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Poipu Point - Walk away from ownership?

billstellar

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Duplicate post, so duplicate reply.

1. Suing DRI is, IMHO, a total waste of time since DRI is not the entity that is charging the assessment to owners, nor is DRI the entity that controls the owners list.

2. There aren't enough deeded owners to gain control of the resort by that means. The only way to gain control of the resort is to first gain control of the Hawaii Collection trust.

*****

Until the leaders of the deeded owners groupls realize that the critical issue is gaining control of the trust, it's hard to take them seriously. To me, that failure demonstrates that they haven't taken the time to understand the resort governance. Talking about starting legal action without first grasping how the resort is governed is ..... I'll just leave it to you to supply your adjectives of choice.

The Deeded Owners Group is now open to Trust Members, I do not know if COPP is going after both lists, however as you said in an earlier post owners controlling boards is a long term objective. Going for legal action against DRI is a waste of time and money and not something I support (and have told COPP so.) Going after the lists (maybe both) is worthwhile I believe and I support thaat action. On the SA, basically as other posters say, it is either opt out or buy in depending on individual situations. For my part I have decided to pay the first installment in January sometime and wait for the next step - how many defaults are there - before making the next decision. DRI has to fix the problem or close the resort. The latter is unlikely as many poster have said. I like your posts - very pointed and "on the nose" so I hope COPP is reading them.
__________________
Whatever I post is my personal opinion and is in no way intended to be, or should be construed to be, an indictment of any company or individual.
 

T_R_Oglodyte

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The Deeded Owners Group is now open to Trust Members, I do not know if COPP is going after both lists, however as you said in an earlier post owners controlling boards is a long term objective. Going for legal action against DRI is a waste of time and money and not something I support (and have told COPP so.) Going after the lists (maybe both) is worthwhile I believe and I support thaat action. On the SA, basically as other posters say, it is either opt out or buy in depending on individual situations. For my part I have decided to pay the first installment in January sometime and wait for the next step - how many defaults are there - before making the next decision. DRI has to fix the problem or close the resort. The latter is unlikely as many poster have said. I like your posts - very pointed and "on the nose" so I hope COPP is reading them.

That's pretty much the position that I'm in. COPP does read my posts and considers that I am part of the problem.

As regards the trust owners list, I have doubts whether DRI can be compelled to release that information. The Trust is not a condominium, so the law requiring disclosure of owner contact information wouldn't be applicable to the trust. I think it's worth noting that the Trust is incorporated in Delaware, so the governing law regarding release of owners names is likely Delaware law, not Hawaii law.

COPP wants $200 per interval to support their cause. Without evidence of any kind of credible strategy to break the DRI stranglehold on the trust, that looks to me like throwing away another $200. (It's statements like that that make COPP think I'm part of the problem.)
 

Poobah

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COPP Strategy

I agree with both Steve and Bill that the objective is to get the owners list so that the VOA AOAO Board can be structured to reflect the ownership of the resort.

I plan to pay the January assessment and will contribute to the COPP. I think to get the list is going to take some legal action. Again we need to establish who "owns" the list. I think it is the VOA/AOAO, not DRI.

One can't help but notice that things seem to be a little quiet on the VOA/AOA/DRi front.

Cheers,

Paul
 

T_R_Oglodyte

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I agree with both Steve and Bill that the objective is to get the owners list so that the VOA AOAO Board can be structured to reflect the ownership of the resort.

I plan to pay the January assessment and will contribute to the COPP. I think to get the list is going to take some legal action. Again we need to establish who "owns" the list. I think it is the VOA/AOAO, not DRI.

One can't help but notice that things seem to be a little quiet on the VOA/AOA/DRi front.

Cheers,

Paul

My problem, Paul, is that I don't see where acquiring the Poipu owners list accomplishes anything. The only owners list that matters is the Hawaii Collection, since there is no realistic chance of breaking the stranglehold on the Board of Directors as long as the trust is controlled by DRI.

Spending any resources to get the Poipu owners is an utter waste as far as I can see. Lacking any other information, for as long as COPP puts gaining access to the Poipu owners list front and center, I will continue to believe they are living in Fantasy Land.

But then, I guess that makes me part of the problem, doesn't it?
 

Jasonb334

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From a practical standpoint, rallying the deeded owners is neither important nor critical. In fact, it simply dissipates energy that is better spent implementing a strategy that has a chance of succeeding.

Communicating with some of the Poipu Owners group, it sounds like they do have a strategy in place and it rallying the deeded & Hawaii collection members is important.

