Got this today from Gene Jaspan. Would like the board's thoughts.
Good afternoon all,
I want to start out by apologizing to members of the Westin Coalition who may have already received the information in this letter and are reading this for the 2nd and perhaps 3rd time. However, the information is so important, in my opinion, that I feel all owners should be apprised of what's going on. Attached is a file containing the legal complaint of one of the vendors involved in the refurbishment of our villas at VGV. Basically, a company called Structural Waterproofing Company wasn't paid for a large part of the work that they did at VGV. As a result of this, they are suing the VGV Homeowners Association, Starwood Vacation Club, and each and every member of the Board of Directors (including the owner board members, Bob Werbel and Phil Schrag). One thing that I have learned throughout the process of trying to take control of the fees at Starwood is to that all Board Members (even those that are Starwood employees) have a fiduciary responsibility to act in the best interests of the homeowners. If not, they can be sued as individuals or together as a group. The attached lawsuit is a perfect example of this, but the plaintiff is an outside party.
Here is the biggest implication of this lawsuit. Right now there is a stay on all closings of units at VGV. Nobody can buy or sell units as the plaintiff in this case has a contractor's lien on all of VGV. Read paragraph 49 on page 10 of the attached complaint. I know for a fact that about 5 closings that were supposed to take place this week have been pushed off for a minimum of 15 days and won't take place unless there is some type of settlement or agreement reached. If there is no settlement, a full-fledged lawsuit will take place against all the parties mentioned. If the plaintiff wins, the Board members, the VGV HOA and Starwood Vacation club could be liable for $750,000 plus legal fees. Guess who's going to pay for this? The owners of VGV in the way of an assessment. Since all the named defendants in this lawsuit have retained legal counsel, they are forbidden from discussing this matter.
The attached lawsuit is fact. I am not writing this to scare anyone. Most of you know that I started a coalition in 2009 to take on Starwood for the outrageous fees that they are imposing on us. We filed a lawsuit of our own against Starwood Vacation Club back in the fall basically insisting that we as owners get majority control of the Board, as we currently own close to 90% of the units. Many of you for your own reasons chose not to participate. You should all be aware that Starwood filed a Motion To Dismiss and our attorney, Nancy D'Anna fought it and Starwood's motion was denied. Starwood recently approached Nancy D'Anna, our attorney, about trying to settle. They obviously don't want a full blown lawsuit, especially with this other one taking place.
Our main goal in settling would be to revise the outdated by-laws so that us owners would have control of the Board. Based on the current by-laws, Starwood has control until the very last unit is sold. That will never happen, because there is a Week 53 (this occurs every 6 years, because your typical year consists of 52 weeks plus 1 day; 2 days for leap year). which Starwood does not sell nor market. For this reason we would never have control even if Starwood could sell the units for all 52 weeks. If we had control of the Board, we would be able to control costs. When refurbishments were necessary, we would run VGV like any normal business and take competitive bids from vendors. Starwood would still manage the property, but they would have to answer to us, not the other way around. Since they would be working for us, they would be subject to competition from other management companies, so we might be able to negotiate a lower fee than the flat 10% of total maintenance fees (including reserves) that they currently charge. Finally we would ask that the sales office continue to market our vacant units. As many of you know first hand, they are actively encouraging owners of VGV to give up their units for an "upgrade" to Bay Vista. In my opinion, those units are inferior to those at VGV. They are converted hotel rooms on the hill. There is no place to park a rental vehicle nearby nor are there any private villa pools. They currently tell prospective buyers that those units are newer and are worth more money than ours. They also sell them on the fact that maintenance fees are significantly less. While that may be the case now, when the selling period ends and Starwood stops their subsidy, those owners are in for a rude awakening.
One final thing that we would ask for in a settlement is that this contractor in the attached lawsuit be paid, so that the lien be taken off of our property. Our coaltion paid approximately $25,000 in legal fees and have basically exhausted our retainer at this point. Since most of you do not want to be hit with another assessment, I want to ask all of you to consider a one time contribution of $100.00 to help pay for the legal counsel to get a settlement in our favor. It's a very small price to pay to take back control of VGV and make it affordable once again. If you are in fact interested in helping out, write a check in the amount of $100.00 payable to:
Nancy D'Anna, ESQ
P.O. Box 8330
St. John, VI 00831
In the memo line, put "VGV Escrow fund" This is for a very good cause. If you're not interested, that is fine. I will not be sending out any more e-mails except to coalition members. However, if you have any questions, feel free to respond and I will get back to you ASAP. You can also reach me at (201) 741-1814. I live in the NY area, so I'm on the Eastern Time Zone.
