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Home > Statutes > Usa Alabama
USA Statutes : alabama
Title : Title 28 INTOXICATING LIQUOR, MALT BEVERAGES AND WINE.
Chapter : Chapter 09 BUSINESS RELATIONS BETWEEN WHOLESALERS AND SUPPLIERS OF BEER.
Section 28-9-1

Section 28-9-1
Legislative intent and purpose.

The legislative intent and purpose of this chapter is to provide a structure for the business relations between a wholesaler and a supplier of beer. Regulation in this area is considered necessary for the following reasons:

(1) To maintain stability and healthy competition in the beer industry in this state.

(2) To promote and maintain a sound, stable, and viable three-tier system of distribution of beer to the public.

(3) To promote the public health, safety, and welfare.



(Acts 1988, No. 88-80, p. 87, §1.)Section 28-9-10

Section 28-9-10
Application, transferee of wholesaler's business; successor of supplier's business.

(a) This chapter shall apply to agreements in existence on March 3, 1988, as well as agreements entered into or renewed after March 3, 1988.

(b) A transferee of a wholesaler that continues in business as a wholesaler shall have the benefit of and be bound by all terms and conditions of the agreement with the supplier in effect on the date of the transfer; provided, however, a transfer of a wholesaler's business which requires supplier's consent or approval but is disapproved by the supplier shall be null and void.

(c) A successor to a supplier that continues in business as a supplier shall be bound by all terms and conditions of each agreement of the supplier in effect on the date of succession.



(Acts 1988, No. 88-80, p. 87, §10.)Section 28-9-11

Section 28-9-11
Liabilities and duties of supplier; action for damages; declaratory judgment and injunctive relief; remedies.

(a) If a supplier engages in conduct prohibited under this chapter, a wholesaler with which the supplier has an agreement may maintain a civil action against the supplier to recover actual damages reasonably incurred as the result of the prohibited conduct. If a wholesaler engages in conduct prohibited under this chapter, a supplier with which the wholesaler has an agreement may maintain a civil action against the wholesaler to recover actual damages reasonably incurred as the result of the prohibited conduct.

(b) A supplier that violates any provision of this chapter shall be liable for all actual damages and all court costs and, in the court's discretion, reasonable attorney fees incurred by a wholesaler as a result of that violation. A wholesaler that violates any provision of this chapter shall be liable for all actual damages and all court costs and, in the court's discretion, reasonable attorney fees incurred by the supplier as a result of that violation.

(c) This chapter imposes upon a supplier the duty to deal fairly and in good faith with a wholesaler which has entered into an agreement with the supplier to purchase and sell a brand or brands of beer sold by the supplier. Except as otherwise provided in this chapter, if a court finds that a supplier has intentionally, consciously or deliberately acted or failed to act which was not in good faith or was in bad faith either in (1) effecting an amendment, modification, termination, cancellation, or nonrenewal of any agreement; or (2) unreasonably interfering with, preventing or unreasonably delaying the transfer of the wholesaler's business where approval of the proposed transferee is not required by this chapter; or (3) unreasonably withholding its consent to or approval of any assignment, transfer, or sale of a wholesaler's business, where approval of the proposed transferee is required by this chapter; it may, upon proof thereof by clear and convincing evidence as defined in Section 6-11-20, award exemplary or punitive damages, as well as actual damages, court costs, and reasonable attorney fees to the wholesaler who has been damaged by the action or failure to act of the supplier. Such actions or failure to act on the part of the supplier shall constitute the tort of bad faith, and the amount of any award of punitive damages and the review thereof by the trial or appellate court shall be governed by the provisions of Section 6-11-25.

(d) A supplier or wholesaler may bring an action for declaratory judgment for determination of any controversy arising pursuant to this chapter.

(e) Upon proper application to the court, a supplier or wholesaler may obtain injunctive relief against any violation of this chapter. If the court grants injunctive relief or issues a temporary restraining order, bond shall not be required to be posted.

(f) The remedies provided by this section are nonexclusive, and nothing contained herein shall abolish any cause of action or remedy available to the supplier or the wholesaler existing on March 3, 1988.

