60-1430. Franchise; sale or transfer of ownership; franchisor; duties.

Notwithstanding the terms, provisions, or conditions of any agreement or franchise, subject to subdivision (2) of section 60-1429, in the event of the sale or a contract for sale or transfer of ownership of the franchisee's dealership by sale or transfer of the business or by stock transfer or in the event of change in the executive management of the franchisee's dealership, the franchisor shall give effect to such a change in the franchise unless (1) the transfer of the franchisee's license under the Motor Vehicle Industry Regulation Act is denied or the new owner is unable to obtain a license under the act, as the case may be, or (2) the proposed sale or transfer of the business or change of executive management will be substantially detrimental to the distribution of the franchisor's motor vehicles, combination motor vehicles and trailers, motorcycles, or trailer products or to competition in the community if the franchisor has given written notice of such fact to the franchisee within sixty days of receipt by the franchisor of information reasonably necessary to evaluate the proposed change.

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Annotations

In the event of sale or transfer of ownership of the franchisee's dealership by sale or transfer of the business, the franchisor shall give effect to such change in the franchise unless the transfer of the franchisee's license under the act is denied or the new owner is unable to obtain a license. S & T Motors v. General Motors Corp., 203 Neb. 188, 277 N.W.2d 701 (1979).

After the transfer of a franchise, the franchisor need not give effect to the contract for a change of ownership until it has had the opportunity to show that such a change would be detrimental to the distribution of the franchisor's motor vehicles. Kizzier Chevrolet Co. v. General Motors Corp., 705 F.2d 322 (8th Cir. 1983).

When the franchisee transfers its ownership, the franchisor need not recognize the transfer until after the board has had a chance to act on the issue of whether the transfer is detrimental to the distribution of franchisor's vehicles in the community. Kizzier Chevrolet Co. v. General Motors Corp., 705 F.2d 322 (8th Cir. 1983).