ORS 650.145
Compensation due dealer upon termination of franchise


(1)

As used in subsection (2) of this section, “fair and reasonable compensation” means the amount a dealer originally paid for vehicles minus any incentive payments, model close-out allowances or any other programs that apply to the vehicles.

(2)

A manufacturer, distributor or importer that terminates, cancels, fails to renew or discontinues a franchise shall pay or allow a dealer fair and reasonable compensation for:

(a)

All new vehicles manufactured in the current calendar year and any subsequent calendar year in the motor vehicle inventory the dealer purchased from the manufacturer, distributor or importer that were not materially altered, substantially damaged or driven for more than 300 miles;

(b)

All new vehicles in the motor vehicle inventory that were not materially altered or substantially damaged, if the vehicles:

(A)

Have a gross vehicle weight rating of less than 8,500 pounds and were:
(i)
Driven for not more than 300 miles;
(ii)
Purchased directly from the manufacturer, distributor or importer within one year of the effective date of the termination, cancellation, nonrenewal or discontinuance; and
(iii)
Paid for or drafted on the dealer’s financing source; or

(B)

Have a gross vehicle weight rating of 8,500 pounds or more and were:
(i)
Driven for not more than 3,500 miles;
(ii)
Purchased directly from the manufacturer, distributor or importer within one year of the effective date of the termination, cancellation, nonrenewal or discontinuance; and
(iii)
Paid for or drafted on the dealer’s financing source;

(c)

Supplies and parts inventory that the dealer purchased from the manufacturer, distributor or importer and that are listed in the manufacturer’s, distributor’s or importer’s current parts catalog;

(d)

Equipment, furnishings and signs that the manufacturer, distributor or importer required the dealer to purchase and that were not materially altered, or substantially damaged or depreciated by more than 50 percent of the original value;

(e)

Special tools required by the manufacturer that the dealer purchased from the manufacturer, distributor or importer within three years of the date of termination, cancellation, nonrenewal or discontinuance and that were not materially altered, or substantially damaged or depreciated by more than 50 percent of the original value; and

(f)

The lesser of one year’s lease payments or the reasonable amount remaining due on a lease or contract for a management computer system that the manufacturer, distributor or importer required the dealer to use, if the dealer will no longer use the management computer system because the manufacturer, distributor or importer terminated, canceled, failed to renew or discontinued the dealer’s franchise.

(3)

This section does not modify a manufacturer’s, distributor’s or importer’s contractual right of setoff.

(4)

In addition to any other payments required under this section, a manufacturer, distributor or importer, after terminating, canceling, failing to renew or discontinuing a dealer’s franchise, shall pay to the dealer a sum equal to the current, fair rental value of the dealer’s established place of business for a period of one year after the effective date of termination, cancellation, nonrenewal or discontinuance, or a sum equal to the current, fair rental value for the remaining period of the dealer’s lease, whichever is less.

(5)

Subsection (4) of this section applies only to the extent that a dealer uses the dealer’s established place of business to perform sales and service obligations under the manufacturer’s, distributor’s or importer’s franchise agreement.

(6)

A manufacturer, distributor or importer need not make the payment described in subsection (4) of this section if the dealer terminates, cancels, fails to renew or discontinues the franchise.

(7)

This section does not relieve a new motor vehicle dealer, lessor or other owner of an established place of business from an obligation to mitigate damages.

