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Timeshare Consumers Association

With the recent surge in the number of owners who have stopped paying their annual fees – we estimate that over 30% of UK owners have not paid for 2011 – timeshare clubs and management companies are becoming more aggressive in the way they attempt to collect un-paid fees.

For many consumers the threat of legal action (including letters from debt collectors and bogus debt collectors) is an entirely new experience which can be very scary and distressing, so the following notes are intended to put the threats into perspective.

• Although a large number of resorts send letters threatening legal action, and some use debt collectors or lawyers in support, very few actually take legal action. See here for a list of resorts that threaten.
• If they really want you to pay their ONLY option is to issue a claim in the courts (County Court in England & Wales or Sheriff Court in Scotland) and win their case.
• Of those who have actually taken owners to court, not all have been successful. And, as we gain experience of the defences that work, the number of successful claims will reduce.

The following is a list of typical defences that may be relevant – but remember that each resort and each purchase will be slightly different so a defence that works in one situation may not necessarily work in another. Only a lawyer can advise in each specific case.

• Out of jurisdiction. Many timeshare purchase agreements are regulated by a jurisdiction outside the UK. Typically the Isle of Man; Spain; Seychelles,; Gibraltar; British Virgin Islands etc. . This makes it very difficult, if not impossible, for a resort to take action in the country in which the consumer resides (or has assets) . An Isle of Man court, for example, cannot force a UK citizen to make any payments.
• Absence of contractual relationship. It is not unknown for a purchase agreement to be unenforceable because the party claiming the debt has no contractural relationship with the owner against whom they are claiming.
• Breach of contract by the resort. It is also not unknown for the resort to have made a substantial breach of the contract – perhaps by increasing annual fees over and above what is in the agreement - which denies them the right to take legal action for the fees.
• Misrepresentation. This is an almost universal defence in timeshare matters but it is often difficult for an individual to use with success being one person’s word against another – although judges would be more inclined to accept the word of an ordinary man-in-the-street than that of a timeshare salesman. But, misrepresentation is a very powerful defence when used by a group of defendants because they will all be disclosing , almost, exactly the same lies they were told as each other.

How to deal with threats of legal action for non-payment of annual fees.

If you receive a letter from the resort then write, by recorded delivery, saying:-

• That you were told a pack of lies to get you to purchase = misrepresentation. See here for typical examples.
• That their annual fees are probably illegal & certainly exorbitant
• That their contract terms are in breach of the Unfair Terms in Consumer Contracts
• That , if court proceedings are issued, the claim will be robustly defended and a counter claim considered.

Keep a copy of the letter

Then stop all annual fee payments and TOTALLY ignore all subsequent correspondence.

If you then receive a letter from a debt collector or lawyer acting on behalf of the resort, send them a copy of the letter and again ignore all subsequent correspondence.
Debt collectors make their money by scaring people into paying. Intimidation; harassment and extortion being their standard tools.
The last thing they want to do is take a claim to the courts – it costs them money and they could easily lose. They almost never take a claim to the court where the consumer has made it clear that any claim in the court would be robustly defended.
Very few debt collectors send someone to a consumers home because the consumer is entitled to tell them to “get lost” and slam the door in their face.
If a debt collector teleohones you at work then write, by recorded delivery, saying that they MUST never call you at work. If they do not comply with this instruction then report them to the Office of Fair Trading - address here

Debt collectors cannot, without first getting a Court Order:-

• Send a bailiff to a consumer’s house to remove goods ("Warrant of Execution")
• Put a default notice on the consumer’s credit rating
• Obtain a charging order on a property
• Obtain an order for attachment of earnings
• Obtain an order for a bank to make the payment from the consumer’s bank account

If you get a Court Claim   (Which is NOT the same as a Court Order)

The Timeshare Consumers Association has made arrangements with solicitors, Linder Myers in Manchester, to act for owners who have actually received a County Court claim (or a Sheriff Court warrant in Scotland).

Linder Myers have agreed to investigate the possibility of doing this work on a group, shared cost, basis.

Only contact Stephen Boyd of Linder Myers if you actually receive a Court Claim – stephen.boyd@lindermyers.co.uk

Note: - If you receive a European Order for Payment “EOP” see here .

WARNINGS.

1. Some organisations have been set up, paid for by the timeshare industry, to advise owners to continue paying irrespective of the circumstances.
2. A number of timeshare traders have set up bogus "Debt Collection" agencies or bogus lawyers to intimidate and harass owners into paying annual fees. If these bogus businesses are operating from the UK then they are breaking the law in not having a valid Consumer Credit Licence issued by the Office of Fair Trading. If you suspect that a business claiming to be "Debt Collectors" is bogus, then report them to the Office of Fair Trading, Salisbury Square, LONDON, EC4Y 8JX