Oregon Statutes - Chapter 650 - Franchise Transactions - Section 650.145 - Compensation due dealer upon termination of franchise.

(1) As used in subsection (2) of this section, ďfair and reasonable compensationĒ means the amount originally paid by the dealer minus any incentive payments, model close-out allowances or any other programs applicable to the vehicles.

(2) Upon the termination, cancellation, nonrenewal or discontinuance of any franchise, the dealer shall be allowed fair and reasonable compensation by the manufacturer, distributor or importer for the following:

(a) All new current model year motor vehicle inventory with a gross vehicle weight rating of less than 8,500 pounds purchased from the manufacturer, distributor or importer that has not been materially altered, substantially damaged or driven for more than 300 miles;

(b) All new motor vehicle inventory that has not been materially altered or substantially damaged, provided that the vehicles:

(A) If motor vehicles with a gross vehicle weight rating of less than 8,500 pounds, were not driven for more than 300 miles, were purchased directly from the manufacturer, distributor or importer within 120 days of the effective date of the termination, cancellation, nonrenewal or discontinuance and were either paid for or drafted on the dealerís financing source; or

(B) If motor vehicles with a gross vehicle weight rating of 8,500 pounds or more, were not driven more than 4,000 miles, were purchased directly from the manufacturer, distributor or importer within one year of the effective date of the termination, cancellation, nonrenewal or discontinuance and were either paid for or drafted on the dealerís financing source;

(c) Supplies and parts inventory purchased from the manufacturer, distributor or importer and listed in the manufacturerís, distributorís or importerís current parts catalog;

(d) Equipment, furnishings and signs purchased from the manufacturer, distributor or importer and required by the manufacturer, distributor or importer that have not been materially altered, or substantially damaged or depreciated over 50 percent of the original value; and

(e) Special tools purchased from the manufacturer, distributor or importer within three years of the date of termination, cancellation, nonrenewal or discontinuance and required by the manufacturer that have not been materially altered, or substantially damaged or depreciated over 50 percent of the original value.

(3) Nothing in this section is intended to modify the manufacturerís, distributorís or importerís contractual right of setoff.

(4) Upon the termination, cancellation, nonrenewal or discontinuance of a franchise, the manufacturer, distributor or importer shall also pay to the dealer a sum equal to the current, fair rental value of the dealerís established place of business for a period of one year from the effective date of termination, cancellation, nonrenewal or discontinuance or the remaining period of any lease, whichever is less.

(5) Subsection (4) of this section shall apply only to the extent that the dealerís established place of business is used for performance of sales and service obligations under the manufacturerís, distributorís or importerís franchise agreement.

(6) In the event that termination is by the dealer, the payment required by subsection (4) of this section is not required.

(7) This section shall not relieve a new motor vehicle dealer, lessor or other owner of an established place of business from the obligation of mitigating damages. [1989 c.716 §2; 2001 c.216 §3; 2007 c.71 §203]

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Last modified: August 7, 2008