New Definition of Rental Activity?

[crisi]

I didn't see this asked, but I just skiimed the comments. The part about points being used by owners or owners families.. How do they know who is my family or not? What constitutes the owners family? Does that just mean me and my immediate family? My in-laws? Cousins? How would they know if John Doe is my brother in law or not? How would they enforce that short of saying that someone whose name is on the contract must be registered as a guest on every reservation? My hypothetical daughter could get married and no longer share our last name. Would that mean I could not make a reservation for her and her husband? Would they require documentation upon check in to prove she is family? I just don't see how they could possibly enforce private rentals. Sure they could crack down on the rental companies, but I'd think it would be hard otherwise.

So fraud software is AMAZING. It knows that my friend, who I've known for 35 years, is my friend. Its easy to map to public records - marriages, births, divorces. But fraud software does SO much more. It knows when we've been to restaurants together. It knows we graduated from high school together. That we worked together. That we've been on a plane together more than once. It, of course, knows we are Facebook friends, and have been for a LONG time. This is how your credit card company knows to contact you when the big screen TV that was purchased on your account is sent to a stranger - and why it doesn't contact you when its sent to your brother.

So your hypothetical daughter is linked to you by her birth certificate and to her new last name by her marriage certificate and name change - that's the EASY part. Your best friend from high school can check in on a reservation you made because you have a long association in records.

ETA: It, of course, isn't 100% - which is why sometimes your credit card company calls you went you sent a big ticket item to a friend. But DVC can make those calls as well - or they can just flag it - one or two people who fraud software can't connect you to, that's OK. Ten in a year who fraud software can't connect you to - that's a pattern of activity worth flagging.

 

[Cyberc1978]

So fraud software is AMAZING. It knows that my friend, who I've known for 35 years, is my friend. Its easy to map to public records - marriages, births, divorces. But fraud software does SO much more. It knows when we've been to restaurants together. It knows we graduated from high school together. That we worked together. That we've been on a plane together more than once. It, of course, knows we are Facebook friends, and have been for a LONG time. This is how your credit card company knows to contact you when the big screen TV that was purchased on your account is sent to a stranger - and why it doesn't contact you when its sent to your brother.

So your hypothetical daughter is linked to you by her birth certificate and to her new last name by her marriage certificate and name change - that's the EASY part. Your best friend from high school can check in on a reservation you made because you have a long association in records.

ETA: It, of course, isn't 100% - which is why sometimes your credit card company calls you went you sent a big ticket item to a friend. But DVC can make those calls as well - or they can just flag it - one or two people who fraud software can't connect you to, that's OK. Ten in a year who fraud software can't connect you to - that's a pattern of activity worth flagging.

Even so, I don't think DVC would use the time and money to subscribe to fraud software. Fraud software is only as good as the intel it can collect.

If information is not present does not mean that something is off, just that the software is not as good as it was sold to be.

I don't know in the U.S but birth, marriage and death certificates are not public records in my country but even so my uncle could live in the U.S and I could rent to him and his family.

No one except my CC company know where I use my card and those data are not allowed to be shared.

Due to GDPR in Europe we are luckily free from a lot of companies try to pry in our personal information.

 

[nlenguyen]

The new restrictions are in the CFW declarations and DVC Membership Agreement and DVC Resort Agreement. As to be enforceable against pre-CFW DVC members, there are serious doubts they can be applied to such members. The new restrictions created are not in the prior POS's, and could require an amendment to the prior declarations that would require the actual vote of the members.

Under the prior declarations, the restriction was limited to a commercial purpose, which could be found if there were a pattern of rental activity that the association, in its reasonable discretion, could conclude constitutes a commercial enterprise or practice. Commercial enterprise is a legal term that means being in the business of doing something.

DVD could argue that the new listed restrictions simply conform with the prior restriction, but there is a major problem with the new terms. Under the prior POS's, any decision made by the association (or possibly DVCM) had to be "reasonable," i.e., the members could challenge whether the decision was correct.

Are you saying similar to point restrictions at new resorts, they had to grandfather contracts in?

 

[HyperspaceMountainPilot]

Are you saying similar to point restrictions at new resorts, they had to grandfather contracts in?

I don’t think they have to grandfather anything in because there has always been a prohibition on commercial use. Renting your points to strangers is clearly a commercial activity— they might have problems trying to enforce it against people who only rent 20-30% of their points but there’s no question that you were never allowed to own it solely for the purpose of renting for profit.

