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JH GLOBAL SERVICES, INC., AND BELLEN BROOK, LLC, D/B/A TEE TIME GOLF CARS vs ACTION GOLF CARS, 07-004524 (2007)

Court: Division of Administrative Hearings, Florida Number: 07-004524 Visitors: 20
Petitioner: JH GLOBAL SERVICES, INC., AND BELLEN BROOK, LLC, D/B/A TEE TIME GOLF CARS
Respondent: ACTION GOLF CARS
Judges: LISA SHEARER NELSON
Agency: Department of Highway Safety and Motor Vehicles
Locations: Daytona Beach, Florida
Filed: Oct. 01, 2007
Status: Closed
Recommended Order on Wednesday, May 28, 2008.

Latest Update: Jul. 15, 2008
Summary: Whether Respondent is not providing adequate representation of STAR Neighborhood electric vehicles in the Volusia County area.Petitioner did not establish that the existing dealer of STAR electric golf cars was providing inadequate representation.
STATE OF FLORIDA

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS


JH GLOBAL SERVICES, INC., AND BELLEN BROOK, LLC, d/b/a TEE TIME GOLF CARS,


Petitioners,


vs.


ACTION GOLF CARS,


Respondent.

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Case No. 07-4524



RECOMMENDED ORDER

On April 23, 2008, a hearing was held in Daytona Beach, Florida, pursuant to the authority set forth in Sections 120.569 and 120.57(1), Florida Statutes. The case was considered by Lisa Shearer Nelson, Administrative Law Judge.

APPEARANCES


For Petitioners: No appearance

JH Global Services, Inc.


Dale Sheppard

Bellen Brook, LLC, d/b/a Tee Time Golf Cars

1510 North Highway 1

Ormond Beach, Florida 32174


For Respondent: Bill Morgan

Action Golf Cars 940 North US 1

Ormond Beach, Florida 32174 STATEMENT OF THE ISSUE

Whether Respondent is not providing adequate representation of STAR Neighborhood electric vehicles in the Volusia County

area.


PRELIMINARY STATEMENT


This action commenced with the filing of a petition by


Action Golf Cars protesting the issuance of a license for STAR Neighborhood electric vehicles (STAR cars) in Volusia County to Bellen Brook, LLC, d/b/a Tee Time Golf Cars (Tee Time).

On October 1, 2007, the petition was forwarded to the Division of Administrative Hearings for assignment of an administrative law judge.

Pursuant to the requirements of Section 320.699, Florida Statutes, final hearing was duly noticed for April 23, 2008, and proceeded as scheduled. While representatives for both Action Golf Cars and Tee Time Golf Cars appeared at hearing, no appearance was made on behalf of Petitioner JH Global Services, Inc. Petitioner Tee Time presented the testimony of one witness and Petitioner's Exhibit numbered 1 was admitted into evidence. Respondent Action Golf Cars also presented the testimony of one witness and Respondent's Exhibit numbered 1 was admitted.

The proceedings were recorded but not transcribed. Both Tee Time and Action Golf Cars timely submitted Proposed Recommended Orders which have been carefully considered in the preparation of this Recommended Order. No submission was received from JH Global Services.

FINDINGS OF FACT


  1. On January 18, 2007, the Department of Highway Safety and Motor Vehicles, Division of Motor Vehicles (Department) issued Final Order No. HSMV-07-37-FOI-DMV, which provides in pertinent part:

    1. Pursuant to the requirements of section 320.642, Florida Statutes, JH Global Services, Inc. provided notice to the department of its intention to allow the establishment of Action Golf Cars, for the sale of STAR Neighborhood Electric Vehicles (NEV) at 940 N. US 1, Ormond Beach, Florida 32174.


    2. In response to the properly filed notice, the department published the required notice in the Florida Administrative Weekly on January 12, 2007.


    3. There are no other dealerships of the same line-make in Volusia County or other contiguous counties.


      It is therefore ORDERED

      That Action Golf Cars shall be granted a license at 940 N. US 1, Ormond Beach, Florida 32714, for the sale of STAR Neighborhood Electric vehicles (NEV) on or after this date, provided an application is received by the Division of Motor Vehicles, Regional Office, meeting all requirements for licensure . . . .


