Welcome to the first Friday’s Letter From Canada, Inside Timeshare is pleased to give a warm welcome to Club Intrawest Owners Group who have contributed this week’s article. As Usual we start off by looking at the European timeshare scene.
At the moment, which is nothing unusual for this time of year as it is rather quiet, that will change after the summer holidays when the maintenance bills start to arrive. That is when we start to see a lot of new or resurrected bogus companies start to appear.
On the legal front, the courts in Spain have been very busy, with an almost daily announcement of cases being resolved. At the moment there seem to be two companies in the firing line, Anfi in Gran Canaria and Resort Properties / Silverpoint in Tenerife.
Anfi, which was the dream project of the late Norwegian Bjorn Lyng, who wanted to build a resort which was pure luxury, has for some time been on the receiving end of many claims for breaches of the timeshare law.
Many of these, involve the taking of deposits within the statutory 14 day cooling off period, contracts with a duration of more than 50 years and the floating weeks and points systems.
This week the Court of First Instance in Maspalomas has ruled on two case to the value of 44,131€ and 35,485€ respectively. In both cases the contracts have been declared null & void.
Resort Properties / Silverpoint have also had several rulings against them this week.
The first was at the Court of First Instance in Arona Tenerife, the judge ordered the return of £22,736, this was followed by a Supreme Court ruling with the judge ordering the return of 37,400€.
We then had another Court of First Instance ruling of around 25.000€ and as we go to print our sources in Madrid have informed us of another 3 rulings by the Supreme Court. At the moment we have no idea of the amounts involved, but we do know that all contracts have been declared null & void.
On the fake law firm front, one gentleman has had lucky escape, he received correspondence from Armando Gareca Abogados, part of the Litigious Abogados family, who we highlighted sometime ago. He received notification to pay the initial procurador fees to get the case into court, but something made him suspicious. He did a search on the internet and found the articles posted on this website about them.
Needless to say he realised he was about to be the victim of an elaborate scam and has not gone ahead. He sent a message of thanks as this has saved him not only a substantial amount of money, but a lot of stress. This does go to show that you must do your homework before engaging with any company, especially if they have contacted you with a story that sounds too good to be true.
The Anfi man made beach project.
It has been awhile since we had any news on this sorry subject, so here is the latest.
As we previously reported the beach has been fenced off denying access to the public, with security guards and police removing anyone who entered the beach. Although recently massive crowds have flocked to the area in defiance, a new strategy has now been implemented.
This new move has also had the impact of denying access to the homes of people who live there, all paths and access roads have now been blocked with rocks and other implements. Videos and photographs have been posted on facebook by one resident who has been campaigning against this project from the start and also published in laprovincia a Spanish newspaper.
This is another example of how a timeshare company behaves, not just to it’s own members but to the local community. It is also an example of how elected authorities view the people they are supposed to serve. Please show your support for the people and post your comments on the links.
Follow the links to view the posts from this local resident and the La Provincia newspaper.
Now on with our latest contributors.
Club Intrawest v. Canada
Must Pay Millions in GST Back Taxes
Following Recent Federal Court of Appeal Decision
July 21, 2017
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 re-branded 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.
“Based on a detailed survey answered by more than 400 members, I expect that the majority of our members will be shocked and disappointed that the court found that members have no beneficial ownership in the vacation homes. About 79% of them remember being told by Intrawest and DRI sales representatives they would own a real estate interest in the resort properties. About 91% of members also remember they were explicitly told that members controlled the Club and that resort properties were vested in a trust for the benefit of members. The Federal Court of Appeal now tells us that no evidence was produced that ownership of these homes has been vested in a trust for the benefit of members”, says Patrick Cormier, Volunteers Team Leader of the Club Intrawest Owners Group (Embarc), (CIOG) a grassroots movement of over 3400 members. “However, it seems clear that the Intrawest/DRI-dominated Board of Directors anticipated the GST liability all along since it began accumulating a C$14 million reserve from members’ resort fees under a 2011 Board resolution without informing members until the CIOG raised the GST issue with the Board in 2016”.
Club Intrawest was established by Intrawest Corporation in 1993 as a stand-alone not-for-profit Delaware corporation, but with Intrawest in a controlling position. Intrawest ensured they had control of the Club in several ways, including by granting themselves (as “Declarant” member) a 15 times voting power advantage over individual members guaranteeing Intrawest and now DRI, ongoing and complete control over all aspects of the Club. In addition, Intrawest and now DRI voted in their own employees on the Club’s Board of Directors to maintain a controlling majority on the Board, hired themselves as manager and pay themselves a guaranteed 10 to 15 per cent management fee on all financial transactions. Club Intrawest (Embarc) members have no control of the club or effective means for recourse, even though members, other than DRI, own 95 per cent of the timeshare points.
About the Club Intrawest Owners Group (Embarc), (CIOG)
The CIOG is a grassroots movement of over 3400 members who are banding together seeking fairness and transparency in their Club’s operation for all 22,000 members. The CIOG is disputing and challenging unfair actions of Intrawest Corporation, Diamond Resorts International and their domination of the Club’s Board of Directors and Management Company. The CIOG came together as a volunteer group in December 2015, following Intrawest’s announcement of the sale (without member input) of Club Intrawest’s management to DRI. Following the sale, DRI rebranded the club to Embarc and fully controls the not-for-profit timeshare. For more about the group, visit
Judgment of Federal Court of Appeal: see link
Clearly this is an evolving story. Inside Timeshare will continue to monitor and report ongoing developments.
Other member sponsored Diamond Advocacy groups include:
DRIP launched by over 1,000 British Diamond members
We seek to provide Diamond Resort members a way to proactively address membership concerns; to advocate for timeshare reform; to obtain greater disclosure from the company; to advocate for a viable secondary market; and to educate prospective buyers.
Some of the points in this article regarding the judges decisions are very similar to those from the Supreme Court in Spain. Especially on the system of “points”. The Spanish Courts also agree that they are not owners but members with only a right to use, it makes us wonder if the Spanish rulings may have had an effect on this?
Anyway thank you to our Canadian cousins or should we say “Canucks”, we look forward to more contributions from you. Also a great big thanks to Irene who is helping to make this happen. It is through articles like this we make the world smaller and help timeshare owners no matter where they are. So welcome to the global timeshare family from, The Philippines, Australia, USA and Europe. We now need some from South Africa!
Have a good weekend and don’t forget to do your your homework!