State of Illinois
91st General Assembly
Legislation

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[ Introduced ][ Engrossed ][ Senate Amendment 001 ]

91_HB0520enr

 
HB0520 Enrolled                               LRB9102551SMdvA

 1        AN ACT to  amend  the  Motor  Vehicle  Franchise  Act  by
 2    changing Sections 4, 5, 6, 13, and 29.

 3        Be  it  enacted  by  the People of the State of Illinois,
 4    represented in the General Assembly:

 5        Section 5.  The Motor Vehicle Franchise Act is amended by
 6    changing Sections 4, 5, 6, 13, and 29 as follows:

 7        (815 ILCS 710/4) (from Ch. 121 1/2, par. 754)
 8        Sec. 4.  Unfair competition and practices.
 9        (a)  The unfair methods of  competition  and  unfair  and
10    deceptive acts or practices listed in this Section are hereby
11    declared to be unlawful. In construing the provisions of this
12    Section,  the  courts may be guided by the interpretations of
13    the Federal Trade Commission Act (15 U.S.C. 45 et  seq.),  as
14    from time to time amended.
15        (b)  It shall be deemed a violation for any manufacturer,
16    factory   branch,   factory  representative,  distributor  or
17    wholesaler, distributor branch, distributor representative or
18    motor vehicle dealer to engage in any action with respect  to
19    a   franchise   which   is   arbitrary,   in   bad  faith  or
20    unconscionable and which causes damage to any of the  parties
21    or to the public.
22        (c)  It shall be deemed a violation for a manufacturer, a
23    distributor,  a wholesaler, a distributor branch or division,
24    a factory branch  or  division,  or  a  wholesale  branch  or
25    division,  or officer, agent or other representative thereof,
26    to coerce, or attempt to coerce, any motor vehicle dealer:
27             (1)  to accept, buy or order any  motor  vehicle  or
28        vehicles,  appliances,  equipment,  parts  or accessories
29        therefor,  or  any  other  commodity  or  commodities  or
30        service or services which such motor vehicle  dealer  has
31        not   voluntarily   ordered  or  requested  except  items
 
HB0520 Enrolled            -2-                LRB9102551SMdvA
 1        required by applicable local, state or federal law; or to
 2        require a motor vehicle dealer to accept, buy,  order  or
 3        purchase  such items in order to obtain any motor vehicle
 4        or vehicles or any other commodity or  commodities  which
 5        have  been  ordered  or  requested  by such motor vehicle
 6        dealer;
 7             (2)  to  order  or  accept  delivery  of  any  motor
 8        vehicle with special features, appliances, accessories or
 9        equipment not included in the list  price  of  the  motor
10        vehicles  as  publicly  advertised  by  the  manufacturer
11        thereof, except items required by applicable law; or
12             (3)  to  order  for  anyone  any parts, accessories,
13        equipment, machinery, tools, appliances or any  commodity
14        whatsoever, except items required by applicable law.
15        (d)  It shall be deemed a violation for a manufacturer, a
16    distributor,  a wholesaler, a distributor branch or division,
17    or officer, agent or other representative thereof:
18             (1)  to adopt, change, establish or implement a plan
19        or system for the  allocation  and  distribution  of  new
20        motor   vehicles   to  motor  vehicle  dealers  which  is
21        arbitrary or capricious or to modify an existing plan  so
22        as to cause the same to be arbitrary or capricious;
23             (2)  to  fail or refuse to advise or disclose to any
24        motor  vehicle  dealer  having  a  franchise  or  selling
25        agreement, upon written request therefor, the basis  upon
26        which  new  motor  vehicles  of  the  same  line make are
27        allocated or distributed to motor vehicle dealers in  the
28        State  and the basis upon which the current allocation or
29        distribution is being made or will be made to such  motor
30        vehicle dealer;
31             (3)  to  refuse  to deliver in reasonable quantities
32        and within a reasonable time after  receipt  of  dealer's
33        order,  to any motor vehicle dealer having a franchise or
34        selling agreement  for  the  retail  sale  of  new  motor
 
HB0520 Enrolled            -3-                LRB9102551SMdvA
 1        vehicles   sold  or  distributed  by  such  manufacturer,
 2        distributor, wholesaler, distributor branch or  division,
 3        factory   branch  or  division  or  wholesale  branch  or
 4        division, any such motor vehicles as are covered by  such
 5        franchise  or  selling  agreement  specifically  publicly
 6        advertised   in   the   State   by   such   manufacturer,
 7        distributor,  wholesaler, distributor branch or division,
 8        factory  branch  or  division,  or  wholesale  branch  or
 9        division  to  be  available   for   immediate   delivery.
10        However,  the  failure to deliver any motor vehicle shall
11        not be considered a violation of this Act if such failure
12        is due to an act of God, a work stoppage or delay due  to
13        a  strike or labor difficulty, a shortage of materials, a
14        lack of manufacturing  capacity,  a  freight  embargo  or
15        other  cause over which the manufacturer, distributor, or
16        wholesaler, or any agent thereof has no control;
17             (4)  to coerce, or  attempt  to  coerce,  any  motor
18        vehicle  dealer  to  enter  into  any agreement with such
19        manufacturer, distributor, wholesaler, distributor branch
20        or division, factory branch  or  division,  or  wholesale
21        branch   or   division,   or   officer,  agent  or  other
22        representative  thereof,  or  to   do   any   other   act
23        prejudicial  to  the  dealer by threatening to reduce his
24        allocation of motor vehicles or cancel any  franchise  or
25        any selling agreement existing between such manufacturer,
26        distributor,  wholesaler, distributor branch or division,
27        or factory branch or division,  or  wholesale  branch  or
28        division,  and  the dealer. However, notice in good faith
29        to any motor vehicle dealer of the dealer's violation  of
30        any  terms  or  provisions  of  such franchise or selling
31        agreement or of any law or regulation applicable  to  the
32        conduct  of a motor vehicle dealer shall not constitute a
33        violation of this Act;
34             (5)  to require a franchisee to  participate  in  an
 
HB0520 Enrolled            -4-                LRB9102551SMdvA
 1        advertising   campaign  or  contest  or  any  promotional
 2        campaign,  or  to  purchase  or  lease  any   promotional
 3        materials, training materials, show room or other display
 4        decorations   or   materials   at   the  expense  of  the
 5        franchisee;
 6             (6)  to cancel or terminate the franchise or selling
 7        agreement of a motor vehicle dealer  without  good  cause
 8        and  without  giving  notice  as hereinafter provided; to
 9        fail  or  refuse  to  extend  the  franchise  or  selling
10        agreement of a motor vehicle dealer upon  its  expiration
11        without   good   cause   and  without  giving  notice  as
12        hereinafter provided; or, to offer a renewal, replacement
13        or succeeding franchise or selling  agreement  containing
14        terms   and   provisions   the  effect  of  which  is  to
15        substantially change or  modify  the  sales  and  service
16        obligations  or capital requirements of the motor vehicle
17        dealer arbitrarily and without  good  cause  and  without
18        giving notice as hereinafter provided notwithstanding any
19        term or provision of a franchise or selling agreement.
20                  (A)  If     a     manufacturer,    distributor,
21             wholesaler, distributor branch or division,  factory
22             branch  or  division or wholesale branch or division
23             intends  to  cancel  or  terminate  a  franchise  or
24             selling agreement or intends not to extend or  renew
25             a  franchise or selling agreement on its expiration,
26             it shall send a letter  by  certified  mail,  return
27             receipt  requested,  to  the  affected franchisee at
28             least 60 days  before  the  effective  date  of  the
29             proposed  action,  or  not later than 10 days before
30             the proposed action when the reason for  the  action
31             is based upon either of the following:
32                       (i)  the   business   operations   of  the
33                  franchisee   have   been   abandoned   or   the
34                  franchisee  has  failed  to  conduct  customary
 
