Davids DVC: Rental reimbursement or rescheduling?

[CraigInPA]

This is a specific case of a frustrated contract. The owner cannot provide a room 'through no fault of their own.' The contract cannot be performed and, normally, the parties are put back to their original possessions -- i.e. money paid is returned.

That is what should happen, legally. David's should be paying back the 30% he is holding, to the renter, and the owner should be paying back the 70% they received, to David's or directly to the renter.

Interesting theory, but it ignores the probability that the owner has experienced a loss of value due to the points expiring. And, it ignores the third party to the contract (David's) who facilitated the contract, who purchased a reservation from the owner, and then sold it to the renter. And, it ignores the fact that there are three contracts involved, not just one. There is the problem with simplistic answers like the one you just gave. The situation isn't simple, complicated by the no refunds clause, lack of a force majeure clause, and responsibilities of each party across the 3 contracts.

 

[CanAdianDad]

The language is already there.

"This is an agreement to rent points that represent accommodations only ... Should accommodations not be available on date of arrival due to an action or omission by the Owner, including but not limited to negligence on the part of the Owner and after communication with the Intermediary, suitable comparable accommodations for the same dates cannot be secured by the Owner, the Renter will be due a refund limited to the amount paid".

Contract states numerous times that it's non refundable, with one clause stating an exception due to an action or omission by the owner, which isn't the case here. The contract isn't for a confirmed reservation, it's to rent points that represent accommodation. But again, it's a contract with three different parties, one of which is a Canadian, and the other two parties can be from different states in the US, or from another country. The chance of winning, and collecting if you win, is close to zero.

Now that I think about it, I change my mind on the chance of success in chargeback. Originally I thought it was much lower. But then it's really up to the renter to convince the issuing bank. The investigator at the issuing bank will look at the situation - renter paid for a reservation, DVC canceled it due to closure, but the "broker" won't give a refund. The average investigator at the issuing bank isn't going to understand all this DVC stuff and differentiate broker vs. Disney, and likely approve the chargeback. Then it's up to David's to present the case to his merchant bank, explain that the renter paid for points instead of an actual reservation, and convince the issuing bank to charge the customer. Again, common sense would dictate that the renter wins. Good luck with that.

Yeah... the outlook looks pretty grim for the intermediary I think. Just look at stub hub. If they have confidence in winning in a chargeback, they wouldn't offer 120% credit for future purchase, which avoids the chargeback. They won't be willing to lose 20% if they have confidence in winning the chargeback argument. This was from a company that was acquired for $4.5 billion in late 2019. You'd think they have the resources to hire lawyers and explore every possible angle. This is the solution they come up with - basically paying a 20% premium to any willing takers to avoid the chargeback.

I would suggest closing the resort is an act of the owner

 

[ziravan]

Your own company contract?

No but I have a standard contract I use. I’ll reprint it later tonight.

 

[ziravan]

I would suggest closing the resort is an act of the owner

I would disagree with that.

 

[DGsAtBLT]

My contract with Davids says something along the lines of a non refundable payment in exchange for a confirmed reservation using DVC points at *resort* from *check in date* to *check out date*. My guess is that language probably helps in the case of chargebacks and such, but that's just a guess.

We've picked apart these contracts so many times, if there was anything concrete in them leaning one way or the other this would have been put to bed already IMO.

 

[lawboy2001]

Interesting theory, but it ignores the probability that the owner has experienced a loss of value due to the points expiring. And, it ignores the third party to the contract (David's) who facilitated the contract, who purchased a reservation from the owner, and then sold it to the renter. And, it ignores the fact that there are three contracts involved, not just one. There is the problem with simplistic answers like the one you just gave. The situation isn't simple, complicated by the no refunds clause, lack of a force majeure clause, and responsibilities of each party across the 3 contracts.

I'm discussing the contract between the owner and the renter. That contact cannot be fulfilled. The owner has indeed suffered a loss of the value of the property the owner wanted to rent. But the contract between the owner and the renter doesn't provide for compensation to the owner in the event of frustration.

 

[Sandisw]

My contract with Davids says something along the lines of a non refundable payment in exchange for a confirmed reservation using DVC points at *resort* from *check in date* to *check out date*. My guess is that language probably helps in the case of chargebacks and such, but that's just a guess.