(g) Any legal action taken under this chapter, or in a dispute arising out of an agreement or breach thereof, or over the provisions of an agreement shall be filed in a court, state or federal, located in Alabama, which state court is located in, or which federal court has jurisdiction and venue of, the county in which the wholesaler maintains its principal place of business in this state.



(Acts 1988, No. 88-80, p. 87, §11.)Section 28-9-2

Section 28-9-2
Definitions.

(a) The following words or phrases, or the plural thereof, whenever they appear in this chapter, unless the context clearly requires otherwise, shall have the meanings ascribed to them in this section:

(1) AGREEMENT. Any agreement between a wholesaler and a supplier, whether oral or written, whereby a wholesaler is granted the right to purchase and sell a brand or brands of beer sold by a supplier.

(2) ANCILLARY BUSINESS. A business owned by a wholesaler, by a substantial stockholder of a wholesaler, or by a substantial partner of a wholesaler the primary business of which is directly related to the transporting, storing, or marketing of the brand or brands of beer of a supplier with whom the wholesaler has an agreement; or a business owned by a wholesaler, a substantial stockholder of a wholesaler or a substantial partner of a wholesaler which recycles empty beverage containers.

(3) DESIGNATED MEMBER. The spouse, child, grandchild, parent, brother or sister of a deceased individual who owned an interest, including a controlling interest, in a wholesaler; or any person who inherits the deceased individual's ownership interest in the wholesaler under the terms of the deceased individual's will, or under the laws of intestate succession of this state; or any person who or entity which has otherwise, by designation in writing by the deceased individual, succeeded the deceased individual in the wholesaler's business, or has succeeded to the deceased individual's ownership interest in the wholesaler pursuant to a written contract or instrument; and also includes the appointed and qualified personal representative and the testamentary trustee of a deceased individual owning an ownership interest in a wholesaler. Designated member also includes the person appointed by a court as the guardian or conservator of the property of an incapacitated individual owning an ownership interest in a wholesaler.

(4) GOOD FAITH. Honesty in fact and the observance of reasonable commercial standards of fair dealing in the trade, as defined in and interpreted under the Uniform Commercial Code, Section 7-2-103.

(5) REASONABLE QUALIFICATIONS. The standard of the reasonable criteria established and consistently used by the respective supplier for Alabama wholesalers that entered into, continued or renewed an agreement with the supplier during a period of 24 months prior to the proposed transfer of the wholesaler's business, or for Alabama wholesalers who have changed managers or designated managers during a period of 24 months prior to the proposed change in manager or successor manager of the wholesaler's business.

(6) RETALIATORY ACTION. Includes, but is not limited to, the refusal to continue an agreement, or a material reduction in the quality of service or quantity of products available to a wholesaler under an agreement, which refusal or reduction is not made in good faith.

(7) SALES TERRITORY. An area of exclusive sales responsibility for the brand or brands of beer sold by a supplier as designated by an agreement.

(8) SUBSTANTIAL STOCKHOLDER or SUBSTANTIAL PARTNER. A stockholder of or partner in the wholesaler who owns an interest of 25 percent or more of the partnership or of the capital stock of a corporate wholesaler.

(9) SUPPLIER. A manufacturer or importer of beer licensed by the board.

(10) TRANSFER OF WHOLESALER's BUSINESS. The voluntary sale, assignment or other transfer of all or control of the business or all or substantially all of the assets of the wholesaler, or all or control of the capital stock of the wholesaler, including without limitation the sale or other transfer of capital stock or assets by merger, consolidation or dissolution, or of the capital stock of the parent corporation, or of the capital stock or beneficial ownership of any other entity owning or controlling the wholesaler.

(11) WHOLESALER. A wholesaler of beer licensed by the board.

(b) Other words and phrases used in this chapter shall have the meanings ascribed to them in Section 28-3-1, as amended, and any acts amendatory thereof, supplementary thereto or substituted therefor, unless the context clearly requires otherwise.



