Effective 28 Aug 2010

407.822. Complaint with administrative hearing commission, filing, when — time and place of hearing — notice to parties — final order, when — petition for review of final order — franchisee's right to file complaint, when — notice to franchisee, when, exceptions — statement required in franchisor's notice — consolidation of applications — burden of proof — mediation, when. — 1. Any party seeking relief pursuant to the provisions of sections 407.810 to 407.835 may file a complaint with the administrative hearing commission within the time periods specified in this section. The complaint shall comply with the requirements for a request for agency action set forth in chapter 536. Simultaneously, with the filing of the complaint with the administrative hearing commission, the petitioner shall send by certified mail, return receipt requested, a copy of the complaint to the party or parties against whom relief is sought. Upon receiving a timely complaint, the administrative hearing commission shall enter an order fixing a date, time and place for a hearing on the record. The administrative hearing commission shall send by certified mail, return receipt requested, a copy of the order to the party seeking relief and a copy of the order and complaint to the party or parties against whom relief is sought. The order shall also state that the party against whom relief is sought shall not proceed with the initiation of its activity or activities until the administrative hearing commission issues its final decision or order, and the party against whom relief is sought shall, within thirty days of such order, file an answer or other responsive pleading directed to each claim for relief set forth in the complaint. Failure to answer or otherwise respond within such time frame may be deemed by the administrative hearing commission as an admission of the grounds for relief set forth in the complaint.

2. Unless otherwise expressly provided in sections 407.810 to 407.835, the provisions of chapter 536 shall govern hearings and prehearing procedures conducted pursuant to the authority of this section. Any party may obtain discovery in the same manner, and under the same conditions and requirements, as is or may hereafter be provided for with respect to discovery in civil actions by rule of the supreme court of Missouri for use in the circuit courts, and the administrative hearing commission may enforce discovery by the same methods as provided by supreme court rule for use in civil cases. The administrative hearing commission shall issue a final decision or order, in proceedings arising pursuant to the provisions of sections 407.810 to 407.835, within ninety days from the conclusion of the hearing. In any proceeding initiated pursuant to sections 407.810 to 407.835 involving a matter requiring a franchisor to show good cause for any intended action being protested by a franchisee, the franchisor shall refrain from taking the protested action if, after a hearing on the matter before the administrative hearing commission, the administrative hearing commission determines that good cause does not exist for the franchisor to take such action. The franchisee may, if necessary, seek enforcement of the decision of the administrative hearing commission pursuant to the provisions of section 407.835. Venue for such proceedings shall be in the circuit court of Cole County, Missouri, or in the circuit court of the county in which the franchisee resides or operates the franchise business. In determining any relief necessary for enforcement of the decision of the administrative hearing commission, the court shall defer to the commission's factual findings, and review shall be limited to a determination of whether the commission's decision was authorized by law and whether the commission abused its discretion. Any final decisions of the administrative hearing commission shall be subject to review pursuant to a petition for review to be filed in the court of appeals in the district in which the hearing, or any part of the hearing, is held and by delivery of copies of the petition to each party of record, within thirty days after the mailing or delivery of the final decision and notice of the final decision in such a case. Appeal of the administrative hearing commission's decision pursuant to this section shall not preclude any action authorized by section 407.835, brought in a court of competent jurisdiction, requesting an award of legal or equitable relief, provided that if such an action is brought solely for the purpose of enforcing a decision of the administrative hearing commission which is on appeal pursuant to this subsection, the court in which such action is pending may hold in abeyance its judgment pending issuance of a decision by the court of appeals. Review pursuant to this section shall be exclusive and decisions of the administrative hearing commission reviewable pursuant to this section shall not be reviewable in any other proceeding, and no other official or court shall have power to review any such decision by an action in the nature of mandamus or otherwise, except pursuant to the provisions of this section. The party seeking review shall be responsible for the filing of the transcript and record of all proceedings before the administrative hearing commission with the appropriate court of appeals.

