web analytics

The unlawfulness of Silverpoint contracts are now entering The Spanish Supreme Court and like the Anfi Judgements Silverpoint (Lately Resort Properties) is taking a pounding. The Highest Court in Spain has issued up to five judgements against the Silverpoint concept of timesharing sold by its marketing company Silverpoint Vacations SL.

Silverpoint is a company, operates in the Canary Islands which falls under the jurisdiction of Spain, they (like many timeshare resorts) have sold unlawful contracts to consumers and are taking a financial pounding as ever increasing numbers of consumer take their disputes to court. Silverpoint is a member of the Resort Development Organisation (RDO) and heavily contributes to TATOC who on occasion supports Silverpoint but reports nothing in respect to the rights of consumers to obtain compensation from Silverpoint.

TATOC consumer Helplines run by Mark Caldicott are equally supported by the RDO and Silverpoint has provided its assets and assistance when and if consumers have asked for advice from TATOC.

The 5 Supreme court rulings all started in the Arona Court of First Instance and then proceeded later to the Provincial Court of Santa Cruz de Tenerife. They have now ruled and Silverpoint is required to pay back to consumers about 169,000 euros.

The first ruling addressed a “variant of the use” of real estate offered by the company, which involved the adherence of the customer to the so-called “Club Paradiso” rules.

The Silverpoint timeshare contracts claimed to provide an annual holiday entitlement, with a maximum duration of eight nights, for a maximum of 4 people and could be enjoyed in any of the Club’s available destinations. These destinations, however, were spread over different areas of the globe, including Tenerife.

Earlier Silverpoint was sentenced and featured in the sentencing were reliance on past case authorities. The Courts condemned Silverpoint Vacations SL to pay almost £ 62,500 and known to authorities is that Silverpoint has sold many more contracts to other consumers between 2003 and 2008 and at the Club Paradiso, Beverly Hills Club and Hollywood Mirage.

Among other aspects of the law, Silverpoint were warned about the collection of advanced and deposit payments and that the clauses/conditions contained in the information sent by the complexes where the apartments were located. These contracts had not been negotiated by consumers were contained on pre-printed forms and not in any way individualised. In addition to voiding the contracts, consumers can claim the restitution of all the maintenance payments they have made.

As with the first ruling in this regard, the Supreme Court considered that the variety of Timeshare contracts issued by Club Paradiso. The consideration of the contracts was conducted regarding Law 42/1998 which came into force in Spain in January 1999. The rule 42/98 rules establish the contracts will be void if they are constructed outside the law. The implementation of the law was to assist consumers and to avoid “legal fraud”.

The Provincial Court denied the status of consumers to the claimants and sought to assert that the consumers were in fact investors. This initial victory was reported on both TATOC Web site and the RDO so as to bolster the two-failing organisation in respect to the timeshare consumers. Well, it’s all change now as the initial judgement was thrown out of the supreme court.

This appeal was in part financed by Canarian Legal Alliance CLC which has been a constant thorn in the side of Timeshare resorts. It must be stated that CLC drove its cases to the supreme court and on behalf of its clients, and as a result of the victories, many other legal companies (like ourselves) enjoy the right to rely upon the judgements which favour consumers. Now many trains are bolting towards Silverpoint and other timeshare resorts as consumer gain more and more confidence in their possibility of success.

In the last claim Silverpoint presented that the timeshare owners were not acting as consumers but Investors However, the supreme court believes that “the mere possibility that they could profit from the transfer of their rights does not exclude their status as consumers” since they did not dedicate themselves professionally to this type of operations.

As for the contracts signed in “Beverly Hills Heights”, the Supreme Court is clear that “the contracts do not respect Law 42/1998 because the minimum content is not collected.”

In addition to that “advances are required that the contract calls them a deposit. That is, rather than a partial breach of the law, therefore, the court is faced with a lack of systematic compliance with it. “

The Supreme Court declares the Silverpoint Contracts Void and specifies that “it is so clear that Silverpoint is trying to circumvent the law by arguing that the contracts they sold do not transcribe arts. 10, 11 and 12 of Law, nor does the Silverpoint contracts mention, as it was obliged, the “character of legal rules applicable to the contract”, so that the acquiring consumer could not know what was the legal regime of his contract.

Therefore the High Court condemns Silverpoint to return to another three customers 10,400, 17,994 and 28,715 pounds as they too are similar to those outlined in the previous case.

The Silverpoint stated “We do not share the view held by the Supreme Court”

The legal representation of Silverpoint Vacations SL assures that it does not share the criteria of the Supreme Court since in its opinion “the people who buy a tourist product with intention to resell it and without intention to enjoy it should not be considered consumers and users.”

In his view, “it is not correct to argue that, in the tourism sector, a person who acquires a product without intending to enjoy it should be considered a consumer.

That is to say, it does not make sense to endow the legal protection granted by the condition of a consumer to whom he buys with the sole intention of profiting from the resale of the product acquired. ” A criterion that, he recalls, has been maintained by the Provincial Court of Santa Cruz de Tenerife and one of the judges of the Supreme Court that issued a special vote that “we consider more adjusted to the European Union regulations on shift taking of real estate.”

In reference to the rights of use of shifts transmitted, Silverpoint believes that the interpretation is given by the Supreme to Law 42/1998 “is not correct, as stated by the General Directorate of Registries and Notary in its Resolution dated 8 Of February 2016, issued after the Supreme Court set its criteria on this particular. “

In respect to Silverpoint and the Second Supreme Court ruling, nº 19/2017

The second sentence of the Supreme Court’s has very little to do with the previous one, number 16/17, since it doesn’t deal with “Club Paradiso” or address the issue of whether buyers are investors or consumers. This ruling examines a “Hollywood Mirage” Club contract and the main issues are: perpetuity, amounts brought from other contracts i.e Trade In’s

Timeshare trade in’s

These are amounts of either money or consideration brought into the sale from previous contracts (Trans amounts) and maintenance fees.

Regarding the first issue, perpetuity, we must remember the Supreme Court has declared contracts with the words Perpetuity is illegal. Further, if the contracts lack a particular end date or are over 50 years (see Article 3 of Law 42/98) they are equally illegal. Silverpoint (and other clubs) were arguing, in their Answers, that they simply haven’t mentioned any deadline in their contracts, and this shouldn’t mean it’s voidable however the courts understand that if nothing is mentioned it is capable of being over 50 years and therefore unlawful. On this issue, the Supreme Court has stated that the mere fact of not pointing out the end date of the contract, is already enough reason to declare the contract void.

Regarding the legal issue, amounts brought from previous contracts (Trade In)

The Supreme Court doesn’t specifically come to pronounce it, but when, in Ground of Law 3 summarises what sums of money are being claimed by the consumer, they included 18,000 euros that came from a previous contract that was traded in. For this reason, it is important that, if a customer is in this situation and has paid part of the consideration by way of trade in they may be able to claim all the money for the trade in as well.

Maintenance Fees

In this same Ground of Law, the Supreme Court recognises, and take for granted, the claim for maintenance fees is also claimable. This is a clear sign that the maintenance fees a consumer paid in the past to support an unlawful contract have to be returned as well.

Finally, this Ground of Law ends affirming that amounts brought from previous contracts, not signed with the same club, cannot be considered as advance payments, since they were in possession of the seller before the signing of the contract and in no case, did it entail a coercive measure to obtain the signature of the contract.

This Article was inspired by these two websites



Posted on: 6th March 2017