(Acts 1988, No. 88-80, p. 87, §2; Acts 1989, No. 89-525, p. 1074, §1.)Section 28-9-3

Section 28-9-3
Sales by beer suppliers through wholesalers; exclusive sales territory.

Each supplier of beer licensed by the board authorizing such licensee to sell its beer within the State of Alabama shall sell its beer through wholesaler licensees of the board, and shall grant in writing to each of its wholesalers an exclusive sales territory in accordance with the provisions of Act No. 84-374 (Acts 1984), appearing as Chapter 8, Title 28, as amended.



(Acts 1988, No. 88-80, p. 87, §3.)Section 28-9-4

Section 28-9-4
Prohibited acts - Suppliers.

A supplier is prohibited from doing the following:

(1) Fail to provide each wholesaler of the supplier's brand or brands with a written agreement which contains in total the supplier's agreement with each wholesaler, and designates a specific exclusive sales territory. Any agreement which is in existence on March 3, 1988, shall be renewed consistent with this chapter; provided, that this chapter may be incorporated by reference in the agreement. Provided, however, nothing contained herein shall prevent a supplier from appointing, one time for a period not to exceed 90 days, a wholesaler to temporarily service a sales territory not designated to another wholesaler, until such time as a wholesaler is appointed by the supplier; and such wholesaler who is designated to service the sales territory during this period of temporary service shall not be in violation of the chapter, and, with respect to the temporary service territory, shall not have any of the rights provided under Sections 28-9-6 and 28-9-8.

(2) Fix, maintain, or establish the price at which a wholesaler shall sell any beer.

(3) Enter into an additional agreement with any other wholesaler for, or to sell to any other wholesaler, the same brand or brands of beer in the same territory or any portion thereof, or to sell directly to any retailer in this state.

(4) Coerce, or attempt to coerce, any wholesaler to accept delivery of any beer, or other commodity which has not been ordered by the wholesaler. Provided, however, a supplier may impose reasonable inventory requirements upon a wholesaler if the requirements are made in good faith and are generally applied to other similarly situated wholesalers having an agreement with the supplier.

(5) Coerce, or attempt to coerce, any wholesaler to accept delivery of any beer, or other commodity ordered by a wholesaler if the order was canceled by the wholesaler.

(6) Coerce, or attempt to coerce, any wholesaler to do any illegal act or to violate any law or regulation by threatening to amend, modify, cancel, terminate, or refuse to renew any agreement existing between the supplier and wholesaler.

(7) Require a wholesaler to assent to any condition, stipulation, or provision limiting the wholesaler's right to sell the brand or brands of beer or other products of any other supplier unless the acquisition of the brand or brands or products of another supplier would materially impair or adversely affect the wholesaler's quality of service, sales or ability to compete effectively in representing the brand or brands of the supplier presently being sold by the wholesaler; provided the supplier shall have the burden of proving that such acquisition of such other brand or brands or products would have such effect.

(8) Require a wholesaler to purchase one or more brands of beer or other products in order for the wholesaler to purchase another brand or brands of beer for any reason. Provided, however, a wholesaler that has agreed to distribute a brand or brands before March 3, 1988, shall continue to distribute the brand or brands in conformance with this chapter.

(9) Request a wholesaler to submit audited profit and loss statements, balance sheets, or financial records as a condition of renewal or continuation of an agreement.

(10) Withhold delivery of beer ordered by a wholesaler, or change a wholesaler's quota of a brand or brands if the withholding or change is not made in good faith.

(11) Require a wholesaler by any means directly to participate in or contribute to any local or national advertising fund controlled directly or indirectly by a supplier.

(12) Take any retaliatory action against a wholesaler that files a complaint regarding an alleged violation by the supplier of federal, state or local law or an administrative rule.

(13) Require or prohibit, without just and reasonable cause, any change in the manager or successor manager of any wholesaler who has been approved by the supplier as of or subsequent to March 3, 1988. Should a wholesaler change an approved manager or successor manager, a supplier shall not require or prohibit the change unless the person selected by the wholesaler fails to meet the nondiscriminatory, material and reasonable standards and qualifications for managers of Alabama wholesalers of the supplier which standards and qualifications previously have been consistently applied to Alabama wholesalers by the supplier. Provided, however, the supplier shall have the burden of proving that such person fails to meet such standards and qualifications which are nondiscriminatory, material and reasonable and have been consistently applied to Alabama wholesalers.

