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Wyckoff Chrysler Plymouth, Inc. v. Butler Chrysler Plymouth Jeep, Inc.

OAL Docket No. MFC 1197-98 (Motor Vehicle Franchise Committee 1998)

FRANCHISES—An automobile franchisee located within eight miles of a proposed new franchisee has the exclusive right to object to the grant of the new franchise even if it is in common ownership with the new dealership and even if it thereby precludes a more remotely located dealership from objecting.

An automobile franchisee claimed a right under New Jersey law to object to the grant of a new franchise by its franchisor, based on the proposed location of the new establishment. The New Jersey statute grants a “same line” franchisee located within an eight mile radius the exclusive right to object, but if there is no potential objector within an eight mile radius, a franchisee within a fourteen mile radius may do so. Here, the complaining franchisee, located more than eight, but fewer than fourteen miles away, claimed that it could object to the grant of the new franchise because the franchisee within an eight mile radius was owned by the same individual as the newly proposed franchisee. The Court dismissed the complaining franchisee’s claim. The Court found that the owner of the proposed franchise did not own a majority of the interest in the established franchise. The Court also found that the statute does not create an exception in cases where the ownership is the same. The Court declined to carve out such an exception since the language of the statute was clear and there was no indication of any legislative intent to create the exception.


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