Festiva speaks out? What did they say?

Pre-ramble

I do have opinions, but I try to primarily post facts and information here that will help us understand what is going on in a complex situation. If you know of an error in any post in this blog, please leave a comment. I will post it if it can be verified.

Please know that unless you leave your contact information in the comment, I cannot respond to you personally. If you do not wish your contact info to be public, tell me, and I will not post it. By leaving a comment you can get connected to a group of unit owners who are trying to do the right thing, just ask me.

Now for the juice:
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The Posting

Jeff Berger puts out a great newsletter and has a terrific site about everything St Maarten. http://www.everythingstmaarten.com/

Excerpts from his newsletters and email forum here are included with his permission and are copyrighted.

Earlier this month, in the email forum there, Festiva was mentioned for it's involvement in the Atrium takeover on the Dutch side of the island.

I have spoken with Rowie Percoco (mentioned below), a unit owner there who hired a lawyer, and their fight against Festiva was successful. Festiva agreed to abide by the Master Deed which did not allow the assessment, and withdrew the illegal assessments just before the matter went to court.

Did you just understand what was written there? They had to be sued in order to behave legally. What were they doing? Breaking the contract knowingly, trying to see how much they could get away with? Or can you think they didn't know what was in the contract? The latter is a bit hard to believe. So that leaves us with the understanding that they knew what they were doing, and only just before they would get thrashed in court did they back down.

Not only did they have to refund monies, but it was found that payments of assessments had gone to Festiva general funds and not to improvements at the resort that was paying the bill!!!

Same story, different resort.

Here is what was written in the email forum:
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More Problems for Festiva Resorts
========

Based on conversations with a number of timeshare owners at Atrium, the consensus about Festiva appears to be that they took over Atrium at a vulnerable time, then socked it to owners with huge AMFs which timeshare owners contend violate their contracts. (Please tell us if you think this is an incorrect interpretation.)

Apparently timeshare owners at Festiva Atrium aren't the only ones who are seething about the way Festiva Resorts is treating them. Look at this: http://sandcastleowners.blogspot.com/

On a different note, we're still awaiting word from Rowie Percoco on the outcome of their (Atrium timeshare owners') litigation against Festiva.

We'll keep you posted.
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Then Jeff included a piece I had previously posted here in the blog, which was actually an alert put out by TimeSharing today about the industry-wide pattern of abuse to unit owners by big companies that take over resorts:

http://sandcastleowners.blogspot.com/2009/09/its-not-right-indeed.html

You will not find Festiva mentioned in that blog posting.

The next day, the following response came in from Sara Bader of Festiva Resorts. She must be keeping an eye on the forum!

Maybe you can translate it for me. I know what double-speak is. Perhaps there is such a thing as half-speak. Or double-half speak , with a twist!! Shaken and stirred.

Here are her remarks and contact info, again, thanks to Jeff Berger and this submission is copyrighted by JMB Communications and is reprinted with permission:
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Festiva replied and we are publishing their reply today:


Unfortunately there is some misleading information in yesterday's
newsletter about Festiva Resorts as it's related to the Sandcastle
Resort. Festiva Resorts is not the developer or management company for
Sandcastle Resort in Provincetown, Mass., therefore we have no control
of the day to day operations, the actions of the board of directors or
the maintenance fees/assessments at that resort. It is simply a part of
our Adventure Club network of resorts as we own units there that
previously belonged to weeks owners who have upgraded to our
points-based Adventure Club. Like any other owner, Festiva Resorts pays
maintenance fees and assessments for the units owned at the Sandcastle.
Please let me know if you have any questions about this topic.


Sara Bader
Director of Corporate Communications
Festiva Resorts
One Vance Gap Road Asheville, NC 28805
sbader@festivaresorts.com

--------------------------------
Cliff Hagberg will have an opportunity this weekend to show some Sandcastle unit owners at the upcoming meeting there, just how much he, and Festiva pay in Maintenance fees and assessments.

He may be able to explain the full nature of the "Affiliation" (his word) of Festiva to Sandcastle. He will help us understand the documents filed in Barnstable on Sept 25, 2008 linking Festiva to Sandcastle.

Look back at the recent post here for the definition of the word Affiliation in the timeshare laws. How it relates to control. Then explain what the Festiva remarks above mean.(or don't mean) What isn't being said?

Like Sara above, I think we should keep it simple. Cliff should simply abide by Mass Laws and the trust instruments and provide us with the owners list and let us view all financial information we have rights to see and copy.

Or the courts can be invited to the game.(the St Maarten shuffle...)

Any questions?

Pertinenet excerpts from MGL 183a and 183b

As we do our research, we read the governing documents and try to figure out who's who and who can do what legally. While the language is more for the lawyers to fully understand, a reading of the Trusts, Mass Laws and all is helpful for all of us to get the gist of the relationships, duties and obligations each player has, in this complex thing called the Time Share.

The first following parts are Definitions for terms in Mass General Law 183b. Understanding these words can help you decipher what is really being said in the documents. The second should give us pause as to who runs the resort.

183a and 183b can be found at : http://www.mass.gov/legis/laws/mgl/mgllink.htm
Just fill in the number in the chapter number box. Then you can read the sections.

You may remember last year Cliff Hagberg told us that Festiva was "affiliated" with Sandcastle. It has been written by Festiva that "we have no control over day-to-day operations...". And that "Like any other owner, Festiva Resorts pays
maintenance fees and assessments for the units owned at the Sandcastle"

No control? Really? Let us see the Sept 08 contracts.

And we would like proof that Festiva is paying MF's and SA's. As unit owners we have the right to inspect the books. So far we have been denied access.
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PART II. REAL AND PERSONAL PROPERTY AND DOMESTIC RELATIONS

TITLE I. TITLE TO REAL PROPERTY

CHAPTER 183B. REAL ESTATE TIME-SHARES

Chapter 183B: Section 2. Definitions

Section 2. As used in this chapter, the following words shall, unless the context otherwise requires, have the following meanings:—

“Affiliate of a developer”, any person who controls, is controlled by, or is under common control with a developer. A person controls a developer if the person is (i) a general partner, officer, director, or employer of the developer, (ii) directly or indirectly or acting in concert with one or more other persons, or through one or more subsidiaries, owns, controls, holds with power to vote, or holds proxies representing, more than twenty per cent of the voting interest in the developer, (iii) controls in any manner the election of a majority of the directors of the developer, or (iv) has contributed more than twenty per cent of the capital of the developer. A person is controlled by a developer if the developer is (i) a general partner, officer, director, or employer of the person, (ii) directly or indirectly or acting in concert with one or more other persons, or through one or more subsidiaries, owns, controls, holds with power to vote, or holds proxies representing more than twenty per cent of the voting interest in the person, (iii) controls in any manner the election of a majority of the directors of the person, or (iv) has contributed more than twenty per cent of the capital of the person. Control does not exist if the powers described in this paragraph are held solely as security for an obligation and are not exercised.

“Association”, the association organized under the provisions of subsection (a) of section nineteen.

“Person”, a natural person, corporation, government, governmental subdivision or agency, business trust, estate, trust, partnership, association, joint venture, or other legal or commercial entity. In the case of a nominee trust, however, “person” means the beneficiary of the trust as well as the trust and the trustee.

“Purchaser”, any person, other than a developer, who by means of a voluntary transfer acquires a legal or equitable interest in a time-share other than as security for an obligation.


Chapter 183B: Section 19. Managing entity

Section 19. (a) If the number of time-shares in a time-share property is more than twelve, the developer, before the first transfer of a time-share, shall create or provide a managing entity to manage the time-share property. The managing entity may be (i) a manager, who may be the developer, or (ii) an association, which shall be a profit or nonprofit corporation or an unincorporated association, the membership of which shall at all times consist exclusively of all the time-share owners. If the time-share property is part of a project containing time-share units and other units, the manager may be the entity that governs the project. If the number of time-shares in the time-share property is twelve or fewer and there is no managing entity, the time-share owners may form an association meeting the requirements specified above.