(14) Upon written notice of intent to transfer the wholesaler's business, interfere with, prevent, or unreasonably delay (not to exceed 30 days) the transfer of the wholesaler's business if the proposed transferee is a designated member.

(15) Upon written notice of intent to transfer the wholesaler's business other than to a designated member, withhold consent to or approval of, or unreasonably delay (not to exceed 30 days after receipt of all material information reasonably requested) a response to a request by the wholesaler for, any transfer of a wholesaler's business if the proposed transferee meets the nondiscriminatory, material and reasonable qualifications and standards required by the supplier for Alabama wholesalers. Provided, however, the supplier shall have the burden of proving that the proposed transferee does not meet such standards and qualifications which are nondiscriminatory, material and reasonable and have been consistently applied to Alabama wholesalers.

(16) Restrict or inhibit, directly or indirectly, the right of free association among wholesalers for any lawful purpose.



(Acts 1988, No. 88-80, p. 87, §4.)Section 28-9-5

Section 28-9-5
Prohibited acts - Wholesalers.

A wholesaler is prohibited from doing the following:

(1) Fail to devote reasonable efforts and resources, within supplier's designated sales territory, to the sale and distribution of all the supplier's brands of beer which the wholesaler has been granted the right to sell or distribute.

(2) Sell or deliver beer to a retail licensee located outside the sales territory designated to the wholesaler by the supplier of a particular brand or brands of beer. Provided, however, during periods of temporary service interruptions impacting a particular sales territory, a wholesaler who normally services the impacted sales territory shall file with the board and give to the affected supplier written notice designating the specific licensed wholesaler or wholesalers, not disapproved by the supplier, who will service the sales territory during the period of temporary service interruption and the approximate length of time of the service interruption. Each wholesaler designated to temporarily service the sales territory shall be a wholesaler who has a current written agreement with a supplier for the brand or brands affected. When the temporary service interruption is over, the wholesaler who normally services the sales territory shall notify in writing the board, the supplier and the wholesaler, or wholesalers, servicing the sales territory on a temporary basis of this fact, and any wholesaler servicing the sales territory on a temporary basis shall cease servicing the sales territory upon receipt of the notice. A wholesaler who is designated to service the impacted sales territory during the period of temporary service shall not be in violation of this chapter, and, with respect to the temporary service territory, shall not have any of the rights provided under Sections 28-9-6 and 28-9-8.

(3) Transfer the wholesaler's business without giving the supplier written notice of intent to transfer the wholesaler's business and, where required by this chapter, receiving the supplier's approval for the proposed transfer. Provided, consent or approval for the supplier shall not be required of any transfer of the wholesaler's business to a designated member, or any transfer of less than control of the wholesaler's business. Provided, however, that the wholesaler shall give the supplier written notice of any change in ownership of the wholesaler.



(Acts 1988, No. 88-80, p. 87, §5; Acts 1989, No. 89-525, p. 1074, §1.)Section 28-9-6

Section 28-9-6
Amendment, cancellation, etc., of agreements; proof of good faith; notice; good cause.

(a) Notwithstanding any agreement and except as otherwise provided for in this chapter, a supplier shall not: amend or modify an agreement; cause a wholesaler to resign from an agreement; or cancel, terminate, fail to renew, or refuse to continue under an agreement, unless the supplier has complied with all of the following:

(1) Has satisfied the applicable notice requirements of subsection (c) of this section.

(2) Has acted in good faith.

(3) Has good cause for the amendment, modification, cancellation, termination, nonrenewal, discontinuance, or forced resignation.

(b) For each amendment, modification, termination, cancellation, nonrenewal, or discontinuance, the supplier shall have the burden of proving that it has acted in good faith, that the notice requirements under this section have been complied with, and that there was good cause for the amendment, modification, termination, cancellation, nonrenewal, or discontinuance.