(8)

If a manufacturer, distributor or importer terminates, cancels, fails to renew or discontinues a dealer’s franchise because the manufacturer, distributor or importer has terminated a line-make, the manufacturer, distributor or importer shall compensate the dealer for expenses the dealer incurred within two years before the termination date of the line-make to finish constructing, altering or remodeling the dealer’s facility to meet the manufacturer’s, distributor’s or importer’s requirements for participating in an incentive program. For the purposes of this subsection:

(a)

A dealer finishes constructing, altering or remodeling the dealer’s facility when the manufacturer, distributor or importer gives final written approval of the construction, alteration or remodeling or the dealer receives a certificate of occupancy, whichever is later; and

(b)

Expenses the dealer incurred to finish constructing, altering or remodeling the dealer’s facility are the actual costs the dealer incurred, less:

(A)

Any assistance the dealer received from the manufacturer, distributor or importer within two years before the termination date of the line-make for constructing, altering or remodeling the dealer’s facility to meet the manufacturer’s, distributor’s or importer’s requirements for participating in an incentive program; and

(B)

An amount for depreciation equivalent to one thirty-ninth of the total cost of the construction, alteration or remodeling per year, beginning in the year after the dealer finishes the construction, altering or remodeling, in accordance with applicable provisions of the Internal Revenue Code. [1989 c.716 §2; 2001 c.216 §3; 2007 c.71 §203; 2009 c.627 §1; 2015 c.584 §3]

Source: Section 650.145 — Compensation due dealer upon termination of franchise, https://www.­oregonlegislature.­gov/bills_laws/ors/ors650.­html.

650.005
Definitions for ORS 650.005 to 650.100
650.010
Franchise sellers required to maintain books and records
650.015
When franchise sale or offer for sale is made in this state
650.020
Liability of franchise seller
650.050
Rules
650.055
General duties and powers of director
650.057
Orders issued under ORS 650.055
650.060
Investigative powers of director
650.065
Injunctive relief
650.070
Director as agent for service of process
650.075
Manner of executing service of process
650.080
When personal service of process required
650.085
Other civil or criminal remedies unaffected
650.095
Civil penalties
650.100
Disposition of civil penalties
650.120
Definitions for ORS 650.120 to 650.170
650.123
Use of protected dealer data
650.130
Prohibited conduct by manufacturer, distributor or importer
650.132
Prohibition of coerced sales of extended service contracts, extended maintenance plans or guaranteed asset protection waivers
650.133
Constructing, altering or remodeling dealer facility
650.140
Good cause required to terminate dealer franchise
650.145
Compensation due dealer upon termination of franchise
650.150
Enjoining establishment of certain franchises or relocation of existing dealership in same market area
650.153
Liability of franchisor for repair of motor vehicle that becomes inoperative prior to sale to consumer
650.155
Liability of manufacturer for damages to vehicles before delivery to carrier
650.158
Predelivery preparation and warranty service
650.161
Compensation for repairs to vehicles subject to recall
650.162
Transfer, assignment or sale of interest in dealership or franchise
650.165
Prohibited franchise conditions
650.167
Violation of ORS 650.140 or 650.150 as irreparable injury
650.170
Dealer’s remedy
650.200
Definitions for ORS 650.200 to 650.250
650.205
Prohibited conduct by franchisor
650.210
Rights and prohibitions governing relationship between franchisor and franchisee
650.215
Prohibited conduct in offer, sale or purchase of franchise
650.220
Consent of franchisor to sale, assignment or transfer of franchise
650.225
Death of franchisee
650.230
Transfer of franchise to corporation in which franchisee has controlling interest
650.235
Franchisor prohibited from requiring operation of service station in excess of 16 hours per day
650.240
When transfer of motor fuel a sale in commerce
650.245
Principle of good faith
650.250
Injunctive relief or damages
650.300
Definitions for ORS 650.300 to 650.480
650.310
Good cause
650.320
Dealership agreement
650.330
Comparable terms and conditions
650.340
Termination, cancellation or failure to renew
650.350
Dealer’s rights upon termination, cancellation or failure to renew
650.360
Coercion prohibited
650.370
Transfer by dealer
650.380
Dealer’s successor
650.390
Dealer compensation for warranty service
650.400
Recalls
650.410
Dealer’s warranty obligations
650.420
Required disclosures
650.430
Damaged or defective vehicles
650.440
Grantor’s ownership, operation or control of dealership
650.450
Indemnification
650.460
Indemnification
650.470
Remedies
650.480
Remedies
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