PHILIPSBURG--The Court of First Instance heard an injunction Friday filed by Timeshare Owners at Caravanserai Association (TOCA) against the beach resort’s new owner Alegría Real Estate B.V. in a renewed effort by timeshare owners to get their units back.
Alegría purchased the Beacon Hill resort in a public auction organised by Scotiabank on August 13, 2014, for US $14 million. Alegría claims it is not bound by any type of timeshare agreement made by former owner Kildare’s subsidiary company Endless Vacation, or any other.
The approximately 2,200 timeshare owners claiming timeshare rights at Caravanserai were informed by letter on September 30, 2014, that their previous ownership rights had been nullified and that Alegría would offer hotel units against payment instead.
As compensation, it offered a hotel room usage agreement, which would allow usage of a hotel room and facilities at the resort against an annual fee to cover part of the operational cost of the resort.
TOCA was established in October 2014. Representing 62 of its members, who together claim to have lost US $1.5 million in advance rent payments, TOCA called upon the Court on Friday to grant its members access to their apartments.
TOCA deems the immediate annulment of clients’ timeshare agreements unjust as these would have constituted a breach of contract. “A landlord should go to Court, he cannot just change the locks,” attorney-at-law Martyn Schellekens said on behalf of TOCA.
The association is of the opinion that the timeshare agreements are, in fact, rental agreements which, as such, should be legally protected.
“Alegría has to respect the rental agreements, but illegitimately denies timeshare owners’ access to the resort,” Schellekens said. “Alegría wants to fumigate the timeshare owners and does not want to wait for the outcome of the main case,” he stated.
TOCA called upon the Court to order Alegría to grant members access to the resort, with a penalty in case of non-compliance, and with payment of damages, retroactively from November 2014.
Alegría did not defer from its position taken in a previous court procedure on the matter and is still of the opinion that it is not bound by timeshare agreements closed by Kildare or any of its subsidiaries.
“Calling timeshare agreements rental agreements a hundred times in pleadings does not make them rental agreements,” Alegría’s attorney Chris de Bres said in responding to TOCA’s position.
Timeshare agreements include the sale and use of apartments and are no rental agreements, and are, therefore, not protected by rent control, it was added.
Alegría’s legal team, which also comprised lawyer Metin Unsal, objected to TOCA members joining the procedure in class action, as they had in fact closed a wide variety of timeshare agreements.
Not only had TOCA members closed agreements with Endless Vacation, but had also purchased timeshare rights via timeshare vacation exchange network RCI. Furthermore, a number of timeshare owners had rights in Caravanserai buildings D and E, “but at this moment these buildings are not yet completed,” Unsal said.
Alegría contested TOCA’s “urgent interests” in handling this case in summary proceedings, and concluded that all claims should be rejected, with lawyer De Bres stating that fulfilling TOCA’s requirements would thwart Alegría’s plans to redevelop the resort.
In a previous injunction, filed in November 2014, the Court of First Instance ruled that TOCA had no case against Alegría, because association members had not closed timeshare agreements with Alegría or with the former resort owner, but with Endless Vacation. Efforts to come to amiable solutions all proved futile.
Caravanserai timeshare owners have vented their fury in the local media and also in the United States, blaming Country St. Maarten for not protecting them and allowing them to be victims, as many of them have lost tens of thousands of dollars. Disappointed timeshare owners also stated they would not return to St. Maarten and would spend their vacations elsewhere. The Court will give its decision August 14.