We've picked apart these contracts so many times, if there was anything concrete in them leaning one way or the other this would have been put to bed already IMO.

Yup! A lawsuit with a judge who could weigh in is probably the only way we would really know! Lol

I would be so surprised if the contracts don’t change, I’d love to know if they did with new rentals.

 

[lawboy2001]

I am not a lawyer and realize that common sense does not apply to the law a lot of times ,but the owner's points that he receives back are not as valuable as they were when rented. To me the points I receive with each use year essentially have a 2 year life span or could be 3 year if borrow into previous year, and some degree of depreciation should apply to the points. In my case I ,as owner , rented points in June 2019 for an April 2020 stay. The value of my points I receive back now is not the same as they were in June 2019.
There should be some shared pain between all parties. If the renter receives all their money back and owner as well as David's give all back, then I do not feel that is fair.
I also do not feel David's remedy for this situation is fair as the owner and renter share all the pain.

I also think David's remedy stinks, as it is pitched as 'helping out the x family' when it is really about funnelling money back to David's. And David's isn't taking a haircut on his commish.

Your point about the owners' points for these cancelled reservations are being returned with much less value, and may even be un-useable to the owner, is a valid one. But that issue would need to be addressed by the contract for there to be any way to recognize the owners' loss. And it isn't. Maybe for good reason -- as a renter, would you sign a contract for a non-refundable payment to an owner, that also stated that if the reservation is canceled for some outside reason (fire destroys resort; closure due to epidemic), then the owner will refund only 50% or 60% of the money, to account for the loss of value of the points to the owner? Of course not. So we can't attribute that kind of a term to the contract now.

 

[DGsAtBLT]

I also think David's remedy stinks, as it is pitched as 'helping out the x family' when it is really about funnelling money back to David's. And David's isn't taking a haircut on his commish.

Your point about the owners' points for these cancelled reservations are being returned with much less value, and may even be un-useable to the owner, is a valid one. But that issue would need to be addressed by the contract for there to be any way to recognize the owners' loss. And it isn't. Maybe for good reason -- as a renter, would you sign a contract for a non-refundable payment to an owner, that also stated that if the reservation is canceled for some outside reason (fire destroys resort; closure due to epidemic), then the owner will refund only 50% or 60% of the money, to account for the loss of value of the points to the owner? Of course not. So we can't attribute that kind of a term to the contract now.

Their remedy does stink. And their social media behaviour even worse, IMO.

I am so turned off by the way they’re shutting down and deleting almost everything that leans negatively, even when its not argumentative or impolite, and the concerns are valid. People are reaching out on Facebook because communication has been so hard. I can understand and appreciate how hard this is to sort out and to a degree how hard it is to communicate with everyone in a timely fashion, but shutting down conversation on their page makes the whole thing feel shadier than I’m sure it actually is.

I’m grateful for these couple threads discussing this openly on here.

 

[ziravan]

This is my standard contract. These days I strongly suggest pay by check instead of PayPal.

Vacation Points Usage Contract
22 August, 2018

ZIRAVAN (DVC Member) certifies that he has and will maintain, in good standing, an ownership interest in the Disney Vacation Club throughout this contract period, sufficient to carry out the terms of this contract. DVC Member agrees to make this reservation in the tenant's name and benefit in exchange for payment.

Minnie Mouse(Tenant) agrees to purchase points necessary for this reservation and has the ability to make full payment.

This contract is entered into, in good faith, between DVC Member and Tenant for the express purpose of purchasing points necessary to reserve lodging as set forth below.

Names in Tenant's Party:
Minnie Mouse
Mickey Mouse

Unit Description and Location:
Disney's Beach Club Villa, Studio Room, Walt Disney World, FL.

DVC member will make room requests and add ons, including MDE bus transportation, dining plan at tenant's expense, celebration notifications, etc., as requested.

