News Column

Scots locked in timeshare fight with country club in England

August 9, 2014

SIMON BAIN; SIMON BAIN

As the timeshare industry responds to the crisis of thousands of ageing owners trapped in apparently everlasting contracts, dozens of Scottish owners are embroiled in a bitter legal battle with a resort just over the Border.

The Herald last week highlighted how a Glasgow man has unwillingly inherited the Macdonald Resorts timeshare liabilities of his mother who died two years ago aged 89, despite the promise of timeshare trade body the Resort Development Organisation (RDO) to release owners from "in perpetuity" contracts in the event of their bankruptcy or death.

This week the 23,000 owners at Macdonald's nine resorts have been voting on its industry- leading proposals to allow a contract exit on payment of four years' maintenance fees, though the Timeshare Consumers Association and claims firm Praetorian Legal have both advised that the fees amount to exit penalties that could not be enforced at law.

Now one group of owners, including more than 100 from Scotland, has gone to court in an attempt to find an escape route from the privately owned Akeld Manor and Country Club in Northumberland, which has no connection to Macdonald. The group recently staged an owners' meeting that voted 149-1 in favour of resolutions designed to bring about a legal arbitration over what owners claim is a refusal by the resort's owner to enter any negotiation over its constitution and administration.

They say owner Patricia Allan will only deal with individuals, not the group representing owners of almost half the maximum 500 weeks available at Akeld; that she has refused to allow the club management committee to see a list of members; and has regularly intervened to prevent sales of weeks agreed by owners with buyers.

Dunfermline-based Mary Nasmyth, who was a member representative on the management committee from 2011 to this year, said: "Many members want to leave because they are now retired and on much reduced incomes, many have tried to sell, others fear that they must pass this growing financial burden to their children.

"We have got people with power of attorney, members well into their eighties, and the membership profile is 80 per cent over 60.

"The members are trapped and soon many will have no ability to meet the fees and no hope of escape from their contract. "

In 2012 a poll of members found 234 wanting to exit, but when a buy-out offer was made available to owners last year, the cost was about 10 years' maintenance fees, Mrs Nasmyth said, or in her case more than pound(s)6,000. She said Akeld had taken many members to court for non-payment, which meant they were never able to use their timeshare as they were permanently in arrears, but were still responsible year on year for escalating maintenance fees.

"Some members are the subject of IVA (voluntary bankruptcy arrangements) who have approached Mrs Allan to be released but to no avail," Mrs Nasmyth said. "Other members have surrendered their certificates and "resigned" from the club, to have their resignation and membership certificate returned." Mrs Nasmyth estimates that up to 150 members are based in Scotland.

"We are about to move to arbitration on a list of grievances, as ruled by a judge at a hearing in March, and it has taken us three years to reach this point. We have used the club constitution to call special general meetings and put forward resolutions in efforts to open negotiations with the owner, but every attempt has been dismissed."

Mrs Nasmyth added: "The European Commission has ruled on the sale of timeshare but has done very little to alleviate the ongoing financial misery for those already trapped in the system.

"Unless the message gets through to these timeshare developers that ultimately the business model is defunct, the crisis will continue."

The Timeshare Consumers Association says Akeld is among 11 resorts, along with UK resorts run by Macdonald, that have "threatened legal action for non-payment of annual fees, sometimes using debt collectors or solicitors".

On its external sales website, the business says: "In recognition of all the awards achieved and standards maintained, Akeld Manor is placed within the top 20 per cent of self-catering holiday resorts in Europe."

The Herald put a list of questions by e-mail to Mrs Allan this week but has received neither an acknowledgement nor a reply.

A spokesman for Macdonald said: "Macdonald Resorts has gone to extreme lengths and costs to provide a solution agreeable to the club committees for those people that wish to continue with their membership or exit."


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Source: Herald, The (Scotland)


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