A Bangor Ford dealership might be able to recover millions of dollars in damages from the car manufacturer under a ruling issued this week by the Maine Supreme Judicial Court.

The damages are mainly attributable to Ford Motor Co.’s failure to send a certified letter that likely would have cost less than $10.

Darling’s, the dealership, sued Ford a decade ago, arguing that the car company failed to provide proper notice of a change in a sales incentive program. The Supreme Court this week said that a lower court was wrong to limit the damages to a nine-month period in 2005 and said instead that Darling’s should be entitled to damages from the time the program was changed in 2005 to the present day.

For the nine-month period in 2005 alone, the lower court said Darling’s was due damages of nearly $155,000. Now there’s potential for millions in damages, covering sales for more than 10 years, although the lawyer for Darling’s refused to speculate on the amount.

The legal dispute has been going on for more than a decade. Its roots go back to 2001, when Darling’s was named a Blue Oval Certified dealer, based on customer satisfaction ratings, which allowed it to get a bonus from Ford of 1.25 percent of the retail price of each car sold.

In 2004, Ford announced it was ending that program, effective in April 2005, and substituting an “Accelerated Sales Challenge” program that offered substantially lower bonuses to dealers. In the nine months that followed the switch of programs, Darling’s earned $57,875 under the new sales incentive program, but it would have earned $212,570 under the Blue Oval Certified plan.


Darling’s challenged the change in the programs with the Maine Motor Vehicle Franchise Board on the grounds that it was a substantial change of the relationship between the manufacturer and franchise owner and Ford failed to provide proper notice, limiting Darling’s ability to file a protest. The franchise board agreed and awarded Darling’s damages of $145,223 and imposed a penalty of $10,000 on Ford. The board limited the award to the amount that Darling’s lost in incentives over the nine-month period because the dealership had 90 days to appeal the switch to the board and the board had 180 days in which to make a decision.

But two years ago, the Supreme Judicial Court threw out that decision, saying the board had no authority to award damages, only to assess a penalty, which would go to the state, not to the dealership.

So Darling’s instead went to court, where a jury agreed that Ford had failed to properly notify the dealership of the change in the programs because it never sent a certified letter.

The court kept the 90-day limit adopted by the board and awarded Darling’s nearly $155,000.

Both Ford and Darling’s appealed that decision.

This week, the Supreme Judicial Court said there’s no reason to limit the damages to the nine-month period because Ford had never sought to send the proper notification to Darling’s. Before the lower court, Ford cited “business reasons” for failing to follow Maine laws on notice, saying it didn’t want to invite similar challenges from other dealers.


Judy Metcalf, Darling’s lawyer, said 94 percent of Ford dealers nationwide were Blue Oval Certified, and a similar percentage in Maine, but she refused to speculate on how many could potentially seek damages because of improper notification. Other states might have different laws on notification of changes in franchise relationships, she said, and dealers would have had to preserve their objections at the time of change in programs to seek damages.

Maine’s law, according to the Supreme Judicial Court, is intended to level the playing field between manufacturers and dealers when it comes to franchise terms. Without laws regulating matters such as changes in the terms, the ruling this week said, the carmakers would have too much bargaining power to tilt the deals in their favor.

Metcalf said she will soon sit down with Ford’s lawyer to discuss damages.

“It’s really a math calculation,” she said. “All along, we have worked with Ford and there’s no point in throwing numbers out there.” But, she added, “we’re really looking forward to working with Ford on that number.”

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