TITLE 6

Commerce and Trade

SUBTITLE II

Other Laws Relating to Commerce and Trade

CHAPTER 28. CAMPGROUND RESORTS MEMBERSHIP AND VACATION TIME-SHARING PLANS SALES ACT

Subchapter II. Vacation Time-Sharing Plan


This subchapter shall apply to each vacation time-sharing plan contract executed at least in part in the State 90 days after this chapter is signed into law, regardless of the whereabouts of the developer's principal office.

67 Del. Laws, c. 433, § 1.;

When used in this subchapter, the following shall have the meanings respectively set forth:

(1) "Accommodations'' means any apartment, condominium or cooperative unit, cabin, lodge, hotel or motel room or any other structure which is situated on real property and designed for occupancy by one or more individuals.

(2) "Advertising'' means the use of media, mail or personal contacts to induce, directly or indirectly, any person to enter into any obligation, acquire any title, interest in or otherwise execute a contract as defined in this section.

(3) "Business day'' means any day except Sunday or a legal holiday.

(4) "Common expenses'' means those expenses properly incurred for the maintenance, operation and repair of all accommodations or facilities subject to this subchapter.

(5) "Contract'' means any written agreement of more than 1 year's duration, executed in whole or in part within the State which grants to a purchaser the rights and obligations of a time-sharing plan.

(6) "Developer'' means the person creating a time-sharing plan.

(7) "Facilities'' means any structure, service, improvement or real property, whether improved or unimproved, which is made available to the purchasers of a time-sharing plan.

(8) "Offer'' means any offer, solicitation, advertisement or inducement to execute a contract.

(9) "Person'' means any individual, corporation, partnership, company, unincorporated association or any other legal entity other than a government or agency or a subdivision thereof.

(10) "Purchaser'' means any person who is buying or who has bought a time-share period in a time-sharing plan.

(11) "Reciprocal program'' means any arrangement under which a purchaser is permitted to use time-share units or facilities in 1 or more time-sharing plans' locations not owned by the seller with whom the purchaser has entered into a contract.

(12) "Salesperson'' means an individual, other than a seller, who offers to sell a contract by means of a direct sales presentation, but does not include a person who merely refers a prospective purchaser to a sales person without making any direct sales presentation.

(13) "Seller'' means any developer, or any other person, or agent or employee thereof, who offers time-share periods for sale to the public in the ordinary course of business, except persons who have acquired a time-share period for their own occupancy and later offer it for resale.

(14) "Time-share period'' means that period of time during which a purchaser of a time-sharing plan is entitled to possession and use of the accommodations or facilities, or both, of a time-sharing plan.

(15) "Time-share unit'' means an accommodation or facility of a time-sharing plan which is divided into time-share periods.

(16) "Time-sharing plan'' means an arrangement, plan, or similar device, whereby a purchaser, in exchange for consideration, receives a right to use accommodations or facilities, or both, for a period of more than 3 years and such use is to occur during specific periods of time which are less than 1 year during any given year within the terms of such arrangement, plan or other device.

67 Del. Laws, c. 433, § 1.;

(a) Every seller, salesperson, or other person who is in the business of offering for sale time-sharing plan contracts for a fee shall deliver to a purchaser a current seller's disclosure statement before execution by the purchaser of the contract and no later than the date shown on such contract.

(b) The seller's disclosure statement shall consist of the following:

(1) A cover page containing:

a. The words, "Vacation Time-Sharing Plan Seller's Disclosure Statement,'' printed in boldfaced type of a minimum size of 10 points, followed by,

b. The name and principal business address of the seller followed by,

c. A statement that the seller is in the business of offering for sale contracts, followed by,

d. The following in printed boldfaced type of a minimum size of 10 points:

