1 00:00:00,200 --> 00:00:03,440 Speaker 1: So one way to have an affordable holiday almost system 2 00:00:03,680 --> 00:00:06,960 Speaker 1: for your family is to buy a holiday share block scheme. Essentially, 3 00:00:07,000 --> 00:00:09,000 Speaker 1: you have a share and a property. You use it 4 00:00:09,080 --> 00:00:11,399 Speaker 1: quite often. It's usually as part of a bigger state. 5 00:00:11,800 --> 00:00:14,280 Speaker 1: You don't have to manage it yourself, have the certainty 6 00:00:14,320 --> 00:00:16,919 Speaker 1: of knowing that that block of time is yours. You 7 00:00:16,920 --> 00:00:19,799 Speaker 1: can imagine Christmas week or you know, the week of 8 00:00:19,840 --> 00:00:23,120 Speaker 1: the middle of the year, holidays or whatever. Trudy Brookman 9 00:00:23,239 --> 00:00:25,720 Speaker 1: is a consumer law attorney who's worked with these truly 10 00:00:25,760 --> 00:00:28,400 Speaker 1: good Evening, I mean that many different things in this market. 11 00:00:28,440 --> 00:00:31,840 Speaker 1: You get time share, you then get a share block. 12 00:00:31,920 --> 00:00:33,120 Speaker 1: What's a share. 13 00:00:32,880 --> 00:00:38,159 Speaker 2: Block if you can imagine Stephen and good evening to 14 00:00:38,240 --> 00:00:41,839 Speaker 2: you and the listeners. If you imagine a few friends 15 00:00:42,000 --> 00:00:45,919 Speaker 2: or family members getting together and buying a holiday home together, 16 00:00:46,200 --> 00:00:48,120 Speaker 2: because of course you don't live there, you don't need 17 00:00:48,159 --> 00:00:52,319 Speaker 2: it every week of the year. And this is a 18 00:00:52,360 --> 00:00:55,760 Speaker 2: formalization of that idea. So it's a holiday our house 19 00:00:55,960 --> 00:00:59,240 Speaker 2: owned by a company. The shares in that company are 20 00:00:59,280 --> 00:01:04,440 Speaker 2: then sold on consumers, and in exchange for ownership of 21 00:01:04,480 --> 00:01:07,000 Speaker 2: the shares, you have a right to stay for a 22 00:01:07,040 --> 00:01:10,600 Speaker 2: fixed period each year, and you have to pay a levee, 23 00:01:11,160 --> 00:01:15,600 Speaker 2: and the turtle levees of the shareholders are intended to 24 00:01:15,680 --> 00:01:20,040 Speaker 2: cover the expenses on the property on the house. So's 25 00:01:20,240 --> 00:01:24,039 Speaker 2: there may be various houses in a particular share block scheme, 26 00:01:24,120 --> 00:01:27,080 Speaker 2: and that's basically how it works. So timeshare, you have 27 00:01:27,280 --> 00:01:32,720 Speaker 2: units or points, and you have varied interests that allow 28 00:01:32,840 --> 00:01:37,920 Speaker 2: you to get weekends, weeks stay, et cetera. In the 29 00:01:37,959 --> 00:01:40,080 Speaker 2: course of the year. You also pay levees. But with 30 00:01:40,200 --> 00:01:44,200 Speaker 2: this you own a share which has wonderful benefits and 31 00:01:44,280 --> 00:01:45,199 Speaker 2: real drawbacks. 32 00:01:45,720 --> 00:01:47,760 Speaker 1: Okay, so I mean the drawbacks are interesting. I mean 33 00:01:47,800 --> 00:01:50,360 Speaker 1: sometimes these places are run by someone, they have an 34 00:01:50,360 --> 00:01:56,000 Speaker 1: actual operator, right, yes, great, So then where do things 35 00:01:56,120 --> 00:01:56,720 Speaker 1: go wrong? 36 00:01:58,400 --> 00:02:03,400 Speaker 2: It often goes wrong with the operation later. So in 37 00:02:03,840 --> 00:02:06,600 Speaker 2: one instance where I'm dealing with a group of clients 38 00:02:06,640 --> 00:02:11,040 Speaker 2: who are suing the developer and the and the shed 39 00:02:11,040 --> 00:02:16,160 Speaker 2: block companies in which they purchased shares quite a few 40 00:02:16,240 --> 00:02:20,360 Speaker 2: years ago, and they're suing for their purchase price back, 41 00:02:22,080 --> 00:02:26,000 Speaker 2: they have found that the management is really shoddy. So 42 00:02:27,000 --> 00:02:31,200 Speaker 2: this resort was advertised as a private residence club which 43 00:02:31,240 --> 00:02:34,960 Speaker 2: provides its owners with all the best services and amenities 44 00:02:34,960 --> 00:02:39,800 Speaker 2: of a five star hotel and appreciating investment in perpetuity 45 00:02:40,960 --> 00:02:45,839 Speaker 2: what they actually experienced, and it's been just patchy. So 46 00:02:45,880 --> 00:02:50,079 Speaker 2: some experiences were better, but the worst experiences were things 47 00:02:50,160 --> 00:02:55,160 Speaker 2: like cockroach infestations, dilapidated furnishings, the air con is broken 48 00:02:55,200 --> 00:02:57,200 Speaker 2: and it's in case it end, so that really the 49 00:02:57,280 --> 00:03:02,960 Speaker 2: problem block brains stand and smellic carpets, and then financial 50 00:03:03,000 --> 00:03:07,400 Speaker 2: irregularities where there's a sort of a cross subsidization from 51 00:03:07,400 --> 00:03:14,200 Speaker 2: the Shapelock scheme of other developments in the in the 52 00:03:14,280 --> 00:03:18,680 Speaker 2: larger state. So those are some of the complaints. There's 53 00:03:18,720 --> 00:03:22,399 Speaker 2: also a bit of a discrepancy often where the shaplock 54 00:03:22,880 --> 00:03:26,919 Speaker 2: schemes where are developer gets very ambitious and they build 55 00:03:26,960 --> 00:03:30,679 Speaker 2: a property for so many million that they sell it 56 00:03:30,840 --> 00:03:34,000 Speaker 2: for three times that price in terms of the shares 57 00:03:34,040 --> 00:03:38,200 Speaker 2: if you add them up, and then you promise that 58 00:03:38,320 --> 00:03:43,640 Speaker 2: this is an investment that my clients have found that 59 00:03:43,760 --> 00:03:49,320 Speaker 2: they get on the account of the estate seventy five 60 00:03:49,320 --> 00:03:52,840 Speaker 2: percent depreciation of what they paid. And property is supposed 61 00:03:52,840 --> 00:03:55,320 Speaker 2: to appreciate, right, So. 62 00:03:55,720 --> 00:03:57,840 Speaker 1: I mean, one of the problems with this is that 63 00:03:57,920 --> 00:04:00,960 Speaker 1: you can't predict the future, and you know that a 64 00:04:01,040 --> 00:04:03,000 Speaker 1: car is not going to last forever. A property you 65 00:04:03,040 --> 00:04:06,040 Speaker 1: do expect to last forever, which means that you really 66 00:04:06,080 --> 00:04:08,440 Speaker 1: are relying on the people who run that for a 67 00:04:08,600 --> 00:04:11,320 Speaker 1: very long time, and that would seem to be the issue. 68 00:04:11,320 --> 00:04:13,760 Speaker 1: This must happen, I suppose quite often if you consider 69 00:04:13,840 --> 00:04:17,000 Speaker 1: how the life expectancy of a property like that. 70 00:04:18,480 --> 00:04:22,839 Speaker 2: Yes, so very much depends on proper maintenance, adjusting the 71 00:04:22,960 --> 00:04:28,080 Speaker 2: levees so that there's sufficient maintenance, and like keeping up 72 00:04:28,880 --> 00:04:34,440 Speaker 2: of the with the fashions and the and the renovations 73 00:04:34,440 --> 00:04:37,320 Speaker 2: that are necessary to keep a place looking sparkling at 74 00:04:37,320 --> 00:04:41,920 Speaker 2: all times. That you also have certain areas which just 75 00:04:41,920 --> 00:04:45,880 Speaker 2: go out of fashion. I mean, in my grand grandmother's era, 76 00:04:46,040 --> 00:04:48,920 Speaker 2: Belita was the place to go, and I think it's 77 00:04:48,920 --> 00:04:50,800 Speaker 2: gone out of quite a light now. 78 00:04:50,920 --> 00:04:51,280 Speaker 3: Durban. 79 00:04:52,160 --> 00:04:55,919 Speaker 2: We have a few clients' you've invested in share blocks 80 00:04:55,960 --> 00:05:00,560 Speaker 2: there and they're really struggling to sell that. You have shares, 81 00:05:00,600 --> 00:05:02,440 Speaker 2: but then you struggle to sell them at all. 82 00:05:03,320 --> 00:05:07,080 Speaker 1: So the Consumer Protection Act does it apply in a. 83 00:05:07,080 --> 00:05:11,120 Speaker 2: Case like this, Yes, it does. So if you buy 84 00:05:11,279 --> 00:05:16,680 Speaker 2: us in your individual name, then you're a consumer purchasing 85 00:05:16,760 --> 00:05:19,680 Speaker 2: from the developer. The developers acting in an ordinary course 86 00:05:19,720 --> 00:05:23,400 Speaker 2: of business, so that consumer Protection Act applies, and one 87 00:05:23,400 --> 00:05:29,040 Speaker 2: of its provisions that applies very specifically is that developers 88 00:05:29,080 --> 00:05:32,800 Speaker 2: are prohibited from charging