General Motors, LLC v. Bureau of Professional & Occupational Affairs, State Board of Vehicle Manufacturers, Dealers & Salespersons
169 A.3d 681
Pa. Commw. Ct.2017Background
- GM and three Pennsylvania dealers (Protesting Dealers) disputed warranty reimbursement after dealers elected statutory retail reimbursement for parts under 63 P.S. § 818.9(a)(2).
- Under GM's Service Policies and Procedures Manual (SPPM), dealers could receive labor reimbursement via Option C (CPI-based) or Option A (dealer retail rate); GM’s 2012 policy made Option C ineligible if a dealer elected retail parts reimbursement.
- Protesting Dealers requested retail reimbursement for parts in 2014; GM approved parts requests but converted their labor reimbursement from Option C to Option A and imposed a $122 per-vehicle surcharge to recover increased parts costs.
- Protesting Dealers filed a protest with the State Board of Vehicle Manufacturers, Dealers and Salespersons (Board), which ruled GM could not (1) convert labor reimbursement to retail rates absent a dealer request, and (2) impose the surcharge.
- The Commonwealth Court reviewed the Board’s legal conclusions and reversed the Board: holding the conversion was governed by contract (outside Board jurisdiction under the Act) and that the statute permits manufacturers to surcharge dealers who invoke statutory retail reimbursement for parts or labor.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether GM violated 63 P.S. § 818.9(a)(3) by converting dealers from Option C to Option A labor reimbursement when dealers elected statutory retail parts reimbursement | Dealers: They did not elect retail labor under the Act; GM cannot unilaterally force conversion to retail labor reimbursement | GM: SPPM contractually conditions Option C eligibility on accepting standard parts reimbursement; electing retail parts makes dealers ineligible for Option C and triggers conversion to Option A | Reversed Board: conversion was a contractual matter consistent with parties’ agreement (not a unilateral statutory invocation) and the Board erred to the extent it treated the change as violating § 9(a)(3) |
| Whether GM may impose a surcharge to recover increased parts costs when a dealer elects statutory retail parts reimbursement | Dealers/Board: Surcharge barred because dealers elected retail parts only and § 9(b.4)(1)(i) bars recovery unless dealer invoked retail reimbursement for both parts and labor | GM: § 9(b.4) allows surcharge when a dealer invokes statutory retail reimbursement for parts or labor; protection applies only to dealers who continue under contractual (nonretail) rates | Reversed Board: statutory text and purpose permit manufacturers to recover increased costs when a dealer invokes statutory retail reimbursement for parts (reading "parts and labor" not to require invocation of both) |
Key Cases Cited
- Rosado v. Ford Motor Co., 337 F.3d 291 (3d Cir. 2003) (describing the Board of Vehicles Act as a comprehensive statute governing manufacturer–dealer relationships)
- Office of the Governor v. Donahue, 59 A.3d 1165 (Pa. Cmwlth. 2013) (statute ambiguous when language supports two reasonable interpretations)
- Bethenergy Mines, Inc. v. Department of Environmental Protection, 676 A.2d 711 (Pa. Cmwlth. 1996) (principle for determining statutory ambiguity and legislative intent)
- Maggiano v. State Board of Vehicle Manufacturers, Dealers and Salespersons, 669 A.2d 1071 (Pa. Cmwlth. 1995) (discussing deference to the Board and the Act’s legislative purpose)
- Alpha Auto Sales v. Department of State, Bureau of Professional and Occupational Affairs, 644 A.2d 153 (Pa. 1994) (standard for judicial review of Board interpretations)