Termination of Gas Station Contracts: Renewal Protections Afforded by The NJ Franchise Practices Act
If you are a service station operator / owner‚ there are various protections that are afforded to you under the New Jersey Franchise Practices Act. These protections are especially useful when dealing with the termination of your franchise rights‚ including rights under Commissioner Marketer Agreements. When faced with termination issues relating to your gas station / service station‚ some important factors to evaluate and consider‚ include:
- The Nature of the Relationship. In the State of New Jersey the methods by which a service station is owned and operated varies from station to station. Some service station owners are independent dealers‚ some are franchisees pursuant to the terms of a franchise agreement and others are franchisees by operation of law and pursuant to the terms of a Commissioner Marketer Agreement ("CMA"). In the State of New Jersey CMA's are recognized as the equivalent of franchise agreements and station operators who possess a CMA are afforded protections under the New Jersey Franchise Practices Act;
- Understanding your Legal Rights. Once you assess your legal status (i.e.‚ whether or not you are an independent dealer‚ franchisee‚ or something else) you should now be ready to discuss and review the legal protections that may or may not be available to you. For example independent dealers may not qualify as franchisees and thereby not be afforded protection under the New Jersey Franchise Practices Act. However these independent dealers may be afforded protection under the Petroleum Marketing Practices Act. Franchisees (including CMA's) are afforded protection under the New Jersey Franchise Practices Act.
You Have Options and Protections
As a service station owner or operator‚ the key factor to be aware of is that irrespective of the nature of your legal relationship ‚ there are legal remedies and rights available to you. So‚ thoroughly assess and evaluate your "legal status" and the options and protections afforded by the New Jersey Franchise Practices Act and the Petroleum Marketing Practices Act.
By Charles Internicola November 30, 2011
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