Cordially,
Gene Jaspan
Good afternoon all,
I want to start out by apologizing to members of the Westin Coalition who may have already received the information in this letter and are reading this for the 2nd and perhaps 3rd time. However, the information is so important, in my opinion, that I feel all owners should be apprised of what's going on. Attached is a file containing the legal complaint of one of the vendors involved in the refurbishment of our villas at VGV. Basically, a company called Structural Waterproofing Company wasn't paid for a large part of the work that they did at VGV. As a result of this, they are suing the VGV Homeowners Association, Starwood Vacation Club, and each and every member of the Board of Directors (including the owner board members, Bob Werbel and Phil Schrag). One thing that I have learned throughout the process of trying to take control of the fees at Starwood is to that all Board Members (even those that are Starwood employees) have a fiduciary responsibility to act in the best interests of the homeowners. If not, they can be sued as individuals or together as a group. The attached lawsuit is a perfect example of this, but the plaintiff is an outside party.
Here is the biggest implication of this lawsuit. Right now there is a stay on all closings of units at VGV. Nobody can buy or sell units as the plaintiff in this case has a contractor's lien on all of VGV. Read paragraph 49 on page 10 of the attached complaint. I know for a fact that about 5 closings that were supposed to take place this week have been pushed off for a minimum of 15 days and won't take place unless there is some type of settlement or agreement reached. If there is no settlement, a full-fledged lawsuit will take place against all the parties mentioned. If the plaintiff wins, the Board members, the VGV HOA and Starwood Vacation club could be liable for $750,000 plus legal fees. Guess who's going to pay for this? The owners of VGV in the way of an assessment. Since all the named defendants in this lawsuit have retained legal counsel, they are forbidden from discussing this matter.
The attached lawsuit is fact. I am not writing this to scare anyone. Most of you know that I started a coalition in 2009 to take on Starwood for the outrageous fees that they are imposing on us. We filed a lawsuit of our own against Starwood Vacation Club back in the fall basically insisting that we as owners get majority control of the Board, as we currently own close to 90% of the units. Many of you for your own reasons chose not to participate. You should all be aware that Starwood filed a Motion To Dismiss and our attorney, Nancy D'Anna fought it and Starwood's motion was denied. Starwood recently approached Nancy D'Anna, our attorney, about trying to settle. They obviously don't want a full blown lawsuit, especially with this other one taking place.
Our main goal in settling would be to revise the outdated by-laws so that us owners would have control of the Board. Based on the current by-laws, Starwood has control until the very last unit is sold. That will never happen, because there is a Week 53 (this occurs every 6 years, because your typical year consists of 52 weeks plus 1 day; 2 days for leap year). which Starwood does not sell nor market. For this reason we would never have control even if Starwood could sell the units for all 52 weeks. If we had control of the Board, we would be able to control costs. When refurbishments were necessary, we would run VGV like any normal business and take competitive bids from vendors. Starwood would still manage the property, but they would have to answer to us, not the other way around. Since they would be working for us, they would be subject to competition from other management companies, so we might be able to negotiate a lower fee than the flat 10% of total maintenance fees (including reserves) that they currently charge. Finally we would ask that the sales office continue to market our vacant units. As many of you know first hand, they are actively encouraging owners of VGV to give up their units for an "upgrade" to Bay Vista. In my opinion, those units are inferior to those at VGV. They are converted hotel rooms on the hill. There is no place to park a rental vehicle nearby nor are there any private villa pools. They currently tell prospective buyers that those units are newer and are worth more money than ours. They also sell them on the fact that maintenance fees are significantly less. While that may be the case now, when the selling period ends and Starwood stops their subsidy, those owners are in for a rude awakening.
One final thing that we would ask for in a settlement is that this contractor in the attached lawsuit be paid, so that the lien be taken off of our property. Our coaltion paid approximately $25,000 in legal fees and have basically exhausted our retainer at this point. Since most of you do not want to be hit with another assessment, I want to ask all of you to consider a one time contribution of $100.00 to help pay for the legal counsel to get a settlement in our favor. It's a very small price to pay to take back control of VGV and make it affordable once again. If you are in fact interested in helping out, write a check in the amount of $100.00 payable to:
Nancy D'Anna, ESQ
P.O. Box 8330
St. John, VI 00831
In the memo line, put "VGV Escrow fund" This is for a very good cause. If you're not interested, that is fine. I will not be sending out any more e-mails except to coalition members. However, if you have any questions, feel free to respond and I will get back to you ASAP. You can also reach me at (201) 741-1814. I live in the NY area, so I'm on the Eastern Time Zone.
Cordially,
Gene Jaspan