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The SaveKBV.org Website

Discussion in 'Kauai Beach Villas IOA Public Square' started by Jeff From Salem, Apr 10, 2019.

  1. ecwinch

    ecwinch Moderator

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    That's a great point Brian. So are you saying that the decision to not renew the contract with Wyndham exceed the BoD's authority under the by-laws? Because there was not a membership vote on that decision.
     
  2. LisaH

    LisaH TUG Lifetime Member

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    If that is the case, someone (Wyndham management, lawyer?) is very incompetent to allow management change without a vote by the owners.
     
  3. bjreichel

    bjreichel Guest

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    Unfortunately (and frustratingly), I am not privy to any information regarding the change in management companies. The only information I have consists of the IOA governing documents, which are available for review on the owners community page of the KBV website. The more I analyze those documents, the more questions and concerns I have. What I can say is that it certainly appears that WE--owners, board members, managers--may not have been administering the IOA consistent with the governing documents over the past many years, and WE--everyone--must share in the blame for that. Moving forward, the following question needs to be constantly asked by owners, board members and the plan manager: Is this course of action authorized by the governing documents?

    Article V, Section 3 of the Declarations states: "Each Owner agrees that they will manage the Plan through the Association according to what is said in the Governing Documents. No owner will manage by themselves or with any group of other Owners outside of the Interval Association. Each Owner gives the Association all rights and powers to manage according to what is said in the Plan Documents, and agrees that what the Interval Association decides and does in accordance with the Interval Governing Documents is binding on him."

    Article III, Section 1 of the Declarations states: "The Interval Association shall provide and maintain an Exchange Program unless a majority of Owners vote to not have such Exchange Program." According to the IOA "Rules and Regulations" (Article 1, Section 3(c)," RCI is the IOA's authorized Exchange Program. So where does "Club Wyndham" fit in? It's not mentioned anywhere in any governing documents. What authorizes Wyndham Vacation Resorts, Inc. to advertise KBV as a "Club Wyndham" property, or even to use the KBV name?

    Article VI, Section 5 of the Declarations provides for the dissemination of certain information to Owners by the Board, including that "Minutes of each Board Meeting must be sent to each Owner as the Board shall direct but within 60 days of after the meeting." I've never been sent any minutes. This section also requires that "[a] statement of the Interval Association's policies and practices in enforcing its remedies against Owners for defaults in the payment of Maintenance Fees and Special Assessments, including the recording and foreclosing of liens against Owner's intervals, must be sent annually to each Owner as the Board shall direct but not less than 60 days prior to the beginning of the fiscal year for the Interval Association." I've never received any such "policies and practices" statement.

    Articel VIII of the Declarations outlines the required process (the use of the word "shall" appears throughout) for dealing with Owner defaults int the payment of maintenance fees. Is this process being followed? If so, why do we allegedly still have units on the books that have been in default for years? Where is the use of a "foreclosure agreement" with a third-party authorized in the governing documents?

    These questions are illustrative examples and not an exhaustive list. My review of the governing documents has triggered many other questions, some of which have been raised in other posts on this forum.

    I do plan to attend the upcoming annual meeting. As a Board candidate and owner, I am hopeful that not only can I obtain the information necessary to answer the many questions raised by my review of the governing documents, but that WE--owners, board members, and plan manager--can come together to get the IOA back on track and operating in accordance with the governing documents and applicable Hawaii law.
     
  4. jacknsara

    jacknsara KBV Forum Moderator TUG Member

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    Karen (KYHOME), a former KBV board member provided some insight last year. I believe a good place to start in the midst of an 11 page thread is:
    https://www.tugbbs.com/forums/index...las-board-election.240675/page-9#post-2150603
     
  5. Jeff From Salem

    Jeff From Salem Guest

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    So interesting, Eric, that you would find a great point potentially in support of Wyndham. Just sayin'.
     
  6. ecwinch

    ecwinch Moderator

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    Those are some interesting points. I have studied numerous timeshare HOA's governing documents over the years, and lax compliance is not entirely uncommon.

    In regards to the requirements outlined in our governing documents, what is your take on the hierarchy of the documents, especially in regard to the statutory requirements set by the State of Hawaii.

    For instance, in regard to the minutes of the meeting, if the minutes of the BoD are published in public area (say the lobby of the clubhouse or the website), does that meet the requirement that they be "sent". In particular if Hawaiian law sets that as an option.