HB0520 Enrolled            -5-                LRB9102551SMdvA
 1                  sales and service operations  during  customary
 2                  business  hours  for  at  least  7  consecutive
 3                  business  days unless such closing is due to an
 4                  act of God, strike or labor difficulty or other
 5                  cause over which the franchisee has no control;
 6                  or
 7                       (ii)  the conviction of or  plea  of  nolo
 8                  contendere  by  the motor vehicle dealer or any
 9                  operator  thereof  in  a  court  of   competent
10                  jurisdiction   to   an  offense  punishable  by
11                  imprisonment for more than two years.
12                  Each notice of proposed action shall include  a
13             detailed   statement   setting  forth  the  specific
14             grounds for the proposed cancellation,  termination,
15             or  refusal  to extend or renew and shall state that
16             the dealer has only 30  days  from  receipt  of  the
17             notice to file with the Motor Vehicle Review Board a
18             written protest against the proposed action.
19                  (B)  If     a     manufacturer,    distributor,
20             wholesaler, distributor branch or division,  factory
21             branch  or  division or wholesale branch or division
22             intends to change substantially or modify the  sales
23             and service obligations or capital requirements of a
24             motor  vehicle dealer as a condition to extending or
25             renewing the existing franchise or selling agreement
26             of such motor vehicle dealer, it shall send a letter
27             by certified mail, return receipt requested, to  the
28             affected  franchisee  at  least  60  days before the
29             date of  expiration  of  the  franchise  or  selling
30             agreement.   Each  notice  of  proposed action shall
31             include  a  detailed  statement  setting  forth  the
32             specific grounds for the proposed action  and  shall
33             state  that the dealer has only 30 days from receipt
34             of the notice to file with the Motor Vehicle  Review
 
HB0520 Enrolled            -6-                LRB9102551SMdvA
 1             Board a written protest against the proposed action.
 2                  (C)  Within  30  15  days  from  receipt of the
 3             notice  under  subparagraphs  (A)   and   (B),   the
 4             franchisee may file with the Board a written protest
 5             against the proposed action.
 6                  When  the  protest  has  been timely filed, the
 7             Board shall enter an order, fixing a date (within 60
 8             days of the date of the order), time, and place of a
 9             hearing on the protest required  under  Sections  12
10             and  29  of  this  Act,  and send by certified mail,
11             return receipt requested, a copy of the order to the
12             manufacturer that filed the notice of  intention  of
13             the  proposed action and to the protesting dealer or
14             franchisee.
15                  The manufacturer shall have the burden of proof
16             to establish that good cause  exists  to  cancel  or
17             terminate,  or fail to extend or renew the franchise
18             or selling agreement of a motor  vehicle  dealer  or
19             franchisee,  and  to  change substantially or modify
20             the  sales  and  service  obligations   or   capital
21             requirements   of   a  motor  vehicle  dealer  as  a
22             condition to  extending  or  renewing  the  existing
23             franchise  or  selling agreement.  The determination
24             whether good cause exists to cancel,  terminate,  or
25             refuse  to  renew or extend the franchise or selling
26             agreement, or to change or modify the obligations of
27             the  dealer  as  a  condition  to   offer   renewal,
28             replacement,  or  succession  shall  be  made by the
29             Board under subsection (d) of  Section  12  of  this
30             Act.
31                  (D)  Notwithstanding  the terms, conditions, or
32             provisions of a franchise or selling agreement,  the
33             following   shall  not  constitute  good  cause  for
34             cancelling or terminating or failing  to  extend  or
 
HB0520 Enrolled            -7-                LRB9102551SMdvA
 1             renew  the  franchise  or selling agreement: (i) the
 2             change of ownership or executive management  of  the
 3             franchisee's  dealership;  or (ii) the fact that the
 4             franchisee or owner of an interest in the  franchise
 5             owns,  has  an  investment  in,  participates in the
 6             management of, or holds a license for  the  sale  of
 7             the  same  or  any  other  line  make  of  new motor
 8             vehicles.
 9                  Good cause shall exist to cancel, terminate  or
10             fail  to offer a renewal or replacement franchise or
11             selling agreement to all franchisees of a line  make
12             if  the  manufacturer  permanently  discontinues the
13             manufacture or assembly of motor  vehicles  of  such
14             line make.
15                  (E)  The   manufacturer   may   not  cancel  or
16             terminate, or fail to extend or renew a franchise or
17             selling  agreement   or   change   or   modify   the
18             obligations  of  the  franchisee  as  a condition to
19             offering  a  renewal,  replacement,  or   succeeding
20             franchise  or  selling  agreement before the hearing
21             process is concluded as prescribed by this Act,  and
22             thereafter,   if   the  Board  determines  that  the
23             manufacturer has failed to meet its burden of  proof
24             and  that  good  cause  does  not exist to allow the
25             proposed action; or
26             (7)  notwithstanding  the  terms  of  any  franchise
27        agreement, to fail to indemnify  and  hold  harmless  its
28        franchised dealers against any judgment or settlement for
29        damages,  including,  but  not  limited  to, court costs,
30        expert witness fees, and reasonable  attorneys'  fees  of
31        the new motor vehicle dealer, and other expenses incurred
32        in  the  litigation,  so  long as such fees and costs are
33        reasonable, arising out of complaints, claims or lawsuits
34        including,  but  not  limited   to,   strict   liability,
 
HB0520 Enrolled            -8-                LRB9102551SMdvA
 1        negligence,   misrepresentation,   warranty  (express  or
 2        implied), or recision of the sale as defined  in  Section
 3        2-608  of the Uniform Commercial Code, to the extent that
 4        the  judgment  or  settlement  relates  to  the   alleged
 5        defective or negligent manufacture, assembly or design of
 6        new   motor  vehicles,  parts  or  accessories  or  other
 7        functions by the manufacturer, beyond the control of  the
 8        dealer;  provided  that,  in order to provide an adequate
 9        defense, the manufacturer receives notice of  the  filing
10        of  a  complaint,  claim, or lawsuit within 60 days after
11        the filing.
12        (e)  It shall be deemed a violation for a manufacturer, a
13    distributor, a wholesaler, a distributor branch  or  division
14    or officer, agent or other representative thereof:
15             (1)  to  resort  to  or  use any false or misleading
16        advertisement in connection with  his  business  as  such
17        manufacturer, distributor, wholesaler, distributor branch
18        or  division  or  officer,  agent or other representative
19        thereof;
20             (2)  to offer to sell or lease, or to sell or lease,
21        any new motor vehicle to any motor vehicle  dealer  at  a
22        lower actual price therefor than the actual price offered
23        to  any  other  motor  vehicle  dealer for the same model
24        vehicle similarly  equipped  or  to  utilize  any  device
25        including,  but  not limited to, sales promotion plans or
26        programs which result in such  lesser  actual  price   or
27        fail  to  make  available to any motor vehicle dealer any
28        preferential pricing, incentive, rebate, finance rate, or
29        low interest loan  program  offered  to  competing  motor
30        vehicle  dealers in other contiguous states. However, the
31        provisions of this paragraph shall not apply to sales  to
32        a  motor  vehicle  dealer  for  resale to any unit of the
33        United  States  Government,  the  State  or  any  of  its
34        political subdivisions;
 
