ROFR - ending the sale?

[klpca]

From the MVCI 55+ facebook page:

"A friend of mine was in the process of selling his deeded week and MVCI wanted it by means of ROFR - Right of First Refuel(sic). What he found out was he did not have to relinquish to MVCI, all that was needed was to send MVCI a letter ending the sale. The original Buyer then upped there offer and the purchase went thought, he felt he got 50% of what he paid"

Really - you can rescind the sale and try again?

 

[GreenTea]

I read that on the regular FB users page also. It sure sounded hinky to me.

 

[Saintsfanfl]

There are many somewhat fraudulent methods of circumventing Marriott's right of first refusal. One of the many is refusing to sell after Marriott exercises their right. Marriott cannot force someone to sign over the deed unless they tried to battle in court, which isn't worth it.

The described process can be done but it's still fraud. The primary risk involved is Marriott calling foul after the subsequent sale goes through. Technically that title is tarnished because it was gotten through fraudulent means. As a buyer I would never, ever want to possess a title in this manner. It's not worth it over a few bucks. So many out there to buy.

 

[b2bailey]

MVCI 55+ FB sounds interesting -- I looked and can't find it.

 

[ronparise]

As has been said marriott can't force anyone to sell that being the case I don't see how what the op has reported can be construed as fraud. As a seller I should be able to sell to whomever I want to subject to Marriotts first right of resusal. Marriott has the right to turn down an offer to sell but they don't have the right to force a sale. Their only right is to say "if you are selling at that price you have to sell to me" if the seller tug uses the deal is dead and at a later date the seller can offer it for sale again

So I see this as two separate offers to sell and two separate and distinct negotiations. In the first marriott exercised their right but but the seller refused and in the second presumably marriot turned it down

Would you see it as fraud if the two purchase and sale agreements wee with two buyers a year apart? I doubt it. I don't think it's any different when it's the same buyer and his bids are two weeks apart

 

[SueDonJ]

As has been said marriott can't force anyone to sell that being the case I don't see how what the op has reported can be construed as fraud. As a seller I should be able to sell to whomever I want to subject to Marriotts first right of resusal. Marriott has the right to turn down an offer to sell but they don't have the right to force a sale their only right is to say "if you are selling at that price you have to sell to me" if the seller tug uses the deal is dead and at a later date the seller can offer it for sale again

So I see this as two separate offers to sell and two separate and distinct negotiations. In the first marriott exercised their right but but the seller refused and in the second presumably marriot turned it down

Would you see it as fraud if the two purchase and sale agreements wee with two buyers a year apart? I doubt it. I don't think it's any different when it's the same buyer and his bids are two weeks apart

About what's bolded - what would be different is if the docs put a constraint based on the time period between the two ROFR filings. For example the SurfWatch docs say that if a new offer is submitted within four months of the Owner refusing to sell on an exercised waiver, Marriott has the right to exercise on the new sale at the same terms and price as the previously-refused sale.

I don't know if the docs of the other Marriott resorts with ROFR contain similar wording and/or if the time constraints vary among those that do. And, like many other things, this could be another something that Marriott chooses to implement differently [less punitively for Owners] from what's in the docs.

 

[SueDonJ]

MVCI 55+ FB sounds interesting -- I looked and can't find it.

Search, "Marriott Vacation Club Owners 55 & Older."

 

[sjsharkie]

As has been said marriott can't force anyone to sell that being the case I don't see how what the op has reported can be construed as fraud. As a seller I should be able to sell to whomever I want to subject to Marriotts first right of resusal. Marriott has the right to turn down an offer to sell but they don't have the right to force a sale. Their only right is to say "if you are selling at that price you have to sell to me" if the seller tug uses the deal is dead and at a later date the seller can offer it for sale again

So I see this as two separate offers to sell and two separate and distinct negotiations. In the first marriott exercised their right but but the seller refused and in the second presumably marriot turned it down

Would you see it as fraud if the two purchase and sale agreements wee with two buyers a year apart? I doubt it. I don't think it's any different when it's the same buyer and his bids are two weeks apart

This may not be fraud, but it is a breach of contract. Past case law does not support your argument.

