During 2021 we had the unfortunate obligation to report on what may only be described as underhand tactics being employed by Seasons Holidays PLC in their quest to force timeshare lodge owners out by winding up the Slaley Hall Owners Club (SHOC). The upshot of these efforts resulted in a call for a Special General Meeting on 17th December 2021.
Like any professionally run club, SHOC had a well drafted constitution, within this constitution there was a clause allowing for the winding up of the club subject to a majority of 75% of members voting to so do. The SGM was called for the very purpose of gathering enough support to wind up SHOC. According to accountant verified figures, 82.2% of votes counted were in favour of such action. So it would appear to be a done deal, or is it?
Tactics
For a considerable period Seasons had been approaching owners of timeshare weeks at Slaley Hall making various offers all of which would result in the surrendering of ownership. At first owners were offered a period in which to take holidays, maintenance fee free but at a cost. We are aware that some club members found this attractive, stumped up the money and now have effectively free holidays.
As the SGM approached, Seasons put two more offers on the table, give up ownership and in exchange receive 15 years holidays maintenance fee free. The other offer was to give up ownership and take a share of the profits raised by the selling of the club assets which include lodge leases. The primary object was for Seasons to gain as many member block votes as possible in order to be in a position to vote through the resolution to wind up. On the surface this appears to have been a winning strategy but a considerable number of owners were not prepared to accept this, more on that later.
Running ahead of themselves
The confidence of Seasons was such that the resort trustees, Hutchinsons, engaged Avison Young who according to their own corporate literature “has real expertise in the holiday accommodation and holiday parks market, developed over many years”. Avison Young are specialist valuers and estate agents and had initially been appointed to value the lodge assets of SHOC.
According to their valuation of the 37 lodges their assessment shows a value of £3,990,000. however they suggest a collective sale price of £4,200,000. The sale of the lodges is not without problems because whilst owning a lodge in such a fantastic location in Northumberland would potentially appeal to a great number of people, especially as the staycation market is very buoyant, individual lodges are not for sale as they are owned by a number of collective leases ranging from 3 to 13 lodges per lease. Below is the estimated cost per individual lease:
Given the quality of both the resort and the lodges, using simple maths, each lodge could have a value of £113,000, catch 22, single lodges cannot be sold. Avison Young carried out a SWOT analysis (Strengths, Weaknesses, Opportunities, Threats) the conclusion was that not being able to sell individual lodges is a definite weakness, as shown below.
The latest news is that Avison Young have formally been appointed by the trustees to commence the marketing and sale of the leases, for this they will charge a fixed fee of £40,000. A press release has been issued by Avison Young and has been published on a number of websites such as Chronicle Live, North East News and Business Live.
The fight continues
A considerable number of club members were far from happy with the steam roller approach of Seasons citing significant irregularities within the SGM on 17th December. In this article it would be impossible to cover all the actions that are deemed in breach of the constitution; however one interesting point came to light. The SGM took place virtually, possibly due to Covid restrictions. Many organisations use technology known as Zoom. Zoom allows individuals to log in and virtually attend a meeting from the comfort of their own home via the internet.
We have been informed of the difficulties experienced by many members of being unable to join the Zoom meeting due to a capacity on the Zoom call. In particular, a limit had been placed of 100 participant IP addresses able to join the Zoom call at the commencement of the meeting. This was extended only part way through the meeting when some members, having been ‘turned away’ by the on-screen message, would have had no way to know that they could join the meeting part way through and thus had been excluded.
This is just one anomalous point cited in a 17 page letter sent to the trustees by lawyers representing members. The letter was dated 18th January.
Light at the end of the tunnel?
If there is light at the end of the tunnel it’s a very dim one. The letter referred to above was extremely well produced and went to lengths to point out the anomalies surrounding the meeting. The lawyer who produced the letter went into extraordinary detail often citing precedent law that had a direct correlation with the perceived breaches of the constitution.
To our knowledge no specific reply has been received, however Hutchinson Trustees did send a letter to members dated 28th January which seemingly totally ignores the concerns and potential illegalities outlined in the lawyers’ letter we referred to above. The letter finishes with what can only be described in simple English as “go away and don’t bother us anymore”, although it did say “no discourtesy intended!”
“We do appreciate that a number of members feel very strongly against the winding up
of the Club and want to vent their frustrations, but our responsibility is to apply the
rules as laid out in the Constitution and in accordance with legal advice received.
However, please note that we will no longer be responding to every email that we
receive complaining about this process. No discourtesy is intended, but there are costs
involved in dealing with these matters and it is not fair that the Club Members as a
whole should bear them. Therefore, we will now be concentrating on collating and
realising the assets of the Club, so that we can distribute them to members.”
Our comment
Once again the timeshare industry shows its true colours by running rough shod over loyal owners. This one is definitely a David and Goliath scenario and we all know how that turned out. For the past 25 years TCA has been of the understanding that timeshare resorts employed trustees to ring fence the assets of owners thus offering them a greater layer of protection for their financial investment and the benefits so attached. Can’t believe we got that one so wrong.
The actions of the trustees of Slaley Hall seem to be acting not on behalf of club members but on behalf of the developer. Whilst the trustees have taken advice from a Queens Councillor (QC) over the proposed action as “agreed” by the result of the vote at the SGM we have to wonder why the losers in this matter may be all those members that a trustee is there to protect.
What comes next is hard to say but what is certain is there are two options. Firstly accept the vote and wait for a payout when the lodge leases are sold or secondly commence legal action which will no doubt be a complicated and expensive matter. The constitution of the club does allow for arbitration and we understand that this is the preferred route the owners are taking.
Over the years we have established that owners of UK timeshare have a much greater affinity to the actual resort they purchased at. If all the leases are sold and no agreement is made with Seasons for future use, which is quite likely, all those members that accepted one of the ongoing holiday deals offered by Seasons will be forced to holiday elsewhere as Slaley Hall will be off the table.
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