Rallying the deeded owners can succeed only if a minimum of about 95% of the deeded owners vote as a bloc for one specific set of candidates. The chances of that happening are pretty close to zero. In fact, a more realistic strategy would be to take the money people have contributed and use it to buy Powerball tickets, in the hopes of hitting the right numbers and then using the Powerball proceeds to rebuild the resort.

I think the people running the Poipu group have a pretty good idea that the 95% block is not realistic and the Hawaii Trust holds the key. I doubt that they have spent this much energy and don't realize that.

+++++++
Realistically, the only way that DRI members can be voted off is by taking control of the Hawaii Collection trust - replacing the DRI cronies on the Board of Directors of the Trust with Directors who are committed to then using the Trust voting power to vote DRI interests off of the Boards of the individual resorts. The owners that need to be rallied are the owners in the Trust. If the group is interested in replacing the resort Directors, that is the only owners list that really counts.

BINGO! That's exactly what I heard from the Poipu group. But they realize that you can't take over the board of the Hawaii Collection because it is also stacked with 4 Diamond Resorts International employees, so this is not an option! Probably why the lawsuit is the most viable option (IMHO).

+++++
I frankly have a very, very hard time taking seriously anyone who thinks they can can take control of the resort by rallying the deeded owners. The primary thrust needs to be getting control of the Hawaii Collection trust. Without accomplishing that, nothing else matters.

BINGO! I thought that a court action will include "discovery" and in that process the attorney representing the owners will have access to the 12,000 members in the Hawaii Collection as well as the deeded members at both resorts in Hawaii. The law firm is not stupid, they will file against the associations, the board of directors in the association personally (yes they have insurance for that, and not immune if fraud exists), Diamond International Resorts, specific individuals of DRI and Does 1-100.

The Class Action that was just settled was a minute assessment compared to the Poipu issue. With the Hawaii resorts alone, there are 30,000 interval weeks, approximately 21,000 deeded owners + 12,000 Trust owners/members. That's a class action waiting to happen.
 

Jasonb334

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I agree with both Steve and Bill that the objective is to get the owners list so that the VOA AOAO Board can be structured to reflect the ownership of the resort.

One can't help but notice that things seem to be a little quiet on the VOA/AOA/DRi front.

The objective should be to call the Board members and tell them what a crappy decision that they made and your owners are ticked off.
The board voted for the assessment and the payment terms so you can't blame Diamond Resorts International.

Your board members can call a special meeting and change the terms.

Point at Poipu Association

Woody Cheeks 907-696-2771
Jacalyn Anderson 651-486-7423 or 651-295-8252
Troy Magdos - Jason Toste - Kathy Wheeler

There was a post earlier that one of the board members in both associations may have resigned - a Diamond Resorts International employee. That would leave the boards somewhat even and the remaining board members could recall this assessment until a better plan is worked out.
 

paaly

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We have a every-year floating oceanfront unit we bought back in 1996 when it was Embassy...and a second every-other-year oceanfront unit we bought in 2004.

We have been trying to sell both the units but on the secondary market, they go for $1500 at best and then too, they are not moving...

We are considering abandoning/walking away from both units - in this economy, shelling out $5,400 for 2012 and $3,300 for 2013 and then again $5,400 for 2014 is a financial drain that we simply CANNOT afford.

I don't know whether our credit will take a hit...or whether we can negotiate an exit or come to a deal. We are willing to give up both units. It is simply unaffordable.

I do know that Diamond will come after us with a vengeance if we default on the maintenance fees. They are one of the most ruthless companies i have dealt with in a very long time. Their customer service is atrocious - their operators are downright nasty and all they care about is money. They have little, if any, regard for their owners and they are of absolutely ZERO help. Calling them has been next to useless...essentially, the specialist I spoke to flipped me the virtual bird on the phone.

So I researched this matter on the web and came across this portal.

Please, if anyone has any idea, experience or recommendations, I would be mightily obliged.

Thanks.

Raj

Dear Raj!

I would give at least one testicle to have known when we bought our timeshare (The Manhattan Club) from the developer, in 1999, what I know now. Finally, we did get rid of it, at an enormous loss. It's a crooked business. We could stay more than a week in Manhattan at a hotel for what the current maintenance fees are. And the place was atrociously decorated -- in the "living room," anyway. The bedroom and baths (in the Penthouse Suites) were nice.

Hindsight! What a brilliant concept!
 

Kpaul

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Looks like COPP is gaining ground. 3rd article this month on the internet!