Case law has held that once you have a binding contract between two parties and the seller notifies the ROFR holder that they have accepted the third party offer, the ROFR becomes an irrevocable option that can be exercised within the period specified in the ROFR contract. Simply put, it cannot be revoked by the seller no matter what happens to the underlying contract between the seller and third-party buyer.

Marriott may choose not to go after the seller if they notify Marriott that they are deciding not to sell -- that is up to them. But if they were to go to court over it, it is likely Marriott would win and the court would demand specific performance as a remedy (i.e. sale of the property at the agreed upon price) based on past case law. I think Marriott simply does not think the time or resources (legal fees, for one) are worth it for most situations, and chooses not to pursue it.

As with anything that goes to court, YMMV -- state law, the judge you are assigned, etc. I'm not an attorney, but I've researched ROFR as I do bid on foreclosure auctions from time to time.

-ryan

 

[sjsharkie]

There are many somewhat fraudulent methods of circumventing Marriott's right of first refusal. One of the many is refusing to sell after Marriott exercises their right. Marriott cannot force someone to sign over the deed unless they tried to battle in court, which isn't worth it.

The described process can be done but it's still fraud. The primary risk involved is Marriott calling foul after the subsequent sale goes through. Technically that title is tarnished because it was gotten through fraudulent means. As a buyer I would never, ever want to possess a title in this manner. It's not worth it over a few bucks. So many out there to buy.

Not sure I would call it fraud, but I definitely agree that this is a breach and Marriott could come after you as the seller.

As a buyer in good faith, you would likely not be harmed. But if you as the buyer knew what the seller was trying to do, it is possible the court would undo the transaction and force the sale to Marriott. I agree -- Marriott probably thinks it isn't worth it unless (maybe) it is something like a week 52 Timber Lodge, Crystal Shores, etc.

-ryan

 

[taterhed]

Hmph.

If you're going to commit fraud (or cheating or however you choose to justify it to yourself...), why not just go whole hog?

Create a fictional buyer and go wild! Why not just use a family member and if you get caught claim familial privilege to avoid big lawsuits and damages (some judges/juries might believe you and take mercy).

Everybody loves ROFR when it protects the value of the property....but hates it when it denies you that last $500 you might have gotten etc...

Stacking fees or building a contract to make it less appealing to ROFR is one thing..... withdrawing a contract to defeat ROFR and resubmitting to milk the price or constructing a contract that you have no intent of fufilling seems pretty much like cheating to me.

Just my 2c.

 

[sjsharkie]

I guess I wouldn't call it fraud, because in the corporate world, people breach contracts all the time understanding the consequences for doing so. Sometimes they determine the consequences of breach are likely better than if they follow through with the contract. Plus Marriott knows what you are doing (by submitting a contract two weeks later with a higher selling price) -- they are just choosing in most cases not to pursue it.

I'd agree that you are far more likely to legally defeat ROFR by adding a material item in the transfer that Marriott cannot match. Another non-Marriott timeshare would be one way -- they may not want to hassle with selling it.

-ryan

 

[taterhed]

I guess I wouldn't call it fraud, because in the corporate world, people breach contracts all the time understanding the consequences for doing so. Sometimes they determine the consequences of breach are likely better than if they follow through with the contract. Plus Marriott knows what you are doing (by submitting a contract two weeks later with a higher selling price) -- they are just choosing in most cases not to pursue it.

I'd agree that you are far more likely to legally defeat ROFR by adding a material item in the transfer that Marriott cannot match. Another non-Marriott timeshare would be one way -- they may not want to hassle with selling it.

-ryan

I can't argue in light of what you stated
"...understanding the consequences for doing so..."


As long as you understand the potential (if unlikely) consequences, you pretty much can do anything.

Don't mean to come off 'better than thou..' I just think the amount of money being wagered is not worth the risk/benefit.

Good discussion though.

It's so hard to take the high road after seeing/reading what the sales people do. Not that all sales people are bad or that Marriott is totally to blame....still, it does rankle.

A quick question SJSHarkie (not to hijack the whole thread), are you happy with your Marriott/SVN combo? I'm considering same. Thanks.

 

[sjsharkie]

I agree. I think there are better ways to disincentivize ROFR. I did lose a Timber Lodge winter week to ROFR but it is what it is.
I love my SVN/Marriott/Hyatt/Worldmark combo. Each gives me something a little different that the others are missing.

Of course it depends where you primarily want to go.

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