Duration and Dates:
4 nights - Arrival: Sun, November 11, 2018; Departure: Thursday, November 15, 2018. (60 points)

Confirmation number: 1234 5678 9012

Price:
$1000.00
Payments / Deposits:

50% of the payment ($500.00) is due on receipt of confirmation number included in this contract. The balance is due before 60 days prior to check-in, on or before September 12, 2018. Payment can be made via www.paypal.com (tenant pays any fees) to account email ziravan@yomymail.com (not my real email) or check mailed to: Ziravan. 123 Main Street, Anytown,, TX 12335.. Any form of payment returned for “insufficient funds”, or any reason, will initiate automatic cancellation of tenant’s reservations and full retention, by DVC member, of any partial payments received up to that date.

Cancellation and Refunds: Funds received for the purpose of purchasing DVC points for a reservation are non-refundable. Once bought, these points belong exclusively to Tenant.

Tenant will be held to the same terms as a DVC member for cancellation:

Cancellation on the day of arrival will forfeit the purchased points and reservation to Disney.

Points for a reservation cancelled within 30 days of arrival are placed by DVC into a holding account and must be used prior to March 31, 2019 and can only be used to book reservations at any DVC within the next 60 days, subject to limited availability.

If reservation is cancelled greater than 30 days from arrival, reservation can be rebooked anytime prior to April 01, 2019 if there is availability in the DVC booking system (11 months out or less at Beach Club Villas or 7 months out or less at any DVC resort.) These points expire on March 31, 2019. Availability may be limited and the closer to the check-in date a reservation is requested, the more difficult it might be to find suitable availability.
Tenant may request, and DVC member will make reasonable attempts, to make reservation changes as directed by the tenant, within the limitations noted above. Tenant should be aware that this might not be possible because of limited room availability.

If Tenant is unable to complete reservation before March 31, 2019, DVC member, at Tenant's request, will try to re-rent these points to another party and refund any amounts received up to the value of the reservation in this contract. Tenant is advised that, depending on when reservation is cancelled and what is available, that DVC member might not be able to recoup the full cost of this reservation on short notice.

Tenant may not sublet this reservation to any party.

DVC member will not make any changes to the reservation without first being directed to do so by the tenant.

Force Majeure: In the case of a catastrophic event beyond the control of the parties to fulfill the essentials of this contract, to provide the specified lodging during the specified times, both parties agree to equally share the loss of non-recoverable reservation/points.

Tenant agrees to follow the DVC rules and accepts responsibility and liability for the use of DVC property, including no pets. Tenant agrees to indemnify and hold harmless DVC member due to any actions taken by tenant, tenant's named party and/or tenant's guests during the execution of this reservation.

Tenant and DVC Member hereby agree to the terms of this contract. Transfer and acceptance of funds constitutes agreement to terms.

DVC Member - Ziravan

Tenant – Minnie Mouse

 

[LAX]

Their remedy does stink. And their social media behaviour even worse, IMO.

I am so turned off by the way they’re shutting down and deleting almost everything that leans negatively, even when its not argumentative or impolite, and the concerns are valid. People are reaching out on Facebook because communication has been so hard. I can understand and appreciate how hard this is to sort out and to a degree how hard it is to communicate with everyone in a timely fashion, but shutting down conversation on their page makes the whole thing feel shadier than I’m sure it actually is.

I’m grateful for these couple threads discussing this openly on here.

While I don't think David's is trying to do anything shady, the way he has been handling this has certainly drummed up so much negativity/loss of confidence that I am not sure his reputation is reparable, IMHO. And this is coming from an outside observer who has had positive experiences in the past. I just don't see how any owners currently have active reservations that have had their 30% of payment withheld will ever want to deal with David's again in the future. Without owners' points, there is no rental business.

LAX

 

[DougEMG]

This is my standard contract. These days I strongly suggest pay by check instead of PayPal.

Vacation Points Usage Contract
22 August, 2018

ZIRAVAN (DVC Member) certifies that he has and will maintain, in good standing, an ownership interest in the Disney Vacation Club throughout this contract period, sufficient to carry out the terms of this contract. DVC Member agrees to make this reservation in the tenant's name and benefit in exchange for payment.

Minnie Mouse(Tenant) agrees to purchase points necessary for this reservation and has the ability to make full payment.

This contract is entered into, in good faith, between DVC Member and Tenant for the express purpose of purchasing points necessary to reserve lodging as set forth below.

Names in Tenant's Party:
Minnie Mouse
Mickey Mouse

Unit Description and Location:
Disney's Beach Club Villa, Studio Room, Walt Disney World, FL.

