Michigan Laws 445.1803 – Death of franchisee; devolution of franchise and lease or other agreement to designated successor or secondary designee; standards; limitation; notice; applicability of section
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(1) Following the death of a franchisee, who is not a trial franchise retailer, the franchise and any lease or other agreement in connection with the franchise shall devolve to the designated successor or secondary designee of the franchisee if prior to the franchisee’s death the franchisee notified the franchisor in writing of the name, address, and relationship of the designated successor and secondary designee. The designated successor and secondary designee shall meet the reasonable standards normally required by the franchisor of a prospective franchisee at the time of the franchisee’s death.
(2) The franchise shall devolve to the secondary designee in the event the designated successor is unable to operate the franchise.
Terms Used In Michigan Laws 445.1803
- Franchise: means a contract between a refiner and a retailer or between a distributor and a retailer, under which a refiner or distributor authorizes or permits a retailer to use, in connection with the sale, consignment, or distribution of gasoline, diesel, gasohol, or aviation fuel, a trademark that is owned or controlled by a refiner, or by a refiner that supplies fuel to the distributor that authorizes or permits such use. See Michigan Laws 445.1802
- Franchisee: means a retailer who is authorized or permitted, under a franchise, to use a trademark in connection with the sale, consignment, or distribution of fuel. See Michigan Laws 445.1802
- Franchisor: means a refiner or distributor who authorizes or permits, under a franchise, a retailer to use a trademark in connection with the sale, consignment, or distribution of fuel. See Michigan Laws 445.1802
- in writing: shall be construed to include printing, engraving, and lithographing; except that if the written signature of a person is required by law, the signature shall be the proper handwriting of the person or, if the person is unable to write, the person's proper mark, which may be, unless otherwise expressly prohibited by law, a clear and classifiable fingerprint of the person made with ink or another substance. See Michigan Laws 8.3q
- Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
- Retailer: means any person who purchases motor fuel for sale to the general public for ultimate consumption. See Michigan Laws 445.1802
- shall not apply: means that the pertinent provision is not operative as to certain persons or things or in conjunction with a particular date or dates. See Michigan Laws 8.4c
- Trial: A hearing that takes place when the defendant pleads "not guilty" and witnesses are required to come to court to give evidence.
(3) The designated successor and secondary designee shall be limited to, unless otherwise agreed to by the parties, the franchisee’s surviving spouse, adult child, stepchild, son-in-law, or daughter-in-law. The designated successor or secondary designee shall not be a previously terminated or nonrenewed retailer of the franchisor.
(4) Within 30 days of the death of the franchisee, the designated successor or secondary designee shall give written notice to the franchisor of his or her election to assume and to operate the franchise, and shall promptly provide any information reasonably requested by the franchisor. If the designated successor or secondary designee fails to give the notice, the franchisor gives the designated successor or secondary designee written notice, specifying the reasons, that the designated successor or secondary designee fails to meet at least 1 of the reasonable standards normally required by the franchisor of a prospective franchisee, or the franchise has not been operated in accordance with the terms and conditions contained in the franchise by the franchisee, then the designated successor or secondary designee shall have no further rights or obligations under the franchise.
(5) This section shall not apply to a franchise where a mutual termination has been executed or an outstanding notice of termination or nonrenewal has been given by the franchisor prior to the death of the franchisee.