(b) In the absence of a managing entity required by this section, a court upon application of a party in interest, including a time-share owner or a lien holder, may appoint and prescribe the powers of a managing entity.
------------------------------------------------

Although we may read sections that do not seem to empower us as we'd like, there are other parts of the laws and trusts that give us, as unit owners, all we need.

Letter to the Editor, Assessment, Manhattan Club "furious"

Once more TimeSharing Today carries helpful information for unit week owners.

In their Sept/Oct 2009 issue is the following letter to the editor.

I will also include a clipping from an article on page 38 about problems at the Manhattan Club. Tell me if something is familiar!

You can leave a comment for me here on this blog, it's easy, and it is seen by me only. I can then connect you, if you are a Sandcastle unit week owner, to a group of concerned owners who are working on issues on behalf of all owners at the resort.

Here's the letter to the editor:

Provincetown problems.

I am an owner at Sandcastles in
Provincetown MA, where Festiva is trying
to get folks to exchange their deeded
units and buy points. The new manager is
a trustee and an owner with three of his
business associates. Maintenance fees are
increasing 26% and there is a special assessment
of $700 -1500 per week without
any clear intent of what is to be done with
this assessment. Also, there is no reserve
fund from the monies we have been paying
yearly. We are contacting the Attorney
General in MA, but management says we
cannot get a list of owners. Some owners
are canvassing during their weeks.
How do I get this information into
TimeSharing Today with a link to http://
sandcastleowners.blogspot.com/
Thanks for any help you can give.
Also do you have a list of timeshare
attorneys?

E.W.

Editor’s reply: You’ve gotten the
information into TimeSharing Today and
we have included your email address so
that attorneys interested in this matter can
contact you.
-------------------------------end of letter----------------------

For the time being I have edited out the email address of the author in case he does not want to be contacted from here.

The assessment at Sandcastle has come out since the writing of this and is $883.94 per unit week, no matter how big the room, or where it is located, and we expect that not all owners are being billed. More on this later.

Now for the clipping from the article in the magazine by manhattanclubowners@yahoogroups.com

from: Manhattan Club Owners “furious”

"....The high maintenance
fees and the economy have made a sale
of their timeshare impossible. The only
way out is foreclosure. Of course, if they
are foreclosed on management will get
the timeshare back for free.

Management has refused to give a
list of current Manhattan Club timeshare
owners. The timeshare owners are trying
to get organized and urge all owners to
join other timeshare owners at their site:
http://groups.yahoo.com/group/manhattanclubowners/

If the owners get united, they can
make the Manhattan Club shine again.

Under the current structure the
owners have little say about how the
timeshare is run. The seven member
board consists of the owner and three of
has appointees. The other three are timeshare
owners. Obviously the owner has
total control of the board of directors."

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The road may be long, take a deep breath and place one foot after the other.

We'll get there.

"Ethics" for ARDA Members, really!?

Who is ARDA? You will find it throughout the timeshare industry websites. The acronym stands for American Resort Development Association.

Take a look and see how organized the corporate side of Timesharing is.
http://www.arda.org//AM/Template.cfm?Section=Home

They are big time into government lobbying.

Now, keep in mind what your experiences have been with those at the resort who have aligned themselves with FESTIVA (an ARDA member).

Now think of what you think the word "ethics" means.

Read the short insert on a page from the website, included below.

If you are up for a longer, quite a bit longer read, click on the hyperlink to view the "Ethics Code" document.

Now consider writing your thoughts to the ARDA and any other industry organization you can find. Let's find out where they stand on what is happening at our resort and all the others that suffer the same ethical dilemmas.

From the website:

ETHICS
ARDA and its members are committed to the highest standards and ethics in resort, vacation, recreational, residential and community development for the benefit of the public. To demonstrate that commitment, ARDA has adopted a Code of Ethics. All members of ARDA and all those who use ARDA services agree to comply with this Code.
The Ethics Code of the American Resort Development Association consists of general requirements, solicitation requirements, and sales requirements, as well as administrative procedures for interpretation and enforcement of the Code. All activities subject to this Code shall be designed to be honest and fair, and to be conducted with integrity, dignity and propriety.
Failure to cooperate with the ARDA Standards & Ethics Committee, the Administrator, or the Appellate Board in an investigation or a proceeding on a Challenge may be considered by the Committee according to the same procedures and with the same sanctions as a Determination of Failure to Comply with the Code.

Read this ethics code and tell me if Festiva is operating it's business in compliance or not.

If the hyperlink doesn't work go to http://www.arda.org/AM/Template.cfm?Section=Site_Map&Template=/CM/SiteMap.cfm.
From the menu on the left, choose Consumer Information, and then Ethics, then click the "Ethics Code" hyperlink in the short article quoted above, and download the 31 page guide. It's a fascinating read.

Tell me what you think!

Tell them what you think.

Tell the Attorney General in your state what you think!

It's not right indeed!

Thanks to the publication TimeSharing Today, self proclaimed advocate of Timeshare week owners, the following alert has hit the internet. Many of you will recognize your resort in the story.

The "takeover playbook" has been written some years ago and is being followed throughout this country and, in fact, internationally, at numerous resorts.

We are not alone; others have fought and won against these "forces".

The alert:

"

It ain't fair

Since we mentioned our intentions of providing enhanced services to our members, a few owners from various resorts have been in touch with us. We are seeing some worrisome patterns emerging. A developer gains control of the board, bylaws are ignored, notices of meeting are not being sent, special assessments to cover questionable expenses are imposed, maintenance fees are raised and owner objections are ignored.

Anytime there is a situation where the Developer controls the Association funds by controlling the Board and owning or controlling the management company, the owners will have concerns that some how the Developer may use Association funds to overcome its own financial problems.

The concerns we hear are not so much that the Developer would flat out steal the Associations funds but that they would use their position to make charges to the Association that are unreasonable or unnecessary either for services provided by the Developer or its management company or that they could pay from the Association funds for goods or services that were more appropriately the Developers.

There are reports of developers/managers preventing an owner elected board member from reviewing and/or disseminating financial information about expenditures, while allowing non-board members to participate in meetings where finances are discussed. In other cases, developers appear to have used Association funds to pay down developer created debt and legal fees for properties or units unrelated to the units for which assessments and maintenance fees are being collected. There are, reportedly, situations in which family members with questionable qualifications are being employed at exorbitant salaries.

As one owner said, "It just ain't fair."

Through its advocacy efforts, TimeSharing Today is looking into these situations. Ultimately, the owners may have no choice but to seek legal counsel to protect their interests.

Email staff@tstoday.com Subject: Advocacy

Festiva sued by owners, backs down, regroups to try again!

Sandcastle owners, you are not alone. The more one looks, the more one finds that shows a pattern of behavior repeated in one resort after another.

TimeSharing Today Magazine has been quoted here before. With their permission I am reprinting contributions to their Mar/April 07, and May/June 08 issues.

In the Mar/April 07 issue:

Owners unite!

Festiva Resorts recently purchased the Atrium in Sint Maarten and proceeded

to ask timeshare owners for a huge special assessment. Festiva owners have a

very unique contract that does not allow Festiva to take these actions,

but the corporation tried to just ignore it and impose excessive fees without

any prior communication with owners.

The contracts only allow maintenance fee increases up the island’s CPI (4%

in 2006) and do not permit any special assessments. Currently, approximately

200owners have refused to pay anything in excess of the contract allowance

and have taken Festiva to court on the island.

As the court date approached, the resort attorney informed us that Festiva

agreed to abide by the contracts as written and we do not need to pay the

special assessment or fees above the island CPI. Nor will Festiva attempt

to prevent anyone from using the resort. To fight this battle we contributed

$50 and still have around $11,000 in the account for further legal action,

if necessary, as it appears Festiva will try to get the island court system to

amend the contract at some future date.

Other owners can still join this action and avoid paying the extra

monies and help increase owner input to resort improvements.

For further details, contact Rowie Percoco at RowieP@aol.com.

