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Silverpoint

Mid Week Report: Diamond Resorts Receive Second Supreme Court Sentence

The Supreme Court, Spain’s highest judicial body has again found against Diamond Resorts as per their previous 129 rulings. This week alone Diamond have lost 2 cases at the highest court in Spain, it all centers on their points system which has been declared an illegal product due to lack of tangibility and the length of the contract.

In the past three years, the Supreme Court has ruled on 131 cases involving the sales of timeshare, each time it has upheld its previous rulings, on many occasions it has added further rulings on the interpretation of the Spanish Timeshare Laws 42/98 & 4/12.

The latest case started with a trial at the Court of First Instance No 24 in Tenerife, the judge in this instance found for the clients as dictated by the previous ruling of the Supreme Court and the Spanish Timeshare laws.

The infractions were the contract had no end date, which is in contravention of the law as laid down and reinforced by previous rulings, the law clearly states that a timeshare contract should be a minimum of 3 years and a maximum of 50 years in duration. The second was the points system, which shows no tangible product, this being a fixed week number and fixed apartment number, which guarantees the purchaser the period and accommodation each year.

The Judge ruled in favour of the client, declaring the contract null and void plus the return of all money paid. However, Diamond did not agree and promptly appealed the decision to the High Court.

During this appeal, Diamond pleaded that what they had sold was not timeshare, that just like Silverpoint, these were “investors” and not consumers of timeshare. For some reason the judges at the High Court agreed and overturned the decision of the Court of First Instance.

The lawyers of Canarian Legal Alliance representing the clients, placed an appeal with the Supreme Court. The Supreme Court had already previously ruled on the point of “investors as opposed to consumers”, ruling that they are consumers.

On 13 December 2018, the judges of the Supreme Court overturned the decision of the Tenerife High Court upholding and reaffirming the ruling of the Court of First Instance, in favour of the client and in accordance to their previous rulings.

The court along with the original decision declared the contract null and void, awarded over 11,000€ plus they ordered the return of all legal fees for the original case and the appeal, sending it back to the original court for execution of sentence.

The full sentence can be seen in the PDF below.

Supreme Court 2nd Diamond sentence data protected

Over the past 3 or so years the Supreme Court has been consistent in reaffirming their previous rulings, which all courts must abide by. The basic rulings are that deposits or any payment made within the cooling off period are illegal, including those made to a third party. The points and floating weeks systems are not permitted as they do not guarantee anything to the consumer. The duration of the contract is another aspect they have consistently ruled upon, that any contract with a period of more than 50 years is not permitted.

As with the Silverpoint rulings on the “investment packs” which Silverpoint argued made the purchaser an “investor” not a “consumer”, the court has ruled these are indeed timeshares and the law applies. This is also being used in the case of fractional ownership and more recently the Silverpoint Company Participations, the courts have ruled that they are timeshare and that the consumer has the full protection of the timeshare law.

On the point of “investing”, timeshare is not an investment in property, it is a right of use and enjoyment of accommodation for specific periods of time, therefore it should never be marketed or sold as an investment. This is actually borne out by First National Trust in 2012, they are the trustees for the Club la Costa Fractional Owners Club, they informed CLC that fractional should never be marketed as an investment. (See link below).

http://clcmembers.blogspot.com/

Over the years we have seen many timeshare companies change the product, giving it new names, in many cases it has been a blatant attempt to bypass the timeshare laws, but thanks to the courts and especially the Supreme Court, this has been thwarted.

As with any new law, it has taken a long time and many test cases to clarify the interpretation of the law, there is still a long way to go as timeshare companies try to evade the strict laws which now govern the sale of any timeshare product in Spain.

  • Have you purchased a timeshare in Spain or upgraded since 5 January 1999?
  • Is the contract over 50 years in duration?
  • Is it a floating weeks or points system?
  • Have you purchased fractional?
  • Did you purchase the Silverpoint “Investment Weeks”?
  • Are you a participant in the Silverpoint “Company Participation” scheme?
  • Have you paid any money within the cooling off period?

