Title BC, Business and Commerce Code

Sec. 56.052. ENFORCEMENT OF CLAUSE PROHIBITED FOLLOWING NOTICE FROM CONTINGENT PAYEE. (a) Except as provided by Subsection (d), a contingent payor or its surety may not enforce a contingent payment clause as to work performed or materials delivered after the contingent payor rece…

Sec. 56.053. ENFORCEMENT OF CLAUSE PROHIBITED IF EXISTENCE OF SHAM RELATIONSHIP. A contingent payor or its surety may not enforce a contingent payment clause if the contingent payor is in a sham relationship with the obligor, as described by the sham relationships in Section 53.0…

Sec. 56.054. ENFORCEMENT OF CLAUSE PROHIBITED IF UNCONSCIONABLE. (a) A contingent payor or its surety may not enforce a contingent payment clause if the enforcement would be unconscionable. The party asserting that a contingent payment clause is unconscionable has the burden of p…

Sec. 56.055. USE OF CLAUSE TO INVALIDATE ENFORCEABILITY OR PERFECTION OF MECHANIC'S LIEN PROHIBITED. A contingent payment clause may not be used as a basis for invalidation of the enforceability or perfection of a mechanic's lien under Chapter 53, Property Code. Added by Acts 200…

Sec. 56.056. ASSERTION OF CLAUSE AS AFFIRMATIVE DEFENSE. The assertion of a contingent payment clause is an affirmative defense to a civil action for payment under a contract. Added by Acts 2009, 81st Leg., R.S., Ch. 87 (S.B. 1969), Sec. 4.001(a), eff. September 1, 2009.

Sec. 56.057. ALLOCATION OF RISK PERMITTED. An obligor or a primary obligor may not prohibit a contingent payor from allocating risk by means of a contingent payment clause. Added by Acts 2009, 81st Leg., R.S., Ch. 87 (S.B. 1969), Sec. 4.001(a), eff. September 1, 2009.

Sec. 57.001. SHORT TITLE. This chapter may be cited as the Fair Practices of Equipment Manufacturers, Distributors, Wholesalers, and Dealers Act. Added by Acts 2011, 82nd Leg., R.S., Ch. 1039 (H.B. 3079), Sec. 2, eff. September 1, 2011.

Sec. 57.002. DEFINITIONS. In this chapter: (1) "Current net parts cost" means an amount equal to the current net parts price of a repair part, less any trade or cash discount typically given to a dealer in the normal, ordinary course of ordering a repair part. (2) "Current net pa…

Sec. 57.003. WAIVER OF CHAPTER VOID. An attempted waiver of a provision of this chapter or of the application of this chapter is void. Added by Acts 2011, 82nd Leg., R.S., Ch. 1039 (H.B. 3079), Sec. 2, eff. September 1, 2011. SUBCHAPTER B. PROVISIONS REGARDING DEALER AGREEMENT OR…

Sec. 57.051. CERTAIN PROVISIONS VOID. The following provisions contained in a dealer agreement are void: (1) any provision that purports to elect the application of a law of another state instead of the law of this state; and (2) any provision that requires a dealer to pay attorn…

Sec. 57.052. CHANGE IN OWNERSHIP OR FINANCIAL STRUCTURE. A supplier may not prevent, by contract or otherwise, a dealer from changing its capital structure or the means by or through which the dealer finances its operations, if: (1) the dealer gives prior notice of the change to …

Sec. 57.053. RELEASE OF LIABILITY PROHIBITED. A supplier may not require a dealer to assent to a release, assignment, novation, waiver, or estoppel that would release any person from liability imposed by this chapter. Added by Acts 2011, 82nd Leg., R.S., Ch. 1039 (H.B. 3079), Sec…

Sec. 57.101. TRANSFER OF INTEREST IN DEALERSHIP BY SUCCESSION; SINGLE-LINE DEALER AGREEMENTS. (a) This section applies only to single-line dealer agreements. (b) If a dealer dies, a supplier has 90 days in which to consider and make a determination on a request by a family member…

Sec. 57.102. APPROVAL OF SALE OR TRANSFER OF BUSINESS AT DEALER'S REQUEST. (a) This section applies only to a dealer agreement that is not a single-line dealer agreement. (b) If a supplier has contractual authority to approve or deny a request for the sale or transfer of a dealer…

Sec. 57.103. APPROVAL OF SALE OR TRANSFER OF BUSINESS AT REQUEST OF PERSONAL REPRESENTATIVE. (a) This section applies only to a dealer agreement that is not a single-line dealer agreement. (b) If a dealer dies and the supplier has contractual authority to approve or deny a reques…

Sec. 57.151. APPLICABILITY OF SUBCHAPTER. This subchapter applies only to a dealer agreement that is not a single-line dealer agreement. Added by Acts 2011, 82nd Leg., R.S., Ch. 1039 (H.B. 3079), Sec. 2, eff. September 1, 2011.