HB0520 Enrolled            -9-                LRB9102551SMdvA
 1             (3)  to offer to sell or lease, or to sell or lease,
 2        any new motor vehicle to any person, except a wholesaler,
 3        distributor or manufacturer's employees at a lower actual
 4        price therefor than the actual price offered and  charged
 5        to  a  motor  vehicle  dealer  for the same model vehicle
 6        similarly equipped or to utilize any device which results
 7        in such lesser actual price. However, the  provisions  of
 8        this  paragraph  shall  not  apply  to  sales  to a motor
 9        vehicle dealer for resale  to  any  unit  of  the  United
10        States  Government,  the  State  or  any of its political
11        subdivisions;
12             (4)  to prevent or attempt to prevent by contract or
13        otherwise any motor vehicle  dealer  or  franchisee  from
14        changing  the  executive  management control of the motor
15        vehicle  dealer  or  franchisee  unless  the  franchiser,
16        having the burden of proof, proves that  such  change  of
17        executive  management will result in executive management
18        control by a person or persons who are not of good  moral
19        character  or  who  do not meet the franchiser's existing
20        and, with consideration given to the volume of sales  and
21        service  of  the  dealership,  uniformly  applied minimum
22        business experience standards in the market area. However
23        where the  manufacturer  rejects  a  proposed  change  in
24        executive management control, the manufacturer shall give
25        written  notice  of  his  reasons to the dealer within 60
26        days of notice to the manufacturer by the dealer  of  the
27        proposed  change.  If  the  manufacturer  does not send a
28        letter  to  the  franchisee  by  certified  mail,  return
29        receipt requested, within 60 days  from  receipt  by  the
30        manufacturer  of  the proposed change, then the change of
31        the executive management control of the franchisee  shall
32        be deemed accepted as proposed by the franchisee, and the
33        manufacturer shall give immediate effect to such change;
34             (5)  to prevent or attempt to prevent by contract or
 
HB0520 Enrolled            -10-               LRB9102551SMdvA
 1        otherwise  any  motor vehicle dealer from establishing or
 2        changing the capital structure of his dealership  or  the
 3        means  by  or  through  which  he  finances the operation
 4        thereof; provided the dealer meets any reasonable capital
 5        standards  agreed  to  between   the   dealer   and   the
 6        manufacturer,  distributor or wholesaler, who may require
 7        that the sources, method and manner by which  the  dealer
 8        finances  or  intends to finance its operation, equipment
 9        or facilities be fully disclosed;
10             (6)  to refuse to  give  effect  to  or  prevent  or
11        attempt  to  prevent  by  contract or otherwise any motor
12        vehicle dealer or any officer, partner or stockholder  of
13        any motor vehicle dealer from selling or transferring any
14        part  of  the interest of any of them to any other person
15        or persons or  party  or  parties  unless  such  sale  or
16        transfer  is  to  a  transferee  who  would not otherwise
17        qualify for a new motor  vehicle  dealers  license  under
18        "The  Illinois  Vehicle  Code"  or unless the franchiser,
19        having the burden of proof,  proves  that  such  sale  or
20        transfer is to a person or party who is not of good moral
21        character  or does not meet the franchiser's existing and
22        reasonable  capital  standards  and,  with  consideration
23        given  to  the  volume  of  sales  and  service  of   the
24        dealership, uniformly applied minimum business experience
25        standards  in  the  market  area. However, nothing herein
26        shall  be  construed  to  prevent   a   franchiser   from
27        implementing   affirmative   action   programs  providing
28        business opportunities for minorities or  from  complying
29        with applicable federal, State or local law:
30                  (A)  If  the  manufacturer intends to refuse to
31             approve the sale or transfer of all or a part of the
32             interest, then it shall, within 60 days from receipt
33             of  the  completed   application   forms   generally
34             utilized by a manufacturer to conduct its review and
 
HB0520 Enrolled            -11-               LRB9102551SMdvA
 1             a  copy  of  all  agreements  regarding the proposed
 2             transfer, send a letter by  certified  mail,  return
 3             receipt  requested,  advising  the franchisee of any
 4             refusal to approve the sale or transfer  of  all  or
 5             part of the interest and shall state that the dealer
 6             only  has  30 days from the receipt of the notice to
 7             file with the Motor Vehicle Review Board  a  written
 8             protest  against  the  proposed  action.  The notice
 9             shall set forth specific criteria used  to  evaluate
10             the  prospective  transferee  and  the  grounds  for
11             refusing  to  approve  the  sale or transfer to that
12             transferee. Within 30 15 days from the  franchisee's
13             receipt of the manufacturer's notice, the franchisee
14             may  file  with  the Board a written protest against
15             the proposed action.
16                  When a protest has been timely filed, the Board
17             shall enter an order, fixing  the  date  (within  60
18             days  of the date of such order), time, and place of
19             a hearing on the protest, required under Sections 12
20             and 29 of this Act,  and  send  by  certified  mail,
21             return receipt requested, a copy of the order to the
22             manufacturer  that  filed notice of intention of the
23             proposed action and to the protesting franchisee.
24                  The manufacturer shall have the burden of proof
25             to establish that good cause  exists  to  refuse  to
26             approve the sale or transfer to the transferee.  The
27             determination whether good cause exists to refuse to
28             approve  the  sale  or transfer shall be made by the
29             Board under subdivisions  (6)(B).  The  manufacturer
30             shall  not refuse to approve the sale or transfer by
31             a dealer or an officer, partner, or stockholder of a
32             franchise or any part of the interest to any  person
33             or  persons  before the hearing process is concluded
34             as prescribed by this Act,  and  thereafter  if  the
 
HB0520 Enrolled            -12-               LRB9102551SMdvA
 1             Board determines that the manufacturer has failed to
 2             meet  its  burden  of proof and that good cause does
 3             not exist to refuse to approve the sale or  transfer
 4             to the transferee.
 5                  (B)  Good  cause to refuse to approve such sale
 6             or transfer under this Section is  established  when
 7             such  sale  or transfer is to a transferee who would
 8             not  otherwise  qualify  for  a  new  motor  vehicle
 9             dealers license under "The Illinois Vehicle Code" or
10             such sale or transfer is to a person or party who is
11             not of good moral character or  does  not  meet  the
12             franchiser's   existing   and   reasonable   capital
13             standards  and,  with  consideration  given  to  the
14             volume  of  sales  and  service  of  the dealership,
15             uniformly  applied   minimum   business   experience
16             standards in the market area.
17             (7)  to  obtain  money, goods, services, anything of
18        value, or any other benefit from any  other  person  with
19        whom  the  motor vehicle dealer does business, on account
20        of or in relation to the transactions between the  dealer
21        and the other person as compensation, except for services
22        actually   rendered,  unless  such  benefit  is  promptly
23        accounted  for  and  transmitted  to  the  motor  vehicle
24        dealer;
25             (8)  to  grant  an  additional  franchise   in   the
26        relevant market area of an existing franchise of the same
27        line  make  or  to  relocate  an  existing  motor vehicle
28        dealership within or into a relevant market  area  of  an
29        existing franchise of the same line make. However, if the
30        manufacturer wishes to grant such an additional franchise
31        to  an  independent person in a bona fide relationship in
32        which such person  is  prepared  to  make  a  significant
33        investment  subject  to  loss in such a dealership, or if
34        the manufacturer wishes to  relocate  an  existing  motor
 
