Welcome to this weeks Tuesday Slot, today Irene Parker looks at what Canada is doing to protect consumers of timeshare, are the events in Spain shaping the Canadian legislators views?
If so this can only be good thing for consumers, change is necessary, Spain leads the way in this field and the more countries that use their model the better off consumers will be. The industry needs to change, if they will not do voluntarily, then it is up to the legislators to make them change.
While doing our usual browsing of the many timeshare related websites and blogs this morning, we came across this rather interesting piece in Mindtimeshare, regarding a new cold calling company and timeshare claims.
Reclaims Yard, with a caller going by the name of Bob Cosgrove, who calls those who were taken in by bogus holiday clubs and resale companies. According to Cosgrove there is money set aside and waiting for them in respect of what they paid out. That even if the consumer doesn’t have any paperwork, that is not a problem.
According to Cosgrove, they do not expect any money from the consumer (no doubt that will come later to cover “TAXES”), but the consumer will be paid out by cheque, being paid out directly from some fund or other.
The telephone number they use is 0115 8242 356 which is a Nottingham code, they also use the email address reclaimsyardltd@consultant.com which as we already know is just another of those free email providers and is not linked to any website.
The interesting fact is that Reclaims Yard Limited, Company Number 07722606, is a genuine company, although according to Company House records has an Active order to Strike off.
This company has nothing to do with timeshare, they are in fact specialist in reclaiming, restoring a selling “interesting and unusual” pieces of the past, reclaiming building materials and architectural salvage.
They have also published on their website a warning regarding the fraudulent use of their name regarding the timeshare claims:
IMPORTANT ANNOUNCEMENT:-
PLEASE NOTE THAT WE ARE ABSOLUTELY NOTHING TO DO WITH SPANISH PROPERTIES, TIMESHARING OR ANY OTHER TYPES OF FOREIGN INVESTMENTS OR RECLAIMING FUNDS.
THIS IS A SCAM!
OUR ADVICE IS TO NOTIFY THE POLICE IF YOU RECEIVE ANY COMMUNICATIONS REGARDING THIS.
WE ONLY TRADE IN RECLAIMED (PREVIOUSLY USED) BUILDING MATERIALS AND NOTHING ELSE.
PLEASE SEE OUR NEWS PAGE FOR FURTHER INFORMATION…….
https://www.reclaimsyard.co.uk/
Once again, we see a fraudulent operation using the name of a genuine company to give themselves credilbility when the consumer does a quick internet check. We cannot emphasise that when making these checks it is not just to see if they are registered but to actually look at the company name that is being used.
Now for today’s article
Quebec Canada Bill 178: An Act to amend various legislative provisions concerning consumer protection
187.13 A contract relating to timeshare accommodation rights is deemed to be a service contract
A contract related to timeshare accommodation rights is considered a service contract. You may resiliate your contract for other reasons, and you have other rights and recourses.
Resiliate: fait d’annuler, de résilier un contrat canceling , termination
The verb resiliation means “To draw back from a contract”
https://dictionary.cambridge.org/dictionary/french-english/resiliation
By Irene Parker
August 7, 2018
Once again the nature of the perpetual timeshare contract comes under the legislative microscope, this time in Quebec. Perpetual contracts are not harmful in the case of your home or car, but with little to no secondary market for unwanted timeshares, the consequences of signing a perpetual timeshare contract has financially devastated many of the 515 families that have contacted Inside Timeshare seeking release. Many members have been scammed by timeshare exit companies and listing agents promising, but not delivering results.
Among other provisions, Quebec Bill 178 defines a timeshare contract as a service contract. This could have lasting consequences for Canadian timeshare buyers who have felt trapped by the perpetual timeshare product. Many timeshare members are saddled with high interest rate loans and some with higher interest rate credit cards issued by timeshare companies.
Under Bill 178, a service contract can be cancelled under liberal conditions. The profound implication boils down to the ability to cancel the timeshare contract if the purchaser is not getting the benefits of ownership. According to those familiar with the legislation, not getting benefits could be due to medical conditions, availability, or a host of other reasons.
This is not the first time Canada has ruled on the definition of a timeshare. According to this 2017 ruling, the Canadian Court of Appeals defined a timeshare more like a country club than real property.
On July 11, 2017, In a decision that will likely affect all timeshares and owners of timeshares with properties located in Canada, the Federal Court of Appeal set aside the Tax Court of Canada’s decision in the case of Club Intrawest v. Canada. In doing so, the Court of Appeal substituted its own decision to refer GST assessments back to Canada Revenue Agency for reassessment of GST just for services supplied in Canada in relation to vacation homes situated in Canada. Federal Appeal Court Judges Nadon, Gauthier and Dawson agreed with the Tax Court’s finding that a principal-agent relationship does not exist between the club and its 22,000 members. This decision also confirms that members of Club Intrawest (now rebranded Embarc by Diamond Resorts International (DRI)) do not hold beneficial ownership in the real estate and equipment in vacation home resorts and do not control the Club. The Court found that members merely own a right of occupancy in exchange for their resort points. This contradicts sales presentations, financial and marketing materials by Intrawest Corporation (“Intrawest”) and now DRI, to the effect that members have beneficial ownership of vacation homes and control the Club through election of the Board of Directors, responsible for managing the Club’s operations. The ruling will require the club to pay reassessed GST back-taxes for tax years 2002-2007. The GST/HST tax liability for tax years 2008-2016 is unknown at this time. All timeshare owners with vacation homes in Canada may be impacted by this decision and may also see themselves assessed for back taxes on the supply of services in Canada related to vacation homes situated in Canada.
http://insidetimeshare.com/fridays-letter-canada/
Spain ended perpetual timeshare contracts.