(c) Notwithstanding any agreement and except as otherwise provided in this section, and in addition to the time limits set forth in subdivision (d)(5) of this section, the supplier shall furnish written notice of the amendment, modification, termination, cancellation, nonrenewal, or discontinuance of an agreement to the wholesaler not less than 60 days before the effective date of the amendment, modification, termination, cancellation, nonrenewal, or discontinuance. The notice shall be by certified mail and shall contain all of the following:

(1) A statement of intention to amend, modify, terminate, cancel, not renew, or discontinue the agreement.

(2) A statement of the reason for the amendment, modification, termination, cancellation, nonrenewal, or discontinuance.

(3) The date on which the amendment, modification, termination, cancellation, nonrenewal, or discontinuance takes effect.

(d) Notwithstanding any agreement, good cause shall exist for the purposes of a termination, cancellation, nonrenewal, or discontinuance under subdivision (a)(3) of this section when all of the following occur:

(1) There is a failure by the wholesaler to comply with a provision of the agreement which is both reasonable and of material significance to the business relationship between the wholesaler and the supplier.

(2) The supplier first acquired knowledge of the failure described in subdivision (1) not more than 18 months before the date notification was given pursuant to subdivision (a)(1) of this section.

(3) The wholesaler was given notice by the supplier of failure to comply with the agreement.

(4) The wholesaler was afforded a reasonable opportunity to assert good faith efforts to comply with agreement within the time limits as provided for in subdivision (d)(5) of this section.

(5) The wholesaler has been afforded 30 days in which to submit a plan of corrective action to comply with the agreement and an additional 120 days to cure such noncompliance in accordance with the plan.

(e) Notwithstanding subsections (a) and (c) of this section, a supplier may terminate, cancel, fail to renew, or discontinue an agreement immediately upon written notice given in the manner and containing the information required by subsection (c) of this section if any of the following occur:

(1) Insolvency of the wholesaler, the filing of any petition by or against the wholesaler under any bankruptcy or receivership law, or the assignment for the benefit of creditors or dissolution or liquidation of the wholesaler which materially affects the wholesaler's ability to remain in business.

(2) Revocation or suspension of the wholesaler's state or federal license by the appropriate regulatory agency whereby the wholesaler cannot service the wholesaler's sales territory for more than 61 days.

(3) The wholesaler, or a partner or an individual who owns 10 percent or more of the partnership or stock of a corporate wholesaler, has been convicted of a felony under the United States Code or the laws of any state which reasonably may adversely affect the good will or interest of the wholesaler or supplier. However, an existing stockholder or stockholders, or partner or partners, or a designated member or members, shall have, subject to the provisions of this chapter, the right to purchase the partnership interest or the stock of the offending partner or stockholder prior to the conviction of the offending partner or stockholder and if the sale is completed prior to conviction the provisions of this subdivision (3) shall not apply.

(f) Notwithstanding subsections (a), (c) and (e) of this section, upon not less than 15 days' prior written notice given in the manner and containing the information required by subsection (c) of this section, a supplier may terminate, cancel, fail to renew, or discontinue an agreement if any of the following events occur:

(1) There was intentional fraudulent conduct relating to a material matter on the part of the wholesaler in dealings with the supplier. Provided, however, the supplier shall have the burden of proving intentional fraudulent conduct relating to a material matter on the part of the wholesaler.

(2) The wholesaler failed to confine to the designated sales territory its sales of a brand or brands to retailers. Provided this subdivision does not apply if there is a dispute between two or more wholesalers as to the boundaries of the assigned territory, and the boundaries cannot be determined by a reading of the description contained in the agreements between the supplier and the wholesalers.

(3) A wholesaler who has failed to pay for beer ordered and delivered in accordance with established terms with the supplier fails to make full payment within two business days after receipt of written notice of the delinquency and demand for immediate payment from the supplier.

