Chapter 707

707.30(5) (5) Powers of managing entity.

707.30(5)(a) (a) Subject to par. (c) and the time-share instrument, the association may do any of the following:

707.30(5)(a)1. 1. Adopt, amend and repeal bylaws, rules and regulations.

707.30(5)(a)2. 2. Adopt and amend budgets for revenues, expenditures and reserves, and levy and collect assessments for time-share expenses from time-share owners.

707.30(5)(a)3. 3. Employ and dismiss employees, agents and independent contractors.

707.30(5)(a)4. 4. Commence, defend or intervene in court actions or administrative proceedings in its name on behalf of itself or 2 or more time-share owners on matters affecting the time-share property or time shares.

707.30(5)(a)5. 5. Make contracts and incur liabilities.

707.30(5)(a)6. 6. Regulate the use, maintenance, repair, replacement and modification of the time-share property.

707.30(5)(a)7. 7. Cause additional improvements to be made to the time-share property.

707.30(5)(a)8. 8. Impose charges for late payment of assessments and, after notice and an opportunity to be heard, levy reasonable fines for violations of the time-share instrument, bylaws and rules or regulations of the association.

707.30(5)(a)9. 9. Impose reasonable charges for the preparation of resale certificates required by s. 707.48 (2) or statements of unpaid assessments.

707.30(5)(a)10. 10. Exercise any other powers conferred by the time-share instrument or bylaws.

707.30(5)(a)11. 11. Impose and receive any payments, fees or charges for the use, rental or operation of the time-share property and for services provided to time-share owners.

707.30(5)(a)12. 12. Acquire, hold, encumber and convey in its name any right, title or interest in or to real or personal property.

707.30(5)(a)13. 13. Assign its right to future income, including the right to receive assessments for time-share expenses, but only to the extent that the time-share instrument expressly so provides.

707.30(5)(a)14. 14. Provide for the indemnification of its directors and officers and maintain directors’ and officers’ liability insurance.

707.30(5)(a)15. 15. Exercise all other powers that may be exercised in this state by legal entities of the same type as the association.

707.30(5)(a)16. 16. Exercise any other powers necessary and proper for the governance and operation of the association.

707.30(5)(b) (b) Except as otherwise provided in the time-share instrument, the manager, to the extent permitted by the management contract, may exercise the powers specified in par. (a) 1. to 11.

707.30(5)(c) (c)

707.30(5)(c)1. 1. The time-share instrument may not impose limitations on the power of the association to deal with the developer which are more restrictive than the limitations imposed on the power of the association to deal with other persons.

707.30(5)(c)2. 2. If the time-share property is a part of a project, this section may not confer any powers on the managing entity, the developer or the time-share owners with respect to any portion of the project other than the units comprising the time-share property.

707.30(6) (6) Powers and responsibility if no managing entity. If the number of time shares in the time-share property is 12 or fewer and no managing entity is established, the time-share owners shall have all of the following:

707.30(6)(a) (a) The powers in sub. (5) (a) 1. to 11., subject to any restrictions and limitations specified by the time-share instrument. If the time-share instrument is silent with respect to the manner of exercise of any of these powers, the time-share owners may exercise the power only by unanimous action.

707.30(6)(b) (b) The responsibilities and liabilities of an association under ss. 707.33 and 707.34.

707.30(7) (7) Campgrounds excluded. This section does not apply to time-share property in which a campground member owns a time-share easement in a campground.

707.30 History History: 1987 a. 399.

707.31 707.31 Transfer of special developer rights.

707.31(1) (1) Definition. In this section, “special developer right” means a developer’s right to do any of the following:

707.31(1)(a) (a) Add more units to a time-share property under s. 707.21 (1) (f).

707.31(1)(b) (b) Maintain sales offices, management offices, models and signs under s. 707.25.

707.31(1)(c) (c) Appoint, control or serve as the managing entity.

707.31(2) (2) Requirements for transfer. No special developer right may be transferred except by an instrument executed by both the transferor and transferee which evidences the transfer and is recorded in every county in which any portion of the time-share property is located.

707.31(3) (3) Liability of transferor. Upon transfer of a special developer right, the liability of a transferor shall be as follows:

707.31(3)(a) (a) The transferor may not be relieved of any obligation or liability arising before the transfer, and the transferor shall remain liable for warranty obligations imposed upon him or her under s. 707.53. Lack of privity may not deprive a time-share owner of standing to maintain an action to enforce an obligation of the transferor.