    Said another way... if there is a conflict between the Declaration and the By-Laws, or the By-Laws and Hawaiian statute, which prevails?

    In regard to your question about Club Wyndham, I think the answer is the governing documents pre-date's the 2006 acquisition of PAHIO Resorts, Inc. and PAHIO Vacation Ownership, Inc.. by Wyndham.

    For instance - in regard to the use of the name, if I recall in my last visit to KBV, the signage still says Pahio KBV or something to that affect, and that Wyndham appears to have stopped referring to KBV as Wyndham KBV in their documentation since the loss of the mgt contract. Below is the page from the Club Wyndham Directory and KBV is no longer referred to as Wyndham KBV, only as KBV. In the prior edition it was listed as Wyndham KBV. So I would think the question would turn on any rights extended as part of the mgt contract or rights granted to Pahio and assigned to Wyndham as part of the 2006 acquisition.

    Snip20190503_1.png

    Thanks for your efforts in digging into the governing documents. I know how tedious that can be, and I will dive in and give you my take on the foreclosure process in a follow-on post.
     
    Last edited: May 3, 2019
  7. ecwinch

    ecwinch Moderator

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    Jeff - thanks for recognizing that I had a great point, but the credit really goes to Brian for digging into the governing documents.

    And I thought the objective here was transparency and ensuring proper governance of KBV for benefit of all the owners. If the BoD's action exceeded their authority as Brian has potentially pointed out, I would think all fair-minded KBV owners would be concerned about that. Wanting to ensure that the actions of the BoD do not exceed the authority granted them under the governing documents.

    Is that not what you are striving for? Or are you only concerned about curbing the abuse of power when you disagree with the intent.
     
  8. bjreichel

    bjreichel Guest

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    It's still listed as Wyndham Kauai Beach Villas on the Club Wyndham website as of 2:51pm MST today:

    https://www.clubwyndham.com/cw/resorts/wyndham-kauai-beach-villas.page
     
  9. ecwinch

    ecwinch Moderator

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    Jeff From Salem likes this.
  10. bjreichel

    bjreichel Guest

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    The issue is addressed in Section 6.02 of the Bylaws. Declaration trumps Bylaws, Hawaii law trumps everything.
     
  11. Jeff From Salem

    Jeff From Salem Guest

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    I have received telemarketing calls asking me about my Wyndham timeshare. It's another thing that peeves me about Wyndham, in that they are selling the owner contact lists. I have never ever listed my timeshare ever as a Wyndham Kauai Beach Villas. I have let the BOD know about this in the past.

    Jeff
     
  12. ecwinch

    ecwinch Moderator

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    Doubling back to this point after reviewing the Declaration.

    The powers of the BoD are spelled out in Article V, Section 7:

    Section 7. Authority/Powers. The Board is authorized to take all actions of the Interval Association including the power to adopt, amend or repeal the Bylaws; to adopt rules and regulations governing the use of the Apartments under this Plan; appoint a Plan Manager pursuant to a written agreement for a term of up to 5 years with such powers as the Board may authorize; appoint committees; renew and/or enter into agreements with an Exchange Company; and to carry on all of the activities of the Interval Association.

    Given the broad language of the highlighted provisions, and the absence of any language in the Article V, Section 9 that restricts the BoD's authority to enter into a foreclosure agreement, I do not see anything in the Declaration or By-Laws that prohibits the BoD from entering into a foreclosure agreement.

    And while Article VIII outlines the required process of handling defaulting owners, nothing in that provision dictates the timetable. But likewise I do not understand the purpose of keeping defaulting owners on the books. Perhaps someone with more insight to the logic will tell us.
     
  13. bjreichel

    bjreichel Guest

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    Interesting question, perhaps best asked of a corporate attorney licensed to practice law in Hawaii. The Declaration (Article XII, Section 1) does contain a provision requiring notices to be given in writing and snail-mailed or "personally delivered" to an owner at his or her last-known address...might this provision be construed to apply to anything the Declaration requires be "sent?"
     
  14. bjreichel

    bjreichel Guest

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    Good point, Eric. But I'm struggling with the fact that other provisions of the Declaration specify what the Board can do. For example, Article V, Section 7(c) goes on to say that "[t]he Board may appoint and retain an accountant or accounting firm and/or legal counsel or counsels" and Article VIII, Section 1(d) states that "the Interval Association may use a collection agent." Why would this language be necessary if your quoted language was intended to be all-encompassing? In other words, doesn't this specific language imply that the IOA should be using an attorney or collection agent to deal with defaults (or handling them internally), rather than through the plan manager or a foreclosure agreement?

