Does David's tell you if the renter cancels?

[Mickey of the Villages]

IMO, this is backwards. It seems it’s the owner should be the one to understand the resorts could close, and bear the responsibility.
Let’s say you had a room reservation (you are the renter) at the Yacht Club. Disney is the owner, you are the renter. Disney closes the Yacht Club. Should Disney keep, or refund your money?

The owner does understand this.

That's why its a non-refundable transaction. The owner makes the reservation and then has no future liability.

The renter bears the risk of loss and in return gets the benefit of the use of the points without having to buy them. If the renter wants to mitigate their risk of loss they buy insurance.

 

[tallguy001]

IMO, this is backwards. It seems it’s the owner should be the one to understand the resorts could close, and bear the responsibility.
Let’s say you had a room reservation (you are the renter) at the Yacht Club. Disney is the owner, you are the renter. Disney closes the Yacht Club. Should Disney keep, or refund your money?

This is exactly right. Nobody would argue that Disney should/could keep the money. The reservation without a room is worthless and leaves the contract with no consideration.

 

[Matty B13]

If the renter wants to mitigate their risk of loss they buy insurance.

Or buy their own points.... renters can't have the advantage of not paying thousands of dollars for a contract up front and still expect to pay 50% of what Disney Resorts is charging by renting points.

 

[Dracula]

FWIW, I have rescheduled two renters that originally booked in March and April to December and January. When and if David asks me to reschedule another Aulani reservation from April, I am willing to do that as well.

 

[fsjking]

Or buy their own points.... renters can't have the advantage of not paying thousands of dollars for a contract up front and still expect to pay 50% of what Disney Resorts is charging by renting points.

Owners can't get the advantage of cheaper reservations, and still expect someone else to pay their maintenance fee through point rentals.

 

[Dracula]

Owners can't get the advantage of cheaper reservations, and still expect someone else to pay their maintenance fee through point rentals.

I read this three times, and could not figure it out - how does that make sense?

 

[Sandisw]

The owner does understand this.

That's why its a non-refundable transaction. The owner makes the reservation and then has no future liability.

The renter bears the risk of loss and in return gets the benefit of the use of the points without having to buy them. If the renter wants to mitigate their risk of loss they buy insurance.

I think this is where I have to disagree. That no refundable statement was to let the renter know that once they agreed to a reservation, they could not back out of the deal,

Once the owner can no longer deliver the reservation, that non refundable clause does not necessarily apply . That is not to say it means the owner should be 100% on the hook, since it isn’t their fault either.

But, it does mean that without the contract specifically saying it includes resort closure, it’s not that simple.

 

[fsjking]

I read this three times, and could not figure it out - how does that make sense?

The PP made a statement that renters should just buy their own points. The counter to that is owners should stop renting out points and pay the MF's out of their own pocket. The owners benefit from this just as much as the renters or they wouldn't do it.

 

[Matty B13]

Owners can't get the advantage of cheaper reservations, and still expect someone else to pay their maintenance fee through point rentals.

Why not, we spent thousands of dollars up front to have access to cheaper reservations. Owners costs aren't just MF's but the additional capital to buy the contracts.

 

[fsjking]

Then renters can get the advantage of paying 50% of the resort rates without the huge upfront cost. Both take the other to exist.

 

[Van Houten]

They chose to make the reservation to the renter on a date their points were soon to expire. Even though it is of no direct fault of their own, they are being "made whole" by DVC.

In fact, DVC is already stating in their announcement that they have plans for those owners who have points expiring shortly - they are just waiting for the whole thing to settle.

At this time, we have not made any changes to our Points banking or expiration policy due the impact this could have on future inventory availability. We understand this is of particular concern for Members with reservations affected by closures and/or the COVID-19 situation who may be toward the end of their Use Year. We are, however, currently evaluating various options to assist Members in this situation, but will need to delay any decisions until we better understand how long COVID-19 will impact our operations.

 

[Brianstl]

It‘s not as straight forward as that, complicated by the no refunds and no changes clauses. Whilst I will do what I can to help the renter I have because I feel it’s the right thing to do, I am not obligated to.

Well, legally, you are going to be obligated. You are a property owner who is renting property that you can't make available to the renter. Under no circumstances can you keep the money. You attempt to and you open yourself not only to civil judgement against you, but criminal charges as well.

 

[Brianstl]

Except the broker is going to be on the hook for a lot of it, for renters who pursue it I wonder if his business will survive

David's is going to be suing a bunch of owners.

