DVC plans to target commercial renters

[DonMacGregor]

Also, if you read the CFW POS, it's getting even more restrictive with every new resort:

5.7 Except for Ownership Interests owned by DVD, rentals of Vacation Homes to the general public by any of The TWDC
Companies including DVD and BVTC, reservation or use of Vacation Homes and facilities of a DVC Resort is limited solely to the
personal use of Club Members, their guests, invitees, exchangers, and lessees and for recreational use by corporations or other similar
business entities owning Ownership Interests while staying as a registered guest at the DVC Resort. Except for any of The TWDC
Companies, purchase of an Ownership Interest and reservation or use of Vacation Homes and facilities of a DVC Resort for
commercial purposes or for any purpose other than personal use is expressly prohibited. BVTC shall be the sole determiner, in its
discretion, of any use or activity that does not constitute personal use or constitutes commercial use under this Agreement. Such
commercial purpose could include a pattern of rental activity of reserved Vacation Homes or frequent occupancy by others of reserved
Vacation Homes other than a Club Member or the Club Member's family; use of regular rental or resale advertising; creating,
maintaining, or frequent use of a rental or resale website; repeated or frequent purchase and resale of Ownership Interests whether in
the name of a Club Member or those related to such Club Member or through the use of entities, partnerships, or trusts; or the
acquisition of a number of Ownership Interests in excess of the amount of the maximum permitted ownership whether in the name of a
Club Member or those related to such Club Member or through the use of entities, partnerships, or trusts.

Now, it's not just "maintaining a rental or resale website", with the latest DVC it's now "creating, maintaining, or frequent use of a rental or resale website". Let that one sink in...

Of course, the DISBoards debate will be over the definition of "frequent", completely glossing over the fact that the language was added for a reason, and it wasn't to limit Disney's ability to ferret out commercial use. Now, "frequent" is certainly vague and ambiguous, and it suggests that limited or "occasional" use of rental sites isn't a concern, but the fact that previous resort POS's made absolutely zero mention of using rental sites whatsoever and whereas the newest one does, is inarguably of some merit.

 

[Sandisw]

There are a lot of people who have plans change inside a month too, and DVC has no problem penalizing them. When the rules of engagement change people change their behaviors to match.

Of course they do and that penalty is there for all to see as well as for the benefit of the membership as a whole.

The flip side is that owners enjoy a very flexible program that only penalizes them at less than 31 days out.

Change it to everything is a cancel and rebook? Can’t think of any way DVC can say that type of change is for the benefit and enhancement of the membership.

 

[Sandisw]

As I was saying...

As to all that other stuff, I never made any suggestion or assertion that the advertising issue related to ANY resort specifically or all of them in general. I simply asked a question regarding what thoughts others have on the advertising issue, regardless of which or how many resorts it might apply to (but it applies to RIV and VDH at a minimum).

And my first answer applied for advertising in general and you corrected me that you were talking about the contract language.

Now I answered you based on the RiV language and I answered that I think it could apply to RiV owners and not others.

My opinion is yes for RIv and beyond and no for pre RiV.

Not sure what more you are asking. And it’s why I think some have tried to make sure to include they are talking about pre RiV because they know the language changed.

 

[Sandisw]

Those specifics may not be enough individually but maybe those specifics could be used for what DVC sees as contributing to a pattern?

Absolutely,,,things in a singular nature can be seen differently than when it is more often.

That’s why I used the example that DVc might choose to “ignore” an owner renting 250 out of 500 points every year because they don’t think it rises to a high enough level for profit, activity, etc

But, they may not treat the 4000 point owner who rents 2000 the same way, even though both rent 50%

So, an owner renting one rental that is a high demand room as a spec rental may simply not be treated the same as someone who does it more often because it can support both.

 

[DVCSunDevil]

Also, if you read the CFW POS, it's getting even more restrictive with every new resort:

Now, it's not just "maintaining a rental or resale website", with the latest DVC it's now "creating, maintaining, or frequent use of a rental or resale website". Let that one sink in...

Of course, the DISBoards debate will be over the definition of "frequent", completely glossing over the fact that the language was added for a reason, and it wasn't to limit Disney's ability to ferret out commercial use. Now, "frequent" is certainly vague and ambiguous, and it suggests that limited or "occasional" use of rental sites isn't a concern, but the fact that previous resort POS's made absolutely zero mention of using rental sites whatsoever and whereas the newest one does, is inarguably of some merit.

