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Monmouth Chrysler-Plymouth Inc. v. Chrysler Corp.

Decided: July 26, 1985.

MONMOUTH CHRYSLER-PLYMOUTH, INC., PETITIONER-RESPONDENT,
v.
CHRYSLER CORPORATION, RESPONDENT-APPELLANT, AND RITTENHOUSE LINCOLN-MERCURY, INC., INTERVENOR-APPELLANT



On appeal from the New Jersey Motor Vehicle Franchise Committee.

Antell, J. H. Coleman and Simpson. The opinion of the court was delivered by, Antell, P.J.A.D.

Antell

This is an appeal by respondent Chrysler Corporation (hereinafter "Chrysler") and intervenor Rittenhouse Lincoln-Mercury, Inc. (hereinafter "Rittenhouse") from a determination by the Motor Vehicle Franchise Committee of the Department of Law and Public Safety precluding Chrysler from enfranchising Rittenhouse as a Chrysler and Plymouth dealer. The decision of the Committee, which affirmed the findings and conclusions of an Administrative Law Judge (hereinafter "ALJ"), upheld the protest of Monmouth Chrysler-Plymouth, Inc. (hereinafter "Monmouth"), an existing Chrysler franchisee.

Under N.J.S.A. 56:10-17 the Motor Vehicle Franchise Committee (hereinafter "Committee") was created to adjudicate disputes between motor vehicle franchisors and franchisees concerning the establishment of new motor vehicle dealerships within a given geographical area. N.J.S.A. 56:10-19 obliges motor vehicle franchisors to give its existing franchisees "in the same line make within the relevant market area 90 days'

advance written notice of its intention to grant, relocate, reopen or reactivate a franchise of the same line make. . . ." The "relevant market area" is defined by N.J.S.A. 56:10-16f as "a geographic area 8 miles in radius from a proposed franchise or business. . . ." Within 30 days after receiving the franchisor's notice, or within 30 days after the end of any appeal procedure provided by the franchisor, any franchisee entitled to receive the notice may file a protest with the Committee, setting forth all reasons for its objection. To guide the Committee in determining the merits of the protest after a hearing, N.J.S.A. 56:10-18 provides that:

No motor vehicle franchisor shall grant, relocate, reopen or reactivate a business, for the purpose of doing business on the retail level, if the franchise or business will be injurious as determined pursuant to section 8 of this act.

Section 8 of the act is found in N.J.S.A. 56:10-23. It provides:

In determining whether the grant, relocation, reopening or reactivation of a franchise or establishment, relocation, reopening or reactivation of a business will be injurious to existing franchisees and to the public interest, the committee may consider, but shall not be limited to considering the following:

a. The effect that the proposed franchise or business would have on the provision of stable, adequate and reliable sales and service to purchasers of vehicles in the same line make in the relevant market area;

b. The effect that the proposed franchise or business would have on the stability of existing franchisees in the same line make in the relevant market area;

c. Whether the existing franchisees in the same line make in the relevant market area are providing adequate and convenient consumer service for motor vehicles of the line make in the relevant market area, which shall include the adequacy of motor vehicle sales and service facilities, ...


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