HB0520 Enrolled            -13-               LRB9102551SMdvA
 1        vehicle  dealership,  then  the manufacturer shall send a
 2        letter by certified mail, return  receipt  requested,  to
 3        each  existing  dealer  or  dealers of the same line make
 4        whose relevant market area includes the proposed location
 5        of the additional or relocated franchise at least 60 days
 6        before the manufacturer grants an additional franchise or
 7        relocates an existing franchise of  the  same  line  make
 8        within  or  into  the relevant market area of an existing
 9        franchisee of the same line make.  Each notice shall  set
10        forth  the  specific grounds for the proposed grant of an
11        additional  or  relocation  of  an  existing   franchise.
12        Unless  the parties agree upon the grant or establishment
13        of the additional or relocated  franchise  within  30  15
14        days  from  the  date  the  notice  was  received  by the
15        existing franchisee of the same line make or  any  person
16        entitled  to receive such notice, the franchisee or other
17        person may file with the Board a written protest  against
18        the  grant or establishment of the proposed additional or
19        relocated franchise and shall state that the dealer  only
20        has  30  days from the receipt of the notice to file with
21        the Motor Vehicle Review Board a written protest  against
22        the proposed action.
23             When  a  protest  has  been  timely filed, the Board
24        shall enter an order fixing a date (within 60 days of the
25        date of the order), time, and place of a hearing  on  the
26        protest,  required  under Sections 12 and 29 of this Act,
27        and send by certified or registered mail, return  receipt
28        requested,  a  copy of the order to the manufacturer that
29        filed the notice of intention to grant or  establish  the
30        proposed  additional  or  relocated  franchise and to the
31        protesting dealer or dealers of the same line make  whose
32        relevant  market  area  includes the proposed location of
33        the additional or relocated franchise.
34             When more than one  protest  is  filed  against  the
 
HB0520 Enrolled            -14-               LRB9102551SMdvA
 1        grant  or  establishment  of  the additional or relocated
 2        franchise  of  the  same  line  make,   the   Board   may
 3        consolidate  the  hearings to expedite disposition of the
 4        matter.  The manufacturer shall have the burden of  proof
 5        to establish that good cause exists to allow the grant or
 6        establishment  of  the additional or relocated franchise.
 7        The  manufacturer  may  not  grant   or   establish   the
 8        additional  franchise  or relocate the existing franchise
 9        before the hearing process is concluded as prescribed  by
10        this Act, and thereafter if the Board determines that the
11        manufacturer  has  failed to meet its burden of proof and
12        that good cause does not exist  to  allow  the  grant  or
13        establishment  of  the additional franchise or relocation
14        of the existing franchise.
15             The determination  whether  good  cause  exists  for
16        allowing  the  grant  or  establishment  of an additional
17        franchise or relocated existing franchise, shall be  made
18        by  the  Board under subsection (c) of Section 12 of this
19        Act. If the manufacturer seeks to enter into a  contract,
20        agreement   or   other   arrangement   with  any  person,
21        establishing any additional motor vehicle  dealership  or
22        other facility, limited to the sale of factory repurchase
23        vehicles  or  late  model vehicles, then the manufacturer
24        shall follow the notice  procedures  set  forth  in  this
25        Section  and  the determination whether good cause exists
26        for allowing the proposed agreement shall be made by  the
27        Board  under  subsection  (c)  of  Section  12,  with the
28        manufacturer having the burden of proof.
29                  A.  (Blank).
30                  B.  For   the   purposes   of   this   Section,
31             appointment of a successor motor vehicle  dealer  at
32             the  same  location  as its predecessor, or within 2
33             miles of such location,  or  the  relocation  of  an
34             existing  dealer  or franchise within 2 miles of the
 
HB0520 Enrolled            -15-               LRB9102551SMdvA
 1             relocating   dealer's   or   franchisee's   existing
 2             location,  shall  not  be  construed  as  a   grant,
 3             establishment  or the entering into of an additional
 4             franchise or selling agreement, or a  relocation  of
 5             an  existing  franchise.  The  reopening  of a motor
 6             vehicle dealership that has not  been  in  operation
 7             for  18  months or more shall be deemed the grant of
 8             an additional franchise or selling agreement.
 9                  C.  This  Section  does  not   apply   to   the
10             relocation of an existing dealership or franchise in
11             a  county  having  a population of more than 300,000
12             persons when the new location is within the dealer's
13             current  relevant  market  area,  provided  the  new
14             location is more  than  7  miles  from  the  nearest
15             dealer of the same line make or is further away from
16             the  nearest  dealer  of  the  same  line make. This
17             Section does not  apply  to  the  relocation  of  an
18             existing  dealership or franchise in a county having
19             a population of less than 300,000 persons  when  the
20             new location is within the dealer's current relevant
21             market  area, provided the new location is more than
22             12 miles from the nearest dealer of  the  same  line
23             make  or  is further away from the nearest dealer of
24             the same line make.
25                  D.  Nothing in this Section shall be  construed
26             to    prevent   a   franchiser   from   implementing
27             affirmative  action  programs   providing   business
28             opportunities  for minorities or from complying with
29             applicable federal, State or local law;
30             (9)  to require a motor vehicle dealer to assent  to
31        a release, assignment, novation, waiver or estoppel which
32        would  relieve  any person from liability imposed by this
33        Act;
34             (10)  to prevent or refuse to  give  effect  to  the
 
HB0520 Enrolled            -16-               LRB9102551SMdvA
 1        succession  to  the  ownership or management control of a
 2        dealership by any legatee under the will of a  dealer  or
 3        to  an heir under the laws of descent and distribution of
 4        this  State  unless  the  franchisee  has  designated   a
 5        successor  to  the  ownership or management control under
 6        the succession provisions of the franchise.   Unless  the
 7        franchiser,  having  the burden of proof, proves that the
 8        successor is a person who is not of good moral  character
 9        or does not meet the franchiser's existing and reasonable
10        capital  standards  and,  with consideration given to the
11        volume of sales and service of the dealership,  uniformly
12        applied  minimum  business  experience  standards  in the
13        market area, any designated  successor  of  a  dealer  or
14        franchisee  may  succeed  to  the ownership or management
15        control of a dealership under the existing franchise if:
16                       (i)  The designated  successor  gives  the
17                  franchiser  written  notice  by certified mail,
18                  return  receipt  requested,  of  his   or   her
19                  intention  to  succeed  to the ownership of the
20                  dealer within 60 days of the dealer's death  or
21                  incapacity; and
22                       (ii)  The  designated  successor agrees to
23                  be bound by all the terms and conditions of the
24                  existing franchise.
25             Notwithstanding the  foregoing,  in  the  event  the
26        motor  vehicle dealer or franchisee and manufacturer have
27        duly executed an agreement concerning  succession  rights
28        prior  to  the  dealer's  death  or  incapacitation,  the
29        agreement shall be observed.
30                  (A)  If  the  franchiser  intends  to refuse to
31             honor the successor to the ownership of  a  deceased
32             or  incapacitated  dealer  or  franchisee  under  an
33             existing  franchise  agreement, the franchiser shall
34             send a letter  by  certified  mail,  return  receipt
 