I don’t think it is necessarily wrong for them to use that verbiage. The intent is not to have people who constantly rent their points. Doing so is commercial renting. If someone needs to rent the points once in a while, fine. But if a pattern of renting (ie “frequent”) arises then that goes against the spirit of DVC allowing renting.

I think that is the most important thing when having this conversation…what is the pattern? DVC wants to give its members flexibility and leeway for when things in life happen, but if a pattern emerges then DVC should have the right to shut it down.

 

[Sandisw]

Also, if you read the CFW POS, it's getting even more restrictive with every new resort:

Now, it's not just "maintaining a rental or resale website", with the latest DVC it's now "creating, maintaining, or frequent use of a rental or resale website". Let that one sink in...

Of course, the DISBoards debate will be over the definition of "frequent", completely glossing over the fact that the language was added for a reason, and it wasn't to limit Disney's ability to ferret out commercial use. Now, "frequent" is certainly vague and ambiguous, and it suggests that limited or "occasional" use of rental sites isn't a concern, but the fact that previous resort POS's made absolutely zero mention of using rental sites whatsoever and whereas the newest one does, is inarguably of some merit.

You may not remember but when this was found, there was a big discussion about it and how important these changes were going forward because DVC was obviously moving toward a much more restrictive product.

It was in that discussion that some legal analysis said it can not be used to apply retroactively.

I know some legala think differently but it was definitely discussed that this was a big change and even @zavandor mentioned this earlier and that those that might want LL as a home resort and have any flexibility to rent might want to read that clause carefully.

 

[DonMacGregor]

I don’t think it is necessarily wrong for them to use that verbiage. The intent is not to have people who constantly rent their points. Doing so is commercial renting. If someone needs to rent the points once in a while, fine. But if a pattern of renting (ie “frequent”) arises then that goes against the spirit of DVC allowing renting.

I think that is the most important thing when having this conversation…what is the pattern? DVC wants to give its members flexibility and leeway for when things in life happen, but if a pattern emerges then DVC should have the right to shut it down.

I don't have any problem with them using the language. I'm simply pointing out that over the last three new DVC resorts, the POS for each has expanded the criteria for DVC's determination of commercial use. First, with RIV and VDH, they added the "advertising" language, and now with CFW they have expanded "maintaining a rental or resale website" to "creating, maintaining, or frequent use of a rental or resale website". I think that is key. It's likely to be in the Lakeshore Lodge POS, regardless of whether that resort is combined with CFW or not as well.

I mentioned the use of "frequent" only because, as well all know, the DIS Boards prefer to argue the definition of a single term rather than discussing the implication of the clause as a whole. I was simply anticipating that single word being the focus of discussion, rather than the more seminal importance of the addition of the associated and as I see it, more restrictive language. I don't have any issue with their use of any of the words used in that clause.

 

[Sandisw]

I don’t think it is necessarily wrong for them to use that verbiage. The intent is not to have people who constantly rent their points. Doing so is commercial renting. If someone needs to rent the points once in a while, fine. But if a pattern of renting (ie “frequent”) arises then that goes against the spirit of DVC allowing renting.

I think that is the most important thing when having this conversation…what is the pattern? DVC wants to give its members flexibility and leeway for when things in life happen, but if a pattern emerges then DVC should have the right to shut it down.

And I think that the change in language means something and that is they want to make sure it is clear.

What is interesting is that they have chosen not to amend the pre RiV resorts and one potential reason is they can’t.

I mean it certainly makes it much easier to enforce the commercial purpose….clause when the POS outlines it in this detail.

 

[DonMacGregor]

It was in that discussion that some legal analysis said it can not be used to apply retroactively.

No one has suggested they will use it retroactively, and I certainly didn't raise it, so it's a moot point. My point is simply that DVC is slowly expanding their criterion for defining commercial use with each new resort.

 

[xdan0920]

What is interesting is that they have chosen not to amend the pre RiV resorts and one potential reason is they can’t.

They don’t have to. All they have to do is show that the new language is “reasonable”

 

[Sandisw]

They don’t have to. All they have to do is show that the new language is “reasonable”

But why not just change them to make them consistent?

If they went to the trouble of making these big time changes to RIV and the newer resorts, they did it because they wanted that language to be clear.

Like I said, some with extensive legal knowledge have said these rules can’t be applied retroactively and that the discretion that DVC has for the pre RIv resorts needs to be in line with what is there and not what is not.

I get others with legal knowledge believe the commerical purpose language is simply an an example.

Only DVC knows why they have chosen…and it is a choice…not to update all the POS documents to be the same.

