Nissan Motor Corp. v. New Motor Vehicle Board

Appellants are Daly City Datsun, a new car dealer (hereinafter DCD or franchisee) and the New Motor Vehicle Board, a state agency (hereinafter Board). The respondent is Nissan Motor Corporation in U.S.A. (hereinafter Nissan or franchisor).

In October 1979 Nissan terminated DCD’s franchise on the ground that DCD had failed to fulfill the requirements of the franchise for the preceding four years. Pursuant to Vehicle Code sections 3050-3069, DCD filed with the Board a protest against the intended termination of franchise. Following an extensive hearing the administrative law judge found that Nissan had amply demonstrated good cause to terminate DCD’s franchise pursuant to section 3061. The Board, however, refused to accept the proposed decision of the hearing officer. Instead, the Board conducted an additional hearing in the matter at the conclusion of which it found among others that although DCD had failed to meet many of Nissan’s national franchise requirements, the franchisor had not established that those requirements were reasonable. Nonetheless, the Board concluded the DCD had no substantial permanent investment and also that the service facility of the franchisee…