HB0520 Enrolled            -17-               LRB9102551SMdvA
 1             requested,  to  the  designated  successor within 60
 2             days from receipt of  a  proposal  advising  of  its
 3             intent  to  refuse  to  honor  the succession and to
 4             discontinue the  existing  franchise  agreement  and
 5             shall  state  that the designated successor only has
 6             30 days from the receipt of the notice to file  with
 7             the  Motor  Vehicle  Review  Board a written protest
 8             against the proposed action. The  notice  shall  set
 9             forth  the specific grounds for the refusal to honor
10             the  succession   and   discontinue   the   existing
11             franchise agreement.
12                  If  notice of refusal is not timely served upon
13             the designated successor,  the  franchise  agreement
14             shall continue in effect subject to termination only
15             as   otherwise   permitted   by   paragraph  (6)  of
16             subsection (d) of Section 4 of this Act.
17                  Within 30 15 days from the date the notice  was
18             received  by  the  designated successor or any other
19             person entitled to notice,  the  designee  or  other
20             person  may  file  with  the Board a written protest
21             against the proposed action.
22                  When a protest has been timely filed, the Board
23             shall enter an order, fixing a date (within 60  days
24             of  the  date  of  the  order), time, and place of a
25             hearing on the protest, required under  Sections  12
26             and  29  of  this  Act,  and send by certified mail,
27             return receipt requested, a copy of the order to the
28             franchiser that filed the notice of intention of the
29             proposed action and to the  protesting  designee  or
30             such other person.
31                  The manufacturer shall have the burden of proof
32             to  establish  that  good  cause exists to refuse to
33             honor the succession and  discontinue  the  existing
34             franchise agreement.  The determination whether good
 
HB0520 Enrolled            -18-               LRB9102551SMdvA
 1             cause exists to refuse to honor the succession shall
 2             be  made  by the Board under subdivision (B) of this
 3             paragraph (10).  The manufacturer shall  not  refuse
 4             to  honor the succession or discontinue the existing
 5             franchise agreement before the  hearing  process  is
 6             concluded  as prescribed by this Act, and thereafter
 7             if the Board determines that it has failed  to  meet
 8             its  burden  of  proof  and that good cause does not
 9             exist  to  refuse  to  honor  the   succession   and
10             discontinue the existing franchise agreement.
11                  (B)  No    manufacturer    shall   impose   any
12             conditions  upon   honoring   the   succession   and
13             continuing the existing franchise agreement with the
14             designated  successor other than that the franchisee
15             has designated  a  successor  to  the  ownership  or
16             management  control  under the succession provisions
17             of the franchise, or that the  designated  successor
18             is  of  good moral character or meets the reasonable
19             capital standards and, with consideration  given  to
20             the  volume  of sales and service of the dealership,
21             uniformly  applied   minimum   business   experience
22             standards in the market area;
23             (11)  to  prevent or refuse to approve a proposal to
24        establish a successor franchise at a location  previously
25        approved  by  the  franchiser  when  submitted  with  the
26        voluntary  termination  by the existing franchisee unless
27        the successor franchisee would not otherwise qualify  for
28        a  new  motor vehicle dealer's license under the Illinois
29        Vehicle Code or unless the franchiser, having the  burden
30        of  proof,  proves that such proposed successor is not of
31        good moral character or does not  meet  the  franchiser's
32        existing  and  reasonable  capital  standards  and,  with
33        consideration given to the volume of sales and service of
34        the   dealership,   uniformly  applied  minimum  business
 
HB0520 Enrolled            -19-               LRB9102551SMdvA
 1        experience standards in the market  area.  However,  when
 2        such  a rejection of a proposal is made, the manufacturer
 3        shall  give  written  notice  of  its  reasons   to   the
 4        franchisee  within 60 days of receipt by the manufacturer
 5        of  the  proposal.   However,  nothing  herein  shall  be
 6        construed  to  prevent  a  franchiser  from  implementing
 7        affirmative   action    programs    providing    business
 8        opportunities  for  minorities,  or  from  complying with
 9        applicable federal, State or local law;
10             (12)  to prevent or refuse to grant a franchise to a
11        person because such person owns,  has  investment  in  or
12        participates  in  the  management of or holds a franchise
13        for the sale of another make or line  of  motor  vehicles
14        within  7  miles  of the proposed franchise location in a
15        county having a population of more than 300,000  persons,
16        or  within 12 miles of the proposed franchise location in
17        a  county  having  a  population  of  less  than  300,000
18        persons; or
19             (13)  to prevent or attempt to prevent any new motor
20        vehicle dealer from  establishing  any  additional  motor
21        vehicle  dealership or other facility limited to the sale
22        of factory repurchase vehicles or late model vehicles  or
23        otherwise  offering  for sale factory repurchase vehicles
24        of the same line make at an existing franchise by failing
25        to  make  available  any  contract,  agreement  or  other
26        arrangement which is made available or otherwise  offered
27        to any person.
28    (Source: P.A. 89-145, eff. 7-14-95; 90-655, eff. 7-30-98.)

29        (815 ILCS 710/5) (from Ch. 121 1/2, par. 755)
30        Sec.  5.  Delivery  and  preparation  obligations; damage
31    disclosures.  Every manufacturer shall specify in writing  to
32    the  dealer  the  delivery and preparation obligations of its
33    motor vehicle dealers prior to delivery of new motor vehicles
 
HB0520 Enrolled            -20-               LRB9102551SMdvA
 1    to retail buyers.  A copy of  the  delivery  and  preparation
 2    obligations  of  its  motor vehicle dealers and a schedule of
 3    the compensation to be paid to its motor vehicle dealers  for
 4    the  work  and  services they shall be required to perform in
 5    connection with such  delivery  and  preparation  obligations
 6    shall   be  presented  to  the  dealer  and  the  obligations
 7    specified therein shall  constitute any  such  dealer's  only
 8    predelivery  obligations  as  between  such  dealer  and such
 9    manufacturer.  The compensation as set forth on said schedule
10    shall be reasonable.
11        A manufacturer, factory branch, distributor,  distributor
12    branch,   or   wholesaler  of  new  motor  vehicles  sold  or
13    transferred to a motor vehicle dealer  in  this  State  shall
14    disclose  to  the  motor  vehicle  dealer, in writing, before
15    delivery of  a  vehicle  to  the  motor  vehicle  dealer  all
16    in-transit,  post-manufacture, or other damage to the vehicle
17    that was sustained or incurred by the motor  vehicle  at  any
18    time  after the manufacturing process was complete but before
19    delivery of the vehicle to the dealer.   This  disclosure  is
20    not  required  when  the cost to repair does not exceed 6% of
21    the manufacturer's suggested  retail  price  of  the  vehicle
22    based  upon the dealer's actual retail repair cost, including
23    labor, parts, and materials if  the  damage  is  repaired  or
24    retail estimate to repair if the vehicle is not repaired. New
25    motor vehicles that are repaired may be sold as new and shall
26    be fully warranted by the manufacturer.
27        For  purposes  of this Section, "manufacturer's suggested
28    retail price" means the retail price of the new motor vehicle
29    suggested by the manufacturer including the retail  delivered
30    price  suggested  by  the  manufacturer  for  each separately
31    priced accessory or item  of  optional  equipment  physically
32    attached to the new motor vehicle at the time of delivery.
33        Whenever  a  new  motor  vehicle  sustains  or incurs any
34    in-transit, post-manufacture, or other  damage  at  any  time
 