If you can say yes to any of these questions, then you may have the right to have your contract declared null and void, along with the return of at least your purchase price, double whatever paid within the cooling off period.

If you require any information on what your rights are and whether you do have a valid and viable claim, then use our contact page and we will point you in the right direction.

You should also bare in mind that these claims must go through a Spanish court using a genuine Spanish registered lawyer, your contract must also still be running. Once you have cancelled any ownership / membership, then you lose your right to file with the courts.

Remember, before you do anything, do your due diligence and check who you are dealing with, do not take at face value some of the claims many companies will make. If you require any help in determining the validity of any company that contacts you, that you find on the internet or through adverts in magazines or newspapers, then contact Inside Timeshare for the best advice possible.

Stay safe and do your homework.

Start the Week

Welcome to Start the Week and our countdown to the Christmas break, we begin this morning with news from the Spanish Courts.

This morning Inside Timeshare has received the following information regarding our old friends Silverpoint, this company is certainly taking a bashing in the courts, contrary to what some might have you believe.

The other breaking news is there has also been another ruling from the Supreme Court, making 130 in total against the timeshare industry, the company on the receiving end is Diamond Resorts.

On Thursday 13 December in the Court of First Instance No 5, Arona Tenerife, Silverpoint were once again found to be in breach of the Spanish Timeshare Laws 42/98 and 4/12, in respect of their product called “Company Participations”.

As we have reported on many occasions this scheme was designed to bypass the current timeshare legislation, instead of purchasing weeks in an apartment the unwary consumer is sold “participations” in apartments which are “registered” as companies. These companies are administered by Silverpoint and Excel Resorts, with the purchaser believing they are “investing” in a “company”. The terms of the contract are complex, with purchaser having no rights to know who the other participants (share holders) are, they also have no right to use the apartments they have purchased these in these “participations”, but are given weeks they may use in other apartments and resorts.

As with the old Silverpoint scheme of “investment weeks”, purchasers are promised a variety of incentives, these are in the form of “dividends” paid each year for the rental income of the “participations” they have purchased, unfortunately many are still waiting to receive them. They also then have the option after 3 years to “sell” their “participations”, but not on the open market, they can only be “sold” to other participants, but only through Silverpoint who will broker the sale.

In the latest sentence, the judge has clearly stated that these “Company Participations” contracts are a blatant disguise of a timeshare product.

The sentence also states and reiterates the ruling from the Supreme Court (STS16/2012 of 16 January) that these purchasers are indeed Consumers and not investors. (Page 2 of the sentence PDF below)

Silverpoint Sentence 13 Dec

The court declared the contract null and void and ordered Silverpoint to return the full purchase prices plus double the deposit paid, a sum of over 108,000€.

The courts have also place another 3 embargoes on Silverpoint accounts securing over 130,000€ for clients who have been awarded their money back.

The Supreme Court has issued their 130th ruling against the timeshare industry, the very first against Diamond Resorts!

The court has upheld previous rulings that the points system is illegal, along with the perpetuity contract which contravenes the maximum duration of 50 years as demanded by law.

Diamond Supreme Court 11 Dec

Although the amounts awarded are not substantial, this ruling now proves that even Diamond are not immune from being prosecuted under Spanish Law.

Both of these cases have been brought on behalf of clients by Canarian Legal Alliance, the leaders in the field of timeshare litigation.

In other news, it has been announced that the CEO of the American Resorts Development Association (ARDA), Howard Nusbaum is to retire in 2019. The board of directors has appointed a committee to search for a new CEO, the members will be working alongside a leading executive search company Spencer Stuart, who will be managing the process.

Whoever is appointed will certainly have a lot on their plate, the timeshare industry is in dire need of a thorough shake up, so let us hope that the new CEO will have the guts to make sure their members start to treat consumers in a better way than we are seeing at the moment.

So that’s it for today, if you require any information on any of the articles published, companies that have contacted you or would like to know where you stand in regards to your purchaes of any timeshare product, especially the “company participations” from Silverpoint, then use our contact page and we will get back to you.