an unfair and reasonable or unjust 89 00:05:32,880 --> 00:05:36,600 Speaker 2: price or from its misleading consumers. And that's what some 90 00:05:36,640 --> 00:05:39,640 Speaker 2: of my clients have found. In other cases, there are 91 00:05:39,680 --> 00:05:44,080 Speaker 2: other issues that the levees are exorbitant, especially for what 92 00:05:44,120 --> 00:05:49,400 Speaker 2: you're getting. The Company's Act also applies, and it protects 93 00:05:49,440 --> 00:05:53,640 Speaker 2: minority shareholders. So what often happens is that the developer 94 00:05:53,720 --> 00:05:57,039 Speaker 2: maintains a majority shareholding and they call the shots in 95 00:05:57,120 --> 00:06:02,120 Speaker 2: terms of managing the various companies earn the properties, and 96 00:06:02,200 --> 00:06:06,680 Speaker 2: as a minority shareholder, you are left high and dry, 97 00:06:06,800 --> 00:06:11,719 Speaker 2: except that the Company's Act provides you with the right 98 00:06:11,920 --> 00:06:16,200 Speaker 2: to put your shares back to the tutor share block 99 00:06:16,279 --> 00:06:22,680 Speaker 2: company for your original purchase price. If the property is 100 00:06:22,760 --> 00:06:25,320 Speaker 2: managed in a way that is a prescible and fairly 101 00:06:25,360 --> 00:06:30,359 Speaker 2: prejudicial to you as a minority shareholder, unfairly disregard your interest. 102 00:06:30,520 --> 00:06:34,240 Speaker 2: So that often is as a remedy that we can utilize. 103 00:06:34,400 --> 00:06:37,440 Speaker 1: So truly, I remember years ago there were public hearings 104 00:06:37,480 --> 00:06:40,480 Speaker 1: into the timeshare industry and someone said as part of 105 00:06:40,560 --> 00:06:43,400 Speaker 1: their testimony they had been unable to get their time 106 00:06:43,440 --> 00:06:47,680 Speaker 1: share agreement that they were unfortunately not long for this world, 107 00:06:47,720 --> 00:06:50,520 Speaker 1: and intended to leave it to Julius Malemarin as well, 108 00:06:51,000 --> 00:06:54,600 Speaker 1: because he thought that the Timeshare company would find that. 109 00:06:56,160 --> 00:06:58,440 Speaker 1: I mean, I remember the scene and I found that 110 00:06:58,520 --> 00:07:00,600 Speaker 1: really quite something. How do or does it to get 111 00:07:00,600 --> 00:07:01,839 Speaker 1: out of a share block scheme? 112 00:07:03,240 --> 00:07:06,200 Speaker 3: It can be harder than even tim share. At least 113 00:07:06,200 --> 00:07:09,080 Speaker 3: some times share there are these resellers who will give 114 00:07:09,120 --> 00:07:12,320 Speaker 3: you maybe a hundredth of of what you paid. With 115 00:07:12,440 --> 00:07:13,760 Speaker 3: some of the share blocks. 116 00:07:13,440 --> 00:07:18,160 Speaker 2: You can literally just not find a buyer. So, but 117 00:07:18,840 --> 00:07:22,360 Speaker 2: our firm has figured out some methodology in terms of 118 00:07:22,360 --> 00:07:26,120 Speaker 2: how to get you out of your share block ownership. 119 00:07:26,480 --> 00:07:29,480 Speaker 2: Even if you don't get value for your shares, at 120 00:07:29,560 --> 00:07:32,480 Speaker 2: least you get out of those oppressive levees that often 121 00:07:32,680 --> 00:07:37,760 Speaker 2: escalate for above Inflash and right. So what we generally 122 00:07:37,800 --> 00:07:41,480 Speaker 2: do is to write to the managers and say that 123 00:07:41,520 --> 00:07:43,320 Speaker 2: our client wants to get out, and do they have 124 00:07:43,360 --> 00:07:47,600 Speaker 2: an exit policy? If there is none of those, we 125 00:07:47,680 --> 00:07:51,320 Speaker 2: go to the extreme step of careering the share certificates 126 00:07:51,360 --> 00:07:54,120 Speaker 2: to them and saying that our client abandons them. You 127 00:07:54,200 --> 00:07:58,320 Speaker 2: can't do that, and that at least gets you out 128 00:07:58,360 --> 00:08:02,000 Speaker 2: of being a shareholder. And you don't need to keep 129 00:08:02,040 --> 00:08:04,400 Speaker 2: on paying the labies for things that you never use. 130 00:08:04,600 --> 00:08:07,360 Speaker 1: Truly, Brooklyn, thank you so much. Really appreciated consuming low 131 00:08:07,480 --> 00:08:08,480 Speaker 1: experts on the money.