THIS DISCLOSURE STATEMENT CONTAINS IMPORTANT MATTERS TO BE CONSIDERED IN THE EXECUTION OF A VACATION TIME-SHARING PLAN CONTRACT. THE VACATION TIME-SHARING PLAN SELLER IS REQUIRED BY LAW TO DELIVER TO YOU A COPY OF THIS DISCLOSURE STATEMENT BEFORE YOU EXECUTE A VACATION TIME-SHARING PLAN. THE STATEMENTS CONTAINED HEREIN ARE ONLY SUMMARY IN NATURE. YOU AS A PROSPECTIVE PURCHASER SHOULD REVIEW ALL REFERENCES, EXHIBITS, CONTRACT DOCUMENTS, AND SALES MATERIALS. YOU SHOULD NOT RELY UPON ANY ORAL REPRESENTATIONS AS BEING CORRECT. REFER TO THIS DOCUMENT AND TO THE ACCOMPANYING EXHIBITS FOR CORRECT REPRESENTATIONS. THE VACATION TIME-SHARING PLAN SELLER IS PROHIBITED FROM MAKING ANY REPRESENTATIONS WHICH CONFLICT WITH THOSE CONTAINED IN THE CONTRACT AND THIS DISCLOSURE STATEMENT.

e. The following language, printed in boldfaced type of a minimum size of 10 points after the appearance of the items required in paragraphs (b)(1)a. through d. of this section:

SHOULD YOU EXECUTE A VACATION TIME-SHARING PLAN CONTRACT, YOU HAVE THE UNQUALIFIED RIGHT TO CANCEL SUCH CONTRACT. THIS RIGHT OF CANCELLATION CANNOT BE WAIVED. THE RIGHT TO CANCEL EXPIRES AT MIDNIGHT ON THE 5th BUSINESS DAY FOLLOWING THE DATE ON WHICH THE CONTRACT WAS EXECUTED. TO CANCEL THE VACATION TIME-SHARING PLAN CONTRACT, YOU AS THE PURCHASER MUST MAIL NOTICE OF YOUR INTENT TO CANCEL BY CERTIFIED MAIL TO THE VACATION TIME-SHARING PLAN SELLER AT THE ADDRESS SHOWN IN THE VACATION TIME SHARING PLAN CONTRACT, POSTAGE PREPAID. THE VACATION TIME-SHARING PLAN SELLER IS REQUIRED BY LAW TO RETURN ALL MONEYS PAID BY YOU IN CONNECTION WITH THE EXECUTION OF THE VACATION TIME SHARING PLAN CONTRACT, UPON YOUR PROPER AND TIMELY CANCELLATION OF THE CONTRACT.

(2) The following information is required after all disclosure statements required in paragraphs (b)(1)a. through e. of this section:

a. The name of the seller and the address of the principal place of business;

b. A brief description of the nature of the purchaser's right or license to use the time-share unit and the facilities which are to be available for use by purchasers;

c. The location of each of the time-share accommodations which is to be available for use by purchasers and a brief description of the facilities at each time-share accommodation which are currently available for use by purchasers. Facilities which are planned, incomplete, or not yet available for use shall be clearly identified as incomplete or unavailable. A brief description of any facilities that are or will be available to nonpurchasers shall also be provided;

d. As to all time-sharing plans offered by sellers:

1. The form of plan offered;

2. The types and duration of plans along with a summary of the major privileges, restrictions and limitations applicable to each type; and

3. Provisions, if any, that have been made for public utilities at each time share unit including water, electricity, telephone and sewer facilities;

e. Any initial or special fee due from the purchaser together with a description of the purpose and method of calculating the fee;

f. A description of any liens, defects or encumbrances affecting the time-share plan;

g. A general description of any financing offered or available through the seller;

h. A statement that the purchaser has until midnight of the fifth business day following the signing of the vacation time-sharing plan contract to cancel the contract by proper notice to the vacation time-sharing plan seller;

i. A description of the insurance coverage that the seller provides for the benefit of purchasers, if any;

j. Any fees or charges that purchasers are or may be required to pay for the use of the time-share unit or any facilities;

k. The extent to which financial arrangements, if any, have been provided for the completion of facilities together with a statement of the seller's obligation to complete planned facilities. The statement shall include a description of any restrictions or limitations on the seller's obligation to begin or to complete such facilities;

l. Any services which the seller currently provides or expenses the seller pays which are expected to become the responsibility of the purchasers, including the projected liability which each such service or expense may impose on each purchaser;

m. A brief description of the ownership in or other right to use the time-share unit which is to be transferred to each purchaser, together with the duration of any lease, license, franchise or reciprocal agreement entitling the seller or the purchasers to use the accommodations, and any provision in any such agreements which restrict or limit a purchaser's use of the time-sharing plan;

n. A summary or copy, whether by way of supplement or otherwise, of the rules, restrictions or covenant regulating the purchaser's use of the time sharing plan and the facilities which are to be available for use by the purchasers, including a statement of whether and how the rules, restrictions, or covenants may be changed;