(4) A wholesaler intentionally has made a transfer of wholesaler's business, other than a transfer to a designated member or pursuant to a loan agreement or debt instrument, without prior written notice to the supplier, and has failed, within 30 days from the receipt of written notice from the supplier of its intent to terminate on the ground of such transfer, to reverse said transfer of wholesaler's business.

(5) A wholesaler intentionally has made a transfer of wholesaler's business, other than a transfer to a designated member, although the wholesaler has prior to said transfer received from supplier a timely notice of disapproval of said transfer in accordance with this chapter.

(6) The wholesaler intentionally ceases, or ceases for a period of more than 61 days, to carry on business with respect to any of supplier's brand or brands previously serviced by wholesaler in its territory designated by the supplier, unless such cessation is due to force majeure or to labor dispute and the wholesaler has made good faith efforts to overcome such events. Provided, however, this shall affect only that brand or brands with respect to which the wholesaler ceased to carry on business.

(g) Notwithstanding subsections (a), (c), (e), and (f) of this section, a supplier may terminate, cancel, not renew, or discontinue an agreement upon not less than 30 days' prior written notice if the supplier discontinues production or discontinues distribution in this state of all the brands sold by the supplier to the wholesaler. Provided, however, nothing in this section shall prohibit a supplier from: (1) upon not less than 30 days' notice, discontinuing the distribution of any particular brand or package of beer; or (2) conducting test marketing of a new brand of beer or of a brand of beer which is not currently being sold in this state, provided that the supplier has notified the board in writing of its plans to test market, which notice shall describe the market area in which the test shall be conducted; the name or names of the wholesaler or wholesalers who will be selling the beer; the name or names of the brand of beer being tested; and the period of time, not to exceed 18 months, during which the testing will take place.



(Acts 1988, No. 88-80, p. 87, §6; Acts 1989, No. 89-525, p. 1074, §1.)Section 28-9-7

Section 28-9-7
Transfer of wholesaler's business.

(a) Upon written notice of intent to transfer the wholesaler's business, any individual owning or deceased individual who owned an interest in a wholesaler may transfer the wholesaler's business to a designated member, or to any other person who meets the nondiscriminatory, material and reasonable qualifications and standards required by the supplier for Alabama wholesalers. The consent or approval of the supplier shall not be required of any transfer of the wholesaler's business, including the assignment of wholesaler's rights under the agreement, to a designated member or shall not be withheld or unreasonably delayed to a proposed transferee (other than a designated member) who meets such nondiscriminatory, material and reasonable qualifications and standards. Provided, however, the supplier shall have the burden of proving that the proposed transferee fails to meet such qualifications and standards which are nondiscriminatory, material and reasonable and consistently applied to Alabama wholesalers by the supplier. Provided, such designated member or transferee shall in no event be qualified as a transferee, without the written approval or consent of the supplier, where such proposed transferee shall have been involved in any of the following:

(1) Insolvency, filing of any voluntary or involuntary petition under any bankruptcy or receivership law, or execution of any assignment for the benefit of creditors; or

(2) Revocation or suspension of an alcoholic beverage license by the regulatory agency of the United States Government or any state, whereby service was interrupted for more than 61 days; or

(3) Convicted of a felony under the United States Code or the laws of any state, which reasonably may adversely affect the good will or interest of the wholesaler or supplier; or

(4) Had an agreement involuntarily terminated, cancelled, not renewed, or discontinued by a supplier for good cause.

(b) The supplier shall not interfere with, prevent or unreasonably delay the transfer of the wholesaler's business, including an assignment of wholesaler's rights under the agreement, if the proposed transferee is a designated member, or if the transferee other than a designated member meets such nondiscriminatory, material and reasonable qualifications and standards required by the supplier for Alabama wholesalers. Where the transferee is other than a designated member, the supplier may in good faith and for good cause related to the reasonable qualifications refuse to accept the transfer of wholesaler's business or the assignment of wholesaler's rights under the agreement. The supplier shall have the burden proving that it has acted in good faith and that there was good cause for failure to accept or consent to the transfer of the wholesaler's business or the assignment of wholesaler's rights under the agreement.