3. Any franchisee receiving a notice from a franchisor pursuant to the provisions of sections 407.810 to 407.835, or any franchisee adversely affected by a franchisor's acts or proposed acts described in the provisions of sections 407.810 to 407.835, shall be entitled to file a complaint before the administrative hearing commission for a determination as to whether the franchisor has good cause for its acts or proposed acts.

4. Not less than sixty days before the effective date of the initiation of any enumerated act pursuant to subdivisions (5), (6), (7) and (14) of section 407.825, a franchisor shall give written notice to the affected franchisee or franchisees, by certified mail, return receipt requested, except as follows:

(1) Upon the initiation of an act pursuant to subdivision (5) of section 407.825, such notice shall be given not less than fifteen days before the effective date of such act only if the grounds for the notice include the following:

(a) Transfer of any ownership or interest in the franchised dealership without the consent of the motor vehicle franchisor;

(b) Material misrepresentation by the motor vehicle franchisee in applying for the franchise that substantially and adversely affects the franchisor;

(c) Insolvency of the motor vehicle franchisee or the filing of any petition by or against the motor vehicle franchisee under any bankruptcy or receivership law that is not vacated within twenty days from the institution thereof;

(d) Any unfair business practice by the motor vehicle franchisee after the motor vehicle franchisor has issued a written thirty-day warning to the motor vehicle franchisee to desist from such practice and the franchisee has failed to desist from the practice after having received the written thirty-day warning;

(e) Conviction of the motor vehicle franchisee of a crime which is a felony;

(f) Failure of the motor vehicle franchisee to conduct customary sales and service operations during customary business hours for at least seven consecutive business days unless such closing is due to an act of God, strike or labor difficulty or other cause over which the motor vehicle franchisee has no control; or

(g) Revocation of the motor vehicle franchisee's license;

(2) Upon initiation of an act pursuant to subdivision (7) of section 407.825, such notice shall be given within sixty days of the franchisor's receipt of a written proposal to consummate such sale or transfer and the receipt of all necessary information and documents generally used by the franchisor to conduct its review. The franchisor shall acknowledge in writing to the applicant the receipt of the information and documents and if the franchisor requires additional information or documents to complete its review, the franchisor shall notify the applicant within fifteen days of the receipt of the information and documents. If the franchisor fails to request additional information and documents from the applicant within fifteen days after receipt of the initial forms, the sixty-day time period for approval shall be deemed to run from the initial receipt date. Otherwise, the sixty-day time period for approval shall run from receipt of the supplemental requested information. In no event shall the total time period for approval exceed ninety days from the date of the receipt of the written proposal. The franchisor's notice of disapproval shall also specify the reasonable standard which the franchisor contends is not satisfied and the reason the franchisor contends such standard is not satisfied. Failure on the part of the franchisor to provide such notice shall be conclusively deemed an approval by the franchisor of the proposed sale or transfer to the proposed transferee. A franchisee's application for a hearing shall be filed with the administrative hearing commission within twenty days from receipt of such franchisor's notice;

(3) Pursuant to paragraphs (a) and (b) of subdivision (14) of section 407.825, such notice shall be given within sixty days of the franchisor's receipt of a deceased or incapacitated franchisee's designated family member's intention to succeed to the franchise or franchises or of the franchisor's receipt of the personal and financial data of the designated family member, whichever is later.

5. A franchisor's notice to a franchisee or franchisees pursuant to subdivisions (5), (6), (7) and (14) of section 407.825 shall contain a statement of the particular grounds supporting the intended action or activity which shall include any reasonable standards which were not satisfied. The notice is not effective unless it also contains, on the first page thereof, a conspicuous statement which reads as follows:

"NOTICE TO FRANCHISEE: YOU MAY BE ENTITLED TO FILE A PROTEST WITH THE MISSOURI ADMINISTRATIVE HEARING COMMISSION IN JEFFERSON CITY, MISSOURI, AND HAVE A HEARING IN WHICH YOU MAY PROTEST THE CONTENTS OF THIS NOTICE. ANY ACTION MUST BE FILED WITHIN THIRTY DAYS FROM RECEIPT OF THIS NOTICE. YOU ALSO HAVE THE RIGHT TO DEMAND NONBINDING MEDIATION. YOUR DEMAND FOR MEDIATION MAY BE MAILED TO THE ADDRESS SHOWN ON THIS NOTICE. FOR FURTHER INFORMATION, CONTACT YOUR ATTORNEY AND REFER TO SECTIONS 407.810 TO 407.835, RSMO.".