 

[tallguy001]

Well, legally, you are going to be obligated. You are a property owner who is renting property that you can't make available to the renter. Under no circumstances can you keep the money. You attempt to and you open yourself not only to civil judgement against you, but criminal charges as well.

This. The open discussion of grand theft here is fascinating.

 

[Van Houten]

The owner does understand this.

That's why its a non-refundable transaction. The owner makes the reservation and then has no future liability.

So what you are saying is:

• The owner buys a real estate interest from DVD, which specifically states that points have no value, exist only to facilitate reservation process within the time allotted, and such reservations are intended for personal use only.
• The owner offers to make a reservation using the privilege of points (which have no value), and charges the renter money for it (while DVD / DVC looks away).
• The real estate association the owner belongs to vacates the property and cancels all reservations, with points being returned to the owner.
• The owner pockets the points for future use, but refuses to return any money paid by the renter, stating as the reason that the points might be expiring soon, or even if they are not, that the renter's money is already gone.

 

[Sandisw]

David's is going to be suing a bunch of owners.

I didn’t think of that but I wonder. Who knows how many actual renters are filing disputes, but I would venture that since some renters have been successful in winning, most will,

If this closure goes on much longer, that could trigger that type of response,

 

[Dracula]

David's is going to be suing a bunch of owners.

If David is out of business (I hope not), he would be in that position because he is out of cash. Even now things must be dire - I imagine all the nice people working there expect to get paid, but I don't see David making many new reservations at this time, they are probably all consumed by communication with existing owners and renters. I am curious how much of the retained 30% is left... Suing many of your customers, either owners or renters, is rarely a good idea for someone looking to be in business in the long term.

 

[Brianstl]

I agree that this is a difficult discussion.

Again, I'm neither a renter nor owner who has rented points.

The contract cannot require that the owner do anything more than make a reservation, right? I mean all the owner has is points so all the owner could ever do is make a reservation.

Reasonable renters must be aware of situations in which the resorts could close, right? What if there was another 9/11-type attack, what if there was a meteorological event (tornado, hurricane), what if there was a war and it interrupted the resorts. These are all risks that could have affected a renter. We must presume renters were aware of these risks, right?

I haven't read the contract but it seems to me that the only thing the owner could contract for is a reservation using her points. That's all she had to offer. The renter must have understood that's all the owner had to offer. The owner does not offer a reservation AND a warranty that the resort will be open the day of the reservation. That's what insurance is for.

Do you believe that the owner warrants that the resort will be open? Is there evidence of this in the contract?

The owner is actually a property owner. That property owner has agreed to a contract that allows DVC to close down their property on their behalf. I am pretty sure legally that is just the same as the DVC owner themselves closing down the property. I believe that will make the DVC owner liable for any losses suffered by a rental broker or renter.

 

[Dracula]

At this point I have 5 standing reservations made for David's customers, from April to October. Of course, I am willing to rebook / reschedule all of them, if needed. I am wondering, if David fails to pay the 30% retained as per contract for the first one, would it be ethical for me to cancel one or more of the other reservations? Normally, if David is bankrupt, that should not be the fault of another renter, who already paid David in full. But nor should I as owner be expected to allow my points for reservations to be used by David (or his customer, really) once it is known David would not make good on his contract. I guess I could contact the renter and ask him to do a charge back, then pay me directly, but this would break my contract with David. But David would have broken the contract first by not paying the 30%. Let's hope it would not come to that...

There are reports of a travel agent, bookit.com, that went bankrupt this week and tourists have been asked to pay upon checkout at the resort, after they already paid bookit - this seems like a similar situation.

 

[Van Houten]

Why not, we spent thousands of dollars up front to have access to cheaper reservations. Owners costs aren't just MF's but the additional capital to buy the contracts.

Owners spent thousands of dollars on what is marketed as a personal lifestyle choice, just as any other timeshare. Additionally, this choice comes with recurring annual fees - which in the end, for someone who chooses to regularly stay in high-end resorts for vacation, is a net savings over the rack rate.
However, when such regular stays do not pan out, timeshare owners are looking for alternative options, something outside of the program, which provides them with flexible means to exchange the timeshare interest they locked themselves into for a more universal medium (cash). From that perspective, owners who are not in position to use all the points they bought need renters. If the rental market goes away - so does this cash exchange option. And yet, mismanagement of this event by the owners will likely have a massive impact on availability of renters with deep pockets, as the stories of embezzling by owners will persist on these boards for years.