Sec. 57.152. TERMINATION BY DEALER; WRITTEN NOTICE. A dealer must give the supplier at least 30 days' prior written notice of termination. Added by Acts 2011, 82nd Leg., R.S., Ch. 1039 (H.B. 3079), Sec. 2, eff. September 1, 2011.

Sec. 57.153. TERMINATION BY SUPPLIER; GOOD CAUSE REQUIRED. A supplier may not terminate a dealer agreement without good cause. Added by Acts 2011, 82nd Leg., R.S., Ch. 1039 (H.B. 3079), Sec. 2, eff. September 1, 2011.

Sec. 57.154. GOOD CAUSE DETERMINATION. (a) Except as specifically provided otherwise by this chapter, good cause for termination of a dealer agreement exists for purposes of this subchapter if: (1) the dealer fails to substantially comply with essential and reasonable requirement…

Sec. 57.155. NOTICE OF TERMINATION; CORRECTION OF DEFICIENCY. (a) Except as otherwise provided by this section, a supplier must provide a dealer written notice of termination of a dealer agreement at least 180 days before the effective date of termination. The notice must state a…

Sec. 57.201. APPLICABILITY OF SUBCHAPTER. This subchapter applies only to a single-line dealer agreement. Added by Acts 2011, 82nd Leg., R.S., Ch. 1039 (H.B. 3079), Sec. 2, eff. September 1, 2011.

Sec. 57.202. TERMINATION BY SUPPLIER; GOOD CAUSE REQUIRED. No supplier may terminate a dealer agreement without good cause. Added by Acts 2011, 82nd Leg., R.S., Ch. 1039 (H.B. 3079), Sec. 2, eff. September 1, 2011.

Sec. 57.203. GOOD CAUSE DETERMINATION. (a) For purposes of this subchapter, "good cause" means failure by a dealer to comply with requirements imposed on the dealer by the dealer agreement if the requirements are not different from those requirements imposed on other similarly si…

Sec. 57.204. NOTICE OF TERMINATION; CORRECTION OF DEFICIENCY. (a) Except as provided by Subsection (b) and Section 57.205, a supplier shall provide a dealer with at least 90 days' written notice of termination. The notice must state all reasons constituting good cause for the ter…

Sec. 57.205. NOTICE OF TERMINATION NOT REQUIRED UNDER CERTAIN CIRCUMSTANCES. The notice and right to cure provisions under Section 57.204 do not apply if the reason for termination is contained in Sections 57.203(b)(1)-(7). Added by Acts 2011, 82nd Leg., R.S., Ch. 1039 (H.B. 3079…

Sec. 57.251. DEFINITION OF TERMINATE AND TERMINATION. For purposes of this subchapter, "terminate" and "termination" do not include the phrase substantially change the competitive circumstances of a dealer agreement. Added by Acts 2011, 82nd Leg., R.S., Ch. 1039 (H.B. 3079), Sec.…

Sec. 57.252. APPLICABILITY OF SUBCHAPTER; CONFLICT WITH SUBCHAPTER. (a) Sections 57.253, 57.254, and 57.255 apply to a warranty claim submitted by a dealer who has complied with the supplier's reasonable policies and procedures for reimbursement of the warranty claim and the clai…

Sec. 57.253. WARRANTY CLAIM. (a) This section applies to a warranty claim submitted by a dealer to the supplier: (1) while the dealer agreement is in effect; or (2) not later than the 60th day after the termination or expiration date of the dealer agreement, if the claim is for w…

Sec. 57.254. RESUBMISSION OF WARRANTY CLAIM. If a warranty claim was rejected on the ground that the dealer failed to properly follow the procedural or technical requirements for submission of a warranty claim, the dealer may resubmit the claim in proper form not later than the 3…

Sec. 57.255. PAYMENT OF WARRANTY CLAIM. Warranty work performed by the dealer shall be compensated in accordance with the reasonable and customary amount of time required to complete the work, expressed in hours and fractions of hours, multiplied by the dealer's established custo…

