(a) The commission shall prescribe and provide forms to be used for applications for licenses and for the renewals thereof to be issued under the terms of this part, and require all applicants and their enfranchised manufacturers, as a condition precedent to the issuance of a license, to provide information touching on and concerning the applicant’s character, honesty, integrity, reputation, business relationships, and ability as the commission may deem necessary; provided, that every application for a new recreational vehicle dealer‘s license shall contain, in addition to any information the commission may require, a statement as to the following facts:

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Terms Used In Tennessee Code 55-17-405

  • Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
  • Commission: means the Tennessee motor vehicle commission. See Tennessee Code 55-17-401
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Dealer: means every person engaged in the business of buying, selling or exchanging vehicles of a type required to be registered and who has an established place of business for that purpose in this state. See Tennessee Code 55-8-101
  • Distributor: means any person who in whole or in part sells or distributes any new and unused recreational vehicles to recreational dealers or who maintains distributor representatives. See Tennessee Code 55-17-401
  • Established place of business: means a permanent structure or structures owned, leased, or rented by a recreational vehicle dealer providing signs, facilities, and office space used exclusively for buying, selling, displaying, advertising, demonstrating, servicing, or repairing recreational vehicles or functional or nonfunctional parts of recreational vehicles and where replacement parts, repair tools, and equipment as well as the books and records needed to conduct the business are kept. See Tennessee Code 55-17-401
  • Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
  • Lien: A claim against real or personal property in satisfaction of a debt.
  • Manufacturer: means any person who manufactures or assembles new and unused recreational vehicles, or who maintains factory representatives. See Tennessee Code 55-17-401
  • Owner: means a person who holds the legal title of a vehicle, or in the event a vehicle is the subject of an agreement for the conditional sale or lease thereof, with the right of purchase upon performance of the conditions stated in the agreement and with an immediate right of possession vested in the conditional vendee or lessee, or in the event a mortgagor of a vehicle is entitled to possession, then the conditional vendee or lessee or mortgagor shall be deemed the owner for the purpose of this chapter and chapter 10, parts 1-5 of this title. See Tennessee Code 55-8-101
  • Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
  • Person: means every natural person, partnership, corporation, association, trust, estate, or any other legal entity. See Tennessee Code 55-17-401
  • Precedent: A court decision in an earlier case with facts and law similar to a dispute currently before a court. Precedent will ordinarily govern the decision of a later similar case, unless a party can show that it was wrongly decided or that it differed in some significant way.
  • Sale: means the issuance, transfer, agreement for transfer, exchange, pledge, hypothecation, or mortgage in any form, whether by transfer in trust or otherwise, of any recreational vehicle or interest in such vehicle, as well as any option, subscription or other contract, or solicitation looking to sell, offer, or attempt to sell in any form, whether spoken or written. See Tennessee Code 55-17-401
  • State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
  • Street: means the entire width between boundary lines of every way when any part thereof is open to the use of the public for purposes of vehicular travel. See Tennessee Code 55-8-101
  • Vehicle: means every device in, upon or by which any person or property is or may be transported or drawn upon a highway, excepting devices used exclusively upon stationary rails or tracks. See Tennessee Code 55-8-101
  • Vehicle salesperson: means a person licensed as a motor vehicle salesperson pursuant to part 1 of this chapter. See Tennessee Code 55-17-401
(1) The applicant’s name and residential address and the trade name, if any, under which the applicant intends to conduct business;
(2) If the applicant is a partnership, each partner’s name and residential address, whether a limited or general partner, and the name under which the partnership business is to be conducted;
(3) If the applicant is a corporation, the name of the corporation and the name and address of each of its principal officers, directors, and all persons owning more than five percent (5%) of outstanding shares of stock issued by the corporation;
(4) The names of any inventory financers, including floor planners used by the dealership. Applicants shall provide this information to the commission and keep it current;
(5) A complete description, including the city, town, or village with the street and number, if any, of the permanent, established place of business and any other additional place or places of business as shall be operated and maintained by the applicant in conjunction with the permanent, established place of business;
(6) A financial statement prepared in accordance with generally accepted accounting principles by a certified public accountant or public accountant dated not earlier than twelve (12) months prior to the date of the application and copies of the most current financial information furnished to the manufacturer, distributor, or their representatives under the terms of any franchise agreements; and
(7) A duly executed service agreement on forms provided by the commission with a factory authorized service or repair garage within a reasonable distance from the applicant’s established place of business if the recreational vehicle dealer applicant does not have facilities at the dealer’s established place of business to service or repair recreational vehicles.
(b) All applications for licenses required to be obtained under this part shall be verified by oath or affirmation of the applicant or the applicants.
(c) All applications shall be accompanied by the payment of the fee prescribed by § 55-17-406. In the event that any application is denied or the license applied for is not issued, seventy-five percent (75%) of the license fee shall be refunded to the applicant or applicants.
(d) All licenses shall expire two (2) years from the date of issuance.
(e) Any change of address of a recreational vehicle dealer must be reported to the commission.
(f) When a vehicle salesperson desires to change employment from one dealer to another, that salesperson must submit such person‘s license to the commission for endorsement of change of employer and may become a salesperson at that person’s new place of employment upon submission of the license for endorsement of change of location and payment of any fees due.
(g)

