DVC should not allow people to cancel

[AnnaKristoff2013]

I know many will be mad at this. That is okay you can be mad at me.
Rules are there to protect all of us including those regarding cancelling at the last minute. If Disney themselves are giving up their points that is fine. If Disney's hand chosen force of yes people are choosing to giveaway point I am not okay with it.

Disney should not be giving away my contract value and holding because they want to feel nice. I will 100% say being at Disney during a hurricane was my favorite trip so in the future if they feel they want to steal from me to give to other at least give me a chance to have discounted nights at DVC locations (they wont though).

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No.

 

[Cyberc1978]

I agree with others on this one.

Rules are rules and they can be changed at anytime. Also it feels irresponsible to sort of force people to travel during a hurricane.

 

[sethschroeder]

Out of curiosity, how is this affecting you personally?

Do you understand how your holdings in DVC work? Every point within DVC for a 50 year period is aligned to bookable rooms. Every time a room is not booked here is now excess points in the system.

Can you elaborate on what Disney did against their own rules? and what you mean by 'hand chosen force of yes people' in regards to following their own stated policy for hurricanes? I do agree, the rules are there to protect people, this is the rule, and it's protecting people.

Disney choosing to put up a rule does not mean it does not impact DVC negatively or is against the contract. DVC has had to reverse course on previous changes they tried to put in place.

I also cannot see how the cancellation policy would dilute your points. On the other side- I am sure if you had to extend your stay because your flight home was cancelled you would be using your points to cover the extra night(s) accomodation.

The cancellation policy is 30 days out and then was retroactively changed to give an exception during hurricanes to individuals. Of which the frequency of these events will only continue. Plenty of people move up fights to leave early during a hurricane.

 

[davidhr]

Do you understand how your holdings in DVC work? Every point within DVC for a 50 year period is aligned to bookable rooms. Every time a room is not booked here is now excess points in the system.

I do actually. In a perfect world with 100% occupancy that would be a problem. Thankfully DVC, while running at a high occupancy level, doesn’t run at a 100% so a few “extra” points in the system wouldn’t hurt you.

 

[sethschroeder]

This has to be a troll post right? Just a post for attention.

Not a troll post. Just someone who looks at DVC and sees them bending the rules which are place when signing a real estate contract with the rules. Looking at your joined date you weren't here through the pandemic when the topic was discussed with people falling on both sides that obviously was a larger impact than a single hurricane.

As an example of a solution insurance is available and possibly DVC needs to take out itself and refund MFs to the individuals instead of points.

 

[Chuck S]

They really can't refund maintenance fees. That would have a direct cost to DIsney. Points, by contract, have no actual monetary value. And as others have pointed out, there are already more points that go unused and lost every year than we'll ever know. It simply means that DIsney won't get as many breakage rooms, assuming people rebook those points. And remember, DVC members do not own 100% of the points in any resort, so even the relatively small amount of points refunded for emergencies like this should not have much impact on the system. It isn;t like the point buildup we had after the pandemic shutdown.

 

[Brian Noble]

In principle, I agree with you. And I think that the Covid policies created a lot of forward-looking headaches for everyone in the system because there were so many excess points rolling around.

However, in practice...

As many called out that breakage is likely beyond this specific instance.

...this was going to be my point. Breakage already meets (and thus presumably exceeds) the reimbursement limit that is allowed in the governing documents. As hard as it is for us to imagine it, there are a LOT of unused points floating around the system. That gives DVCMC significant flexibility in these situations.

 

[zavandor]

The points that are sold for each resort are calculated as if all lockoffs are booked as 2BR.
But a studio + 1BR cost more points than a 2BR. Every time a lockoff 2BR is booked as a studio and a 1BR members use more points than what have been sold.
This generate extra breakage, which DVC sell for cash. Part of this goes to offset MF, but mostly go into Disney pockets because the cap is reached every year.

Only Disney know how many points are "consumed" by lockoff rooms every year, but it must be A LOT. Given the popularity of studios and lack of popularity of 1BR, I bet the vast majority of lockoff are booked separately.
That's why after Covid the points refunded for closures didn't destabilise the system for too long. Borrowing was limited only for how long? A couple of years? Consider not only closures, but also rooms sitting empty for weeks and months after reopening (one could get almost anything with short notice). And all points extended for international travelers who go exceptions to the banking rules for a year or so after reopening.
All those extra points have been "absorbed" by the system in a relatively short amount of time.
A few days of cancellations will have a minimal effect in comparison. Giving points back really just hurts Disney pockets, because they'll sell fewer breakage rooms.