    On a side note, anyone who attempts to collect a debt on behalf of another is considered a "debt collector" under the Federal and State Fair Debt Collection Practices Act (FDCPA), and must comply with the requirements of that Act. All states of which I'm aware require that a debt collector be duly bonded and licensed or registered with the state in which they are attempting to collect a debt. If the IOA hires a third-party to handle accounts already in default (whether through a "foreclosure agreement" or plan manager), it needs to use an attorney or licensed collection agency to avoid potential liability under the FDCPA.

    Or better yet, handle everything internally since Hawaii allows for non-judicial foreclosure in the form of a private sale. How hard could it possibly be to simply have the plan manager provide the Board with a list of units in default, create a form default notice template that complies with the Declaration and gets signed by the Board President and mailed to defaulting owners, and if the default remains at the end of the notice period generate a sale notice (using another form template) and send it to the local newspaper for publication? The IOA could hold a private foreclosure sale on the tennis courts. Wouldn't this be much more cost-effective?

    The Declaration (Article VIII, Section 1(e)(ii)), as amended in 1996, specifically allows the IOA to purchase units at the private sale. The IOA could bid a nominal amount ($100 per unit?) and turn the deficiency balance on each account over to a collection agency to handle for a contingent fee based on a percentage of the amount recovered. Is there anything in Hawaii law that would preclude the IOA from turning around and advertising the units for sale directly on e-bay without the need to hire a licensed real estate agent to market them? Do we really care how much the units sell for, as long as we have owners who are paying their maintenance fees?
     
  15. ecwinch

    ecwinch Moderator

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    That is not my read for a couple of reasons. First off, because the language used is permissive (i.e. MAY) rather the imperative (i.e. SHALL). And while context can make "MAY" to be more like "SHALL", the section you cite is enumerating the Authority/Power of the BoD, so I dont think the context supports that interpretation. Perhaps if it was worded differently and in Section 9 under the "Limitations" of the BoD's authority.

    And from a broader perspective, I think it is well understood that the Declaration and By-Laws cannot possibly address each and every situation that might require the BoD's action. And in the absence of specific restriction at law or in the governing documents, I believe a court will normally defer to the judgement of a duly-elected BoD. Especially given the members right to veto a BoD's decision as outlined in Section 9(b) and the broad language of Section 7.

    I would agree that getting those intervals in the hands of dues paying owners is the imperative. And likewise, I dont understand why the BoD is not making these intervals available to the owners, and/or having a flyer offering the intervals to exchangers and renters. If the intent is to upgrade the resort to make it more appealing, it seems we should at least have the framework in place for getting those intervals out of the HOA inventory.
     
    Last edited: May 4, 2019
  16. Jeff From Salem

    Jeff From Salem Guest

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    At both of the other resorts I own, lists are readily and easily available (even online!) for those wishing to purchase. Anything that makes it easier and clearer that "we're" open for business in that regard would be helpful.
     
  17. ecwinch

    ecwinch Moderator

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    And in regard to the prior discussion on Dani Ramos serving on the BoD:

    §514B-107 Board; limitations. (a) Members of the board shall be unit owners or co-owners, vendees under an agreement of sale, a trustee of a trust which owns a unit, or an officer, partner, member, or other person authorized to act on behalf of any other legal entity which owns a unit. There shall not be more than one representative on the board from any one unit.
     
  18. jacknsara

    jacknsara KBV Forum Moderator TUG Member

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    I am pasting a relevant part of a post made in a different thread ( https://www.tugbbs.com/forums/index.php?threads/annual-meeting-questions.289590/#post-2279428 ) here.
    A not small detail is that the source Eric quotes (514B) is Condominiums. 514B is applicable to the AOAO. https://cca.hawaii.gov/pvl/files/2013/08/514B-CPR-R-090518.pdf
    514E TIME SHARING PLANS does not contain the same provision. http://cca.hawaii.gov/pvl/files/2013/08/hrs_pvl_514e.pdf

    BTW - Dani Ramos is an exceptionally qualified and competent board member whose history with the resort goes back to the Dave Walters days.
     