Dan and Terri Shields

And in the May/June 08 issue:

Call to Atrium owners

Timeshare owners of the Atrium in St Maarten continue to battle with Festiva

management over special assessments. Since Festiva purchased the Atrium

several years ago they are claiming very large operating losses and have

reduced expenditures to improvements. They then issued bills with very large

increases in the yearly maintenance fee and added a large special assessment

completely ignoring the owners contracts that limit maintenance fee increases

to the island CPI (approximately 4%) and do not allow special assessments.

Now Festiva is trying to collect large daily fees per person from

all those who visit the Atrium. These fees are not allowed in the contract either.

There are now over 500 owners who refuse to pay the special assessments.

When the owners went to court, Festiva signed documents agreeing owners

needed to pay only the amounts required in their contracts. After more than a

year of fighting, our legal fees have amounted to about $20 per owner and we

have not paid any of the special assessments or the elevated maintenance fees

beyond the island CPI.

Our use of the facilities remains the same. We are also asking the

courts to return the extra monies collected from those people who joined our

group after paying the higher fees. But Dutch courts do not allow class action

suits so we only represent those owners who join our group.”

However, while our actions have forced Festiva to form an advisory

committee, that committee has no power and has been ignored. We seek

some veto power regarding expenditures and collections.

A review of Festiva’s financial documents has revealed that much of the

special assessment money has gone to Festiva’s operating account and not

into the capital improvement fund for the Atrium. Now Festiva has entered

the Dutch courts to try to amend our contracts and claiming only a small

minority are fighting management direction. Of course, we have no way

of contacting other owners for their support as we do not know who

they are. The larger the number of owners who are in

our group the greater the odds of success so we are renewing our efforts to

contact all owners. Please join us.

For additional information, contact Rowie Percoco at

rowiep@aol.com.

Dan Shields

Editor’s note: We have not received any response from Festiva to our

request for comment.

There is Help for Unhappy Contract Signers

http://www.theownersadvocate.com/

The usual warning goes out to all readers: This and any other website should be vetted for credibility. In fact , what we have learned about websites should be practiced with anyone or any company working to get your business. So you should make sure that the person or group is legitimate, and trustworthy before doing business with anyone!!!!!!!!! On the web, in person, on the phone, or at Sandcastle.

The folks at the above website look to me like they can be helpful even for those whose contracts are older than the "cooling off period" or the "three day cancellation" time frame. Go to the site and read, research, ask your questions. I got great answers to questions asked.

When I heard about a flyer that had been circulated at Sandcastle in mid-August, that, according to some in the sales group, it constituted grounds for a lawsuit by the sales people against the distributor, I obtained a copy and asked for professional opinions about it.

The unanimous response, from attorneys and timeshare industry experts, was that the content of the flyer in no way obstructed anyone's business: It is well within the free speech rights of the producing individual/s ; that it didn't even express an opinion; that it merely advocated for owners to educate themselves before signing a contract; that one has rights to cancel a contract; and that timeshare week owners have rights to meet and talk in common areas, about whatever they please, and that they can put that in writing as well.

The bullying and intimidating tactics people tell me about at Sandcastle are just that, bullying and intimidation. They are bothersome and annoying and disturbing of the owners right to peacefully enjoy their time. Threats by a salesperson to call a sheriff to take away an unhappy non-buyer of the point system are empty. Just as an individual, you cannot call a sheriff to take the salesman away either, although you may have been clearly mistreated and possibly threatened.

There is still due process in this country, and no one can revoke your Constitutional rights just because they "say so". There are also procedures that anyone and everyone must follow to lodge a complaint or press charges. These procedures protect us all....victims and possible-perpetrators alike. In time, when the system works, the victims prevail and justice is served.

But the people, the victims, must take actions on their own behalf.

Make your notes, file your complaints, do your research, and work to get your contract canceled if you feel fraud was involved. You will be helping yourself and Sandcastle.

Seek your own attorney for legal advice, join a group that is taking action, and/or check out the following site:

http://www.theownersadvocate.com/

....and stay tuned here........

File an FTC Complaint

The following was submitted to me by a motivated, concerned Sandcastle WEEK owner:

The FTC has a website (as well as the MA AG) to file complaints against businesses that engage in fraud, deceit, misrepresentation and/or high pressure sales tactics. http://www.ftc.gov/bcp/index.shtml

From their site: "The Federal Trade Commission is the nation's consumer protection agency. The FTC's Bureau of Consumer Protection works For The Consumer to prevent fraud, deception, and unfair business practices in the marketplace."

If anyone feels that their dealings with NEVS, LLC, Outfield Marketing LTD, Festiva Resorts LLC, and/or Festiva Resorts Adventure Club has been fraught with any of the above issues - fraud, deceit, misrepresentations and/or high pressure sales tactics, you are encouraged to file a complaint with the FTC also.

The website and complaint link will be provided at the end. Once you click on the complaint form you will have to answer certain questions to progress - such as is this in relation to identity theft Yes/No, you will then have a choice of business type - pick other, click next, enter the type of business for example: Timeshare Marketing, Timeshare Developer, hairdresser!!!! or whatever you wish.

You will need to provide the company name/address etc. and the representatives name and position if you have it. If you can't complete all fields, leave them blank. Some are listed below.

You will reach a box to type in your complaint, limited to 3500 characters = several paragraphs.

Then you have to complete your personal contact page.

Once you submit the complaint you will get a confirmation number and an email as well.

The link is:

https://www.ftccomplaintassistant.gov/

Click Consumer Protection – then on the line below – click File Complaint. This will bring you to the page to complete an online complaint - you then have to click the box on the upper right to get to the initial form.

You may file complaints against more than one business, but you must file a separate complaint for each. You must have dealt with that business personally. If you were given a price enter the amount. If you paid for any product enter the amount on the next line. If you paid no money - leave it blank or enter zero. You may still continue with your complaint.

Please keep track of your experiences. Write down what you can remember. Write down promises, guarantees made, phrases used to pressure you, threats of any kind, deadlines that did not come to pass, etc. Pay special attention to what you were told and what is different in the contract. Make notes of the differences: What were you told before buying into the Festiva point system, what have you learned after signing that is not the same .

Outfield Marketing, Ltd. 135 E. Hickory, Denton, TX 76201: 940 566 5127

Principal: Mark Monroe

Sales agents: Greg Hughes, Frank Rose, Marty Guthrie, Kim Guthrie, Mike???, Kevin Hanson – list is incomplete.

New England Vacation Services, LLC PO Box 2487, 93 Hawes Avenue, Hyannis, MA

Developer/Trustee Clifford Hagberg No phone # listed

Email address: nevmsllc@gmail.com

Festiva Resorts Adventure Club Members Association

One Vance Gap Rd

Asheville, NC 28805-1227
(828) 254-3378

Herbert Patrick Jr., 1 Vance Gap Rd, Asheville, NC

Tobias Weiss

Donald Clayton

Yvette Smith

I am NOT asleep

Dear Sandcastle owners (and friends, and spies),

I have a good deal of news for you. Many of you have visited Sandcastle this summer and I have received numerous reports about that.

Things are moving forward on numerous fronts.

My day to day time has been tilted towards my business recently, but I have been gathering info and I have much to tell you.

Please activate an account here and you can get notices of updates.

Stay tuned...much to come very soon.

Write the Attorney General of Massachusetts

Please, please, please...write the Attorney General and voice your complaint about what is happening at Sandcastle.

It has worked in other states, but you and I, and as many of us as possible have to act here too!

In Missouri Festiva was fined $325,000. North Carolina is starting an investigation. Complaints have been registered in other states: Tennessee, South Carolina, Louisiana, Florida, Wisconsin, Maine.

Go here to view an ABC News clip about this:
http://abclocal.go.com/wtvd/story?section=news/abc11_investigates&id=6789555

You can read the transcript there too. You will see some very familiar items there.

Then write your online complaint here:
http://www.mass.gov/?pageID=cagoterminal&L=3&L0=Home&L1=Consumer+Protection&L2=Complaints+%26+Mediation+Services&sid=Cago&b=terminalcontent&f=consumer_consumer_complaint&csid=Cago

Print out the online complaint and write your own story, with any specifics you can include and send it snail mail to the Attorney General.