Sec. 57.256. WARRANTY CLAIM FOR CERTAIN REPAIR WORK OR INSTALLATION OF REPLACEMENT PARTS. Any repair work or installation of replacement parts performed with respect to inventory equipment of a dealer or with respect to equipment of a dealer's customers, at the request of a suppl…

Sec. 57.257. AUDIT OF WARRANTY CLAIMS. (a) Except as provided by Subsection (b), a supplier may audit a warranty claim submitted by a dealer until the first anniversary of the date the claim was paid and may charge back the amount of any claim that is shown by audit to have been …

Sec. 57.258. ALTERNATE REIMBURSEMENT TERMS ENFORCEABLE. (a) Sections 57.253, 57.254, and 57.255 do not apply if the terms of a written dealer agreement between the parties require the supplier to compensate the dealer for warranty labor costs either as: (1) a discount in the pric…

Sec. 57.301. COERCED ORDERS, DELIVERIES, OR REFUSALS TO PURCHASE. (a) A supplier may not coerce, compel, or require a dealer to accept delivery of equipment or a repair part that has not been voluntarily ordered by the dealer, unless: (1) the equipment or repair part is a safety …

Sec. 57.302. CONDITIONAL PURCHASES OF GOODS AND SERVICES. (a) A supplier may not condition the sale of equipment, repair parts, or goods or services to a dealer on the purchase of other goods or services. (b) This section does not prohibit a supplier from requiring a dealer to pu…

Sec. 57.303. EQUIPMENT REPRESENTED AS AVAILABLE FOR IMMEDIATE DELIVERY. A supplier may not refuse to deliver, in reasonable quantities and within a reasonable time after receipt of a dealer's order, to any dealer having a dealer agreement for the retail sale of new equipment sold…

Sec. 57.304. DISCRIMINATION IN ORDERS. A supplier may not discriminate, directly or indirectly, in filling an order placed by a dealer for retail sale or lease of new equipment under a dealer agreement as between dealers of the same product line. Added by Acts 2011, 82nd Leg., R.…

Sec. 57.305. DISCRIMINATION IN PRICES OF NEW EQUIPMENT. (a) Except as provided by Subsection (b), a supplier may not discriminate, directly or indirectly, in the price among different dealers with respect to a purchase of equipment or a repair part of like grade and quality and i…

Sec. 57.351. DEFINITION OF TERMINATE AND TERMINATION. For purposes of this subchapter, "terminate" and "termination" do not include the phrase substantially change the competitive circumstances of a dealer agreement. Added by Acts 2011, 82nd Leg., R.S., Ch. 1039 (H.B. 3079), Sec.…

Sec. 57.352. APPLICABILITY OF SUBCHAPTER TO SEVERAL BUSINESS LOCATIONS COVERED BY SAME AGREEMENT. If a dealer has more than one of its business locations covered by the same dealer agreement, this subchapter applies to the repurchase of the dealer's inventory at the particular bu…

Sec. 57.353. PAYMENTS OR CREDITS. (a) When a supplier or dealer terminates or otherwise discontinues the dealer agreement entered into between the two parties, the supplier shall pay to the dealer, or credit to the dealer's account, if the dealer has outstanding any sums owing th…

Sec. 57.354. LATE PAYMENT OR CREDIT. (a) All payments or allowances of credit due to a dealer shall be paid or credited within 90 days after receipt by the supplier of property required to be repurchased under this subchapter. (b) Any payment or allowance of credit due a dealer t…

Sec. 57.355. LIABILITY. (a) A supplier who refuses to repurchase any inventory covered under this chapter after termination or discontinuation of the dealer agreement is liable to the dealer for: (1) 110 percent of the amount that would have been due for the inventory had the sup…

Sec. 57.356. CONSTRUCTION OF SUBCHAPTER; CREDITOR'S CLAIMS. This subchapter may not be construed to affect any security interest the supplier may have in the inventory of the dealer, and any repurchase of the dealer's inventory under this subchapter may not be subject to the clai…

Sec. 57.357. AGREEMENT TERMINATED BY DEALER; INAPPLICABILITY OF SUBCHAPTER TO CERTAIN SPECIALTY SUPPLIERS. (a) This subchapter does not apply to a specialty agricultural equipment supplier if the dealer terminates the dealer agreement without good reason. A dealer has good reason…

Sec. 57.358. EXCEPTIONS. (a) A supplier is not required to repurchase from a dealer: (1) a repair part that, except as provided by Subsection (b), is in a broken or damaged package; (2) a repair part that because of its condition cannot be resold as a new part without repackaging…