DVC member will make room requests and add ons, including MDE bus transportation, dining plan at tenant's expense, celebration notifications, etc., as requested.

Duration and Dates:
4 nights - Arrival: Sun, November 11, 2018; Departure: Thursday, November 15, 2018. (60 points)

Confirmation number: 1234 5678 9012

Price:
$1000.00
Payments / Deposits:

50% of the payment ($500.00) is due on receipt of confirmation number included in this contract. The balance is due before 60 days prior to check-in, on or before September 12, 2018. Payment can be made via www.paypal.com (tenant pays any fees) to account email ziravan@yomymail.com (not my real email) or check mailed to: Ziravan. 123 Main Street, Anytown,, TX 12335.. Any form of payment returned for “insufficient funds”, or any reason, will initiate automatic cancellation of tenant’s reservations and full retention, by DVC member, of any partial payments received up to that date.

Cancellation and Refunds: Funds received for the purpose of purchasing DVC points for a reservation are non-refundable. Once bought, these points belong exclusively to Tenant.

Tenant will be held to the same terms as a DVC member for cancellation:

Cancellation on the day of arrival will forfeit the purchased points and reservation to Disney.

Points for a reservation cancelled within 30 days of arrival are placed by DVC into a holding account and must be used prior to March 31, 2019 and can only be used to book reservations at any DVC within the next 60 days, subject to limited availability.

If reservation is cancelled greater than 30 days from arrival, reservation can be rebooked anytime prior to April 01, 2019 if there is availability in the DVC booking system (11 months out or less at Beach Club Villas or 7 months out or less at any DVC resort.) These points expire on March 31, 2019. Availability may be limited and the closer to the check-in date a reservation is requested, the more difficult it might be to find suitable availability.
Tenant may request, and DVC member will make reasonable attempts, to make reservation changes as directed by the tenant, within the limitations noted above. Tenant should be aware that this might not be possible because of limited room availability.

If Tenant is unable to complete reservation before March 31, 2019, DVC member, at Tenant's request, will try to re-rent these points to another party and refund any amounts received up to the value of the reservation in this contract. Tenant is advised that, depending on when reservation is cancelled and what is available, that DVC member might not be able to recoup the full cost of this reservation on short notice.

Tenant may not sublet this reservation to any party.

DVC member will not make any changes to the reservation without first being directed to do so by the tenant.

Force Majeure: In the case of a catastrophic event beyond the control of the parties to fulfill the essentials of this contract, to provide the specified lodging during the specified times, both parties agree to equally share the loss of non-recoverable reservation/points.

Tenant agrees to follow the DVC rules and accepts responsibility and liability for the use of DVC property, including no pets. Tenant agrees to indemnify and hold harmless DVC member due to any actions taken by tenant, tenant's named party and/or tenant's guests during the execution of this reservation.

Tenant and DVC Member hereby agree to the terms of this contract. Transfer and acceptance of funds constitutes agreement to terms.

DVC Member - Ziravan

Tenant – Minnie Mouse

Thanks for posting

 

[ziravan]

If you look at my contract above, this isn’t a true force majeure. Because the tenant owns the points, DVC refunding them to me means they still belong to tenant. In other words, by rebooking, we were still able to fulfill the terms of the contract.

had the points been so close to expiration that rebooking wasn’t possible, the force majeure clause would have kicked in: the renter would be out the use of the points but we had agreed to split the financial value of that loss.

 

[fsjking]

I would leave that to those who have a law degree and actually practice it for a living to figure that out (perhaps you might be one in real life).

LAX

I think a pretty clear example would be are you aware of a single instance where DVC will talk to a renter and allow them to make a reservation? If the points now belong to the renter, they could call Disney and make reservations or do anything else an owner can do with points. As we know non-owners cannot do that, you did not sell them points. You could not in any way transfer points to them short of selling them your shares in the resort and making them members. You are selling a reservation based on points, but not the points themselves.

My contract specifically says that once purchased, THE POINTS belong to the renter. It lists the expiration of the points and says that, within reason, I will work to rebook a trip if necessary. Within reason to me means I won’t do so 5 or 6 times. It also list cancellation policy and says points are subject to that policy and it states that any rebooking is subject to availability and due to the nature of timeshares, could be a significant issue.