I spoke today with:

Alexander Terry
Legislative Aide
Office of Senator Robert A. O'Leary
Cape & Islands District
P: 617-722-1570
F: 617-722-1271

He advised us to fill out the online Consumer complaint form linked above, and to also write using regular mail, to the address at the top of the form. Be specific, tell your story, do not just generalize your unhappiness.

Numbers (quantity of complaints) matter and so does the quality of the complaint.

Please do view the ABC video clip and read the article. You will see things like this: "Festiva says it no longer uses outsourced companies for sales and marketing."

This article is dated May 1,09! So are they lying to the news reporter? or is Outfield part of Festiva? Isn't the group selling Festiva points and taking Sandcastle deeds from owners called Outfield? Haven't we been told the companies are legally separate?

We need help unraveling this web. Write the AG today!

Festiva Problems in Missouri, North Carolina

Consider first that the following comes from a website. We all know that it can be hard to trust what we read on the web. So, don't take it as gospel.

The "ex-employee" posting might not really have been an employee.

However, it sure looks familiar, right down to the appearance of the owner being happy to answer questions while at the same time not answering questions already asked and not responding to obvious issues already raised.

In my opinion, a public forum is a good place for company owners/managers to answer people's concerns. How better to reach as many as possible? On the other hand, insisting to only respond individually leaves the questioner open to trained tactics designed to achieve pre-determined results. Outfield does the same when they insist on meeting the owner in their home and not some public space.
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The following comes from the site called Rip-off Report. The page is here:http://www.ripoffreport.com/reports/0/356/RipOff0356189.htm#421685

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Festiva Resorts Misleads Consumers Asheville North Carolina

Festiva Resorts, Festiva Resorts Misleads Consumers Asheville North Carolina

If you are considering buying a timeshare do NOT buy from Festiva Resorts. My husband and I own a timeshare that we bought from Equivest in 2000. In 2007, Festiva purchased Equivest and has since been trying to convert all the Equivest owners over to Festiva. They have been using misleading information and using scare tactics to get over $3000 from each Equivest owner to convert to Festiva.

Basically, they are trying to charge us $3000 to buy what we already own. The sales rep we dealt with made several claims which we found out were false. We have had issues dealing with Festiva to make reservations

and get our maintenance fees paid. I have heard nothing good about this company and recently read an account where the Attorney General in Missouri took Festiva to court and Festiva was found guilty of misleading consumers. Numerous complaints have been filed with the Attorney General in North Carolina (where Festiva's home offices are located) regarding the fraudulent activities of Festiva. This company cannot be trusted.

There is a group on Yahoo made up of Equivest/Peppertree owners and if you are an owner of an Equivest/Peppertree timeshare and wish to exchange ideas, share experiences, or get information then join us at
http://groups.yahoo.com/group/Equivest-PeppertreeOwners/. We hope to join together to file a complaint against Festiva.
---------------------------

Submitted: 8/10/2008 5:21:29 PM

Modified: 8/10/2008 9:19:19 PM

Timeshare Insider

Mt. Pleasant, South Carolina
U.S.A.

Buyer Beware of Festiva/Timeshares

If you are considering buying TIMESHARE do NOT purchase with Festiva Resorts. As a former employee I know that they hire and retain sales people who have criminal records

. Many of them have drug and alcohol problems. They LIE, PRESSURE YOU, and MANIPULATE. When they approach the consumer they tell you it is a vacation club....it is simply TIMESHARE using a points system.

Points do not work well. They are difficult to use, lose value each and every year, and will not put you in a great vacation destination in prime season.

When going to a Festiva property they take you to the 'model' which is always so much nicer than the units available when you return to vacation. YOU HAVE 5 DAYS to CANCEL if you have purchased a timeshare. USE IT and send them notice by certified mail. Contact your credit card company and reverse the charge.

--------------------------

Submitted: 5/14/2009 8:37:05 AM

Modified: 5/14/2009 10:17:14 AM

Festiva Rep

Asheville, North Carolina
U.S.A.

Response from CEO of Festiva Resorts

My name is Don Clayton and I am the CEO of Festiva Resorts

.

Although I am sure there are areas where our company can do a better job I am very proud of what we are doing and I am willing to assist in any way to answer your questions and concerns.

If you are truly interested in seeking solutions to any concerns you may have please contact me I will be glad to speak with you about your concerns and lets see if we can work together to resolve any of them. I can be reached at 828.254.3378.

Thank you.
Don Clayton

TimeShare Today article

The following article is reprinted here by permission of the magazine TimeSharing Today, from their Jul/Aug issue.
Their website is www.tstoday.com

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This is the right article at the right time for us!

Please read through to see how similar this is to our situation. Perhaps we can use this info towards a successful outcome to our complaints

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Ousted Directors Fight Back,
Seeking Help from State, Court

Hanalei Bay Resort owners and four directors
ousted by Celebrity Resorts Management
have sought help from Hawaiian Senate Majority
Leader Gary Hooser and the Court in
seeking to regain control of the resort.
According to the Petition filed by the ousted directors,
their removal from the Board of Directors was
masterminded by Celebrity in response to the directors
raising “issues and concerns” alleging Celebrity’s
mismanagement and self-dealing.

The luxury oceanfront resort was built in 1975 and
managed in recent years by Quintus Vacation Management,
headed by Gary Grottke. Grottke, who owns a unit
at the resort, was one of five Board members, with the
other four having been elected by the owners. However,
at the time the management contract was made with
Quintus, Grottke controlled the Board. As a result, the
management contract is automatically renewed annually
unless a majority of owners authorize the
Board to cancel the agreement.

In August, 2008, Grottke sold the
management rights to Celebrity Resorts
Management. Prior to the sale, Peter
Somerville, Richard Schweickert, David
Nicholl and Don Finch had been elected
to the Board and, according to their court
Petition, their standing as duly elected
directors had never been questioned by
Grottke or Quintus, which had administered
the elections.

In April, 2009, Celebrity and Grottke
notified the other four directors that they
had not been properly elected and that four
new directors (all connected to Celebrity)
had been appointed. Somerville, Schwe-
ickert, Nicholl and Finch then filed a Petition
in the Hawaii Circuit Court seeking
to have the court remove all five directors
and oversee an election of the directors.
In addition, the ousted directors and other
owners sought help from Senate Majority
Leader Gary Hooser, who wrote to the
Department of Commerce and Consumer
Affairs and the Attorney General, urging
them to look into the siutation:

“Your prompt review and evaluation
of the below information is greatly
appreciated. The below data and allegations
originate from numerous telephone
and email communications with interval
owners at the Hanialei Bay Resort. I have
not spoken directly with the owner of the
management company or others involved
and named below, nor have I verified any
of the a11egations.

“However; it seems clear to me that
there is serious conflict going on between
parties that involve ownership rights that
arc governed by state law. It is further
obvious that this situation is of an urgent
nature as the financial impacts to all parties
involved may be significant.

“It has come to my attention that the
management company of the Hanalel
Bay Resort, Quintus Resorts LLC and
its successor. Celebrity Resorts, may
have, apparently without owner notice
or approval, replaced the members of
the Hanalei Bay Resort Vacation Owners
Association Board of Directors (VOA
Board), and installed its own board.
Timeshare owners, many of whom
maintain their own businesses and have
owned their properties for years, are
understandably upset, and have sought
my assistance.

“Pilikea [Hawaiian for trouble] such
as this affects not only our reputation as a
tourist destination but Kaua’i owners and
residents who work at the Resort.

“I understand from my constituents
that they have peppered your offices with
inquiries and requests for assistance to resolve
these matters, and to restore control
of Hanalei Bay Resort to its owners.

“Though I do not have firsthand
knowledge and I have not verified the
statements and allegations stated in the
above letter, it is clear to me that there is
an urgent need for an independent evaluation
of this situation by the Attorney
General’s office and or the Department of
Commerce and Consumer Affairs.”

An investigation by the Department
of Commerce and Consumer Affairs is
now reportedly under way.

