Your Share of Vacation Time - Own It!
It is well known that our beloved Island paradise is a premier vacation destination in the Caribbean and is top-of-list for experienced World travellers. The introduction of the Timeshare Vacations Act (the "Act") which is to take effect on an appointed day, will no doubt serve to enhance our tourism product and broaden the range of possible property owners of vacation accommodation.
A timeshare contract is an agreement in which exclusive right to occupy property for more than one or more periods of six months or less, over a total period of not less than three years is acquired for value.
The concept of shared, time-sensitive ownership of accommodation for the purpose of a vacation is by no means a new one, but the advent of timeshare vacations may play a pivotal role in propelling our country into the lead position as a regional vacation destination. Tourism stakeholders have intimated that the average stay for a timeshare vacation could easily be double that of the average stay of a hotel guest.
Interestingly, the interpretation of accommodation in the Act includes not only buildings or premises designed for overnight use but also land for a campsite and any caravan, vehicle, boat, ship designed for occupancy by one or more individuals for at least one night.
Get a Licence
The Act requires that any person engaged in business related to time share schemes must operate in accordance with a licence granted by the Real Estate Board (acting in accordance with the Act) where it is satisfied that the person is an individual or Company in good standing under the Companies Act; qualified in accordance with the prescribed requirements of promoting timeshare accommodation; and fit and proper again according to the prescribed criteria.
The Real Estate Board is responsible for determining all applications for such licences, monitoring compliance with the provisions of the Act, and providing the necessary regulatory guidance. The licence lasts for a year and is renewable. Applications for registration are made by the property owner to the Real Estate Board and must be accompanied by a prescribed licence fee.
Where an application is granted the Real Estate Board issues a registration certificate to the property owner. The certificate includes a statement that all deeds issued by the Real Estate Board shall not have the effect of passing any estate or interest in the land. The Certificate is not transferable without approval.
Be proactive – register before completion
It is possible with the permission of the Real Estate Board to commence marketing and promoting for reservations prior to registration.
Before licensed individuals or companies can promote or offer timeshare contracts they must also register what is called a Timeshare Plan in accordance with the provisions set out in the Act. An application for registration of a Timeshare Plan must contain certain particulars including: the description of the accommodations, facilities and services to be offered; the floor plan of the timeshare accommodations; particulars of the property owner; evidence of the licence above; evidence of financial requirements prescribed by the Act; a copy of the timeshare contract; and evidence that the relevant property taxes have been paid. Once the Real Estate Board is satisfied with all the information contained in the application, the Real Estate Board will issue a registration certificate.
The timeshare contract
Prior to the execution of a timeshare contract between property owner and purchaser, the property owner must provide the purchaser with all the relevant information relating to the timeshare contract, such as: the particulars of the property owner; a description of the nature of the timeshare accommodation; the terms and conditions which will be binding on the purchaser, and a detailed statement setting out all charges to be paid by the purchaser. A property owner who fails to provide the necessary information as outlined in the Act commits an offence. It must also be noted that the property owner must provide the purchaser with a copy of the executed timeshare contract no later than 30 days after execution. Failure to provide this will render the timeshare contract unenforceable against the purchaser.
The Act provides for the purchaser to withdraw from the timeshare contract by giving the property owner written notice of the withdrawal within a specified period.
Once the Registration Certificate is issued by the Real Estate Board in respect of a timeshare plan, the property owner must apply to the Registrar of Titles for an entry to be made on the title indicating that the property of the subject of a timeshare plan under the Act. Following that the Real Estate Board, at the request of the property owner, will issue a deed in the name of the purchaser.
A purchaser in whose name a deed to any timeshare is issued is entitled to exercise his rights as a purchaser in accordance with the timeshare contract. He may assign and transfer those rights and obligations by an assignment or transfer of the deed or even create a mortgage, charge or security interest in his right or interest arising under the timeshare contract.
Property owner's Obligations
The property owner is obliged to supervise the promotion and/or advertisement of any timeshare plan and is liable for any office committed along with person committing the offence unless it can be shown that he took steps to prevent the offence.
Before promoting or offering timeshare accommodation the property owner is to open and maintain an escrow account with an approved agent for monies received from a purchaser pursuant to the timeshare contract, with a report of each payment made to the Real Estate Board.
Right of occupancy
One of the main features of the Act is that it protects the occupancy right of a timeshare purchaser even where a pre-existing mortgagee exercises power of sale. In those circumstances, a purchaser from a mortgagee exercising power of sale would be precluded from evicting the timeshare occupant prior to expiration of the timeshare contract.
Finally, for those looking for a well-deserved respite, Jamaica may be poised to bring fresh life to a tried and tested concept. Who can resist owing a piece of the Rock, even for a moment in time?