Here is a posting I received 12/30/11 that may be of interest to those owning at the Point. Remember, I am not the source of the info but only passing it on.

Let the lights shine brightly. Sterling

Diamond Resorts responds in dispute with timeshare owners

Submitted to The Garden Island newspaper in Hawaii

The following information was provided to The Garden Island Newspaper some time ago. The fight is ongoing and COPP’s voice is getting louder.

LIHU‘E — In a wry turn of events, the Concerned Owners of The Point at Poipu (“COPP, LLC”, formerly “CDOPP”), a vacation owners group that was threatened with a lawsuit by the developer/management company of The Point at Poipu in March of last year, is now itself preparing a lawsuit against this corporate giant, Diamond Resorts International, Inc. (“DRI”), one of the largest hospitality companies in the world. There has been an intense struggle between DRI and many upset vacation owners at the resort in Kauai who have owned there long before DRI ever showed up. Many of these owners are alleging that they have been deceived by DRI , that DRI has serious conflicts of interest in Board decisions and does not recuse itself, that there is a shocking lack of disclosure of essential information, that it has been non-compliant with Hawaii Revised Statutes and that the resort is generally mismanaged.

The initial grassroots efforts of this owners group was spearheaded by former President of CDOPP, Rich Batchelder, who retired from the group in October of this year, leaving the group floundering. Unwilling to give up, members of CDOPP recruited a new, energized board to help them. According to Keith Paulsen, the new President, it was a Facebook page designed by one of the vacation owners, Tammy Sona, which helped revitalize the group. This Facebook page now gave members a way to communicate with each other where there had been none before. Sona currently plays a pivotal role as one of the new board members of the owners group that is now called “COPP, LLC.” The address of the Facebook page that she created is: http://www.facebook.com/pointatpoipu.

Meanwhile, the next DRI atrocity was foisted on all of the vacation owners at The Point at Poipu when they were informed in October 2011 of a $65 million assessment to repair damages to the resort from water intrusion. This outrageous price tag would be paid for by the vacation owners and in part by DRI. To illustrate, an owner that holds a vacation interest for two weeks a year is expected to pay, by January 1, 2012, more than $6,300, consisting of maintenance fees and the first-year water intrusion assessment fees. Further, this entire amount would have to be paid by February 1, 2012, in order to avoid: “…the following:

a. A one-time late charge equal to 5% of the delinquent amount.

b. An interest charge of 12% per annum from the due date.

c. General Excise Tax (GET) of 4.16666% on all of the above charges.

d. Owner will suffer suspension of use rights.

e. All future reservations will be cancelled and owner will be required to re-book the reservation and will be subject to first come, first served availability.”



If the account is not paid in full or not operating under a payment plan by February 15, 2012, “…the account will be submitted for collection action resulting in additional collection fees.” If the account is not paid by March 15, 2012, “Your Board of Directors may request any necessary actions to collect outstanding assessments. Actions may include but are not limited to the following:



1. Submit a delinquent account to an attorney.

2. Engage a professional collection agency.

3. Record a claim of assessment lien.

4. Foreclose on the claim of assessment lien.

5. Institute a small claims suit or legal action.



All related costs for the above, including General Excise Tax (GET) of 4.16666%, will be added to the delinquent member’s account.”

Tammy Sona speaks for many vacation owners when she says, “A great number of our owners are retired now, having spent many years working hard so they could enjoy their senior years vacationing in Kauai. This assessment is such a hardship on these owners, not just the ones that are retired, and some will be forced to surrender their deeds or be foreclosed on. This just isn’t right, it’s not the way you treat people.”

Vacation owners were notified of all this in October 2011, giving them THREE MONTHS NOTICE to come up with thousands of dollars for an unexpected assessment. To add fuel to the fire, two informational meetings were held on October 19, 2011, in Irvine, California, and on October 20, 2011, in San Francisco, California, just days after the assessment fees were announced. Most vacation owners, of course, would not be able to attend these meetings on such short notice and at their expense. NO informational meetings about the water intrusion problem have taken place at the resort!

The vacation owners have been led to believe that DRI has performed its due diligence regarding the $65 million assessment. To the contrary, DRI will not release pertinent information such as the consultants’ reports, engineers’ and architects’ reports, insurance policies and other documents that would help to justify this huge expense. COPP, LLC, does not dispute that some of the work is necessary, but it wants the opportunity to bring in an independent third party to assess the situation. “With many of our members having backgrounds in the construction-related industries, we’re not about to accept this without some degree of scrutiny” asserts Paulsen. DRI insists that the insurance company denied the claim for the damage, but no one except DRI has seen the denial letter. DRI has created a website for vacation owners’ perusal regarding the water intrusion problem, but nothing of real substance can be found there.