The “issues and concerns” alleged by the Hanalei Bay Resort Board
included the following actions and failures by Celebrity:
(a) Without authorization from the Board, cancelled the contract with the longterm
insurance broker and signed a contract for insurance brokerage services with
an affiliate of Celebrity Resorts Management located in Florida;
(b) Failed, neglected and refused to prepare the 2009 budget In a timely manner;
(c) Failed, neglected and refused to provide information requested by the Board
regarding the location and amounts of all bank accounts and only provided such
information after repeated requests over several months;
(d) Failed, neglected and refused to provide to the Board an accurate and complete
list of Interval Owners, including their contact information;
(e) Rented out the intervals of delinquent or defaulted interval Owners and collected
the rent for its own account rather than the account of the owners association
(f) Failed neglected and refused to provide the Board with detailed condition
reports with respect to all Interval Units, as promised;
(g) Failed, neglected and refused to provide the Board with any Information
regarding a substantial tax audit involving the Hawaii general excise tax payable
for the resort;
(h) Failed, neglected and refused to create and generate the Project website as
promised to the Board;
(i) Contrary to the direction of the Board, prepared and sent mailings to Interval
Owners without first providing a draft to the Board and failed to include in such mailings
and items the Board had specifically instructed Celebrity to include;
(j) Subsequently sent additional mailings without even providing any copies
thereof to the Board;
(k) Failed, neglected and refused to send out the 2009 Annual maintenance fee
bills to the interval Owners on a timely basis and when it did send out such bills in
an untimely manner, it failed to include any deadline for payment by the Interval
Owners;
(1) Hired an assistant manager at the time the resort was operating at an annual
deficit without the approval of, or without even providing prior notice to, the
Board;
(m) Paid the real property taxes on the Interval Units after the due date, incurring
penalties and interest;
(n) Failed to aggressively pursue the collection of delinquent maintenance fees
from Interval Owners despite Instructions from the Board; and
(o) Unilaterally changed the rules without the approval of the Board or the Interval
Owners to prohibit interval Owners from reserving a specific Unit with their
reserved week, which is contrary to the Declaration and the long-standing custom
and practice of the owners association.

Addresses to write to; Website to read; Take action now.

Mass. STATE SENATOR
ROBERT A. O'LEARY (Cape Cod and the Islands)
website http://www.mass.gov/legis/member/rol0.htm
email Robert.O'Leary@state.ma.us

State House
Room 511B
Boston, MA 02133
--------------------------------------------------------------------
U.S. Senator Edward M Kennedy
site: http://kennedy.senate.gov/
email: http://kennedy.senate.gov/senator/contact.cfm
(That's an email form online)

Washington Office
317 Russell Senate Building
Washington D.C. 20510
-------------------------------------------------------------------

See July 6 Blog entry for sample AG letter and contact info.
http://sandcastleowners.blogspot.com/2009/07/sample-ag-letter.html

Please consider writing your own or at least add your own to this
pre-written letter. There is more that can be said. I would suggest
you send copies to both of the AG addresses (one on the form letter,
one listed below in this blog posting.)
------------------------------------------------------------
The Mass AG's Office for info:
Public Inquiry & Assistance Center Hotline, (617) 727-8400
Consumer Complaint Form (Fillable PDF)

mail address for complaint:
PublicInquiry & Assistance Center
Attorney General’s Office
One Ashburton Place
Boston, MA 02108
-------------------------------------------------

Cliff Hagberg
Managing General Partner
New England Vacation Management Services, LLC
Sandcastle
P.O. Box 576, Rte 6A
Provincetown MA 02657
------------------------------------------------
For some other useful addresses visit the conversation at:
http://www.tugbbs.com/forums/showthread.php?t=82489&page=6
Scroll down and read entries that provide addresses and form links.
Excerpts from pertinent laws are also there.

Whether there or here or to the AG, let your voice be heard.

From page six of the TUG website you can visit any page and view
questions to and “answers” from Cliff Hagberg. (His “name” there
is NEVMSLLC) Numerous people post about their experiences with
Outfield Marketing. That's the company that has been hired to sell
Festiva club points and take control of your deeds at Sandcastle.

See if you think Mr Hagberg answers the questions and complaints
and clears up the confusion.

You can check the “Hagberg confusion” letter on this blog to get an
idea of the enmeshed relationships of the companies and the officers
involved in the current Sandcastle experience.

To this date, my sense is that we must make up our own minds about
what is really happening at Sandcastle. If what you have experienced
and what you read is OK with you then sit back. If not, then act now
to get the information you need, lodge complaints to authorities, or
do your own research and add to the pool of information available and
tell your story.

Owners mailing list

Several people have brought the following to my attention. It is the Massachusetts law governing the mailing list, or list of owners of a timeshare. It looks to me like we have a legal right to it.

I would ask anyone visiting Sandcastle this summer to go to the office and request the list of owners, and cite the law, section, and paragraph. In fact, print it out and hand over a copy. This is one reason I created this blog.

The list obviously exists because we have been sent bills and meeting minutes. I will ask for the list in writing since I may not be going back to P'town this summer. If it is not provided the AG should know about that.

Here is the link for the Mass law table of contents governing timeshares: http://www.mass.gov/legis/laws/mgl/gl-183b-toc.htm

Here is the link for the law section pertaining to owner address lists: http://www.mass.gov/legis/laws/mgl/183b-32.htm

And here is the specific paragraph:

(b) The managing entity shall keep reasonably available for inspection and copying by any time-share owner all addresses, known to it or to the developer, of all the time-share owners with the principal permanent residence address of each indicated if known. The managing entity shall revise continually the list of addresses in the light of any information it obtains, and the developer shall keep the managing entity advised of any information he has or obtains.

People have been told that the list is withheld for privacy reasons. That may be someone's policy, but it is not the LAW!

Please root around and look at various sections of the law. You will see info about allocation of votes, and many other pertinent things such as this excerpt:

"At the time the time-share owners are notified of the amount of the assessment for the current year, the time-share owners shall be provided with a copy of the budget prepared in accordance with the provisions of clause (6) of subsection (a) of section thirty-eight and an accounting of income and expenses for the preceding year."

Has anyone received such documents?

"Hagberg Confusion"

The following letter was sent as a follow-up to the previously posted one, by an owner. It is long but please hang in there, there is lots of good information and numerous pertinent questions are asked. Please consider writing your own letter and keep records of all your experiences.

If it seems like this is too complicated and you don't have time for it, please realize this sheds a great deal of light on what is happening at Sandcastle that is upsetting so many owners. Someone felt it was important enough to do the research and take the time to compose this. It outlines, in many respects, how we might lose what we have in Provincetown. It also gives us a lot of information we might follow up on ourselves if we care to stop what is going on, protect our interests, or at least demand full disclosure which I believe is our right as owners.
------------------------------------------------------------------------------

Our new Manager, Developer, and Trustee, Cliff Hagberg

I have read many angry statements in on-line blogs concerning Mr. Hagberg, but I believe he deserves the benefit of doubt. My impression is that he is very personable, and he has stated that he has our (and Sandcastle’s) best interests at heart. That said, at the Owner’s Meeting this past April a number of factual questions were asked that he claimed not to be able to answer. Although he has been a successful business man in the timeshare business for decades, it is possible that he doesn’t know the answers to many of the questions raised, and it is also possible that the confusion that resulted was because of a communication issue. In fact, I suspect that many of the problems other owners have raised with Mr. Hagberg’s management of Sandcastle to date may come down to a matter of communication style.

AVAILABILITY
Mr. Hagberg has repeatedly stated that he will answer all owner questions by email. Yet, he is probably too busy to answer everyone. I suppose it is more likely a time issue for Mr. Hagberg than a purposeful avoidance of certain issues, as suggested by many owners whose emails have been ignored. Admittedly, our correspondence went unacknowledged for months as well.

We sent Mr. Hagberg a letter with a number of what seemed like pretty straightforward questions (by both email and certified, return receipt snail mail on Feb 12, 2009, attachment # 3), but he never responded. When pointedly asked at the Owners’ Meeting in April whether or not he had received the letter, he stated that he had, but did not answer it, because it contained “only legal questions” which he was not equipped to answer. I found this repeated answer confusing and a little frustrating since these seemed to be almost all factual questions that someone who was the property Manager, Developer, Trustee, and Owner should be able to answer, and if he wasn’t able to answer them, it seemed to me that these were questions of sufficient importance that all Sandcastle owners (including Mr. Hagberg himself) would want and need to know the answers to. I remain particularly surprised that Mr. Hagberg, an otherwise successful businessman, seems to have purchased a large stake in Sandcastle without knowing the answers to what seemed to me to be critical questions.