(Acts 1988, No. 88-80, p. 87, §7; Acts 1989, No. 89-525, p. 1074, §1.)Section 28-9-8

Section 28-9-8
Liability of supplier for acts diminishing value of wholesaler's business; arbitration procedures; determination of amount of compensation; cost of arbitration; default of arbitration procedures.

(a) Except as provided for in this chapter, a supplier that has amended, modified, canceled, terminated, or refused to renew any agreement; or has caused a wholesaler to resign from an agreement; or has interfered with, prevented or unreasonably delayed, or where required by this chapter, has withheld or unreasonably delayed consent to or approval of, any assignment or transfer of a wholesaler's business, shall pay the wholesaler reasonable compensation for the diminished value of the wholesaler's business, including any ancillary business which has been negatively affected by the act of the supplier. The value of the wholesaler's business or ancillary business shall include, but not be limited to, any good will. Provided, however, nothing contained in this chapter shall give rise to a claim against the supplier or wholesaler by any proposed purchaser of wholesaler's business.

(b) Should either party, at any time, determine that mutual agreement on the amount of reasonable compensation cannot be reached, the supplier or the wholesaler may send by certified mail, return receipt requested, written notice to the other party declaring its intention to proceed with arbitration. Arbitration shall proceed only by mutual agreement of both parties.

(c) Not more than 10 business days after the notice to enter into arbitration has been delivered, the other party shall send written notice to the requesting party declaring its intention either to proceed or not to proceed with arbitration. Should the other party fail to respond within the 10 business days, it shall be conclusively presumed that said party shall have agreed to arbitration.

(d) The matter of determining the amount of compensation may, by agreement of the parties, be submitted to a three-member arbitration panel consisting of one representative selected by the supplier but unassociated with the affected supplier; one wholesaler representative selected by the wholesaler but unassociated with the wholesaler; and an impartial arbitrator.

(e) Not more than 10 business days after mutual agreement of both parties has been reached to arbitrate, each party shall designate, in writing, its one arbitrator representative and the party initiating arbitration shall request, in writing, a list of five arbitrators from the American Arbitration Association or its successor and request that the list shall be mailed to each party by certified mail, return receipt requested. Not more than 10 business days after the receipt of the list of five choices, the wholesaler arbitrator and the supplier arbitrator shall strike and disqualify up to two names each from the list. Should either party fail to respond within the 10 business days or should more than one name remain after the strikes, the American Arbitration Association shall make the selection of the impartial arbitrator from the names not stricken from said list.

(f) Not more than 30 days after the final selection of the arbitration panel is made, the arbitration panel shall convene to decide the dispute. The panel shall conclude the arbitration within 20 days after the arbitration panel convenes and shall render a decision by majority vote of the arbitrators within 20 days from the conclusion of the arbitration. The award of the arbitration panel shall be final and binding on the parties as to the amount of compensation for said diminished value.

(g) The cost of the impartial arbitrator, the stenographer, and the meeting site shall be equally divided between the wholesaler and the supplier. All other costs shall be paid by the party incurring them.

(h) After both parties have agreed to arbitrate should either party, except by mutual agreement, fail to abide by the time limitations as prescribed in subsections (c), (e) and (f) of this section, or fail or refuse to make the selection of any arbitrators, or fail to participate in the arbitration hearings, the other party shall make the selection of its arbitrator and proceed to arbitration. The party who has failed or refused to comply as prescribed in this section shall be considered to be in default. Any party considered to be in default pursuant to this subsection shall have waived any and all rights the party would have had in the arbitration and shall be considered to have consented to the determination of the arbitration panel.



(Acts 1988, No. 88-80, p. 87, §8; Acts 1989, No. 89-525, p. 1074, §1.)Section 28-9-9

Section 28-9-9
Waiver of rights; good faith dispute settlements.

A wholesaler may not waive any of the rights granted in any provision of this chapter and the provisions of any agreement which would have such an effect shall be null and void. Nothing in this chapter shall be construed to limit or prohibit good faith dispute settlements voluntarily entered into by the parties.



(Acts 1988, No. 88-80, p. 87, §9.)
 
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