Oregon Statutes - Chapter 646A - Trade Regulation - Section 646A.304 - Payment for farm implements, parts, software, tools and signs upon termination of retailer agreement.

(1) If a retailer agreement is terminated, canceled or discontinued, unless the retailer elects to keep the farm implements, machinery and repair parts under a contractual right to do so, the supplier shall pay the retailer for the farm implements, machinery and repair parts or, if the retailer owes any sums to the supplier, credit the cost of the farm implements, machinery and repair parts to the retailerís account. The payment or credit shall be as follows:

(a) The payment or the credit for the unused complete farm implements and machinery in new condition shall be in a sum equal to 100 percent of the net cost of all complete farm implements and machinery that are current models and that have been purchased by the retailer from the supplier within the 24 months immediately preceding notice of intent to cancel or discontinue the retailer agreement. The payment or credit shall include the transportation charges to the retailer and from the retailer to the supplier, if the charges have been paid by the retailer or invoiced to the retailerís account by the supplier, and a reasonable reimbursement for services performed in connection with assembly or predelivery inspection of the implements or machinery. The supplier assumes ownership of the farm implements and machinery F.O.B. the dealership.

(b) The payment or credit for equipment used for demonstration or rental and that is in new condition shall equal the depreciated value of the equipment to which the supplier and retailer have agreed.

(c)(A) The payment or credit for repair parts shall be a sum equal to 95 percent of the current net prices of the repair parts, including superseded parts, plus the charges for transportation from the retailer to the destination designated by the supplier that the retailer paid or the supplier invoiced to the retailerís account. The supplier assumes ownership of the repair parts F.O.B. the dealership.

(B) This paragraph applies to parts purchased by the retailer from the supplier and held by the retailer on or after the date of the cancellation or discontinuance of the retailer agreement.

(C) This paragraph does not apply to repair parts that:

(i) The supplier identified as not returnable when the retailer ordered the parts.

(ii) The retailer purchased in a set of multiple parts, unless the set is complete and in resalable condition.

(iii) The retailer failed to return after being offered a reasonable opportunity to return the repair part at a price not less than 100 percent of the net price of the repair part as listed in the then current price list or catalog.

(iv) Have a limited storage life or are otherwise subject to deterioration, including but not limited to rubber items, gaskets and batteries and repair parts in broken or damaged packages.

(v) Are single repair parts priced as a set of two or more items.

(vi) Are not resalable as new parts without new packaging or reconditioning because of their condition.

(D) The supplier shall also pay the retailer or credit to the retailerís account a sum equal to five percent of the current net price of all parts returned for the handling, packing and loading of the parts, unless the supplier elects to list the inventory and perform packing and loading of the parts itself.

(d) Upon the payment or allowance of credit to the retailerís account of the sum under this subsection, the title to the farm implements, farm machinery or repair parts shall pass to the supplier making the payment or allowing the credit and the supplier shall be entitled to the possession of the farm implements, machinery or repair parts.

(2)(a) If a retailer agreement is terminated, canceled or discontinued, the supplier shall, upon request of the retailer, pay the retailer for:

(A) Computer and communications hardware that:

(i) The supplier required the retailer to purchase within the preceding five years; and

(ii) The retailer possesses on the date of the agreementís termination, cancellation or discontinuation.

(B) Computer software that:

(i) The supplier required the retailer to purchase from the supplier; and

(ii) The retailer used exclusively to support the retailerís dealings with the supplier.

(b) If the retailer owes any sums to the supplier, the supplier may credit the cost of the hardware and software to the retailerís account.

(c) The payment or credit shall be the net cost of the hardware and software, less 20 percent per year that the retailer possessed the hardware and software.

(d) This subsection does not apply if the retailer exercises a contractual right to keep the hardware or software.

(3)(a) If a retailer agreement is terminated, canceled or discontinued, the supplier shall pay the retailer for the retailerís specialized tools.

(b) If the retailer owes any sums to the supplier, the supplier may credit the cost of the specialized tools to the retailerís account.

(c)(A) If a tool is new and unused and used for the supplierís current models, the payment or credit shall be the net cost of the tool.

(B) If a tool is not new and unused and used for the supplierís current models, the payment or credit shall be the net cost of the tool, less 20 percent per year that the retailer possessed the tool.

(4)(a) If a retailer agreement is terminated, canceled or discontinued, the supplier shall pay the retailer for the retailerís current signs.

(b) If the retailer owes any sums to the supplier, the supplier may credit the cost of the signs to the retailerís account.

(c) The payment or credit shall be the net cost of the sign, less 20 percent per year that the retailer possessed the sign.

(5) A supplier shall provide all payments or allowances due under this section within 90 calendar days of the retailerís return of the farm implements, machinery, repair parts, computer and communications hardware, computer software, specialized tools or current signs. A supplier who does not provide a payment or allowance within 90 calendar days of the retailerís return of the farm implements, machinery, repair parts, computer and communications hardware, computer software, specialized tools or current signs shall pay the retailer interest of 18 percent per annum on the past due amount until paid.

(6) This section supplements any retailer agreement between the retailer and the supplier covering the return of farm implements, machinery, repair parts, computer and communications hardware, computer software, specialized tools or current signs. The retailer may elect to pursue either the retailerís remedy under the retailer agreement or the remedy provided under this section. An election by the retailer to pursue the remedy under the retailer agreement does not bar the retailerís right to the remedy provided under this section as to those farm implements, machinery, repair parts, computer and communications hardware, computer software, specialized tools or current signs not affected by the retailer agreement. This section does not affect the right of a supplier to charge back to the retailerís account amounts previously paid or credited as a discount incident to the retailerís purchase of goods.

(7) This section does not apply to farm implements, machinery, repair parts, computer and communications hardware, computer software, specialized tools or current signs that a retailer acquired from a source other than the supplier. [Formerly 646.425]

Note: Section 13 (1), chapter 466, Oregon Laws 2003, provides:

Sec. 13. (1) The amendments to ORS 646.425 [renumbered 646A.304 in 2007] by section 2 of this 2003 Act apply to retail agreements that:

(a) Are entered into on or after the effective date of this 2003 Act [January 1, 2004].

(b) Are entered into before the effective date of this 2003 Act and:

(A) Do not state a date for termination, cancellation or discontinuation; and

(B) Are terminated, canceled or discontinued after the effective date of this 2003 Act. [2003 c.466 §13(1)]

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Last modified: August 7, 2008