Curiously, the items requested in the list at the end of the letter to Mr. Hagberg are required by Massachusetts law to be made available to any requesting owner by both the property Manager and the Trustees (he is both). Although he never responded to our letter, at the Owners’ Meeting, Mr. Hagberg did extend an open invitation to anyone to come to his office and “sift through mountains of papers” to obtain these answers. I plan to visit Mr. Hagberg’s office this summer and request in person a concise presentation of those items he is required by law to produce, and I would encourage all of you to do the same.

CONFUSING COMMUNICATION REGARDING ORGANIZATION TRANSPARENCY AND CONFLICT OF INTEREST
Mr. Hagberg wrote in an email “There is no relationship between IVS Realty, Outfield Marketing, and Festiva. All are completely independent companies under separate ownership. NEVMS is the management company that manages the resort for all of the owners.”

According to a number of on-line blogs, Mr. Hagberg has made this point repeatedly. And at the Owners’ Meeting he stated “The Trustees are all part of NEVS. None of them are affiliated with Festiva.” “NEVS, NEVMS, Outfield Marketing share absolutely no relationship or interest and have no interest in Festiva.”

Mr. Hagberg seems to be legally correct. The entities appear to be legally independent. However, it is interesting to note the following information based upon what we were told at the Owners’ Meeting:

IVS Realty: Mr. Hagberg is CEO of this realty company.

NEVS: the company that purchased “unsold inventory at Sandcastle” is comprised of Mr. Hagberg and the three owners of Outfield Marketing, Tom Franks, Steve Lamantia, and Mark Monroe (incidentally, these are also now the four Trustees for Sandcastle).

NEVMS: the management company hired by the four current Trustees and is comprised of Mr. Hagberg, and the three owners of Outfield Marketing Tom Franks, Steve Lamantia, and Mark Monroe.

Outfield Marketing: a company based in Texas owned by Tom Franks, Steve Lamantia, and Mark Monroe. Based on on-line sources, this company seems to have a long-standing relationship with Festiva as their sales and Marketing company.

A number of other owners have expressed anger at what they see as a misleading description of the relationships between these entities; however, technically, Mr. Hagberg’s description seems to be correct. There is probably no legal connection between these entities, but clearly they are all owned by the same individuals.

When Mr. Hagberg was asked at the Owners’ Meeting whether or not he might have a “conflict of interest” with him being a Trustee, Developer, Manager, unit owner, and partnered with the owners of Outfield Marketing, etc., Mr. Hagberg responded, “No, the lawyers tell me there is not [a conflict of interest].” I don’t know whether his lawyers are giving him correct advice or not, since not only are Trustees required to act in a manner that is not self-serving, but they are also required to act in a way that does not even appear to be self-serving. And without a clear and available budget or accounting, we must hope and assume that when Mr. Hagberg and the other three Trustees hired themselves as Sandcastle’s management company and then hired Mr. Hagberg as the Property Manager that this was all done at reasonable and customary wage rates and without a conflict of interest.

STAND ON OUTFIELD MARKETING AND THEIR BULLYING SALES TACTICS
Mr. Hagberg has expressed justifiable outrage over Outfield Marketing representatives’ “illegal and false” sales practices to Sandcastle owners that resulted in “two” representatives “being fired” and others being “retrained.”

Although Mr. Hagberg is partnered with the Outfield owners in at least two companies, it is his position that it is not his responsibility to make sure that the Sandcastle owners visited by the malfeasant Outfield Marketing representatives who made false claims were identified, apologized to, and offered to back out of their Festiva commitments.

I can also understand why many owners have raised questions about Mr. Hagberg’s association with Outfield Marketing, because Sandcastle’s whole relationship with Outfield Marketing seems to be a bit mysterious. Mr. Hagberg has explained that Outfield Marketing was “hired” by NEVMS to sell NEVS properties to existing owners. Yet, I have not heard of a single owner visited by Outfield Marketing where NEVS inventory was discussed; whereas in every case that I have heard about, the financial advantages of Festiva and their points system was brought up. In fact, when he was asked at the Owners’ Meeting how much Sandcastle was paying Outfield Marketing to try to sell NEVS owned units, Mr. Hagberg said, “Nothing. They make their money selling Festiva.” So, I remain very confused. Aside from the fact that Mr. Hagberg has business associations with the owners of Outfield Marketing, I still don’t understand why Outfield Marketing has gotten involved and why they have been given the list of Sandcastle owners, when I understand that Mr. Hagberg says such a list cannot be given to other owners as it would violate owner privacy.

CONFUSION OVER SANDCASTLE’S FINANCES
Mr. Hagberg stated that the budget prior to him taking over “was never balanced.” Each year, the prior Trustees took out a loan to meet Sandcastle expenses, which they paid back with maintenance fees from the next year, but they never fell short and apparently were not getting farther and farther behind. I suppose this is a matter of semantics. To me this was not an unbalanced budget, but a budget that was balanced out of synch with the calendar year. Thus, if there was a $350,000 “shortfall” from the previous year, it was made up for during the following year. This is not necessarily a problem for the continued functioning of Sandcastle, but it certainly would be a problem for someone who wishes to turn around and sell their controlling stake in Sandcastle. What I don’t understand is how Mr. Hagberg when doing his diligence prior to purchasing his large stake in Sandcastle missed the fact that the Sandcastle was $350,000 behind in its budget every year.

The “budget” provided by Mr. Hagberg for 2009 during the Owners’ Meeting is not itemized, and the “Salaries, Wages, General, and Administrative” costs add up to $817,894 (54% of the budget). This does not include “laundry, supplies, repairs and maintenance.” I’m sure Mr. Hagberg has not intended the finances to be obscure, but it is both our legal right and of considerable interest to know how much of the $800,000+ is going to management salary and the management company. Recall that the management company was hired by the Trustees (and ARE the Trustees who have a legal fiduciary responsibility to all owners). This budget proposed by Mr. Hagberg seems to have a $40,000 profit with an already assessed 26% increase in maintenance fees before any special assessments. Where does the $40,000 profit go?

Further, Mr. Hagberg has suggested a $700 “hopefully onetime” assessment fee from each owner-week. But when asked at the Owners’ Meeting how many paying owners he expected to receive this from and what total amount is he trying to raise and for what purpose, he responded “It’s just an estimate… I don’t have any numbers to give you!”

I was sadly surprised to hear Mr. Hagberg assert that he had no knowledge when he acquired the unsold inventory at Sandcastle and became Developer, Manager, and Trustee that a.) there was a $350,000 shortfall, b.) the state-required Reserve Account did not exist, and c.) he was blind-sided by the financial extent of the repairs necessary at Sandcastle. Mr. Hagberg who paid 1.2 million dollars for the unsold inventory at Sandcastle apparently failed to obtain a careful inspection of the property and its books and has been “able to find no records of anything.”

I remain hopeful that Mr. Hagberg’s long success in the timeshare business will pay off in the end, and that he will be a more careful steward of our assets than he claims to have been of his own.

Mr Hagberg also asserted at the Owner’s Meeting that the unit-weeks he purchased have never paid maintenance fees (or special assessments) and he, as their new owner, doesn’t have to pay these fees either. I have not been able to get a satisfactory answer as to why. My understanding was that once the developers sold a week for a unit, from then on, the developer was required to pay the fees related to all the other weeks for that unit until the developer sold those other weeks. Since I have been told that at least one week has been sold for each unit at Sandcastle, I don’t understand how Mr. Hagberg can maintain developer status for his units. I don’t know whether it’s that my information is incorrect or if sometime along the way an error in the billing developed. Further, since Mr. Hagberg asserts that there is “no record of anything,” I am uncertain how they know which units have been sold and which have not.