  2. The license for Action Golf Cars was issued by the Department May 11, 2007.

  3. On July 13, 2007, the Department issued a Notice of Publication for a New Point Franchise Motor Vehicle Dealer in a County of More than 300,000 Population, stating that JG Global

    Services, Inc., intended to allow "the establishment of Bellen Brook, LLC d/b/a Tee Time Golf Cars as a dealership for the sale of Star Neighborhood electric vehicles (STAR) NEV at 1510 North Highway 1, Ormond (Volusia County), Florida 32174, on or after June 18, 2007."

  4. Section 320.642(1), Florida Statutes, requires that any licensee proposing to establish an additional motor vehicle dealership within a community where the same line-make vehicle is presently represented shall give written notice of its intention to the Department. The notice shall include, among other things, the identity of all motor vehicle dealers who are franchised to sell the same line-make vehicle with licensed locations in the county or any contiguous county to the county where the additional or relocated vehicle dealer is proposed to be located. Upon publication in the Florida Law Weekly, the Department is required to mail a copy of the notice to those dealers identified in the licensee's notice.

  5. Action Golf Cars did not receive the notice contemplated by Section 320.642, Florida Statutes.

  6. On July 17, 2007, the Department issued Final Order No. HSMV-07-940-FOI-DMV, which states in pertinent part:

    1. Pursuant to the requirements of section 320.642, Florida Statutes, JH Global Services, Inc., provided notice to the Department of its intention to allow the establishment of Bellen Brook, LLC d/b/a Tee Time Golf Cars, for the sale of Star Neighborhood electric vehicles (STAR) NEV at 1510 North Highway 1, Ormond, Florida 32174.

    2. In response to the properly filed notice, the Department published the required notice in the Florida Administrative Weekly on July 13, 2007.


    3. There are no other dealerships of the same line-make in Volusia County or other contiguous counties.


      It is therefore ORDERED


      That Bellen Brook, LLC d/b/a Tee Time Golf Cars shall be granted a license at 1510 North Highway 1, Ormond, Florida 32174, for the sale of Star Neighborhood electric vehicles (STAR) NEV on or after this date, provided an application is received meeting all requirements for licensure. . . .


  7. Notwithstanding JH Global Services, Inc.'s notice to the Department regarding Tee Time, on July 25, 2007, JH Global executed an agreement with Action Golf Cars which stated that Action Golf Car's territory would be Flagler and Volusia counties, and that "JH will not sell to other dealers located in this area directly without acknowledge [sic] of Action Golf Cars." The agreement further provided that

    If other dealers call from these two counties, JH will refer the business to Action Golf Cars. Action Golf Cars will sell to other dealers at the price of $200.00 more than the purchasing prices plus other direct cost associated with the car. Or, with Action Golf Cars's (sic) consent, JH may sell to other dealer directly, but have to give Action Golf Cars, Inc. credit for $200.00 for the cars sold.

  8. Bill Morgan, the owner of Action Golf Cars believed that he held the exclusive dealership for STAR cars for the Volusia/Flagler Counties area. Although he had purchased cars from JH Global in 2006, he did not have a written agreement until 2007.

  9. In late July, Bill Morgan saw STAR cars on the Tee Time premises. Tee Time is approximately three miles from Action Golf Cars.

  10. Mr. Morgan called JH Global and was told by representatives of the company that the STAR cars were purchased by Tee Time from an independent distributor in Georgia. Upon further investigation, Mr. Morgan learned of the notice regarding Tee Time receiving a license and called JH Global again. He was told that Tee Time was "very persistent." After this conversation, Mr. Morgan filed his complaint on behalf of Action Golf Cars with the Department, protesting the issuance of a license to Tee Time.

  11. Once Action Golf Cars filed its protest, JH Global refused to sell any more golf cars to Tee Time, and does not currently do so. Tee Time sent some golf cars back to JH Global, at Tee Times' expense, because if it could not service the vehicles (because of the inability to purchase parts), its representative did not want to sell the remaining stock.

    However, Tee Time wants the ability to sell STAR cars in the Volusia County area and believes it should be allowed to do so.