Friday’s Letter from America

Welcome to another Letter from America, the original article which was going to be published today has been replaced, this is due to the timeshare company reaching out to the members. As always, Inside Timeshare sends a draft copy to the timeshare company for comment, we do not always get a response, but on this occasion the company did respond. It may have been at the eleventh hour, but we congratulate the timeshare company concerned for their reaching out and we hope that they are able to resolve the matter.

As a last minute replacement we publish a revised version of The Peasant of Venice and the Queen of Versailles, by Irene Parker, originally published in November 2016.

This week has been a rather quiet one as far as the courts are concerned, there have been many cases going before the judges, but the sentences are unlikely to be announced until the New Year. Although we did get news of two sentences issued this week.

The first was from the Court of First Instance No4 in Maspalomas, Gran Canaria, the judge in this case declared the contract with Anfi null and void. The reason was the length of the contract which exceeded that allowed by Spanish Timeshare Law 42/98, which states that perpetuity contracts or contracts with no end date and exceed the 50 years maximum are illegal. The client in this case has been refunded over 61,000€ plus legal Interest.

At the High Court No4 in Tenerife, Silverpoint was on the receiving end. The contract was declared null and void as it did not include any tangible product. Again under Law 42/98, a timeshare must include specific information such as a set apartment or an exact time of year. The client in this case has been refunded over 10,000€ plus legal interest.

Once again these cases were brought on behalf of the clients by Canarian Legal Alliance, contrary to what some forums run by some very dubious characters will tell you, these are genuine cases and are a matter of public record.

     

Now for this week’s replacement article.

The Peasant of Venice and the Queen of Versailles Revisited

    Jackie Siegel, Queen of Versailles  

By Irene Parker

December 14, 2018

“The Peasant of Venice and Queen of Versailles” article was first published November 6, 2016. I wrote the article because I wanted to explain how I went from being a 30 plus year timeshare owner without a timeshare complaint, question or post, to a full time volunteer whistleblower.

In July of 2015 I experienced a pathetically aggressive timeshare sales presentation in Florida. We had previously purchased points in Virginia because the company said they were adding New York properties, only to learn it would take about $10,000 in equivalent maintenance fee dollars to stay at the same hotel, same week that could be booked online for $1,000 plus tax. When I checked December 1, 2018, it would have cost $12,000 using our timeshare points. I don’t blame the sales agent. He may not have known about the poor value. It was the response from the company to the Attorney General listing all the times we had used our points prior to that purchase that bothered me. Eventually I was offered our money back for that purchase, but could not bring myself to sign the non-disclosure agreement.       

Rosa Parks said, “I was just trying to get home from work.” In my case, we were trying to get to our new home, moving from Bowling Green, Kentucky to Venice, Florida. It was my intention to return to my first love – teaching piano lessons. That all changed after the revolting timeshare presentation we experienced in Florida.  Disgusted, I returned to our unit, turned on the television and witnessed the jaw dropping house pictured above, being built by Westgate timeshare owners Jackie and David Siegel. I could not resist.

It was a hot July summer day in Orlando when my retirement turned upside down.

We entered the hospitality area where we were invited to attend a 55 minute “information only” presentation for existing owners. “Will we be paired with a commissioned sales agent?” I asked three times. “No”, Julie replied, “Only if you have questions in the last ten minutes. I attended and I learned a lot! We have group presentations now because we had so many complaints about high pressure aggressive sales sessions.” We did not sign the form agreeing to the 55 minute meeting because the fine print said we would be robo-called if we did. We were robo-called anyway. There was no form to be signed for the three hours that followed the 55 minutes.