o. A description of any restraints on the transfer of the vacation time sharing plan contract;

p. A brief description of the policies covering the availability of time-share units, the availability of reservations and the conditions under which they are made;

q. A brief description of any grounds for forfeiture of a purchaser's contract;

r. A statement of whether the seller has the right to withdraw permanently from use all or any portion of any facilities devoted to the time-sharing plan and, if so, the conditions under which such withdrawal is to be permitted; and

s. A statement describing the material terms and conditions of any reciprocal program to be available to the purchaser including a statement concerning whether the purchaser's participation in any reciprocal program is dependent upon the continued affiliation of the operator with that reciprocal program and whether the operator reserves the right to terminate such affiliation.

(c) The seller shall promptly amend the seller's disclosure statements to reflect any material change in the time-sharing plan or its facilities.

67 Del. Laws, c. 433, § 1; 70 Del. Laws, c. 186, § 1.;

(a) A purchaser shall have the right to cancel a vacation time-sharing plan contract within 5 business days following the date of its execution.

(b) The right of cancellation shall not be waived and any attempt to obtain such a waiver shall be unlawful. Nothing in this section shall preclude the execution of documents in advance of closing for delivery after the expiration of the cancellation period.

(c) If the purchaser elects to cancel the contract, the purchaser may do so only by mailing notice thereof by certified mail to the seller at the address listed in the contract. The cancellation shall be deemed effective upon mailing.

(d) Upon cancellation, the seller shall refund to the purchaser all payments made by such purchaser and collected by the seller pursuant to the canceled contract. The refund shall be made within 15 days and may, where payment has been made by credit card, be made by an appropriate credit to the purchaser's account.

67 Del. Laws, c. 433, § 1.;

The seller shall deliver to the purchaser a fully executed copy of the contract, which contract shall include at least the following information:

(1) The actual date the contract is executed by the purchaser.

(2) The name of the seller and address of the principal place of business.

(3) The total financial obligation imposed upon the purchaser by the contract, including the initial purchase price and any additional charges which the purchaser may be required to pay.

(4) A description of the nature and duration of the plan being purchased.

(5) A statement that the seller, salesperson or any other person who is in the business of offering for sale or transfer the rights under contracts for a fee is required by this chapter to provide each purchaser of a vacation time-sharing plan with a copy of the seller's disclosure statement prior to execution of such contract and that a failure to do so is a violation of this chapter.

(6) The following statement shall appear in the contract, under its own paragraph, immediately above the space reserved in the contract for the signature of the purchaser, in boldfaced type of a minimum size of 10 points:

"PURCHASER'S NONWAIVABLE RIGHT TO CANCEL''

shall appear at the beginning of said paragraph in boldfaced type of a minimum of 10 points, immediately preceding the following statement:

                                          

                                               (Date of Transaction)

"YOU MAY CANCEL THIS CONTRACT WITHOUT ANY PENALTY OR OBLIGATION WITHIN 5 BUSINESS DAYS FROM THE ABOVE DATE.

IF YOU CANCEL, ANY PAYMENTS MADE BY YOU UNDER THE CONTRACT AND ANY NEGOTIABLE INSTRUMENT EXECUTED BY YOU WILL BE RETURNED WITHIN 15 BUSINESS DAYS FOLLOWING RECEIPT BY THE SELLER OF YOUR CANCELLATION NOTICE, AND ANY SECURITY INTEREST ARISING OUT OF THE TRANSACTION WILL BE CANCELLED.

IF YOU DECIDE TO CANCEL THIS CONTRACT, YOU MUST NOTIFY THE SELLER IN WRITING BY CERTIFIED MAIL OF YOUR INTENT TO CANCEL. YOUR NOTICE OF CANCELLATION SHALL BE EFFECTIVE UPON THE DATE SENT AND SHALL BE SENT

TO: ______________ AT

                   (Name of Seller)                    (Address of Seller)

NO PURCHASER SHOULD RELY UPON REPRESENTATIONS OTHER THAN THOSE INCLUDED IN THIS CONTRACT.''

If no interest in real property is being conveyed, the contract shall also contain the following statement:

"YOU MAY ALSO CANCEL THIS CONTRACT AT ANY TIME AFTER THE ACCOMMODATIONS OR FACILITIES ARE NO LONGER AVAILABLE AS PROVIDED IN THIS CONTRACT.''