6. When more than one complaint is filed with the administrative hearing commission, the administrative hearing commission may consolidate the applications into one proceeding to expedite the disposition of all relevant issues.

7. Unless otherwise specifically required by another provision of the MVFP act, in all proceedings pursuant to sections 407.810 to 407.835, the franchisor shall have the burden of proving by a preponderance of the evidence that it has acted in good faith, that all required notices were given, and that good cause exists for its actions.

8. If a franchisee prevails in an action against a franchisor under any provision of sections 407.810 to 407.835, then the franchisee shall also have a cause of action against the franchisor for damages and reasonable expenses of litigation, including, but not limited to, depositions, transcripts, expert witnesses, and attorney fees.

9. A franchisee may mail a demand for mediation to its franchisor at any time after it receives any notice from a franchisor as required by any provision of the MVFP act. In addition, prior to, contemporaneous with, or after the filing of a complaint with the administrative hearing commission, a franchisee may mail a demand for mediation to its franchisor for any violation by the franchisor of any provision of the MVFP act. The mailing of the demand for mediation is effective when mailed to the address shown on the notice from the franchisor, the address shown on the franchise agreement, the address of the franchisor shown on its license with the department of revenue, the address of the franchisor's registered agent in this state, or the address of its attorney in a proceeding pending at the administrative hearing commission concerning the subject of the demand for mediation. The demand for mediation shall contain a short statement of the dispute and the relief sought by the franchisee; however, the contents of the demand are not jurisdictional.

10. The mailing of a demand for mediation stays any time period for the franchisee to initiate any action under the MVFP act that is the subject of the dispute described in the demand for mediation. If the parties fail to resolve the matter in dispute after meeting with the mediator, then the time period for filing any action with the administrative hearing commission shall start on the first business day after the date of the last date of any meeting with the mediator.

11. If a proceeding is pending before the administrative hearing commission concerning the subject of the demand for mediation, the franchisee shall also file a copy of the demand for mediation with the administrative hearing commission. The filing of a copy of the demand for mediation with the administrative hearing commission shall stay any further action by the administrative hearing commission, other than the issuance of the order required of the administrative hearing commission under subsection 1 of this section informing the franchisor that it shall not proceed with the initiation of its activity or activities until the administrative hearing commission issues its final decision or order. If the matter is not resolved after the meeting with the mediator, then either party may inform the administrative hearing commission that the matter is not resolved and the administrative hearing commission shall issue its order terminating the stay of its proceeding.

12. Within five business days after the date of receipt of the demand for mediation, the franchisor shall contact the franchisee or its legal representative reflected in the demand for mediation to exchange suggested lists of mediators. The parties shall mutually accept a mediator within two business days after the date of exchanging suggested lists of mediators. If the parties cannot agree on a mediator, then the presiding judge in Cole County or in the circuit court for the county in which the franchisee does business shall appoint the mediator. Within twenty days after the receipt of the demand for mediation, the parties shall meet with the mediator for the purpose of attempting to resolve the dispute. The meeting shall take place in this state at a location designated by the mediator. The mediator may extend the date of the meeting upon the agreement of the parties or upon good cause shown by either party.

13. The director of revenue shall require each franchisor to establish and maintain a panel of mediators who may serve as mediators for disputes that may arise in this state with its franchisees.

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(L. 1997 H.B. 516, A.L. 2001 H.B. 693, A.L. 2001 H.B. 575, A.L. 2010 H.B. 2198)