Exiting a Contract
This is not as easy as most people expect it to be, however there are rules when entering into a contract and as such, if those rules have been broken by one party then the other party will have the right to rescind the contract in part or whole.
Further to the above statement, as the contract is subject to the jurisdictional law which regulates the contract, in existence will be statutes which could provide a pathway which results in extended protection for a consumer.
Contract exits and the option to track on to an exit strategy will require a party to think carefully as to the reasons why they are seeking an exit and which is the best option available to them.
This will involve lengthy discussion with an expert, so that your case and your quest does not flounder leaving you subjected to adverse cost orders from the other party.
In respect to timeshare exit solutions the two main avenues to achieve an exit are:
- Breach of express, implied or statutory terms.
- Misrepresentations
Listed below is a brief outline of the issues contract law and misrepresentation brings to the table when considering embarking on a legal claim. You will appreciate that a layman will struggle with the legal concepts however if a consumer has seen a solicitor they will be able and should easily read this brief and give just consideration to the information which was gleaned from the consumers solicitors or legal representatives.
Contract Law
In common law legal systems (of which the UK is one), a contract firstly is expressed as an agreement having a lawful effect if entered into voluntarily by two or more persons/parties, each of whom wants to and intends to create one or more binding legal obligations between them.
The elements of a contract are quite simple and in 3 stages “offer” and “acceptance” by “competent persons” (having legal capacity to engage and exchange) and “consideration” to create mutuality of obligation.
These can be achieved in writing in part or whole or orally in part or whole or indeed by the parties conduct.
If the contract is broken by a party a remedy may be required for “breach of contract” seeking either “damages” in the form of compensation or specific performance dealt with through an injunction.
The parties may be natural persons or not (i.e. a company).
A contract is either a legally enforceable promise or undertaking that something will or will not happen. The word promise can be used as a legal synonym for contract, although care is required as a promise may not have the full standing of a contract, as when it is an agreement without consideration.
Contract law is based on the principle “agreements must be kept” but more literally means “pacts which must be kept”.
Jurisdictions vary in their principles of freedom of contract Although In common law jurisdictions such as the United Kingdom, a high degree of freedom is expected.
Not all agreements are necessarily contractual, as the parties generally must have an intention to be legally bound (or the functional equivalent under the objective theory of contracts).
In England, the term gentlemen’s agreement is one which is not intended to be legally enforceable; “binding in honour only.”
At the core of any relationship between a Timeshare company, owners club and of course the owner of the timeshare themselves, there is a contract. When a party to that contract wholeheartedly believes the another party to the contract is acting in a manner which appears unfair it’s that contract which the parties to the agreement should look to, so as to refresh themselves as to the bargain they struck, intended to strike or believed they struck. Then a consumer will understand if there exists a divergence from what they expected.
This being said it it’s those terms, conditions and obligations contained in the contract which one should refer to so as to begin the investigation as to the rights or purported right of each party has.
Offer and acceptance
For a contract to be formed, parties to the contract must reach mutual assent (this is called a meeting of the minds). This is typically reached through offer and an acceptance. It does not vary the offer’s terms therefore it is known as the “mirror image rule“.
If an acceptance does vary the terms of the original offer, it is not an acceptance of the offer, but a counteroffer and, therefore, simultaneously a vacation of the original offer.
As a court cannot read minds, the intent of the parties is interpreted objectively from the perspective of a reasonable person.
Contracts involving Timeshare are generally bilateral contracts.
Consideration
Consideration is something of value given by a promissor to a promisee in exchange for something of value given by a promisee to a promissor.
Scottish law-based systems do not require consideration, and some commentators have suggested that consideration be abandoned, and estoppel be used to replace it as a basis for contracts.
Courts will typically not weigh the “adequacy” of consideration as long as the consideration is determined to be “sufficient”, with sufficiency defined as meeting the test of law, whereas “adequacy” is the subjective fairness or equivalence.
A party must have capacity to enter a contract .That means parties in a contract must justify their age so as to establish an understanding as to the terms of the contract, further they must be mentally able to understand the implications of entering into the contract.
The purpose of the contract must be lawful the form of the contract must be legal the parties must intend to create a legal relationship, Finally the parties must consent.
As a result, there are a variety of affirmative Defences that a party may assert to avoid their obligation.
Affirmative Defences
Vitiating factors constituting defences to purported contract formation include: Mistake (such as non est factum) Incapacity, including mental incompetence and infancy/minority Duress Undue influence Unconscionability Misrepresentation or fraud Frustration of purpose.
Such defences operate to determine whether or not a purported contract is either void or voidable.
Void contracts cannot be ratified by either party. Voidable contracts can be ratified.
The aforementioned are therefore the common and basic positions to be explored to challenge the assertions of a timeshare contract. It is not necessary to wait to be pursued by a Timeshare company; any party to a contract can ask the courts for a determination as to the contract they entered into.
For more information regarding this article or assistance in any other timeshare related issues please contact the TCA on 01908 881058 or email: info@TimeshareConsumerAssociation.org.uk