 

[crisi]

Even so, I don't think DVC would use the time and money to subscribe to fraud software. Fraud software is only as good as the intel it can collect.

If information is not present does not mean that something is off, just that the software is not as good as it was sold to be.

I don't know in the U.S but birth, marriage and death certificates are not public records in my country but even so my uncle could live in the U.S and I could rent to him and his family.

No one except my CC company know where I use my card and those data are not allowed to be shared.

Due to GDPR in Europe we are luckily free from a lot of companies try to pry in our personal information.

Disney already subscribes to fraud software and they already run this check if you use a credit card to book a hotel room for your daughter for her honeymoon. And the fraud software already accounts for one or more of you living in Europe with higher privacy controls (which you are lucky to have - I wish we had determined we have a right to privacy). And they are looking for patterns.

 

[Cyberc1978]

I don’t think they have to grandfather anything in because there has always been a prohibition on commercial use. Renting your points to strangers is clearly a commercial activity— they might have problems trying to enforce it against people who only rent 20-30% of their points but there’s no question that you were never allowed to own it solely for the purpose of renting for profit.

In the past commercial use was more than 20 rentals. If owners has abided to that in good faith I might add, are they allowed to all of a sudden to say now we see it differently and we are going to cancel your reservations.

If some owners bought to rent and use because according to the rules they were allowed to and now that changes and reservations are getting cancelled - now who is acting in bad faith?

 

[Cyberc1978]

Disney already subscribes to fraud software and they already run this check if you use a credit card to book a hotel room for your daughter for her honeymoon. And the fraud software already accounts for one or more of you living in Europe with higher privacy controls (which you are lucky to have - I wish we had determined we have a right to privacy). And they are looking for patterns.

Problem with patterns are that systems might see them when there are none.

 

[Sandisw]

Are you saying similar to point restrictions at new resorts, they had to grandfather contracts in?

I think it’s the change in language that the decision would be solely in the hands of DVc with an owner not having any right to challenge it.

The current terms of the other resorts is not like that. So, I think that might be the aspect that could be an issue.

Also the definition of it being reasonable. Since we are allowed to rent, what rules are still within it.

But, they can also ask for a vote and as already mentioned, I could be worded I. Such a way that people think it’s good to adopt these rules.

 

[crisi]

Problem with patterns are that systems might see them when there are none.

Yep, that's the issue with statistics. But I suspect that as long as you aren't making tens of reservations a year in someone's name other than your own, you won't need to worry. If you are, you may get flagged - and let's hope that they do put in arbitration instead of Disney's sole discretion.

 

[GoingSince1990]

So fraud software is AMAZING. It knows that my friend, who I've known for 35 years, is my friend. Its easy to map to public records - marriages, births, divorces. But fraud software does SO much more. It knows when we've been to restaurants together. It knows we graduated from high school together. That we worked together. That we've been on a plane together more than once. It, of course, knows we are Facebook friends, and have been for a LONG time. This is how your credit card company knows to contact you when the big screen TV that was purchased on your account is sent to a stranger - and why it doesn't contact you when its sent to your brother.

I'm not sure that we are living in quite that much of a surveillance society yet, at least in the US. I don't know how any software would know who has been to restaurants together, unless the smartphone companies like Apple are selling a breathtaking amount of location data, showing that (for example) your and your friend's iPhones were both at the same Applebees for 90 minutes. And I think it's similarly unlikely that the airlines would be selling passenger lists to enable software to determine who has taken flights together. As for the verification that you sometimes have to do with a credit card purchase, I think that's more to do with an unusually large dollar amount as opposed to who the item is going to, as it's not uncommon for me to have to do that for fairly large purchases, even if they are going to my own home.

 

[sndral]

In the past commercial use was more than 20 rentals. If owners has abided to that in good faith I might add, are they allowed to all of a sudden to say now we see it differently and we are going to cancel your reservations.

If some owners bought to rent and use because according to the rules they were allowed to and now that changes and reservations are getting cancelled - now who is acting in bad faith?