A Diamond Resorts member recently sent me this comment from a former Diamond concierge describing an unfair and deceptive practice:

Concierge (Former Employee) – Virginia Beach, VA 23451 – December 3, 2018

A typical day of work consisted of misleading current owners and their guests in order to persuade and entice them to attend a timeshare meeting that could last well over what was initially disclosed….The hardest part of this job was knowing I was intentionally misleading owners/guests of the length of time for their timeshare meeting, as well as not disclosing it as a timeshare meeting as instead it was mandatory we refer to it as simply an “update on their current status” or “ways you can stay here and affiliated businesses in the future”. The most enjoyable part of this job was the interaction with varying people and the connections I gained therein.

https://www.indeed.com/cmp/Diamond-Resorts-International/reviews

Our Nightmare on Timeshare Street begins:

The next day we entered the reception area to be greeted by an attractive young lady. “Hello,” Donna greeted us. “Are you a commissioned agent?” I asked.  Puzzled, she took us by the arm and escorted us to the 55 minute presentation, retrieved us immediately after, and led us to her den.

I told Donna, “My husband is 77 years old. We do not want to invest in vacation plans because we need to investigate long term care plans.” “Why, we have many in their 90’s who come and enjoy our resorts!” she cried. “But we are in the middle of building a house and have no permanent residence at this time,” I countered. Kneeling and looking up, she gazed into my eyes and confessed she was a single mother and had to resort to her Diamond points when she divorced. “I know you didn’t put all your money in that house though,” she added. I kept saying over and over, “We don’t want to travel. We like our new house.” Frustrated, the manager ended by advising me to go to the website if I want to find out what’s new. Three hours and three sales agents and managers later, we returned to our unit.

I checked my email and learned the 4,500 points we had been promised for our Port Elsewhere Ozark timeshare deposit was credited only 3,000 points. Sure enough, I learned later the 4,500 points promised could be changed at any time for any reason. It’s all in the fine print.

I then decided to take my mind off this disturbing revelation by watching television. I turned on the FOX news show Property Man show hosted by Las Vegas Attorney Bob Massi, and there she was – The Queen! The King and Queen of Westgate timeshare were building a 90,000 square foot home that defied the imagination. Jackie’s clothes closet is 5,500 square feet!

http://www.realtor.com/news/trends/queen-of-versailles-q-and-a/

Thinking about the pathetically aggressive timeshare sales presentation we were deceived into attending, and the worthless points specifically purchased to stay in New York City, I wrote to Mr. Massi at Property Man never dreaming I would earn a response. Copying the letter to Diamond customer service, they credited the correct amount promised for our Port Elsewhere week.

A few months later a FOX producer called. I was asked if I would be willing to be interviewed by Mr. Massi. The producer told me the Queen of Versailles show wasn’t even about timeshares. It was about their house, but FOX had been flooded with timeshare complaints. She said I was the only viewer they asked to interview because I was the only respondent who said I wanted to talk about the positives in addition to the negatives of timeshare. I told her I was sorry, but I had just accepted a position as interim music director for a large church and could not participate, but I offered to research timeshare to help them with their talking points.

I started digging. The deeper I dug, the more alarmed I became. Wyndham, Westgate, Bluegreen and Diamond seemed to have the most complaints, with Disney, Hilton and Marriott far fewer. I submitted my research to FOX and returned to the choir. Six months later, after arranging a flight to Phoenix to stay at  a Diamond resort in Sedona, I received a call from the FOX producer, asking if we would agree to be interviewed by Mr. Massi in Phoenix as they had interviews scheduled that weekend. Some things are meant to happen.

The FOX producer told me David Cortese of Magical Realty had also been interviewed by Mr. Massi about timeshare resales. David is a member of the Licensed Timeshare Resale Broker Association (LTRBA). After viewing David’s segment, I contacted him to see if he would sell our Diamond points. I was told their company would not accept a listing to sell Diamond points. I surveyed all 64 LTRBA members and 22 responded also saying they felt Diamond points were worthless on the secondary market. “We feel Diamond has placed too many restrictions on the use of secondary points to be of any value to a buyer,” they sadly explained.

One of the LTRBA members asked if I would speak with a Hispanic family. Since this first October 2016 complaint, the calls and emails have not stopped. I have heard from 646 timeshare members.

