State of Illinois
91st General Assembly
Legislation

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[ Introduced ][ Enrolled ][ Senate Amendment 001 ]

91_HB0520eng

 
HB0520 Engrossed                              LRB9102551SMdvA

 1        AN ACT to  amend  the  Motor  Vehicle  Franchise  Act  by
 2    changing  Sections  4,  5,  6, 13, and 29, and adding Section
 3    7.1.

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

 6        Section 5.  The Motor Vehicle Franchise Act is amended by
 7    changing Sections 4, 5, 6, 13, and 29, and adding Section 7.1
 8    as follows:

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

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

14        (815 ILCS 710/6) (from Ch. 121 1/2, par. 756)
15        Sec. 6.  Warranty agreements; claims; approval;  payment;
16    written disapproval.
17        (a)  Every    manufacturer,    distributor,   wholesaler,
18    distributor branch or division, factory branch  or  division,
19    or  wholesale  branch  or division shall properly fulfill any
20    warranty agreement and adequately and fairly compensate  each
21    of its motor vehicle dealers for labor and parts.
22        (b)  In  no event shall such compensation fail to include
23    reasonable compensation  for  diagnostic  work,  as  well  as
24    repair service, and labor, and parts. Time allowances for the
25    diagnosis  and performance of warranty work and service shall
26    be reasonable and adequate for the work to be  performed.  In
27    the determination of what constitutes reasonable compensation
28    under   this  Section,  the  principal  factor  to  be  given
29    consideration shall be the prevailing wage rates  being  paid
30    by  the dealer in the relevant market area in which the motor
31    vehicle dealer is doing business, and in no event shall  such
32    compensation  of  a motor vehicle dealer for warranty service
33    be less than the  rates  charged  by  such  dealer  for  like
 
HB0520 Engrossed            -24-              LRB9102551SMdvA
 1    service  to  retail  customers  for  nonwarranty  service and
 2    repairs. The franchiser shall reimburse  the  franchisee  for
 3    any  parts  provided  in  satisfaction  of  a warranty at the
 4    retail rate customarily charged by that dealer for  the  same
 5    parts  when  not  provided in satisfaction of a warranty. All
 6    claims, either original or resubmitted, made by motor vehicle
 7    dealers hereunder and under Section  5  for  such  labor  and
 8    parts  shall be either approved or disapproved within 30 days
 9    following their submission.  All  approved  claims  shall  be
10    paid  within  30  days  following  their approval.  The motor
11    vehicle dealer who submits a claim which is disapproved shall
12    be notified in writing of the  disapproval  within  the  same
13    period, and each such notice shall state the specific grounds
14    upon  which  the  disapproval  is  based.   The motor vehicle
15    dealer shall  be  permitted  to  correct  and  resubmit  such
16    disapproved  claims within 30 days of receipt of disapproval.
17    Any claims not specifically disapproved in writing within  30
18    days  from  their  submission  shall  be  deemed approved and
19    payment shall follow within  30  days.  The  manufacturer  or
20    franchiser   shall  have  the  right  to  require  reasonable
21    documentation for claims and to audit such  claims  within  a
22    one  year  period  from the date the claim was paid or credit
23    issued by the manufacturer or franchiser, and to charge  back
24    any  false  or unsubstantiated claims. The manufacturer shall
25    have the burden of establishing  that  the  documentation  is
26    reasonable.  The  audit  and  charge  back provisions of this
27    Section also apply to all other incentive  and  reimbursement
28    programs  for  a  period  of  18 months after the date of the
29    transactions that are subject to  audit  by  the  franchiser.
30    However,  the  manufacturer  retains the right to charge back
31    any fraudulent claim if the  manufacturer  establishes  in  a
32    court  of competent jurisdiction in this State that the claim
33    is fraudulent. Any charge back resulting from an audit  shall
34    not  be  made  until  a  final  order  is issued by the Motor
 
HB0520 Engrossed            -25-              LRB9102551SMdvA
 1    Vehicle Review Board if a protest to the proposed charge back
 2    is filed within 30 days of the  notification  of  the  amount
 3    claimed by the manufacturer, distributor, branch, or division
 4    to be due.
 5    (Source: P.A. 87-1163.)

 6        (815 ILCS 710/7.1 new)
 7        Sec.   7.1.    Prefiling   of  franchise  agreements  and
 8    amendments.  Any franchise, as defined in Section 2,  offered
 9    to  a  motor  vehicle dealer in this State shall provide that
10    all terms and conditions in the agreement  inconsistent  with
11    any  laws  or rules of this State are of no force and effect.
12    On or before January 1,  2000,  every  manufacturer,  factory
13    branch,  distributor,  or  distributor  branch  which uses an
14    identical or substantially similar form  franchise  agreement
15    for  its  franchisees in this State shall file with the Motor
16    Vehicle Review Board a copy of the  franchise  agreement  and
17    all  supplements.  Not later than 60 days prior to the date a
18    revision, modification, or addition to a franchise  agreement
19    is  offered  generally  to  a  franchisee  in this State, the
20    manufacturer, factory  branch,  distributor,  or  distributor
21    branch  shall  notify  the  Motor Vehicle Review Board of the
22    proposed revision, modification, or addition to the franchise
23    agreement on  file  with  the  Board  and  include  with  the
24    notification:
25             (1)  A  copy  of  the form franchise agreement which
26        incorporates   all    of    the    proposed    revisions,
27        modifications, and additions;
28             (2)   A  separate  statement  which  identifies  all
29        substantive  revisions,  modifications,   and   additions
30        proposed.
31        It  shall  be  unlawful  for a franchise agreement or any
32    addendum or supplement thereto  to  be  offered  to  a  motor
33    vehicle dealer in this State after January 1, 2000, until the
 
HB0520 Engrossed            -26-              LRB9102551SMdvA
 1    manufacturer,  factory  branch,  distributor,  or distributor
 2    branch has complied with all  of  the  requirements  of  this
 3    Section.  The Board is authorized and directed to investigate
 4    and   prevent      violations   of  this  Section,  including
 5    inconsistencies of  any  manufacturer's  franchise  agreement
 6    with the provisions of this Act.

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

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

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