It is legally required to have a signed dealer agreement in place for each line-make a dealer carries.

In accordance with the PA Board of Vehicles Act (Chapter 5, Section 503), “A manufacturer or distributor may not sell a recreational vehicle in this Commonwealth to or through a dealer without having first entered into a manufacturer/dealer agreement with a dealer which has been signed by both parties.”

Not having a signed dealer agreement for each line-make that is carried will make a dealership, and manufacturer, out of compliance with the state law and weaken the dealership’s position if indemnification or other protections are needed.

For example, in a product liability suit, if there is a product defect, unrelated to anything the dealer did, and the insurance carrier steps in, they may ask for a copy of the dealer agreement before beginning the defense. If one cannot be produced, it can make the indemnification process with the manufacturer more difficult. 

Without a signed agreement, both the dealer and manufacturer are out of compliance.

Please review your dealer agreements, make sure they are signed and up-to-date!