One can assume it’s because it’s not needed but I am not so sure because it certainly would make it much easier for them to enforce.

So, IMO, it is possible that the analysis by those with legal knowledge are correct.

What I will add is with all of the concerns owners have brought to them and them saying they have added resources to address it, it certainly would make sense for them to update the language to RiV If for no other reason than to make enforcement a piece of cake.

If they don’t, and don’t use any of those RiV criteria, then it will beg the question as to why.

 

[DonMacGregor]

They don’t have to. All they have to do is show that the new language is “reasonable”

If I was a rental site, I wouldn't be losing sleep over losing VBR, OKW, BRV, or HHI rental traffic regardless (although it won't happen). Yes, there are several 2042 resorts that rent at a premium (BCV, BWV), and there are obviously the remaining post-2042 resorts, but as a percentage of total DVC rooms, they will steadily become a smaller cohort and will continue to do so over time. I think the Poly tower will be the last DVC rooms at WDW without the new POS language (or even more restrictive language) moving forward.

I also don't think DVC can retroactively change the POS for pre-Riviera resorts and I wouldn't want them to try. It's a very slippery slope that opens the door to too many other potential changes. An increase in post-Riviera resorts, and diminished demand for many of the older resorts will provide natural selection.

If I were a rental site, I WOULD be concerned if every shiny new (and potentially most valuable) DVC resort from Riviera forward had language in the POS raising the specter that owners utilizing the rental site could be exposing themselves to an allegation of commercial use, simply by listing their reservation on the site.

 

[Sandisw]

No one has suggested they will use it retroactively, and I certainly didn't raise it, so it's a moot point. My point is simply that DVC is slowly expanding their criterion for defining commercial use with each new resort.

I was trying to respond with you in a way that connects to the current situation because I thought that was your purpose in making the info known.

If it wasn’t, then I completely misunderstood the point of your post.

It’s definitely been discussed on and off here in this thread that DVCs changes in language are a move to being more expressly restrictive.

And while you didn’t ask or state anything related to this point, I do believe they did it because they had to.

 

[DonMacGregor]

I was trying to respond with you in a way that connects to the current situation.

If that is not the purpose of why you are bringing it up, then I have misunderstood your posts.

But as I said, it’s definitely been discussed on and off here in this thread that DVCs changes in language are a move to being more expressly restrictive.

And while you didn’t ask or state anything related to this point, I do believe they did it because they had to.

I bring it up because there have been several hundred posts that keep referencing back to this nebulous "20 rentals" language that no one has actually seen since 2008 (or whenever it was) as the primary criterion for defining commercial use, and I'm simply pointing out that the POS for resorts since Riviera have significantly broader and more clearly defined criteria for DVC to use as a definition for "commercial use", "commercial activity" or whatever term we're using today. The number of reservations may be moot, depending on resort. No argument that that is restricted to pre-Riviera resorts, and no one is suggesting that they can retroactively change that language.

However, I would disagree that the post-Riviera language has been discussed on this thread already, and if you do a search, you won't find any mention of the question of advertising or using rental sites in this thread prior to my query. I'm not sure everyone knows that the criteria, as outlined in the respective POS's, is significantly different and that not all rentals can be looked at under the same DVC microscope, and that DVC has very different toolboxes pre-Riviera versus Riviera-forward.

Yes, we have discussed it previously in other threads, but not in this thread, and I think it's important to keep in mind that while pre-Riviera POS's rely heavily on the ambiguity of the term "commercial" and the number of rentals constituting commercial activity (the ambiguity of the language is a primary reason this thread is now 73 pages long), Riviera forward, they may not even need to utilize a tally of the number of reservations made, and can avail themselves of a far broader set of criteria. Heck, with the cabins, just using a rental site some number of times is now on the list. I think that is important to the discussion, particularly when they include listing on a rental site as a potential trigger for review.

I own several hundred points at Riviera, and if I was to assume that the number of rentals I make in a year was the only criteria for defining commercial usage (as one might assume based on the rental count criteria utilized in older resorts), I'd be sorely mistaken as that ambiguous language does not relate to any resort from Riviera moving forward.

The topic of the thread is DVC planning to target commercial renters, and I'm simply pointing out that, depending on resort, DVC has increasingly broader discretion as to what they consider commercial renting, and I think that is VERY much connected to the current situation.

 

[WilsonFlyer]

Please pardon the intrusion, but could somebody give me a brief synopsis of what has changed or is going to change due to these 73+ pages of discussion?