  12. Tee Time purchased six STAR cars in 2007. It sold two and sent back four.

  13. STAR cars are a relatively new product in the golf car market, having been first introduced in 2006. Each car costs a dealership approximately $4,000. In 2006, Action Golf Cars purchased approximately $58,600 worth of product from JH Global. In 2007, that amount increased to $135,523. In other words, in 2006, Action Golf Cars purchased approximately 14 STAR cars for resale. In 2007, it purchased an additional 33.

  14. Given the limited amount of time the product has been on the market, the impact of allowing Tee Time to sell STAR cars cannot be readily determined.

    CONCLUSIONS OF LAW


  15. The Division of Administrative Hearings has jurisdiction over the subject matter and the parties to this action in accordance with Sections 120.569 and 120.57(1), Florida Statutes.

  16. This case is brought pursuant to the provisions of Section 320.642, Florida Statutes, which provides in pertinent part:

    (2)(a) An application for a motor vehicle dealer license in any community or territory shall be denied when:

    1. A timely protest is filed by a presently existing franchised motor vehicle dealer with standing to protest as defined in subsection (3); and

    2. The licensee fails to show that the existing franchised dealer or dealers who register new motor vehicle retail sales or

      retail leases of the same line-make in the community or territory of the proposed dealership are not providing adequate representation of such line-make motor vehicles in such community or territory. The burden of proof in establishing inadequate representation shall be on the licensee.


      (b) In determining whether the existing franchised motor vehicle dealer or dealers are providing adequate representation in the community or territory for the line-make, the department may consider evidence which may include, but is not limited to:

      1. The impact of the establishment of the proposed or relocated dealer on the consumers, public interest, existing dealers, and the licensee; provided however, that financial impact may only be considered with respect to the protesting dealer or dealers.

      2. The size and permanency of investment reasonably made and reasonable obligations incurred by the existing dealer or dealers to perform their obligations under the dealer agreement.

      3. The reasonably expected market penetration of the line-make motor vehicle for the community or territory involved, after consideration of all factors which may affect said penetration, including, but not limited to, demographic factors such as age, income, education, size class preference, product popularity, retail lease transactions, or other factors affecting sales to consumers of the community or territory.

      4. Any actions by licensees in denying its existing dealer or dealers of the same line- make the opportunity for reasonable growth, market expansion, or relocation, including the availability of line-make vehicles in keeping with the reasonable expectations of the licensee in providing an adequate number of dealers in the community or territory.

      5. Any attempts by the licensee to coerce the existing dealer or dealers into consenting to additional or relocated franchises of the same line-make in the community or territory.

      6. Distance, travel time, traffic patterns,

        and accessibility between the existing dealer or dealers or of the same line-make and the location of the proposed additional or relocated dealer.

      7. Whether benefits to consumers will likely occur from the establishment or relocation of the dealership which cannot be obtained by other geographic or demographic changes or expected changes in the community or territory.

      8. Whether the protesting dealer or dealers are in substantial compliance with their dealer agreement.

      9. Whether there is adequate interbrand and intrabrand competition with respect to said line-make in the community or territory and adequately convenient consumer care for the motor vehicles of the line-make, including the adequacy of sales and service facilities.

      10. Whether the establishment or relocation of the proposed dealership appears to be warranted and justified based on economic and marketing conditions pertinent to dealers competing in the community or territory, including anticipated future changes.

      11. The volume of registrations and service business transacted by the existing dealer or dealers of the same line-make in the relevant community or territory of the proposed dealership.


  17. Action Golf Cars has standing to protest as Volusia County has a population of more than 300,000 persons and Action Golf Cars is within 12.5 miles of the proposed dealership.

    § 320.642(3)(b)1, Fla. Stat.


  18. Based on the language of the statute, the licensee referred to and having the burden of proof in this proceeding is JH Global. Larry Dimmitt Cadillac, Inc. v. Seacrest Cadillac, Inc., 558 So. 2d 136 (Fla. 1st DCA 1990); Bill Kelley Chevrolet v. Calvin, 322 So. 2d 50 (Fla. 1st DCA 1975).

  19. JH Global chose not to make an appearance in this

    proceeding and, since the filing of the protest, has elected not to continue to sell STAR cars to Tee Time. While Tee Time and Action Golf Cars expressed frustration regarding JH Global's business practices, any complaints they have regarding those practices must be addressed in another forum.