Former Diamond Resorts International Executive Vice President and General Counsel Elizabeth Brennan was quoted in a March 1, 2010, Garden Island article that stated “…the few members of the concerned owners group are not representative of the ownership of this resort and their satisfaction level.” The disgruntled owners group, renamed COPP, LLC (Concerned Owners at the Point at Poipu) has grown to well over 1,000 determined owners looking for changes to the operations and management of the resort.

Members of COPP, LLC, who have been interested in running for a position on one of the resort’s Boards of Directors have been denied by DRI their request for the resort’s membership list, needed to gain support for their candidacy by contacting other owners. This denial, both at The Point at Poipu and at the Kaanapali Beach Club in Maui, is contrary to the laws of Hawaii and to the resorts’ organizational documents. Section 514A-83.3 of the Hawai‘i Revised Statutes requires the board of directors to provide an ownership list to any owner for the use of soliciting votes.

The management and corporate administration fees at The Point at Poipu that were $721,262 in 2007 have increased to $3,265,745, budgeted for 2012--over a 353% increase during this short timeframe. The DRI executives would like us to believe that the Board of Directors (consisting of a majority of DRI employees or relatives of DRI employees) voted for these increases independent of their association with DRI.

DRI’s Vice President of Association Administration, Linda Riddle, was quoted in an earlier article, “If they aren’t happy, they could vote us out. They have the power to do that.” COPP, LLC, members disagree. “If it was that easy, it would be done immediately,” said Paulsen, “but without the membership list everyone knows that it’s virtually impossible to campaign for office, and DRI wants it that way.”

Paulsen adds “with control of the boards, including the Hawaii Collection Board of Directors, the vacation owners are at the mercy of this corporate giant. It’s really a David versus Goliath situation but this is a determined group of owners that are not going to stop fighting no matter who is running the show. I think they are underestimating the strength of the membership and the power of the internet.” Members of COPP, LLC, have been very active on the internet and others have helped support their efforts.

COPP, LLC, registration grows on a daily basis and it is a very simple registration process. Hawaii Collection members can also register by inputting their account number followed by “HC” to identify that they are a points collection member.

The Hawaii Collection consists of The Point at Poipu in Kauai, The Kaanapali Beach Club in Maui, the Polo Towers Villas in Las Vegas, and the Sedona Summit Resort in Sedona, AZ. Members of the Hawaii Collection are also charged a portion of the assessment based on the amount of points they own, whether or not they have ever used or plan to use the resort in Kauai.

Brennan and Riddle said the proscription elsewhere in 514A against directors voting on an issue in which they have a conflict of interest could apply to developer reps and deeded owners alike, and said they do not believe there are conflicts of interest when the boards vote on budgets that include fees that impact the company’s bottom line. To that Sona replied, “This statement made by DRI is almost comical. Do they really think people are that stupid? They want us to believe that their employees are going to bite the hand that feeds them, seriously?” :hysterical:

DRI’s tactics have demonstrated its intention to completely take over the Point at Poipu. It has encouraged vacation owners to surrender their deeds in exchange for membership and points in its vacation club. It recently offered some vacation owners a reduced Water Intrusion Assessment if they would give up their deeds for points and then buy additional points in the vacation club. What DRI is not disclosing is that owners who surrender their deeds lose all voting rights and no longer have any say about how the resort is run. COPP, LLC, intends to discourage vacation owners at the Point at Poipu from surrendering their deeds. It fully intends to keep working diligently to reclaim its resort from DRI.

For more information on the concerned deeded owners, visit www.poipuowners.org :clap:
 

TSToday

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We have been following issues raised by the Concerned Owners at Poipu Point for the past few years. Our Jan/Feb issue contains an article summarizing the latest special assessment. We also had a recorded interview earlier in December with Keith Paulsen, president of COPP that will be broadcast on TimeSharing Today Radio.

A recent article in the Garden Island newspaper had the following quote from DRI. “Diamond’s Sloane said there is no evidence to show the repair fee announcement has resulted in units going up for sale”.

TimeSharing Today did receive email from owners looking to sell and several resale brokers advised us that they have received inquiries from PPT owners looking to sell or walk away. If you have any comments on the issue that we can publish, please email staff@tstoday.com Subject: PPT

We will continue to follow developments as they occur.
Happy New Year.
Shep Altshuler
Publisher
TimeSharing Today
 
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