HB0520 Enrolled            -21-               LRB9102551SMdvA
 1    after  the  manufacturing  process  is  complete,  but before
 2    delivery of the vehicle to  the  motor  vehicle  dealer,  the
 3    dealer  may within a reasonable period of time after delivery
 4    of the motor vehicle notify the manufacturer  or  distributor
 5    of that damage and either:
 6             (1)  revoke  acceptance  of  the delivery of the new
 7        motor vehicle whereby  ownership  of  the  motor  vehicle
 8        shall  revert  to  the manufacturer, and the dealer shall
 9        incur no obligations, financial, or  otherwise  for  that
10        new motor vehicle; or
11             (2)  request  authorization from the manufacturer to
12        repair the damage sustained or incurred by the new  motor
13        vehicle.    If  the  manufacturer  refuses  or  fails  to
14        authorize repair of the  damage  within  3  days  of  the
15        request  by  the  dealer,  the  dealer  may  then  revoke
16        acceptance  of  the  delivery  of  the new motor vehicle;
17        ownership shall  revert  to  the  manufacturer;  and  the
18        dealer   shall   incur   no  obligations,  financial,  or
19        otherwise for that new motor vehicle.
20        A motor vehicle dealer shall disclose  to  the  purchaser
21    before  delivery  of  the  new motor vehicle, in writing, any
22    damage that the dealer has actual knowledge was sustained  or
23    incurred   by  the  motor  vehicle  at  any  time  after  the
24    manufacturing process was complete but before delivery of the
25    vehicle to the purchaser.  This disclosure  is  not  required
26    when   the   cost  to  repair  does  not  exceed  6%  of  the
27    manufacturer's suggested retail price of  the  vehicle  based
28    upon the dealer's actual retail repair cost, including labor,
29    parts,  and materials if the damage is repaired or the retail
30    estimate to repair the vehicle if it is not repaired.
31        Damage  to  glass,  tires,  bumpers,  and  in-dash  audio
32    equipment is not to be considered in determining the cost  of
33    repair   if   replaced   with   the  manufacturer's  original
34    equipment.
 
HB0520 Enrolled            -22-               LRB9102551SMdvA
 1        If disclosure is  not  required  under  this  Section,  a
 2    purchaser  may  not revoke or rescind a sales contract due to
 3    the fact the new vehicle  was  damaged  and  repaired  before
 4    completion  of  the sale. In that circumstance, nondisclosure
 5    does not constitute a misrepresentation or omission of fact.
 6        A manufacturer, factory branch, distributor,  distributor
 7    branch,   or   wholesaler   of   new  motor  vehicles  shall,
 8    notwithstanding  the  terms  of  any   franchise   agreement,
 9    indemnify   and   hold  harmless  the  motor  vehicle  dealer
10    obtaining a new motor vehicle from the manufacturer,  factory
11    branch,  distributor,  distributor branch, or wholesaler from
12    and against any liability,  including  reasonable  attorney's
13    fees,  expert  witness  fees, court costs, and other expenses
14    incurred in the litigation, so long as such  fees  and  costs
15    are   reasonable,  that  the  motor  vehicle  dealer  may  be
16    subjected to by the  purchaser  of  the  vehicle  because  of
17    damage  to the motor vehicle that occurred before delivery of
18    the vehicle to the dealer  and  that  was  not  disclosed  in
19    writing to the dealer prior to delivery of the vehicle.  This
20    indemnity  obligation  of  the  manufacturer, factory branch,
21    distributor,  distributor  branch,  or   wholesaler   applies
22    regardless of whether the damage falls below the 6% threshold
23    under this Section.  The failure of the manufacturer, factory
24    branch,  distributor,  distributor  branch,  or wholesaler to
25    indemnify and hold harmless the motor  vehicle  dealer  is  a
26    violation of this Section.
27    (Source: P.A. 88-581, eff. 1-1-95.)

28        (815 ILCS 710/6) (from Ch. 121 1/2, par. 756)
29        Sec.  6.  Warranty agreements; claims; approval; payment;
30    written disapproval.
31        (a)  Every   manufacturer,    distributor,    wholesaler,
32    distributor  branch  or division, factory branch or division,
33    or wholesale branch or division shall  properly  fulfill  any
 
HB0520 Enrolled            -23-               LRB9102551SMdvA
 1    warranty  agreement and adequately and fairly compensate each
 2    of its motor vehicle dealers for labor and parts.
 3        (b)  In no event shall such compensation fail to  include
 4    reasonable  compensation  for  diagnostic  work,  as  well as
 5    repair service, and labor, and parts. Time allowances for the
 6    diagnosis and performance of warranty work and service  shall
 7    be  reasonable  and adequate for the work to be performed. In
 8    the determination of what constitutes reasonable compensation
 9    under  this  Section,  the  principal  factor  to  be   given
10    consideration  shall  be the prevailing wage rates being paid
11    by the dealer in the relevant market area in which the  motor
12    vehicle  dealer is doing business, and in no event shall such
13    compensation of a motor vehicle dealer for  warranty  service
14    be  less  than  the  rates  charged  by  such dealer for like
15    service to  retail  customers  for  nonwarranty  service  and
16    repairs.  The  franchiser  shall reimburse the franchisee for
17    any parts provided in  satisfaction  of  a  warranty  at  the
18    prevailing  retail  price charged by that dealer for the same
19    parts when  not  provided  in  satisfaction  of  a  warranty;
20    provided  that  such  motor  vehicle  franchisee's prevailing
21    retail price is not unreasonable when compared with  that  of
22    the  holders  of motor vehicle franchises from the same motor
23    vehicle  franchiser  for   identical   merchandise   in   the
24    geographic  area  in  which  the  motor vehicle franchisee is
25    engaged  in  business.  All  claims,   either   original   or
26    resubmitted,  made  by  motor  vehicle  dealers hereunder and
27    under Section 5 for such labor  and  parts  shall  be  either
28    approved  or  disapproved  within  30  days  following  their
29    submission.  All approved claims shall be paid within 30 days
30    following  their  approval.   The  motor  vehicle  dealer who
31    submits a claim which is disapproved  shall  be  notified  in
32    writing  of  the disapproval within the same period, and each
33    such notice shall state the specific grounds upon  which  the
34    disapproval  is  based.   The  motor  vehicle dealer shall be
 