AFAIK there is no written language guaranteeing 20 reservations. There is language prohibiting commercial use - commercial means for profit.
My understanding is that many years ago DVC sent letters to folks making more than 20 reservations per annum warning them that DVC would assume that more than 20 reservations per annum would be presumed to be commercial.
Just because over a decade ago DVC decided that 20 was the threshold that would trigger enforcement of the no commercial use clause & advised a few owners of that fact didn’t create a ‘right’ to make 20 rentals for all owners.
The rental world has changed since then, it‘s grown & DVC may have decided the 20 reservation threshold isn’t sufficient to enforce the no commercial use clause & they may now have the ability/technology to use a more sophisticated approach to enforce a clause that was always there.

Edited to add: I’m linking this article https://dvcnews.com/index.php/dvc-p...commercial-renting-limitations-amended-to-pos because it suggests there might have been language in the POS about 20 reservations back in 2007, I can’t really tell from the article.

 

[Genie+]

In the past commercial use was more than 20 rentals. If owners has abided to that in good faith I might add, are they allowed to all of a sudden to say now we see it differently and we are going to cancel your reservations.

If some owners bought to rent and use because according to the rules they were allowed to and now that changes and reservations are getting cancelled - now who is acting in bad faith?

Commercial use wasn’t defined as 20 rentals. It was a metric they offered to where renting clearly crossed the limit.

The contracts say for personal use and not for commercial use. What would a reasonable person consider personal use? I don’t think buying contracts to rent most or all of the points on a repeating basis. Why would a person buy many times over the amount of points they’d use for themselves and circle of family/friends? I think there’s a clear difference between the occasional excess of points to rent and intentionally buying excess points for rental purposes.

Is it bad faith to buy 800pts with plans to rent out 500pts yearly, when the contract says no commercial use and for personal use only? I can’t see people doing that unless as a for profit endeavor, otherwise why bother.

But I can see arguments against any enforcement too. Somebody can say they want 4 home resort priorities and that’s how/why they have excess points and they’re not renting for profit, just to offset costs.

There’s more but my suspicion is DVC will change over the next several years and as they tighten the ship they’ll offer new ways for owners and buyers to navigate. If they are able to improve the product for casual owners while opening new streams of profit for themselves, that might not upset the majority of owners and be quite an accomplishment lol.

 

[LoveToDisney]

I personally can’t wait to see the commercial renting shut down. In the “old days”, when someone bought a large contract, I think it was because they wanted to use more points to stay in larger accommodations or go more frequently throughout the year. They did not buy the large contract to reserve all standard view, low cost studios in early December, as an example, to rent them out for profit. Before commercial renting became a problem you just didn’t hear anyone walking a reservation because it was so much easier to get a reservation.

 

[DonMacGregor]

I do find it interesting that on all of the various sites I've seen debating this issue, whether it's a forum or Facebook or IG or whatever, I've yet to see a single comment by anyone associated with any of the recognizable online rental or resale companies. Curious...

 

[drusba]

Are you saying similar to point restrictions at new resorts, they had to grandfather contracts in?

The main issue is the DVC Resort Agreement for CFW. The CFW declarations and all other CFW documents other than the Resort Agreement, apply only to CFW. However, the DVC Resort Agreement applies to CFW members and other resort members who want to reserve CFW. Under the terms of our prior DVC Resort Agreements, BVTC agrees that, as to any future resorts (such as CFW) that it wants to add to the DVC Reservation Component, the terms of agreement it makes for the new resort will be substantially the same in all material respects as our DVC Resort Agreements.

In at least the following ways, the CFW agreement substantially differs from the prior agreements:

1. CFW agreement has the same rental restrictions as the CFW declarations, and provides that BVTC has the absolute power, like the association and DVCM, to determine the issue. No such provisions exist in prior Resort Agreements, including because BVTC has never before even had the power to adopt rental restrictions or enforce rental restrictions.

2. The CFW agreement gives BVTC the power to charge an incident fee to anyone from another resort to use the DVC Reservation Component to make a reservation at CFW. The prior resort agreements expressly prohibit such incident charges for any member making a reservation for any unowned resort.

3. The CFW agreement gives BVTC the power to reallocate annual points among room sizes needed for a reservation, e.g., it can lower 2BRs and raise studios. Not only has BVTC never before been given any power to reallocate points in prior agreements, but the terms of the POS's of those agreements allow for reallocating points among the same size room for changes in seasonal demand, and reallocation due to changes in room size demand is not preserved anywhere. A peculiar factor about that clause is that it obviously does not even apply to CFW cabins since all cabins are the same size and have the same point costs, i.e. it was added to be applied to other resorts.

