Utah Code 32B-14-401. Reasonable compensation — Arbitration
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(1)
Terms Used In Utah Code 32B-14-401
- Appeal: A request made after a trial, asking another court (usually the court of appeals) to decide whether the trial was conducted properly. To make such a request is "to appeal" or "to take an appeal." One who appeals is called the appellant.
- Distributorship agreement: means a written agreement between a supplier and a wholesaler pursuant to which the wholesaler has the right to purchase, resell, and distribute in a designated geographical area any brand of beer manufactured, imported, or distributed by the supplier. See Utah Code 32B-14-102
- Fair market value: The price at which an asset would change hands in a transaction between a willing, informed buyer and a willing, informed seller.
- Good cause: means the material failure by a supplier or a wholesaler to comply with an essential, reasonable, and lawful requirement imposed by a distributorship agreement if the failure occurs after the supplier or wholesaler acting in good faith provides notice of deficiency and an opportunity to correct in accordance with Part 2, Termination. See Utah Code 32B-14-102
- Member: means an individual who, after paying regular dues, has full privileges in an equity licensee or fraternal licensee. See Utah Code 32B-1-102
- Supplier: means a person who sells an alcoholic product to the department. See Utah Code 32B-1-102
- Writing: includes :(48)(a) printing;(48)(b) handwriting; and(48)(c) information stored in an electronic or other medium if the information is retrievable in a perceivable format. See Utah Code 68-3-12.5(1)(a) If a supplier violates Section 32B-14-201 or 32B-14-304, the supplier is liable to the wholesaler for the sum of:(1)(a)(i) the laid-in cost of inventory of the affected brands; and(1)(a)(ii) any diminution in the fair market value of the wholesaler’s business with relation to an affected brand.(1)(b) In determining fair market value, consideration shall be given to all elements of value, including good will and going concern value.
(2)
(2)(a) A distributorship agreement may require that any or all disputes between a supplier and a wholesaler be submitted to binding arbitration.
(2)(b) In the absence of an applicable arbitration provision in a distributorship agreement, either the supplier or the wholesaler may request arbitration if a supplier and a wholesaler are unable to mutually agree on:
(2)(b)(i) whether good cause exists for termination or nonrenewal;
(2)(b)(ii) whether the supplier unreasonably withheld approval of a sale or transfer under Section 32B-14-304; or
(2)(b)(iii) the reasonable compensation to be paid for the value of the wholesaler’s business in accordance with Subsection (1).
(2)(c) If a supplier or wholesaler requests arbitration under Subsection (2)(b) and the other party agrees to submit the matter to arbitration, an arbitration panel shall be created with the following members:
(2)(c)(i) one member selected by the supplier in a writing delivered to the wholesaler within 10 business days of the date arbitration was requested under Subsection (2)(b);
(2)(c)(ii) one member selected by the wholesaler in a writing delivered to the supplier within 10 business days of the date arbitration was requested under Subsection (2)(b); and
(2)(c)(iii) one member selected by the two arbitrators appointed under Subsections (2)(c)(i) and (ii).
(2)(d) If the arbitrators fail to choose a third arbitrator under Subsection (2)(c)(iii) within 10 business days of the day on which the arbitrators under Subsections (2)(c)(i) and (ii) are selected, a judge of a district court in the county in which the wholesaler’s principal place of business is located shall select the third arbitrator.
(2)(e) Arbitration costs shall be divided equally between the wholesaler and the supplier.
(2)(f) The award of the arbitration panel is binding on the parties unless appealed within 20 days from the date of the award.
(2)(g) Subject to the requirements of this chapter, arbitration and a proceeding on appeal are governed by Title 78B, Chapter 11, Utah Uniform Arbitration Act.