(7) The full name of all sales persons involved in the execution of the membership camping resort contract.

67 Del. Laws, c. 433, § 1.;

All purchase money received from or on behalf of a purchaser in connection with the execution of a contract shall be deposited and held in this State in an escrow account designated solely for that purpose, which may be the seller's own escrow account or that of the seller's attorney, until the time for cancellation has expired as provided for in § 2824 of this title, unless a later time is provided in the contract. If the contract has not been canceled, any purchase money received from a purchaser may be released to the seller upon:

(1) The conveying to the purchaser of the right or license to use the time-share unit and facilities as required in the contract; or

(2) The forfeiture of the purchase money by the purchaser under the terms of the contract.

67 Del. Laws, c. 433, § 1.;

(a) It is unlawful for any person by any means, as part of an advertising program, to offer any item of value as an inducement to the recipient to visit a vacation time-sharing plan's facilities, attend a sales presentation or contact a salesperson, unless the person clearly discloses in writing in the offer in plain language each of the following:

(1) The name and vacation time-sharing plan's address.

(2) A general statement that the advertising program is being conducted by a seller and the purpose of any requested visit.

(3) A statement of odds, in Arabic numerals, of receiving each item offered.

(4) The approximate retail value of each item offered.

(5) The number of vacation time-sharing plans that are participating in such advertising programs.

(6) The restrictions, qualifications and other conditions that must be satisfied before the recipient is entitled to receive the item, including:

a. Any deadline, if any, by which the recipient must visit the vacation time-sharing facilities, attend the sales presentation or contact a salesperson in order to receive the item.

b. The approximate duration of any visit and sales presentation.

c. The date upon which the offer shall terminate and the final date upon which the gift or prizes are to be awarded.

d. Any other conditions, such as minimum age qualification, a financial qualification or a requirement that if the recipient is married both spouses must be present in order to receive the item.

(7) A statement that the seller reserves the right to provide a rain check or a substitute or like item, if these rights are reserved.

(8) All other material rules, terms and conditions of the offer or program.

(b) It is unlawful to charge postage, shipping, handling, insurance redemption fees or any other fees for any item of value offered as an inducement to the recipient to visit a vacation time-sharing plan's facilities and attend a sales presentation.

(c) It is unlawful for any person making an offer subject to subsection (a) of this section or any employee or agent of the person to offer any item if the person knows or has reason to know that the offered item will not be available in a sufficient quantity based on the reasonably anticipated response to the offer.

(d) If the person making an offer subject to subsection (a) of this section is unable to provide an offered item because of limitations of supply, quantity or quality not reasonably foreseeable or controllable by the person making the offer, the person making the offer shall provide the approximate retail value of the item as stated in the advertising program as required under paragraph (a)(4) of this section.

(e) On the written request of a recipient who has received or claims a right to receive any offered item, the person making an offer subject to subsection (a) of this section shall furnish to the recipient sufficient evidence showing that the item provided matches the item randomly or otherwise selected for distribution to that recipient.

(f) It is unlawful for any person making an offer subject to subsection (a) of this section or any employee or agent of the person, to:

(1) Misrepresent the size, quantity, identity or quality of any prize, gift, money or other item of value offered.

(2) Misrepresent in any manner the odds of receiving any particular gift, prize, amount of money or other item of value.

(3) Label any offer a "notice of termination'' or "notice of cancellation.''

(4) Materially misrepresent, in any manner, the offer or program.

(g) Any violation of this section shall make any contract entered into voidable at the option of the purchaser.

67 Del. Laws, c. 433, § 1; 70 Del. Laws, c. 186, § 1.;

A violation of any of the provisions of §§ 2823 to 2827 of this title inclusive, or failure to comply with the notice of cancellation required by § 2825 of this title shall constitute an unfair or deceptive act or practice as set forth in Chapter 25 of this title.

67 Del. Laws, c. 433, § 1.;

Violations of this subchapter shall be within the scope of the enforcement duties and powers of the State Division of Consumer Protection as described in Chapter 25 of Title 29.

67 Del. Laws, c. 433, § 1; 69 Del. Laws, c. 291, § 98(b), (c); 77 Del. Laws, c. 282, § 8.;