(a) Any owner of a new motor vehicle dealership may appoint by will or any other written instrument a designated family member to succeed in the ownership interest of the said owner in the new motor vehicle dealership.

(b) Unless there exists good cause for refusal to honor succession on the part of the franchiser, any designated successor of a deceased or incapacitated owner may succeed to the ownership interest of the owner if:

(1) The designated successor gives the franchiser written notice of his or her intention to succeed to the ownership interest within 120 days of the owner’s death or incapacity or within a longer period if so provided in the franchise agreement; and

(2) The designated successor agrees to be bound by all the terms and conditions of the franchise.

(c) The franchiser may request the designated successor to complete a standard dealer application, and the designated successor shall provide promptly upon said request personal and financial data that is customarily required by the franchiser to determine whether the succession should be honored.

(d) If a franchiser believes that good cause exists for refusing to honor the succession to the ownership interest of an owner by a designated successor of a deceased or incapacitated owner, the franchiser may, within 60 days following receipt of:

(1) Notice of the designated successor’s intent to succeed to the ownership interest of the owner, or

(2) Any personal or financial data which it has requested,

serve upon the designated successor notice of its refusal to honor the succession and of its intent to discontinue the existing franchise with the dealer no sooner than 90 days from the date such notice is served. However, if the franchiser shall enter into 1 or more interim or trial agreements with the designated successor, which interim or trial agreements may not extend more than 2 years from the owner’s death or disability, then and in such event notice shall be deemed timely if sent within 60 days of the termination of such interim or trial agreement.

(e) The notice must state the specific grounds for the refusal to honor the succession and the franchiser’s intent to discontinue the existing franchise with the dealer.

(f) If a franchiser refuses to honor the succession to the ownership interest of a deceased or incapacitated owner, then and in such event:

(1) The franchiser shall allow the designated successor a reasonable period of time, which shall not be less than 6 months, in which to negotiate a sale of the dealership.

(2) Upon termination of the franchise pursuant to such refusal, the provisions of § 4906 of this title shall apply.

(g) If notice of refusal and discontinuance is not timely served upon the designated successor, the franchise shall continue in effect subject to termination only as otherwise permitted by this chapter.

(h) No franchiser shall terminate, cancel or fail to renew any franchise solely because of the death or incapacity of an owner who is not listed in the franchise as one on whose expertise and abilities the franchiser relied in the granting of the franchise.

64 Del. Laws, c. 27, § 1; 70 Del. Laws, c. 186, § 1; 73 Del. Laws, c. 78, § 7; 73 Del. Laws, c. 273, § 1.