Timeshare members want straight answers but straight answers are in short supply at some timeshare customer service desks. Callers or emailers explain how a sales agent lied to them, but when they contacted the timeshare company they were told, “You signed a contract.” Some described how the rescission period was dodged. Some things, like over promised availability, can’t be determined by reading the contract. I feel I was deceived by reading the contract which stated, “You can sell your points but we will not assist you.” They left out the part about no buyers.

From the October 2016 article describing what happened to the Hispanic family:

Maintenance fees increased to the point where they could no longer afford to own their points. The family soon found that they had to charge maintenance fees to their credit card in order to pay them. The family had already taken out a $33,000 home equity loan from their credit union to reduce the high loan interest rate, typically 14% to 18%.

In August 2015, when they complained about maintenance fees, they said that a sales agent tried to convince them to purchase another 10,000 points in order to achieve Platinum level. He said that by being Platinum, it would allow the couple to pay their maintenance fees with their points, as only Platinum members are allowed to use their points to pay maintenance fees. Then and now Platinum members can pay maintenance fees at $.04 per point, so if all 50,000 points were tendered, it would pay $2,000 towards a 2018 $8,631 maintenance fee bill.

If the family had agreed to the additional 10,000 points, they would have gone further into debt with little recourse. Based on hundreds of reported responses, if they had purchased the points, they would have been told, “You signed a contract” or “We are not responsible for what our sales agents say.” They have a daughter who just graduated from high school and has started college.

I spoke to the family not long ago. They relinquished their $60,000 worth of points that they had accumulated. They are still paying off the home equity loan.

Contact a member of the Licensed Timeshare Resale Broker Association to find out if your timeshare has resale value.

Property Man was preempted due to the 2016 election coverage, so our segment aired April of 2017. The Florida DBPR timeshare division only acted on 110 out of 2,360 timeshare complaints from April 2012 to April 2014, so ignore Pam Bondi.  Bob Massi and his advice on timeshare resales:

https://www.facebook.com/RealBobMassi/videos/1041694629230338/

From FOX I stumbled onto Jim Cramer of Mad Money’s investment news service TheStreet, where remarkable editors, possessing the patience of Job, provided a crash course in editing.

https://www.thestreet.com/author/1684637/irene-parker/all.html

A member who submitted an article to Inside Timeshare introduced me to Whistleblowers of America https://whistleblowersofamerica.org/. Accepting an invitation to attend a Whistleblowers Summit in Washington DC this year, I was introduced to OpEd News:

https://www.opednews.com/articles/Witness-to-Las-Vegas-Octo-by-Irene-Parker-America-181030-359.html

And of course, there’s Charles Thomas at Inside Timeshare in Spain and Wayne Robinson in Malaysia and Wayne’s book.  I was honored to edit and write the Forward. Everything About Timeshare, Before. During and After the Sale

https://www.barnesandnoble.com/w/everything-about-timeshares-wayne-c-robinson/1129749757?ean=2940161600962

So all in all, I’m getting great value from my timeshare points measured in the people I’ve met, readers who read my articles, and the gratitude from members who are grateful for straight answers. We especially appreciate our Facebook administrators and our growing team of members helping other members. I do believe we are a disruptor and hope our efforts will benefit sales agents who sell the product honestly, as well as forestalling new buyers and existing members from making a decision that has financially devastated more than a few families. When sold honestly, timeshare provides years of fun for friends and family.

We seek to provide timeshare 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.

https://www.facebook.com/timeshareadvocategroup/

https://www.facebook.com/groups/DiamondResortsOwnersAdvocacy/

https://tug2.com/Home.aspx

https://everythingabouttimeshares.com/consider-exchange-options/

https://www.facebook.com/groups/180578055325962/

https://www.facebook.com/groups/465692163568779/

https://www.facebook.com/groups/1639958046252175/

Thank you Irene for getting this article out to us so quickly, it is difficult to replace an article at such short notice, but at least the timeshare company did respond and for that Inside Timeshare was happy to replace the original one.

That’s it for this week, join us again next week our last one before Christmas.

To all our readers have a great weekend and remember to do your homework before engaging with any company that contacts you or that you have found on the internet.