HB0520 Enrolled            -24-               LRB9102551SMdvA
 1    permitted to correct and  resubmit  such  disapproved  claims
 2    within  30  days  of  receipt  of disapproval. Any claims not
 3    specifically disapproved in writing within 30 days from their
 4    submission shall be deemed approved and payment shall  follow
 5    within 30 days. The manufacturer or franchiser shall have the
 6    right  to  require reasonable documentation for claims and to
 7    audit such claims within a one year period from the date  the
 8    claim  was  paid  or  credit  issued  by  the manufacturer or
 9    franchiser, and to charge back any false  or  unsubstantiated
10    claims.  The audit and charge back provisions of this Section
11    also apply to all other incentive and reimbursement  programs
12    for  a period of 18 months after the date of the transactions
13    that are subject to audit by  the  franchiser.  However,  the
14    manufacturer  retains the right to charge back any fraudulent
15    claim if the manufacturer establishes in a court of competent
16    jurisdiction in this State that the claim is fraudulent.
17        (c)  The  motor  vehicle   franchiser   shall   not,   by
18    agreement,  by restrictions upon reimbursement, or otherwise,
19    restrict the nature and extent of services to be rendered  or
20    parts  to  be  provided so that such restriction prevents the
21    motor vehicle franchisee  from  satisfying  the  warranty  by
22    rendering  services  in  a  good  and  workmanlike manner and
23    providing  parts  which  are  required  in  accordance   with
24    generally  accepted  standards.   Any  such restriction shall
25    constitute a prohibited practice.
26        (d)  For the purposes of this  Section,  the  "prevailing
27    retail price charged by that dealer for the same parts" means
28    the  price  paid  by  the motor vehicle franchisee for parts,
29    including all shipping and other charges, multiplied  by  the
30    sum  of  1.0  and  the franchisee's average percentage markup
31    over the price paid by the motor vehicle franchisee for parts
32    purchased by the motor  vehicle  franchisee  from  the  motor
33    vehicle  franchiser  and  sold  at retail.  The motor vehicle
34    franchisee may establish average percentage markup under this
 
HB0520 Enrolled            -25-               LRB9102551SMdvA
 1    Section by submitting to the  motor  vehicle  franchiser  100
 2    sequential  customer paid service repair orders or 90 days of
 3    customer paid  service  repair  orders,  whichever  is  less,
 4    covering  repairs  made  no  more  than  180  days before the
 5    submission, and declaring what the average percentage  markup
 6    is.   The average percentage markup so declared shall go into
 7    effect 30 days following the declaration, subject to audit of
 8    the submitted repair orders by the motor  vehicle  franchiser
 9    and adjustment of the average percentage markup based on that
10    audit.   Any audit must be conducted within 30 days following
11    the declaration.  Only retail sales  not  involving  warranty
12    repairs,  parts covered by subsection (e) of this Section, or
13    parts supplied for  routine  vehicle  maintenance,  shall  be
14    considered  in  calculating  average  percentage  markup.  No
15    motor  vehicle  franchiser  shall  require  a  motor  vehicle
16    franchisee  to  establish  average  percentage  markup  by  a
17    methodology, or by  requiring  information,  that  is  unduly
18    burdensome  or  time consuming to provide, including, but not
19    limited to,  part  by  part  or  transaction  by  transaction
20    calculations.  A motor vehicle franchisee shall not request a
21    change  in  the  average percentage markup more than twice in
22    one calendar year.
23        (e)  If a motor vehicle franchiser  supplies  a  part  or
24    parts  for  use  in  a repair rendered under a warranty other
25    than by sale of that part  or  parts  to  the  motor  vehicle
26    franchisee, the motor vehicle franchisee shall be entitled to
27    compensation  equivalent  to  the  motor vehicle franchisee's
28    average percentage markup on the part or  parts,  as  if  the
29    part  or  parts had been sold to the motor vehicle franchisee
30    by the motor vehicle franchiser.  The  requirements  of  this
31    subsection  (e)  shall  not apply to entire engine assemblies
32    and entire transmission assemblies.  In  the  case  of  those
33    assemblies,  the motor vehicle franchiser shall reimburse the
34    motor vehicle franchisee in the amount of  30%  of  what  the
 
HB0520 Enrolled            -26-               LRB9102551SMdvA
 1    motor  vehicle  franchisee  would have paid the motor vehicle
 2    franchiser for the assembly if  the  assembly  had  not  been
 3    supplied  by  the  franchiser  other than by the sale of that
 4    assembly to the motor vehicle franchisee.
 5        (f)  The obligations imposed on motor vehicle franchisers
 6    by this  Section  shall  apply  to  any  parent,  subsidiary,
 7    affiliate,  or  agent  of  the  motor vehicle franchiser, any
 8    person under common ownership or control, any employee of the
 9    motor vehicle franchiser, and any person holding 1%  or  more
10    of  the  shares of any class of securities or other ownership
11    interest in the motor vehicle franchiser, if  a  warranty  or
12    service or repair plan is issued by that person instead of or
13    in addition to one issued by the motor vehicle franchiser.
14    (Source: P.A. 87-1163.)

15        (815 ILCS 710/13) (from Ch. 121 1/2, par. 763)
16        Sec.  13.   Damages;  equitable relief. Any franchisee or
17    motor vehicle  dealer  who  suffers  any  loss  of  money  or
18    property,  real  or  personal,  as  a  result  of  the use or
19    employment  by  a  manufacturer,   wholesaler,   distributor,
20    distributor  branch  or division, factory branch or division,
21    wholesale branch  or  division,  or  any  agent,  servant  or
22    employee  thereof,  of  an unfair method of competition or an
23    unfair or deceptive act or practice declared unlawful by this
24    Act may bring an action for  damages  and  equitable  relief,
25    including  injunctive relief. Where the misconduct is willful
26    or wanton, the  court  may  award  treble  damages.  A  motor
27    vehicle  dealer,  if it has not suffered any loss of money or
28    property, may obtain permanent equitable relief if it can  be
29    shown  that the unfair act or practice may have the effect of
30    causing such loss of money or property.  Where the franchisee
31    or dealer substantially prevails  the  court  or  arbitration
32    panel  or  Motor  Vehicle Review Board shall award attorney's
33    fees and assess costs,  including  expert  witness  fees  and
 
HB0520 Enrolled            -27-               LRB9102551SMdvA
 1    other  expenses  incurred by the dealer in the litigation, so
 2    long as such fees  and  costs  are  reasonable,  against  the
 3    opposing  party.  Moreover,  for the purposes of the award of
 4    attorney's fees, expert witness fees, and costs whenever  the
 5    franchisee  or  dealer is seeking injunctive or other relief,
 6    the franchisee or dealer may be considered to have  prevailed
 7    when  a  judgment  is  entered  in  its  favor,  when a final
 8    administrative decision is entered in its favor and affirmed,
 9    if subject to  judicial  review,  when  a  consent  order  is
10    entered   into,   or   when  the  manufacturer,  distributor,
11    wholesaler, distributor branch or  division,  factory  factor
12    branch  or  division,  wholesale  branch  or division, or any
13    officer, agent or other  representative  thereof  ceases  the
14    conduct,  act or practice which is alleged to be in violation
15    of any Section of this Act.
16    (Source: P.A. 89-145, eff. 7-14-95.)