 

[bdrex28]

Do you understand how your holdings in DVC work? Every point within DVC for a 50 year period is aligned to bookable rooms. Every time a room is not booked here is now excess points in the system.

How is this any different than when an owner doesn't book a reservation for a year and banks points out? The points are still getting pushed out and a reservation wasn't used.

How is this any different than when a reservation is cancelled?

If every time a room is not booked you feel there are excess points in the system, then there are many other occasions this also applies.

Besides, there is a set time that the points must be used by or they flush out of the system. The system essentially resets itself.

 

[Sandisw]

Do you understand how your holdings in DVC work? Every point within DVC for a 50 year period is aligned to bookable rooms. Every time a room is not booked here is now excess points in the system.




Disney choosing to put up a rule does not mean it does not impact DVC negatively or is against the contract. DVC has had to reverse course on previous changes they tried to put in place.



The cancellation policy is 30 days out and then was retroactively changed to give an exception during hurricanes to individuals. Of which the frequency of these events will only continue. Plenty of people move up fights to leave early during a hurricane.

Except the holding policy can be changed or amended at any time since it’s part of the Home resort rules and regulations, isn’t it?

That is the same as with the hurricane policy. It has been in effect for a long time and part of it, just like the current holding policy.

So, the rules are being followed as they are written. Now, if the issue is that you think DVC should have stricter penalties for canceling, that’s a different topic.

But ultimately I think as long as the rules that are in place are consistently applied, I am okay with the way they are currently writte.

 

[MyDogTink]

I imagine DVC, in conjunction with CR, utilizes this to help book rooms for CMs, other DVC members and hotel guests who get stranded, and local residents evacuating. Also, some DVC members will be there during the hurricane and extend their trip and use points. So, I guess it is better that DVC offers the ability to cancel without penalty. If people were going to get penalized, they may not cancel, and those rooms wouldn't be available for the situations in my first sentence.

I am really not agreeing or disagreeing.

 

[MagicalDaze]

Don't have enough insight into the total number of points that were involved and whether there will now be a glut but I'm not particularly worried/bothered either way because to the extent allowing cancellations without penalty during a natural disaster results in a reasonable (probably even negligible) burden on the entire system, it's what I would call a "do the right thing" tax. Reasonable minds can differ but that's a tax I'm willing to pay.

 

[The Jackal]

In reality, people default on loans and dues. Points are reclaimed by DCV. Some points are lost in this process. Some people get stuck with 1-15 points they can’t use and they get lost. DVC themselves own at least 2% of all resorts and they rent these points out and use some for themselves on Demo rooms. Are they still renting the 1st floor Grand Villa at VGF? At this moment in time the returning of points are not really effecting anything like the closure back in 2020 for several months. In 2041 and 2042 we will start to feel it when resorts start to get booked fully before they leave the association. Luckily we do not own any 2042 resorts, so we will be able to see how 2042 plays out to handle our points when our resorts come up to expire. There is plenty that I disagree with what DVC does.

 

[DebbieB]

What does the park closing have to do with it? You just bought a room only after all right…?

With the airport closed, those rooms are likely to be picked up by people who extended stays. I don’t think they want to encourage people to come during a state of emergency.

 

[drusba]

If I understand correctly, the position being taken is that DVC, in allowing cancellations and return of points when a hurricane is near or already happening, is doing something gratuitous that it is not required to do. That assumption is legally incorrect. DVC, by having a policy of allowing cancellations and returning points, is actually setting out the likely minimum it is legally required to do in the face of a hurricane.

Many may have heard about force majuere clauses in contracts. which allow someone with a room reservation to cancel it without penalty in the face of events such as hurricanes, floods, fires and other disastrous events which can affect the reservation. What many likely do not know is that the absence of a force majuere clause in a contract, or stated policy for the occupancy of a resort, does not mean the landlord, manager, or owner of the resort can keep what has been paid for the room if there is an unforeseen event, such as a hurricane, that causes those who have reserved rooms to cancel, unless the controlling documents expressly provide the renter or member forfeits all rights of recovery for any and all unforeseen events that may result in cancellation of the reservation.

