Royal Holiday Club Investigation by KING 5 Television, Posted By Robert Paisola

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Investigators: Timeshare troubles beach vacation dreams

10:55 PM PDT on Wednesday, October 17, 2007

By JESSE JONES / KING 5 News

Timeshare troubles SEATTLE - Timeshares can be great opportunities. Vacationers can buy a few weeks of lodging a year at resorts all over the world for one price.

But get involved with a troubled company and you can find yourself tied up in a bad deal for decades.

Mark and Misty Nason of Puyallup, Wash. and Leanne Carden of Lynnwood, Wash. are just three of hundreds of customers who say they've been victimized by Royal Holiday Club.

"It's hundreds of people and it's the same story," Misty Nason said. "I think this is what is so disheartening. This is happening every day to people."

Royal Holiday Club has an "F" rating according to the national Better Business Bureau.

"This company has quite a few complaints," said Marcella Kallmann, a spokesperson for the bureau. "In the past 36 months they have almost 200 complaints."

The KING 5 Investigators found complaints against Royal Holiday Club all across the country, alleging bait-and-switch selling practices to outright fraud. They have been lodged with the Better Business Bureau, logged on consumer Web sites and filed with Attorney General's offices.

"We just want to warn people to just walk away, no matter what they offer you," said Mark Nason.

The Nasons say they should have taken their own advice. While on vacation in Cancun, the couple spent $17,000 to join Royal Holiday's timeshare club. As a family with young kids they couldn't use all three weeks they purchased, so they wanted the ability to sell time back to the club.

"We asked many questions about that feature, stipulations and when we could do it," Misty Nason said. "They said absolutely any time just call."

Royal Holiday has an "F" rating, according to the Better Business Bureau.
When Mark and Misty returned home they called Royal Holiday to arrange selling time back. It's exactly what the salesman in Cancun promised. But Royal Holiday club's representative said that was not company policy.

"His exact words: 'It's your fault, Ms. Nason, you were lied to,'" Misty Nelson said. "'It's is your responsibility to make sure you are getting everything you are being told.'"

KING 5 had University of Washington law professor Kate O'Neill look at the Nasons' contract.

Jesse Jones: "Would you sign that deal?"

Kate O'Neill: "I hope not."

O'Neill points to several clauses in the contract that all prospective timeshare owners should look for. Here's one: If the Nasons want to sue Royal Holiday, they'll have to make a long trip.

"The purchase and sale agreement says the governing law will be the law of the state of Mexico City," O'Neill said.

The contract also has customers sign a merger clause.

"They are very dangerous clauses for consumers to sign," O'Neill said.

The merger clause basically means verbal agreements can't be added to the contract. Though the salesman told the Nasons they could sell time back to the club, there are no rules for that in the contract. So they are out.

"I doubt my typical first-year law student would understand what this means until after I teach them contract law," O'Neill said.

Leanne Carden met with a Royal Holiday salesman in Puerto Vallarta. She already owned two timeshares with another company and didn't need another one.

"I was ready to stand up and leave when he said, 'What would you say if I could sell your timeshares?' He thought I was going away and that was the hook," she said.

Leanne was told another company would sell her timeshares and that she'd get discounted rates on airfare and resorts around the world. She's says none of it happened. She called Royal Holiday demanding her $7,000 back.

"I said 'I'm just going to get a lawyer,'" Leanne said. "And he said 'Leanne, we have the best lawyers write this contract. There's no way you can break this contract. It's air-tight.'"

Leanne filed a complaint with Profeco - the Mexican consumer protection agency - and got $3,000 back.

Jesse Jones: "Was that the most expensive vacation you've ever been on?"

Leanne: "Yep."

The Nasons tried to cancel, but the deal they signed locks both parties in for 30 years. What's worse - they are responsible for $450 maintenance fees every year for the life of the deal.

"In my mind there's no reason throwing good money after bad," Mark Nason said. "They'll never get another dime from me."

After trying for weeks to get any word from Royal Holiday Club, Wednesday afternoon KING 5 finally received a response.

Royal Holiday Club says it only gets complaints on 1 percent of all of its sales and they are working to address the concerns of each member.

The company adds that it will give the Nasons a full refund. It says the issue of Leanne’s case is closed.

However, Royal Holiday Club does admit that some sales people did break company policy in offering to resell other timeshares. Those employees have been fired.