  19. Jeff From Salem

    Jeff From Salem Guest

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    Eric, you still haven't answered whether you own any deeds in Wyndham resorts or in the Wyndham Vacation Club. You conveniently answered the question of whether you own stock in Wyndham or are an employee (You replied 'no' to those). Your lack of transparency on owning timeshares or deeds in Wyndham is telling to me. You keep trying to find ways to argue for Wyndham. You have never argued against them. Ever. There are plenty of reasons to suspect Wyndham for poor practices.

    As Jack corrects, your point about 514B corresponds to condominiums, not timeshares. The point I and others have brought up applies in that a board member either needs to be an owner or, if representing a corporate interest, needs to be an officer of that company. Dani doesn't own any deeds, therefore has no personal vested interest in the resort.

    In response to Jack regarding Dani Ramos, Dani has been an employee of either PAHIO or Wyndham for a long time. She remembers back when my wife and I bought in the first place. But her allegiance is with Wyndham, not KBV. She is a full-time Wyndham employee, and she serves Wyndham's interests first and foremost. She has no place on the Board Of Directors, in my opinion. Sometimes Wyndham's interests may coincide with individual owners, but, quite importantly, Wyndham's interests are against individual owners. They have shown it here at KBV, and they have shown it at other resorts throughout the U.S., and those times have been well documented.
     
  20. ecwinch

    ecwinch Moderator

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    Jack,

    So HRS 514B does not apply to the IOA?

    Any idea why that is cited as the applicable provision that prevented Wyndham from voting on the mgt contract?

    upload_2019-5-5_22-21-4.png

    Source: SaveKBV.org archives.
     
  21. ecwinch

    ecwinch Moderator

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    OMG - cannot you not read? I have posted repeatedly that I am a member of the Wyndham Vacation Club aka Club Wyndham. Why do you keep asking this inane question?
     
  22. bjreichel

    bjreichel Guest

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    In her "Statement of Candidates" I received in the mail as part of the annual package, Ms. Ramos states that she "currently serves as the Regional Controller for Wyndham Vacation Resorts." Does that particular Wyndham entity appear as an owner of any intervals according to the IOA's current membership list?
     
  23. jacknsara

    jacknsara KBV Forum Moderator TUG Member

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    Just guessing since I'm not going back to the source. Wyndham does hold the management contract for the AOAO which is the condominium of 150 units and is subject to 514B.
     
  24. bjreichel

    bjreichel Guest

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    I believe I may have found an answer. The State of Hawaii publishes a booklet entitled "Condominium Property Regimes: Owner Rights and Responsibilities," which can be found at this link:
    http://files.hawaii.gov/dcca/reb/condo_ed/condo_gen/condo_bod/2009_CondoOwnersRandR.pdf

    Pages 9-10 of that booklet explain that Hawaii had 2 different Condominium Acts in effect: HRS 514A (the original Act), and 514B, which applied to all condominium regimes created after July 1, 2006. According to this booklet, "with few exceptions, the provisions of Chapter 514B that govern the management and operation of condominium associations supersede the old Condominium Property Act even for condominiums created before July 1, 2006."

    The booklet was published in 2009. It appears that, as of January 1, 2019, 514B now applies in its entirety to ALL condominium regimes:

    §514B-21 Applicability. [Effective January 1, 2019] (a) This chapter applies to all condominiums created within this State; provided that such application shall not invalidate existing provisions of the declaration, bylaws, condominium map, or other constituent documents of those condominiums if to do so would invalidate the reserved rights of a developer. Amendments to this chapter apply to all condominiums, regardless of when the amendment is adopted.
    (b) For purposes of interpreting this chapter, the terms "condominium property regime" and "horizontal property regime" shall be deemed to correspond to the term "condominium"; the term "apartment" shall be deemed to correspond to the term "unit"; the term "apartment owner" shall be deemed to correspond to the term "unit owner"; and the term "association of apartment owners" shall be deemed to correspond to the term "association".

    I urge everyone, particularly those who plan to be in attendance at the annual meeting, to read 514B in its entirety, paying special attention to the section pertaining to elections and meetings beginning at 514B-121. Here's a link to access a pdf of 514B:
    https://cca.hawaii.gov/pvl/files/2013/08/514B-CPR-R-090518.pdf

    Also, please keep in mind that the Association is incorporated as a Hawaii non-profit corporation, so Hawaii's Non-Profit Corporation Act (HRS 414D) also applies to the extent it's not in conflict with 514B. A pdf link to the 414D can be found here:
    https://www.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0414D/HRS_0414D-.htm
     
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