That is because there are common law doctrines referred to as impossibility of performance or frustration of purpose that would require that the renter or member who reserved the room get back whatever has been paid for the room, in money or points. And frustration of purpose could potentially apply broadly to the effects of a possible hurricane, e.g., even though the rooms may still be usable at WDW, someone could possibly cancel and get back what has been paid for frustration of purpose if the parks are closed, since having access to the parks is an understood main purpose for reserving the room. Thus, in the absence of a force majuere clause, the member would still have the same type of remedies as provided in a force majuere clause. For many organizations, the modern purpose of a force majuere clause is to define and limit the kinds of unforeseen events or possible remedies that might apply under the common law principles.
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[MyDogTink]

If I understand correctly, the position being taken is that DVC, in allowing cancellations and return of points when a hurricane is near or already happening, is doing something gratuitous that it is not required to do. That assumption is legally incorrect. DVC, by having a policy of allowing cancellations and returning points, is actually setting out the likely minimum it is legally required to do in the face of a hurricane.

Thank you for this explanation. DVC could put restrictions on those points though, right? I’m thinking of cruise lines during the beginning of the pandemic that gave vouches for future cruises but didn’t provide a cash refund. So DVC is being gratuitous in the sense that they are returning points to the UY with no penalty.

 

[drusba]

Thank you for this explanation. DVC could put restrictions on those points though, right? I’m thinking of cruise lines during the beginning of the pandemic that gave vouches for future cruises but didn’t provide a cash refund. So DVC is being gratuitous in the sense that they are returning points to the UY with no penalty.

It is my understanding that cruise lines generally have force majuere clauses in the cruise agreements. Do not know what most cruise lines clauses actually say but such clauses could limit the remedy to an alternative cruise, i.e., as I mentioned the modern purpose of force majuere clause is to limit remedies that would otherwise be available under the common law rules. The Disney cruise line has a force majuere clause that states as a remedy for a cruise cancelled as a result of a covered unforeseen event, the cruise line will offer a cruise just as good or better than the one cancelled, but the offer can be refused, in which case it will return any amounts paid. As to what happens to DVC points for such a cancellation, I have seen mention that, since the points returned to the member are reservation points, their use is limited to matters in the Disney Collections, such as Disney hotels.

Basically, what DVC does for cancellations of DVC resort reservations due to unforeseen events is return the points to the member, waive any holding rule, and typically allow points to be banked if they were bankable at the time the reservation was made. DVC has, for a long time, had some stated, but incomplete, policies relating to cancellations involving hurricanes, see https://disneyvacationclub.disney.go.com/vacation-planning/hurricane-policy.

DVC's usual practice is not gratuitous by any legal sense. Typically, the remedy for a contract that cannot be performed due to unforeseen events is, unless the force majuere clause specifically provides otherwise, to put the parties back into the position they were in at the time they entered into the contract, in this case at the time they made the reservation. Thus, returning the points, waiving the holding rule, and allowing the banking of points that could have been banked comes close to providing just that. The remedy is somewhat less if the cancellation does not occur until the member is already at the resort, in which case, the member can cancel the remaining part of the reservation and get back the points used for that remaining part.

The problem DVC would have with creating a new rule that is far more restrictive than the above is that no such more restrictive rule appears in the POS documents, and it is something that could require the vote of the members because it could be construed as a material change in expected rights that existed at the time the member purchased.

During the pandemic, DVC did apply some additional, more favorable rules (making it better for members is not something that would necessarily require a member vote). For example, it allowed borrowed points for a reservation to be returned to their original use year due to cancellation resulting from covid. Those "extra" benefits during the covid period appear to have disappeared. and it appears we are now just back to the the usual legal remedy which is, to the extent reasonable, to put the parties in the position they were in when the reservation was made.

 

[CarolynFH]

@drusba, thanks for bringing clarity on the legal aspects here, as always.

 

[tom1944]

I am happy to hear that they have this policy of allowing cancellations when a hurricane is going to impact the area. If it somehow impacts me negatively that is something I can live with.

 

[lynnfitz]

We don't own DVC, we rent points, so I know this is a bit off topic-I just wanted to say we were there during Milton-we had come from the west coast, spending 3 nights at the cabins at Copper Creek. The night of the hurricane they moved us into the lodge into a 2 bedroom. We had to extend our stay by 1 night since our rental home on the west coast did not have power. Anyway, I just wanted to say that Disney was wonderful through this, the CM's were great (a little nerve racking since we're from NY and haven't been through a hurricane). A little perk like breakfast half price was a nice touch. Again, not involved with the above discussion, but just wanted to put this out there. Sometimes I feel Disney gets a lot of negativities, and through this hurricane they really were great. The night we were going to pay cash for the room I was going to switch us to a 1 bedroom, they said we could stay in the 2 bedroom for the price of the 1 bedroom (that was discounted 40% due to the storm)