707.31(3)(b) (b) If a successor to a special developer right is an affiliate of the developer, the transferor shall be jointly and severally liable with the successor for any obligations or liabilities of the successor relating to the time-share property.

707.31(3)(c) (c) If the transferor retains any special developer right but transfers other special developer rights to a successor who is not an affiliate of the developer, the transferor shall be liable for any obligations or liabilities imposed on a developer either by this chapter or by the time-share instrument relating to the retained special developer rights and arising after the transfer.

707.31(3)(d) (d) A transferor is not liable for any act or omission or any breach of a contractual or warranty obligation arising from the exercise of a special developer right by a successor developer who is not an affiliate of the transferor.

707.31(4) (4) Rights where foreclosure or tax sale.

707.31(4)(a) (a)

707.31(4)(a)1. 1. Unless otherwise provided in a mortgage instrument or deed of trust, in case of foreclosure of a mortgage, tax sale, judicial sale, sale by a trustee under a deed of trust, or sale under bankruptcy or receivership proceedings, of any time shares owned by a developer in the time-share property, a person acquiring title to all of the time shares being foreclosed or sold shall succeed, depending upon his or her request, to one of the following:

707.31(4)(a)1.a. a. All special developer rights.

707.31(4)(a)1.b. b. Any rights reserved in the time-share instrument under s. 707.25 allowing the developer to maintain sales offices, management offices, models and signs.

707.31(4)(a)2. 2. The judgment or instrument conveying title shall provide for transfer of only those special developer rights requested under subd. 1.

707.31(4)(b) (b) Upon foreclosure, tax sale, judicial sale, sale by a trustee under a deed of trust, or sale under bankruptcy or receivership proceedings of all time shares in a time-share property owned by a developer, all of the following shall occur:

707.31(4)(b)1. 1. The right to appoint, control or serve as the managing entity shall terminate unless the judgment or instrument conveying title provides for transfer of all special developer rights to a successor developer.

707.31(4)(b)2. 2. The developer shall cease to have any other special developer rights.

707.31(5) (5) Rights, liabilities and duties of successor.

707.31(5)(a) (a) A successor to any special developer right who is an affiliate of a developer is subject to all obligations and liabilities imposed on the transferor by this chapter or the time-share instrument.

707.31(5)(b) (b)

707.31(5)(b)1. 1. A successor to any special developer right, other than a successor described in par. (c) or (d), who is not an affiliate of a developer, is subject to any of the following obligations and liabilities imposed by this chapter or the time-share instrument:

707.31(5)(b)1.a. a. On a developer, which relate to a developer’s exercise or nonexercise of special developer rights.

707.31(5)(b)1.b. b. On the successor’s transferor, except as provided in subd. 2.

707.31(5)(b)2. 2. A successor described in subd. 1. is not subject to any of the following obligations and liabilities of the successor’s transferor:

707.31(5)(b)2.a. a. Liability for misrepresentations by a previous developer.

707.31(5)(b)2.b. b. Warranty obligations on improvements made by any previous developer or made before the property became a time-share property.

707.31(5)(b)2.c. c. Breach of any fiduciary obligation by any previous developer or any developer’s appointees.

707.31(5)(b)2.d. d. Any liability or obligation imposed on the transferor as a result of the transferor’s acts or omissions after the transfer.

707.31(5)(c) (c) A successor to only the right to maintain sales offices, management offices, models and signs under s. 707.25, if the successor is not an affiliate of a developer, may not exercise any other special developer right and is not subject to any liability or obligation as a developer, except the obligation to provide a time-share disclosure statement and any liability arising as a result of providing the time-share disclosure statement.

707.31(5)(d) (d) If a successor to all special developer rights held by a transferor is not an affiliate of the developer and has succeeded to those rights by deed in lieu of foreclosure, judgment or an instrument conveying title to the time shares under sub. (4), the successor may declare in a recorded instrument the intention to hold those rights solely for transfer to another person. Thereafter, until transferring all special developer rights, that successor may not exercise any of those rights other than any right held by the transferor to appoint, control or serve as the managing entity, and any attempted exercise of those rights is void. During any period in which a successor may not exercise special developer rights under this paragraph, the successor is not subject to any liability or obligation as a developer other than liability for his or her acts and omissions in appointing, controlling or serving as the managing entity.

