadvantage not offered to all holders of the same or similar dealer\nagreements; or\n 9. To prevent by contract or otherwise, any dealer, from changing its\ncapital structure, ownership or the means by or through which the dealer\nfinances its operations, so long as the dealer gives prior notice to the\nsupplier and provided the dealer at all times meets any responsible\ncapital standards agreed to between the dealer and the supplier and\nimposed on similarly situated dealers and provided such change by the\ndealer does not result in a change in the person with actual or\neffective control of a majority of the voting interests of the dealer;\nor\n 10. If a supplier has contractual authority to approve or deny a\nrequest for a sale or transfer of a dealer's business or an equity\nownership interest therein, the supplier shall approve or deny such a\nrequest within sixty days after receiving a written request from the\ndealer. If the supplier has neither approved nor denied the request\nwithin the sixty day period, the request will be deemed approved. The\ndealer's request shall include reasonable financial, personal\nbackground, character references and work history information for the\nacquiring persons. If a supplier denies a request made pursuant to this\nsubdivision, the supplier must provide the dealer with a written notice\nof such denial that states the reasons for such denial. A supplier may\nonly deny a request based on the failure of the proposed transferees to\nmeet the reasonable requirements consistently imposed by the supplier in\ndetermining approval of such transfer and/or approvals of new dealers;\nor\n 11. To require a dealer to assent to a release, assignment, notation,\nwaiver, or estoppel which would relieve any person from liability\nimposed by this article; or\n 12. (a) To unreasonably withhold consent, in the event of the death of\nthe dealer or the principal owner of the dealership, to the transfer of\nthe dealer's interest in the dealership to a member or members of the\nfamily of the dealer or the principal owner of the dealership or to\nanother qualified individual if the family member or other qualified\nindividual meets the reasonable financial, business experience and\ncharacter standards of the supplier. Furthermore, and only in the event\nthat the transfer proposed is to a person other than a family member,\nsuch person shall have actively participated in the dealership or in the\nfarm equipment or similar industry for at least twelve months preceding\nthe proposed date of transfer. Should a supplier determine that the\ndesignated family member or other qualified individual is not\nacceptable, it shall provide the dealer with written notice of its\nobjection and specific reasons for withholding its consent. A supplier\nshall have thirty days to consider a dealer's request to make a transfer\nto a family member or other qualified individual. As used in this\nparagraph, "family" means and includes a spouse, parents, siblings,\nchildren, step-children, sons-in-law, daughters-in-law and lineal\ndescendants, including those by adoption of the dealer or principal\nowner of the dealership.\n (b) Notwithstanding the foregoing, in the event that a supplier and\ndealer have duly executed an agreement concerning succession rights\nprior to the dealer's death, and if such agreement has not been revoked,\nsuch agreement shall be observed, even if it designates someone other\nthan the surviving spouse or heirs of the decedent as the successor.\n