CONFUSION OVER WHAT NEVS BOUGHT AND WHY
Mr. Hagberg states that NEVS purchased “between 350 and 400 unit-weeks.” (He doesn’t know exactly what they bought, but knows they paid 1.2 million). That means NEVS paid $3,000-$3,428 for each week. Why? He says that “most” of these unit weeks held by NEVS are when Sandcastle is closed between December and May, and that these are “developer” units that have never been sold, and so don’t pay maintenance fees.

Although most of these weeks are “legal” weeks, they have no sale value, because Sandcastle is closed. Yet, Mr. Hagberg asserts that “the whole purpose” NEVS bought the unsold weeks and then hired Outfield Marketing was to change the Trustees, improve the quality of the units, and then sell the previously unsold units to owners who will pay maintenance fees. I am so confused. Who is buying units at Sandcastle when Sandcastle is closed? And Mr. Hagberg was pleased to announce that he had graciously signed an agreement that any monies obtained from rental of the NEVS owned units (recall most (all?) of these are when Sandcastle is closed) will go into the Trust to reduce maintenance fees. Since Mr. Hagberg generally speaks to the letter of the law, there must be a legal reason for this, because I can see NO financial benefit to the Sandcastle owners.

LACK OF CLARITY OF SANDCASTLE CONTROL
Mr. Hagberg said at the Owners’ Meeting “until such time as I sell the (NEVS) weeks, I’m going to have complete control over the resort, King of the Castle.” On the other hand, he says that NEVS does “NOT own 51% of anything” and although he declined to discuss the concept of “Beneficial Ownership” in the Master Deed and the Deed’s Amendment which gives essentially all voting power to Red Week (Summer time owners) because that was a “legal question”, he does admit that he is not sure whether his weeks give him any voting power at all.

To try to summarize what I think is the current situation: Mr. Hagberg states there are some 4,500 unit-weeks. NEVS bought 350-400 (off season). There are some 600 owners delinquent in their maintenance fees, and thus their voting power may be questionable. So, if there are 4,500 weeks and maintenance fees are not being paid on 400 developer + 600 delinquent weeks, that leaves 3,500 being paid for. An assessment of $700 for each of the 3,500 weeks yields a total of $2.45 million – for what?

In fact, as I understand the Master Deed and Massachusetts law sections 183A and B, Mr. Hagberg’s control over Sandcastle remains as long as he and his business partners remain Trustees. This is NOT related to his (or NEVS’) ownership of usable weeks. In distinction, new Trustees are generally appointed by existing Trustees and such appointment is often linked to the sale of “developer weeks.”

CONFUSING REPRESENTATIONS
When discussing his qualifications at the owners meeting, Mr. Hagberg made two claims:
MR. HAGBERG: “I am THE guy who wrote the resale ethical guidelines – the national code of ethics for resale companies.”
WHAT WE’VE BEEN TOLD: The National Code of Ethics For Resale Companies was written and published by The American Resort Development Association (ARDA). When asked whether Mr. Clifford Hagberg was the sole, primary, or a prominent author of this document, Mr. Howard C. Nusbaum, CEO of ARDA, wrote “Mr. Clifford Hagberg was one of many who worked on our official resale guidelines.”
MR. HAGBERG: “I’m the ONLY one that’s qualified in the country as an expert witness in timeshare fraud.”
WHAT WE’VE BEEN TOLD: According to Mr. Nusbaum, CEO of the American Resort Development Association, “there are many such qualified experts in our Association.”

I can’t say whether Mr. Nusbaum or Mr. Hagberg is giving us the more accurate description; however, it does show that clearly we have to be very careful about evaluating what we are told about what is happening with Sandcastle as different people can have very different views about the same thing.

SUMMARY
I think Mr. Hagberg’s style of communication has lead to much confusion and perhaps even mistrust by some. I believe we simply need to be sure we obtain clear answers from him.

There remain two important issues for Sandcastle owners. The first is a question as to whether Mr. Hagberg and the owners of Outfield Marketing (which have practiced “illegal and false” sales tactics) are reliable and dependable stewards of our Sandcastle Trust as Trustees, and the second are legal questions for the Attorney General’s Office.

A. Is Mr. Hagberg a reliable Trustee?
i. Does he show good judgment by involving Outfield Marketing and their sales practices? Can we understand why they are involved at all?
ii. Is Mr. Hagberg reliably going to improve Sandcastle with a balanced budget when he has provided no real figures or estimates and states he was blindsided by a $350,000 shortfall, unaware of a significant missing Reserve Fund, and surprised by the extent of repairs needed at Sandcastle?
iii. Has he convinced us that his salary as Manager and the cost of his Management Company are justified, reasonable, and customary? Recall that whatever his Sandcastle salary is, it is only a % of his total salary, since he runs other timeshare properties and has other businesses. Is this salary commensurate with the salaries of other Managers?
iv. Is he exhibiting any conflicts of interest as Developer, Trustee, Owner, Manager, and main owner of the management company?
v. Is he transparent in his actions?
vi. In accordance with State law, will he provide us with “a copy of the budget prepared in accordance with the provisions of clause (6) of subsection (a) of section 38 of 183a and an accounting of income and expenses for the preceding year” when we are being given our “special assessment” on top of our 26% increase in maintenance fees?

B. Are the current Activities of the Sandcastle Developer legal?
i. Is it legal for “development properties” which are 30 years old and have never been sold and thus are not assessed maintenance fees or special assessments to be renovated (after falling into disrepair over decades) by maintenance fees paid by other existing owners? Or is it not the responsibility of the developer to finish building a property so that it is sellable?
ii. If a “unit” is rented (ever) or partly owned by another owner, is it still permitted to be construed as “development property”?
iii. If there are “no documents” available to show “any records of anything”, how do we know these “development units” have never been owned by someone? We don’t even know how many units we are talking about, what weeks, and where. Mr. Hagberg has declined to provide this information.

Letter of request for Information and Answers to Mr Hagberg

From Timeshare week owner
2/12/2009
to:

Cliff Hagberg
Managing General Partner
New England Vacation Management Services, LLC
Sandcastle
P.O. Box 576, Rte 6A
Provincetown MA 02657


Dear Mr. Hagberg,

I very much appreciate the letter you sent to us in late October informing us of New England Vacation Services’ interest in Sandcastle and your plans to renovate existing structural problems.

I think it is best to have everything clearly written down so there are no misunderstandings. We all know how people sometimes erroneously hear what they want to hear, rather than what was actually said.

My family owns several units at the Sandcastle Resort, and although I am not the formal spokesperson for other Sandcastle owners, I believe my questions reflect many of the concerns raised by a very rapidly expanding community of owners that are in communication over the internet.

Since you have been intimately involved in managing time shares for over 20 years, and since you are clearly aware of scams perpetrated by others (http://www.ivsrealty.com/Scams.htm), you will appreciate the anxiety that the many changes that seem to be occurring at Sandcastle have created in current owners. As the manager, I’m certain you will wish to make the process as clear as possible for everyone. In this light, we would really appreciate if you would answer the following questions. Thank you for helping us to understand what is happening at the Sandcastle Resort that we all care so much about.


Question 1: What relationships exist among (1) New England Vacation Services (NEVS), (2) IVS Realty (your original company), (3) Festiva, and (4) Outfield Marketing? Are any of these entities affiliates of each other or owned directly, or indirectly, by the same company or people?

In an e mail to Ms. Watson, you wrote “There is no relationship between IVS Realty, Outfield Marketing, and Festiva. All are completely independent companies under separate ownership. NEVMS is the management company that manages the resort for all of the owners.”

However, we are confused by this e-mail because:

1. It was our understanding that you are the CEO of IVS and the Managing General Partner of NEVMS.

2. When you write “separate ownership,” do you mean there is no cross over at the highest management or invested interest levels, or that these companies are not affiliated with each other?

3. In your October letter, you stated that NEVS purchased the “unsold inventory” of Sandcastle from Vince Barth and Robert Woods. Yet, when an Outfield Marketing representative came to our house, he told us:

a. “I’m with a company called Outfield, and there’s a lot of different companies involved here. It’s all one company . . . but nowadays they segment everything. The big company [over everything] is Festiva Resorts.”

b. “Festiva owns 52% of Sandcastle weeks.” Now that sounds like the unsold inventory to us, but you wrote that the unsold inventory was purchased by NEVS.