Please and thank you.

 

[Genie+]

You may not remember but when this was found, there was a big discussion about it and how important these changes were going forward because DVC was obviously moving toward a much more restrictive product.

It was in that discussion that some legal analysis said it can not be used to apply retroactively.

I know some legala think differently but it was definitely discussed that this was a big change and even @zavandor mentioned this earlier and that those that might want LL as a home resort and have any flexibility to rent might want to read that clause carefully.

It could also just be DVC using the opportunity to add wording now that they know what the rental landscape is in post-2019.

It doesn’t necessarily mean they don’t think previous contracts have room to step in there, but now they know how things have changed with renting* and are writing/selling new contracts, it was wise be more descriptive.

Legally there always that chance a ruling doesn’t go as expected. The new wording could just be to lower that chance down to zero as close they can, at least for contracts moving forward.

*eta - and stripping/flipping and broker sites getting into the rental/resale action themselves too

 

[Sykes]

I'm not sure everyone knows that the criteria, as outlined in the respective POS's, is significantly different and that not all rentals can be looked at under the same DVC microscope, and that DVC has very different toolboxes pre-Riviera versus Riviera-forward.

Yes, we have discussed it previously in other threads, but not in this thread, and I think it's important to keep in mind that while pre-Riviera POS's rely heavily on the ambiguity of the term "commercial" and the number of rentals constituting commercial activity (the ambiguity of the language is a primary reason this thread is now 73 pages long), Riviera forward, they may not even need to utilize a tally of the number of reservations made, and can avail themselves of a far broader set of criteria. Heck, with the cabins, just using a rental site some number of times is now on the list.

But that's not really true--the SSR and RIV language on this matter is materially and substantively the same (except that the RIV language might not require that the Association act reasonably, although I think there are other parts of the agreement that mandate that anyway). The RIV language puts the reader on notice that Disney might use this certain criteria for evaluating whether or not something is commercial, but Disney has had the ability to use that criteria since Day 1 because since Day 1 they have had wide discretion to determine what constitutes commercial activity. All they've done is clarified a little bit to help eliminate the outside chance that a court could accept the argument that the buyer was deceived because they didn't understand that restriction.

 

[DonMacGregor]

But that's not really true--the SSR and RIV language on this matter is materially and substantively the same (except that the RIV language might not require that the Association act reasonably, although I think there are other parts of the agreement that mandate that anyway). The RIV language puts the reader on notice that Disney might use this certain criteria for evaluating whether or not something is commercial, but Disney has had the ability to use that criteria since Day 1 because since Day 1 they have had wide discretion to determine what constitutes commercial activity. All they've done is clarified a little bit to help eliminate the outside chance that a court could accept the argument that the buyer was deceived because they didn't understand that restriction.

I'll defer to you on the legal analysis of the POS. I'm simply pointing out that the "certain criteria" that might be used has been expanded on, at least in the written documents. Whereas DVC may previously have relied simply upon their broad discretion, they have more recently expanded, at least in the documents, some of the criteria that they may rely upon. I'm not qualified to opine on whether that limits them or not, or what their "broad discretion" might mean now versus 20 years ago, but it certainly puts the owner on notice.

People on here tend to take two lines of defense: "It's not in the POS so DVC can't do it", and "They can't change the POS, and the only criteria DVC has ever mentioned is the 20-rentals for personal use rule, so that's what they are stuck with". At least with the latter, the POS's of the newer resorts would seem to render that argument moot (at least at those resorts).

 

[Genie+]

All they've done is clarified a little bit to help eliminate the outside chance that a court could accept the argument that the buyer was deceived because they didn't understand that restriction.

This was what I was wondering. Thanks.

 

[Sykes]

Imagine as a metaphor instead of banning commercial activity Disney was banning birds from the property.

The SSR POS basically says:
All birds are banned. The Board gets to say, within its reasonable discretion, what constitutes a bird, including considering whether or not the animal can fly.

The RIV POS basically says:
All birds are banned. The Association gets complete discretion to determine what constitutes a bird. In doing so, the Association may evaluate whether or not the animal can fly, whether or not it has feathers, whether or not it lays hard eggs, etc ...

In both versions a penguin is banned because it's a bird. At SSR the board isn't required to solely consider whether or not the animal can fly because it's the only criteria listed--they can use all the other criteria too, and criteria that isn't contemplated in either POS--because they have the discretion to do so. The underlying restriction hasn't changed, but the later revisions do help illustrate how Disney might evaluate and enforce that restriction.