17        (815 ILCS 710/29)
18        Sec.  29.   Procedures  for  hearing  on  protest.   Upon
19    receipt of a timely notice of protest under paragraph (6)  of
20    subsection  (d)  or paragraph (6), (8), or (10) of subsection
21    (e) of Section 4 and  Section  12  of  this  Act,  the  Motor
22    Vehicle  Review  Board  shall  enter  an  order fixing a date
23    (within 60 days of the date of the order), time, the place of
24    a  hearing  and  send  by  certified  mail,  return   receipt
25    requested,  a  copy  of the order to the manufacturer and the
26    objecting dealer or dealers.  Subject to Section 10-20 of the
27    Illinois  Administrative  Procedure  Act,  the  Board   shall
28    designate  a  hearing  officer who shall conduct the hearing.
29    All  administrative  hearing  officers  shall  be   attorneys
30    licensed to practice law in this State.
31        At  the  time  and  place fixed in the Board's order, the
32    Board or its duly  authorized  agent,  the  hearing  officer,
33    shall  proceed  to  hear  the protest, and all parties to the
 
HB0520 Enrolled            -28-               LRB9102551SMdvA
 1    protest shall be afforded an opportunity to present in person
 2    or by counsel, statements, testimony, evidence, and  argument
 3    as  may  be pertinent to the issues.  The hearing officer may
 4    continue the hearing date by agreement  of  the  parties,  or
 5    upon  a  finding  of  good  cause,  but in no event shall the
 6    hearing be rescheduled more than 90 days  after  the  Board's
 7    initial order.
 8        Upon any hearing, the Board or its duly authorized agent,
 9    the  hearing  officer,  may administer oaths to witnesses and
10    issue subpoenas for the  attendance  of  witnesses  or  other
11    persons  and  the  production of relevant documents, records,
12    and other evidence and may require examination  thereon.  For
13    purposes  of  discovery,  the Board or its designated hearing
14    officer may, if  deemed  appropriate  and  proper  under  the
15    circumstances,  authorize  the  parties  to  engage  in  such
16    discovery  procedures as are provided for in civil actions in
17    Section 2-1003 of the Code  of  Civil  Procedure.   Discovery
18    shall   be   completed   no  later  than  15  days  prior  to
19    commencement of the proceeding or hearing.    Enforcement  of
20    discovery procedures shall be as provided in the regulations.
21    Subpoenas  issued  shall  be  served  in  the  same manner as
22    subpoenas issued out of the  circuit  courts.   The  fees  of
23    subpoenaed witnesses under this Act for attendance and travel
24    shall  be  the  same  as fees of witnesses before the circuit
25    courts of this State, such fees to be paid when  the  witness
26    is  excused  from further attendance, provided the witness is
27    subpoenaed  at  the  instance  of  the  Board  or  an   agent
28    authorized  by  the  Board; and payment of fees shall be made
29    and audited in the same  manner  as  other  expenses  of  the
30    Board.   Whenever  a  subpoena  is issued at the request of a
31    party to a proceeding, complainant,  or  respondent,  as  the
32    case  may  be, the Board may require that the cost of service
33    of the subpoena and the fee of same shall  be  borne  by  the
34    party  at  whose  instance  the  witness is summoned, and the
 
HB0520 Enrolled            -29-               LRB9102551SMdvA
 1    Board shall have power,  in  its  discretion,  to  require  a
 2    deposit to cover the cost of service and witness fees and the
 3    payment  of  the legal witness fee and mileage to the witness
 4    served with the subpoena. In any protest  before  the  Board,
 5    the  Board  or  its  designated  hearing  officer may order a
 6    mandatory settlement conference.  The failure of a  party  to
 7    appear,  to  be  prepared, or to have authority to settle the
 8    matter may result in any or all of the following:
 9        (a)  The Board or  its  designated  hearing  officer  may
10    suspend  all proceedings before the Board in the matter until
11    compliance.
12        (b)  The Board or  its  designated  hearing  officer  may
13    dismiss  the proceedings or any part thereof before the Board
14    with or without prejudice.
15        (c)  The Board or  its  designated  hearing  officer  may
16    require  all  of the Board's costs to be paid by the party at
17    fault.
18        Any circuit court of this State, upon application of  the
19    Board, or an officer or agent designated by the Board for the
20    purpose  of  conducting  any hearing, may, in its discretion,
21    compel the attendance of witnesses, the production of  books,
22    papers,  accounts,  or  documents,  and  giving  of testimony
23    before the Board or before any officer  or  agent  designated
24    for  the  purpose of conducting the hearing.  Failure to obey
25    the order may be punished by the circuit court as contempt.
26        A party may conduct cross-examination required for a full
27    and fair disclosure of the facts. Within 20 days of the  date
28    of  the  hearing,  the hearing officer shall issue his or her
29    proposed decision to the Board and shall, by certified  mail,
30    return  receipt  requested,  serve the proposed decision upon
31    the parties, with an opportunity afforded to  each  party  to
32    file  exceptions  and  present a brief to the Board within 10
33    days of their receipt of the proposed decision.  The proposed
34    decision shall contain a statement of  the  reasons  for  the
 
HB0520 Enrolled            -30-               LRB9102551SMdvA
 1    decision  and  each  issue  of  fact  or law necessary to the
 2    proposed decision.  The Board  shall  then  issue  its  final
 3    order  which,  if  applicable,  shall  include  the  award of
 4    attorney's fees, expert witness fees, and  an  assessment  of
 5    costs,  including  other expenses incurred in the litigation,
 6    if permitted under this Act, so long as such fees  and  costs
 7    are reasonable.
 8        In  a  hearing  on a protest filed under paragraph (6) of
 9    subsection (d) or paragraph (6), (8), or (10) of Section 4 or
10    Section 12 of this  Act,  the  manufacturer  shall  have  the
11    burden of proof to establish that there is good cause for the
12    franchiser to:  grant or establish an additional franchise or
13    relocate  an existing franchise; cancel, terminate, refuse to
14    extend or renew a franchise or selling agreement;  or  change
15    or  modify  the  obligations of the motor vehicle dealer as a
16    condition to offering a renewal, replacement,  or  succeeding
17    franchise  or selling agreement or refuse to honor succession
18    to ownership or refuse to  approve  a  proposed  transfer  or
19    sale.   The  determination whether good cause exists shall be
20    made under Section 12 of this Act.
21        The Board shall  record  the  testimony  and  preserve  a
22    record  of  all proceedings at the hearing by proper means of
23    recordation.   The  notice  required  to  be  given  by   the
24    manufacturer  and  notice  of  protest by the dealer or other
25    party, the notice of hearing, and all other documents in  the
26    nature  of  pleadings,  motions,  and  rulings, all evidence,
27    offers  of  proof,  objections,  and  rulings  thereon,   the
28    transcript  of  testimony, the report of findings or proposed
29    decision of the hearing officer, and the orders of the  Board
30    shall  constitute  the  record of the proceedings.  The Board
31    shall furnish a  transcript  of  the  record  to  any  person
32    interested  in  the  hearing  upon payment of the actual cost
33    thereof.
34    (Source: P.A. 89-145, eff. 7-14-95; 89-433, eff. 12-15-95.)

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