4. Festiva is listed in the Deeds office as being an owner of many properties which seem to have been acquired many months before your letter to the owners was mailed.

5. Calls to our home from Outfield Marketing to set up the representative’s meeting with us and calls from Kaitlyn of NEVS Customer Service Department are coming from the same phone number 800 436 9094.

6. In the letter we got from you in October, you state that NEVS is pursuing an “affiliation” with both Interval International and Festiva, as well as a “Professional Management Company.” Is this Management Company Outfield Marketing or a subsidiary of Festiva?


Question 2: What is the current status of Sandcastle’s governing body, and who are the current Trustees?

This really breaks down into several related questions:

1. How many current Trustees are there, and what are their names and addresses? In the original Master Deed, the Trustees were listed as four: Joseph and Wayne McCabe (of Provincetown and North Truro, respectively) and two Fred Sarteriales (of Belmont, Mass.).

2. How/when will any new Trustees be appointed/elected?

3. Who has a copy of prior Trust meeting minutes? How can we get these?

4. How do we get a copy of the Trust formation documents and by laws?


Question 3: What is happening with the next annual Owners Meeting?

Again, this breaks down into several related questions:

1. There is a rumor circulating that there will be an Owners Meeting on April 25th at Noon. Is this correct?

2. Will you be sending a mailing to all owners to advise them of this meeting, and if so, when? I am sure, as an owner yourself, that you are aware that in the past many unit owners were not made aware that an Owners Meeting was taking place.

3. What will be the agenda at this meeting, how will it be run and who will be running it?

4. What issues will be discussed and voted upon at this meeting, including will we be reviewing and voting on the plans for construction and improvement that we keep hearing rumors about?

5. Do you intend (or do you know of anybody else who intends) to seek proxies in advance of the Owners Meeting, and when do you intend this mailing?


Question 4: Who owns what and what rights do the owners have?

The Outfield representative told us that Festiva owns 52% of the Sandcastle weeks (mostly from off season weeks), and so, as individual owners, we can “voice opinions,” but we have “absoutely no control” in what happens to the resort. In your letter, however, you wrote that NEVS acquired the entire “unsold inventory.”

1. Our master deed states that off season week holders have no voting rights or limited voting rights! So does that mean that Festiva or NEVS who owns mostly off season weeks has limited voting rights, except for rights related to units obtained from individuals who signed on with Festiva for their points system?

2. Would you be kind enough to send us a copy of the list of all the weeks/units currently held by NEVS and, to the extent you know it, by Festiva?

3. Would you send us a copy of the list of all of Sandcastle’s owners? We understand that the previous managers were unable to provide a list – we understand from the Outfield Marketing rep that the former managers didn’t really have a proper list, but that through your and Outfield’s diligence over the winter, the list is in much better shape – though, considering that the deed ownership is a matter of public record, we weren’t clear why it’s been so difficult to make a complete list.

4. Have any of the Sandcastle properties in default been foreclosed yet or “given” back to the Trust or management company? How many and when?


Question 5: What are the immediate plans and expenses for planned construction and improvements at Sandcastle?

1. In your October letter, you wrote that you already had a detailed budget for 2009.

a. Would you kindly provide us with the same, including management company fees and, if applicable, management salaries?

b. I am particularly (but not at all exclusively) interested in who paid for the Outfield Marketing representatives to go door to door talking to us, rather than sending initial information in writing and then simply manning a phone bank for further owner questions.

2. Our Outfield Marketing rep who came to our house mentioned the need, because of the purchase by NEVS, to bring Sandcastle up to city legal codes. Can you explain why the purchase by NEVS triggered this requirement since what NEVS purchased was just a block of units? Was there something else purchased – for example, did NEVS purchase development rights or something similar — (same questions for Festiva)?

3. In your letter, you wrote that you would be developing a detailed plan for improvements to Sandcastle over the next few months. Now, some four to five months later, and a mere three to four months before summer occupancy, we are hoping the plan is finished and available for review, – at a minimum for proposed dates and costs for any legally mandated fixes, and for any work that is intended to be done before summer occupancy begins. We feel anxious to see that plan so that we know what to anticipate for the summer of 2009.

a. Are you sure that Sandcastle will be open (legally) for regular occupation by unit owners in 2009 who have paid their maintenance fees?

b. I am seriously concerned about the lack of safety of the railings on upstairs hallways and balconies. What happens if a child falls through those railings and gets seriously injured or killed? To me, if there is going to be work done, these railings should be a first priority concern in Sandcastle improvements. Is that already planned to be attended to?

4. The Outfield Marketing representative who came to our house told us that “Festiva had to pay $100,000” to the existing Management to cover “delinquent fees” by Sandcastle owners and that had “to be paid back.”

a. How and why was this possible and necessary? Was there some kind of loan agreement? Why would Festiva be interested in lending money to Sandcastle? What did they get/are they getting in return? Why would delinquent fees need to be covered in the first place?

b. Isn’t fee collection the responsibility of the Trustees per the Master Deed, and why wasn’t it done?

c. If delinquent fees resulted in the management company then renting the related owned units, what happened to that money?

d. We read that you had already collected $50,000 in delinquent fees. Is this money placed into a reserve account now? How does it relate to the $100,000 that needs to be “paid back”?

e. We are unclear as to why, (after reviewing Massachusetts Chapter 183A, the Master Deed, and our individual deeds), individual owners, who are up to date with their own fees, are responsible for the delinquencies of other owners, or of those entrusted with the responsibility to collect those fees, or for the results of not having enough money then to keep the building up to code par because of such delinquencies, and we understand this is quite different from special assessments for property improvements.
Question 6: What is the purpose of these new institutional relationships?

Would you briefly explain your (or the Trustees’) reasons for “associating” with Festiva Resorts, a company which has a significant record of discontent among its constituents? In searches of the internet by us and other owners, I have been astounded by the shear number of negative reviews of the organization – (certainly, far more than one would expect for an organization its size). In addition, Festiva has been fined for illegal behavior by the Attorney General of Missouri. I’m certain you know this company’s record well, but here are just a few examples I found.

http://timeshareconsumergroup.org/fraud_festiva.html
http://ago.mo.gov/newsreleases/2008/Agreement_with_Festiva_Resorts_LLC/
http://festiva resorts.pissedconsumer.com/

2. What benefit is the association with Outfield Marketing with whom you share phones (office space?)? The representative was very knowledgeable about Festiva and its Point System, but not at all knowledgeable about real projected costs / improvements at Sandcastle. What is Outfield Marketing doing at Sandcastle, and are we paying for it?

3. What is the purpose of the professional management company that you were looking to hire? Is this different from what you are doing/going to be doing? Would we have two management companies? Did you hire a professional management company?


Mr. Hagberg, we very much appreciate your attention to these matters, and I look forward to hearing your response. I realize that we are asking a number of questions, but, as I’m sure you can imagine, there is a lot of concern and confusion among the owners. Hopefully, your answers here will clear up a lot of that confusion.

In addition to the above requests, we would like to get copies of the following:

1. Trust by laws
2. Minute book of the Trust/trustees
3. Minutes of the last three or so previous owner meetings
4. Financial records including:
a.. receipts and expenditures of the last three years
b. records regarding all funds, including the replacement reserve fund
c. the most recent audits, reviews or similar documents, etc. (I believe the legal
requirement is that an audit be performed annually).
d. contracts for work to be performed for or services to be provided (including the
Manager's contract)

Could send the above documents and the other items requested in this letter with the response to this letter as soon as possible? (We would be more than happy to pay for the postage). However, if that will not be possible, can you please let us know when, during reasonable business hours, it would be possible for a member of my family (since I am one of the owners) to come to your office to make copies?

Most Sincerely,

Sandcastle timeshare owner


Note: No response to date. Some answers have been found since the writing of this letter, although apparently they did not come from Mr Hagberg.