Spain was the first country to rule that perpetual timeshare contracts are illegal. In Spain timeshare contracts purchased in perpetuity, floating weeks and points, have been deemed unlawful by the Supreme Court. To date, Spain has ruled in favor of the consumer in a whopping 129 Supreme Court victories.
Marriott Vacation Club (VAC U.S.: NYSE stock symbol) filed an 8-K Other Events, as reported by Market Exclusive July 19, 2018. One of the events was mention of Spain’s Supreme Court rulings invalidating timeshare contracts.
A series of Spanish court rulings over the past several years invalidating timeshare contracts have increased our exposure to litigation and such litigation may materially adversely affect our business and financial condition.
https://marketexclusive.com/marriott-vacations-worldwide-corporation-nysevac-files-an-8-k-other-events-4/2018/07/
Notes from the Quebec Bill 178
http://www.assnat.qc.ca/en/travaux-parlementaires/projets-loi/projet-loi-178-41-1.html
Introduced 18 April 2018 Quebec National Assembly
Passed 6 June 2018
Excerpts from the bill:
Bill 178 defines a timeshare contract is a service contract and not a purchase agreement involving a property transfer.
Bill 178 (2018, Chapter 14) An Act to amend various legislative provisions concerning consumer protection
The Act proposed amendments to the Consumer Protection Act to introduce a protection regime governing contracts relating to timeshare accommodation rights.
- The Act introduces rules specific to the making of that type of contract and sets out the compulsory information such a contract must include. It grants consumers the right to resolve the contract without charge or penalty within 10 days of signing it and specifies the circumstances in which that right is extended to one year.
- The Act imposes on merchants who enter into a contract relating to timeshare accommodation rights the obligation to establish a payment schedule for each year covered by the contract…..Furthermore, the Act introduces a disclosure obligation related to promotion made by merchants engaged in the business of such contract, prohibits certain stipulations and provides that such contracts may not be automatically renewed.
Division V.3
Contract Relating to Timeshare accommodation rights
187.13 A contract relating to timeshare accommodation rights is deemed to be a service contract
187.14 A contract relating to timeshare accommodation rights must be evidenced in writing. In addition to the information that may be required by regulation, it must contain or state the following, presented in conformity with the model prescribed by regulation:
- (h) the term and expiry date of the contract;
- (j) the fees to obtain an accommodation right, their amount on an annual basis if they are calculated on a basis other than annual, and the total of such amounts for the entire term of the contract.
- (t) a statement that the merchant may not collect payment from the consumer before beginning to perform his obligation;
- (u) the right granted to the consumer to resolve the contract at his sole discretion within 10 days after that on which each of the parties is in possession of a duplicate of the contract; and
- (v) the other circumstances in which the consumer may resolve or resiliate the contract, any applicable conditions and the time within which the merchant must refund the consumer.
187.15 Any stipulation that results in the automatic renewal of a contract relating to timeshare accommodation rights is prohibited.
187.16 The merchant may not make the entering into or the performance of a contract relating to timeshare accommodation rights dependent upon the entering into of a credit contract.
187.21 The contract may be resolved at the discretion of the consumer within 10 days following that on which each of the parties is in possession of a duplicate of the contract.
That period is, however, extended to one year from the date on which the contract is made in either of the following cases:
- the contract is inconsistent with any of the rules set out in section 25 to 28 for the making of contracts, or one of the particulars required under section 187.14 does not appear in the contract; or
- a Statement of consumer resolution and resiliation rights and a resolution and resiliation form that are in conformity with the model prescribed by regulation were not attached to the contract at the time the contract was made.
187.24 Any contract entered into by a consumer, even with a third-party merchant, on the making of or in relation to a contract relating to timeshare accommodation rights and that results from an offer, representation, or other action by the merchant who is party to the contract relating to timeshare accommodation rights forms a whole with the latter contract and is resolved or resiliated by operation of law at the time the contract relating to timeshare accommodation rights is resolved or resiliated.
In addition, the consumer may, with respect to a contract entered into with a third-party merchant and contemplated in the first paragraph, exercise directly against the merchant a recourse based on the non-performance of the contract or on the provision of this Act.
187.25 Within 15 days after resolution or resiliation, for the reason set out in section 187.26, of the contract relating to timeshare accommodation rights, the merchant must refund all sums paid by the consumer under the contract and under any other contract contemplated in section 187.24, including sums paid to a third-party merchant.
229.1 No person may, when making or promoting a contract relating to timeshare accommodation rights, make representations implying that the contract is an investment, unless the person gives the consumer a document showing the truthfulness of the representations.
A contract related to timeshare accommodation rights is considered a service contract. You may resiliate your contract for other reasons, and you have other rights and recourses.
What’s next on the timeshare horizon?
The key word in 229.1 is “may” because in the U.S., the language in one state regulator’s ruling states “should” not make representations implying that the contract is an investment. What a difference one word can make.
Thank you Irene for this very interesting piece of news, we do hope that others will follow in the footsteps of Spain and now Canada to put into place laws and regulations to protect consumers from the excesses of the timeshare industry. We can only wait wait and see.
From our warning of another fraudulent timeshare reclaims caller, this does really hit home that you must always do thorough company that contacts you or that you have found on the internet. Doing your homework is vital to protect yourself from scammers and fraudsters.
If you need help in checking if a company is indeed genuine, then use our contact page, Inside Timeshare will help you find the truth and point you in the right direction.
Remember DO YOUR HOMEWORK AND KEEP YOUR HARD EARNED MONEY SAFE!
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