707.31(6) (6) Preservation of purchaser’s claims and defenses.

707.31(6)(a) (a) Any claim or defense based on any written documentation which a purchaser may raise against the person who sold the time share to the purchaser is preserved against any assignee or successor to any of the following:

707.31(6)(a)1. 1. The contract of sale.

707.31(6)(a)2. 2. Any credit contract in connection with the sale of the time share which is executed by the purchaser and which may be retained by or assigned to the developer, an affiliate of the developer or a creditor having a contractual relationship with the developer.

707.31(6)(b) (b) Any recovery by a purchaser under par. (a) may not exceed the amounts paid by the purchaser under the contract.

707.31(6)(c) (c) Sellers and creditors shall include the following language in promissory notes executed in connection with the sale of time shares:

NOTICE

ANY HOLDER OF THIS CREDIT CONTRACT IS SUBJECT TO ALL CLAIMS AND DEFENSES WHICH THE DEBTOR COULD ASSERT AGAINST THE SELLER OF SERVICES OR PROPERTY OBTAINED PURSUANT TO THE CREDIT CONTRACT OR WITH THE PROCEEDS OF THE CREDIT CONTRACT. RECOVERY UNDER THE CREDIT CONTRACT BY THE DEBTOR MAY NOT EXCEED AMOUNTS PAID BY THE DEBTOR UNDER THE CREDIT CONTRACT.

707.31(7) (7) Extent of obligations. Nothing in this section subjects any successor to a special developer right to any claims against or other obligations of a transferor developer, other than claims and obligations arising under this chapter or any written documentation.

707.31 History History: 1987 a. 399.

707.32 707.32 Termination of contracts and leases of developer.

707.32(1) (1) Definition. In this section, “time-share property” does not include a campground.

707.32(1m) (1m) Authority of the association. The following contracts or leases relating to the time-share property which are entered into before the developer ceases under s. 707.30 (4) (c) to appoint a majority of the board of directors may be terminated without penalty by the association at any time after the developer ceases to appoint a majority of the board of directors, upon not less than 90 days’ notice to the other party to the contract or lease:

707.32(1m)(a) (a) Any management contract, employment contract, or lease of recreational or parking areas or facilities.

707.32(1m)(b) (b) Any contract or lease between the managing entity and a developer or an affiliate of a developer.

707.32(1m)(c) (c) Any contract or lease that is not bona fide or was unconscionable to the time-share owners when entered into under the circumstances then prevailing.

707.32(2) (2) Applicability to leases. This section does not apply to a lease if termination of the lease would terminate the time-share property or reduce its size, unless the real estate subject to the lease was included in the time-share property for the purpose of avoiding the right to terminate a lease under this section.

707.32(3) (3) Action by time-share owner. If no association is established under s. 707.30 (2), any time-share owner, individually or on behalf of the class of time-share owners, may maintain an action under sub. (1m) to terminate a contract or lease of the developer relating to the time-share property.

707.32 History History: 1987 a. 399.

707.33 707.33 Upkeep of units.

707.33(1) (1) Responsibility of managing entity and required access.

707.33(1)(a) (a) Unless otherwise provided in the time-share instrument, the managing entity shall be responsible for maintenance, repair and replacement of the time-share units and any personal property available for use by time-share owners in conjunction with the time-share units, other than personal property separately owned by a time-share owner.

707.33(1)(b) (b) Each time-share owner shall afford access through the time-share unit reasonably necessary for the purposes described in par. (a), but the managing entity shall promptly repair any damage to the time-share unit or personal property in the time-share unit which results from the access required under this paragraph.

707.33(2) (2) Alteration of unit. Subject to the time-share instrument, a time-share owner may not change the appearance of a time-share unit without the consent of the managing entity.

707.33 History History: 1987 a. 399.

707.34 707.34 Tort and contract liability.

707.34(1) (1) Actions against developer and the association.

707.34(1)(a) (a) An action in tort alleging a wrong done by a developer or a manager selected by the developer, or an agent or employee of either, in connection with any portion of the time-share property or other property which the developer or the manager has the responsibility to maintain may not be maintained against the association or any time-share owner other than a developer.

707.34(1)(b) (b) An action in tort alleging a wrong done by an association or by an agent or employee of the association or an action arising from a contract made by or on behalf of the association may be maintained only against the association.