- The Many Ways to Rid Yourself of Timeshare Ownership
- April 22, 2013
- Law Firm: Mitchell Reed Sussman Associates - Beverly Hills Office
While it is true that a timeshare contract is a binding legal document, it is often mistakenly thought that such a contract cannot only be cancelled. In fact, most timeshare companies maintain that their contracts are not capable of being cancelled.
This misconception is perpetuated by timeshare companies and user groups that are funded, maintained and controlled by the timeshare industry.
The truth of the matter is, that under the law, contracts are subject to being cancelled for a variety of reasons, including fraud and mistake.
Moreover, a person who is burdened by the obligations of a contract may "terminate" it and no longer be bound by the contract for reasons other than breach.
"Cancellation" occurs when either party puts an end to the contract for breach by the other and its effect is the same as that of 'termination' except that the canceling party also retains any remedy for breach of the whole contract or any unperformed balance." Uniform Commercial Code 2106(4); see 13 Corbin (Rev. ed.), §73.2; 13 Am.Jur.2d (2000 ed.)
"Termination" occurs when either party, pursuant to a power created by agreement or by law, puts an end to the contract otherwise than for its breach. Uniform Commercial Code sec. 2106 (3)
Since it is the law of the land, that a breach of contract by a party to the contract may result in the other party being released from their obligations under the contract, the notion that one is forever bound by a timeshare contract is erroneous as a matter of law.
The purpose of this article is to provide a ray of hope to those timeshare owners who are no longer interested in being tied to their timeshare and its lifetime of financial obligations.
To start, when you first purchase your timeshare, most states have a rescission, or "cooling off," period during which timeshare buyers may cancel their contracts and have their deposit returned. This is know as the "right of rescission."
Once this period expires, however, most timeshare companies will have you believe that their contract is not capable of being cancelled and you are thereafter bound in perpetuity to pay the ever increasing maintenance fees that go along with timeshare ownership.
Moreover, the proponents of timeshare ownership would have you believe that once the initial "right of rescission" expires the only legal way to end timeshare contracts involve a transfer of ownership whether by selling, donating or giving it away.
In fact, most timeshare user groups and virtually all timeshare companies want you to believe that under no circumstances will a timeshare company voluntarily take back their timeshare. This again, is not true.
What is true is that most timeshare companies will not willingly take back their timeshare. As will be seen below, when faced with litigation or the potential of litigation, many timeshare companies will in fact either take back their timeshare or simply agree to release the timeshare owner from any future liability in connection with the timeshare contract.
Before I discuss the latest developments in cancelling a timeshare, I'd like to devote a little time to the more traditional means of cancelling or getting rid of an unwanted timeshare.
As mentioned above, the traditional means of ridding oneself of an unwanted timeshare is through a sale, donation or transfer.
On the subject of selling a timeshare, many unwary timeshare owners seeking to rid themselves of their timeshare fall pray to listing companies that propose to list their timeshare for sale. Such companies have been under investigation by state Attorney General's for fraudulent and deceptive practices and a proposed timeshare seller wishing to sell his or her timeshare obligation should first consider selling their timeshare by listing it on sites like eBay or Craigslist.
Other options are to list it through the developer, if the developer handles re-sales, or through a timeshare resale broker. One thing the proposed timeshare seller should not do is pay an advance fee for the sale of their timeshare. It is these advance fee practices that have fallen under the scrutiny of state Attorney Generals.
Another frequently discussed solution to the problem of how to be released from your timeshare's financial burdens, is to donate the timeshare. Where there once were a number of organizations that accept deeded-timeshare donations, with the ever increasing burden of maintenance fees which seem to go up every year, such organizations are a vanishing breed.
More information on this subject can be found at www.timesharelegalaction.com