  20. Even assuming that Tee Time, as opposed to JH Global, could assume the burden of proof, it has not been met in this proceeding. The product at issue is a very new product, having been on the market approximately two years. It would be speculative, especially on the evidence presented, to determine what portion of the market STAR cars would enjoy and whether Action Golf Cars was providing inadequate representation. While evidence was presented regarding how many STAR cars Action Golf Cars purchased, there was no evidence presented regarding how many of those cars were sold. Likewise, while there was evidence that demand had increased in 2007 from that shown in 2006, there was no evidence that Action Golf Cars was unable to meet the demand. Under these circumstances, no finding of inadequate representation can be made.

RECOMMENDATION


Upon consideration of the facts found and conclusions of law reached, it is

RECOMMENDED:


That a final order be entered denying Tee Time's application for licensure.

DONE AND ORDERED this 28th day of May, 2008, in Tallahassee, Leon County, Florida.

S

LISA SHEARER NELSON

Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(850) 488-9675 SUNCOM 278-9675

Fax Filing (850) 921-6847 www.doah.state.fl.us


Filed with the Clerk of the Division of Administrative Hearings this 28th day of May, 2008.


COPIES FURNISHED:


Jane Zhang

JH Global Services, Inc.

52 Pelham Davis Circle Greenville, South Carolina 29615


Dale Sheppard Bellen Brook, LLC,

d/b/a Tee Time Golf Cars 1510 North Highway 1

Ormond Beach, Florida 32174


Michael J. Alderman, Esquire Department of Highway Safety

and Motor Vehicles

Neil Kirkman Building, Room A-432 2900 Apalachee Parkway

Tallahassee, Florida 32399-0635


Bill Morgan Action Golf Cars 940 North US 1

Ormond Beach, Florida 32174

Electra Theodorides-Bustle, Executive Director Department of Highway Safety

and Motor Vehicles Neil Kirkman Building 2900 Apalachee Parkway

Tallahassee, Florida 32399-0500


Robin Lotane, General Counsel Department of Highway Safety

and Motor Vehicles Neil Kirkman Building 2900 Apalachee Parkway

Tallahassee, Florida 32399-0500


NOTICE OF RIGHT TO SUBMIT EXCEPTIONS


All parties have the right to submit written exceptions within

15 days from the date of this recommended order. Any exceptions to this recommended order should be filed with the agency that will issue the final order in this case.


Docket for Case No: 07-004524
Issue Date Proceedings
Jul. 15, 2008 Agency Final Order filed.
May 28, 2008 Recommended Order cover letter identifying the hearing record referred to the Agency.
May 28, 2008 Recommended Order (hearing held April 24, 2008). CASE CLOSED.
May 05, 2008 Suggested Order filed.
Apr. 29, 2008 Letter of Recommendation filed.
Apr. 24, 2008 CASE STATUS: Hearing Held.
Nov. 07, 2007 Order of Pre-hearing Instructions.
Nov. 07, 2007 Notice of Hearing (hearing set for April 24, 2008; 1:00 p.m.; Daytona Beach, FL).
Oct. 29, 2007 Letter from B. Morgan regarding Bill Morgan d/b/a Action Golf Cars not a corporation, but a sole proprietor filed.
Oct. 24, 2007 Response to the Order filed.
Oct. 18, 2007 Order (enclosing rules regarding qualified representatives).
Oct. 11, 2007 Letter response to the Initial Order filed.
Oct. 10, 2007 Letter response to the Initial Order filed.
Oct. 10, 2007 Letter response to the Initial Order filed.
Oct. 02, 2007 Initial Order.
Oct. 01, 2007 Notice of Publication for a New Point Franchise Motor Vehicle Dealer filed.
Oct. 01, 2007 Written Protest of Establishment of New Franchise Dealership filed.
Oct. 01, 2007 Agency referral filed.

Orders for Case No: 07-004524
Issue Date Document Summary
Jul. 11, 2008 Agency Final Order
May 28, 2008 Recommended Order Petitioner did not establish that the existing dealer of STAR electric golf cars was providing inadequate representation.
Source:  Florida - Division of Administrative Hearings

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