(1) Each application for a license or renewal of a license of a recreational vehicle dealer shall be accompanied by evidence satisfactory to the commission that the dealer has a surety bond in the amount of at least fifty thousand dollars ($50,000) in force. A letter of credit shall not be satisfactory evidence of a surety bond in the required amount.
(2)

(A) The bond is for the benefit of any person who suffers loss because of either:

(i) Nonpayment by the dealer of a retail customer’s prepaid title, registration, or other related fees or taxes; or
(ii) The recreational vehicle dealer’s failure to deliver in conjunction with the sale of a recreational vehicle a valid recreational vehicle title certificate free and clear of any prior owner‘s interests and all liens except a lien created by or expressly assumed in writing by the buyer of the recreational vehicle.
(B) The aggregate liability of the surety to all persons shall in no event exceed the amount of this bond.
(3) In lieu of a corporate surety on the bond required by subdivision (g)(1), the commission may allow the recreational vehicle dealer to secure the bond by depositing collateral in the form of a certificate of deposit, as accepted and authorized by the banking laws of this state, that has a face value equal to the amount of the bond. The collateral may be deposited with or executed through any authorized state depository designated by the commission. Interest on any deposited certificate of deposit shall be payable to the dealer who has deposited it as collateral, or to a person as the recreational vehicle dealer or the certificate may direct.
(4) The surety bond must remain and continue in force for as long as the licensee remains licensed and must name the Tennessee motor vehicle commission as beneficiary. Upon notice of cancellation, the licensee shall either cease business operations until proof of minimum coverage is provided, or provide evidence of minimum coverage from another provider.
(5) Any surety is required to provide sixty (60) days’ notice of cancellation of the bond or certificate of deposit or letter of credit to the commission.
(6) No license so issued shall be transferable, and a separate license shall be required for each separate place of business and shall be prominently displayed in the place of business operated by the person to whom the license is issued.
(h)

(1) All applications for issuance or renewal of a recreational vehicle dealer license shall contain an attestation that the applicant will comply with each of the following requirements:

(A) The applicant shall maintain the surety bond required by subsection (g) in full force and effect during all times that the license is active; and
(B) The applicant shall notify the commission upon a change in ownership or location of the dealership as required by § 55-17-407.
(2) Additionally, all applications for issuance or renewal of a recreational vehicle dealer license shall contain the following statement, immediately following the attestation required by subdivision (h)(1):

FAILURE TO MAINTAIN A SURETY BOND AS REQUIRED BY T.C.A. § 55-17-405, OR NOTIFY THE TENNESSEE MOTOR VEHICLE COMMISSION OF A CHANGE IN THE OWNERSHIP OR LOCATION OF THE DEALERSHIP AS REQUIRED BY T.C.A. § 55-17-407, MAY RESULT IN THE ASSESSMENT OF A CIVIL PENALTY AND/OR SUSPENSION OR REVOCATION OF THE RECREATIONAL VEHICLE DEALER LICENSE.

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