Specifically, I sell points not rent reservations. All sales are final transactions.

My contract also has a force majeure clause that says we split the loss if a trip can’t be performed because of circumstances beyond our control. In the case of the one renter that got stranded with an April reservation, it wasn’t a true force majeure because she owns the points and there was plenty of time to rebook, which we did for Fall.

In any case, BECAUSE it wasn’t a true force majeure and because the points were an April UY for an April trip - I could have easily made reuse of them - I offered a full refund. She elected to rebook. It worked out well because she was able to trade Easter upcharge AKV stay for Fall Poly stay for the same number of night.

Same as above. You can't sell them points. Your contract with DVC doesn't allow you to do that.

 

[Sandisw]

If you look at my contract above, this isn’t a true force majeure. Because the tenant owns the points, DVC refunding them to me means they still belong to tenant. In other words, by rebooking, we were still able to fulfill the terms of the contract.

had the points been so close to expiration that rebooking wasn’t possible, the force majeure clause would have kicked in: the renter would be out the use of the points but we had agreed to split the financial value of that loss.

Your contract is a great one and if I ever do rent, I’ll be borrowing it. Thank you for sharing.

 

[ziravan]

IANAL and my major experience with contracts is oil leases. The oil companies have very specific deadlines to meet certain obligations and without a force majeure for things beyond their control, they could lose all the leases for a well over a single incident.

So, my experience there is what prompted me to add a force majeure clause. There are several old old threads on drafting a rental contract and I took the parts I liked best and created my own.

If you read mine, I purposely created more than one alternative solution if a renter were to get into a bind. Another renter recently had a child schedule a wedding during her trip. No problem, we rescheduled the trip. Life happens. My major fault with the brokers has always been not recognizing that.

I know I know the deal they made with the owners prevents that flexibility. I always viewed flexibility as my main advantage.

 

[Amymouse13]

What percentage of owners that rent, does anyone think, are actually reading this thread?

 

[WDWEPCOT]

Just my opinion but I would say small percent
I own and also rented and I’m in this both ways right now I contacted my April renter and this person was clueless about what was going on and how DVC worked but is experiencing the same frustrations dealing with David’s

 

[Minniemoo15]

IANAL and my major experience with contracts is oil leases. The oil companies have very specific deadlines to meet certain obligations and without a force majeure for things beyond their control, they could lose all the leases for a well over a single incident.

So, my experience there is what prompted me to add a force majeure clause. There are several old old threads on drafting a rental contract and I took the parts I liked best and created my own.

If you read mine, I purposely created more than one alternative solution if a renter were to get into a bind. Another renter recently had a child schedule a wedding during her trip. No problem, we rescheduled the trip. Life happens. My major fault with the brokers has always been not recognizing that.

I know I know the deal they made with the owners prevents that flexibility. I always viewed flexibility as my main advantage.

Thanks for sharing. I have rented points through Davids and on my own. I prefer on my own because it allows some level of comfort speaking directly to the owner/renter. Though my contracts state non refundable, it allows me the ability to be flexible within reason. One of my recent renters had to change dates and resorts twice due to personal reasons - no problem, there was availability so I didn’t mind doing so.

Renting independently is a lot more work than going through Davids, but it keeps the human aspect in place which I am realizing is more important than ever.

 

[McCrae]

I also think David's remedy stinks, as it is pitched as 'helping out the x family' when it is really about funnelling money back to David's. And David's isn't taking a haircut on his commish.

Your point about the owners' points for these cancelled reservations are being returned with much less value, and may even be un-useable to the owner, is a valid one. But that issue would need to be addressed by the contract for there to be any way to recognize the owners' loss. And it isn't. Maybe for good reason -- as a renter, would you sign a contract for a non-refundable payment to an owner, that also stated that if the reservation is canceled for some outside reason (fire destroys resort; closure due to epidemic), then the owner will refund only 50% or 60% of the money, to account for the loss of value of the points to the owner? Of course not. So we can't attribute that kind of a term to the contract now.

People did sign a Contract with a no refunds or changes allowed clause and were advised to take out insurance to cover unexpected changes. If renters had this they could recover potential losses.