4. The CFW agreements and prior agreements define a club member (the person who can use the DVC reservation component to reserve a room) as the owner of Record of an Ownership Interest. However, the prior resort agreements define Ownership Interest to mean a "property interest in a Unit in a DVC Resort." The CFW agreement defines it as "a timeshare estate in a DVC Resort, which is a real property interest pursuant to Section 721.05(34)," so it is not the same.

5. The CFW agreement has a provision under which BVTC agrees as to new resorts (which, under the CFW documents, can include new DVC Resorts created out of units from prior resorts that have have not yet been added to the those DVC Resorts) to allow, for a one-year period during which any new purchasers of the that new DVC Resort can reserve rooms at the resort before the 11-month window begins. In other words, it could create a new DVC Resort out of remaining undeclared units at Riviera, whose purchasers could, for a year, reserve Riviera rooms before 11-months out. Such provision does not exist in any prior DVC Resort Agreement, or anywhere else.

DVD should be required to redo the CFW DVC Resort Agreement, or withdraw CFW as a DVC Resort. A possible alternative would be to exempt all owners of the prior resorts from being subjected to any of the above terms.

 

[DonMacGregor]

Just because over a decade ago DVC decided that 20 was the threshold that would trigger enforcement of the no commercial use clause & advised a few owners of that fact didn’t create a ‘right’ to make 20 rentals for all owners.
The rental world has changed since then, it‘s grown & DVC may have decided the 20 reservation threshold isn’t sufficient to enforce the no commercial use clause & they may now have the ability/technology to use a more sophisticated approach to enforce a clause that was always there.

Almost like when the POS was originally written, online rental and trading sites didn't exist. In fact, the internet as a public tool didn't really exist. Heck, Facebook didn't come along until OKW was already 13 years old. DISBoards only dates back to 1997, when OK was 6 years old. None of this stuff was contemplated back in 1990. Anybody who wants to convince themselves that the POS was fine as it was written in 1990, addressed any and all potential contingencies, and nothing has happened in the interim, should take a gander at the US Constitution. That was written by some reasonably smart fellows, and even it has been amended 27 times (well I guess technically 25 times since #21 repeals #18, so it's a net-25).

 

[tx911]

I personally can’t wait to see the commercial renting shut down. In the “old days”, when someone bought a large contract, I think it was because they wanted to use more points to stay in larger accommodations or go more frequently throughout the year. They did not buy the large contract to reserve all standard view, low cost studios in early December, as an example, to rent them out for profit. Before commercial renting became a problem you just didn’t hear anyone walking a reservation because it was so much easier to get a reservation.

Awesome, maybe they can address renting and markedly decrease walking in one stroke!

 

[mamaofsix]

I do find it interesting that on all of the various sites I've seen debating this issue, whether it's a forum or Facebook or IG or whatever, I've yet to see a single comment by anyone associated with any of the recognizable online rental or resale companies. Curious...

They must be very worried right now. Feel kinda badly for those who could potentially lose their entire business due to the change. Hope they have a plan B.

 

[DonMacGregor]

They must be very worried right now. Feel kinda badly for those who could potentially lose their entire business due to the change. Hope they have a plan B.

I'm guessing they are at least taking a good long look at the new language (along with their lawyers) before anyone says anything. I'm just wondering if it hasn't at least got their attention.

 

[drusba]

As to the 20-reservation rule mentioned that was created in 2007, it was actually a rule issued by DVD that was not included in any of the POS documents, and provided that if a member made more than twenty reservations in any one year period, a presumption would arise that the member is violating the commercial purpose limitation, and the member, to avoid any penalty, would need to show that the reservations were not for a commercial purpose, and if unable to do so the reservations after the first 20 would be voided.

The major problems with the new rules are that they are vague and the association and DVCM have unchallengeable power to interpret them. For example, nothing is said as as to what constitutes "frequent" for reservations in any category mentioned. The association or DVCM could decide for one member that two in four months is frequent and, for another, that five in a month is not, and the one destroyed by the first decision could not challenge the finding even if he had the evidence to show the other member was found to have done nothing wrong. As I mentioned before, the most serious problem created by the new rules is that they allow the association and DVCM to do anything they feel like doing and it cannot be challenged.