West Virginia Code 36-9-8 – Reservation agreements; escrows
(a) (1) Prior to filing the public offering statement with the division a seller shall not offer a time-sharing plan for sale but may accept reservation deposits upon approval by the division of a fully executed escrow agreement and reservation agreement property filed with the division.
Terms Used In West Virginia Code 36-9-8
- Contract: A legal written agreement that becomes binding when signed.
- Contract: means any agreement conferring the rights and obligations of the time-sharing plan on the purchaser. See West Virginia Code 36-9-4
- Conviction: A judgement of guilt against a criminal defendant.
- Developer: means the person creating a time-sharing plan. See West Virginia Code 36-9-4
- Division: means the division of land sales and condominiums in the office of the State Auditor. See West Virginia Code 36-9-4
- Escrow: Money given to a third party to be held for payment until certain conditions are met.
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- offer: means solicitation of purchasers, the taking of reservations or any other method whereby a purchaser is offered the opportunity to participate in a time- sharing plan. See West Virginia Code 36-9-4
- Purchaser: means any person who is buying or who has bought a time-share period in a time-sharing plan. See West Virginia Code 36-9-4
- Seller: means any developer or any other person, or agent or employee thereof, who is offering time-share periods for sale to the public in the ordinary course of business, except a person who has acquired a time-share period for his own occupancy and later offers it for resale. See West Virginia Code 36-9-4
- State: when applied to a part of the United States and not restricted by the context, includes the District of Columbia and the several territories, and the words "United States" also include the said district and territories. See West Virginia Code 2-2-10
- Time-sharing plan: means any arrangement, plan, scheme or similar device, other than an exchange program, whether by membership, agreement, tenancy in common, sale, lease, deed, rental agreement, license or right-to-use agreement or by any other means, whereby a purchaser, in exchange for a consideration receives a right to use accommodations or facilities, or both, for a specific period of time less than a full year during any given year, but not necessarily for consecutive years, and which extends for a period of more than three years. See West Virginia Code 36-9-4
(2) Reservations shall not be taken on a time-sharing plan unless the seller has an ownership interest or leasehold interest, of a duration at least equal to the duration of the proposed time-sharing plan, in the land upon which the time-sharing plan is to be developed.
(b) Each executed reservation agreement shall be signed by the seller and the escrow agent and shall contain the following:
(1) A statement that the escrow agent will grant a prospective purchaser an immediate, unqualified refund of the reservation deposit upon either the purchaser's or the seller's written request directed to the escrow agent;
(2) A statement that the escrow agent may not otherwise release moneys unless a contract is signed by the purchaser, authorizing the release of the escrowed reservation deposit as a deposit on the purchase price. Such deposit shall then be subject to the requirements of section seven of this article, relating to escrow accounts, surety bonds and nondisturbance instruments;
(3) A statement of the obligation of the developer to file a public offering statement with the division prior to entering into binding contracts;
(4) A statement of the rights of the purchaser to receive the public offering statement required by this chapter;
(5) The name and address of the escrow agent and a statement that the purchaser may obtain a receipt from the escrow agent upon request; and
(6) A statement that the seller assures that the purchase price represented in or pursuant to the reservation agreement will be the price in the contract for the purchase or that the price represented may be exceeded within a stated amount or percentage or a statement that no assurance is given as to the price in the contract for purchase.
(c) (1) The total amount paid for a reservation shall be deposited into a reservation escrow account.
(2) All funds paid in connection with the reservation of a time-share shall be placed in an escrow account established solely for that purpose with an attorney who is a member of the State Bar; a bank having trust powers and located in this state; a savings and loan company located in this state; a trust company located in this state; or a real estate broker registered under chapter forty-seven of this code. In lieu of the foregoing, with the approval of the division, the funds may be deposited into an escrow account required by the jurisdiction in which the sale took place.
(3) The escrow agent may invest the escrowed funds in securities of the United States government, or any agency thereof, or in savings or time deposits in institutions insured by an agency of the United States government. The right to receive the interest generated from any such investments shall be as specified by the reservation agreement.
(4) The escrowed funds shall at all reasonable times be available for withdrawal in full by the escrow agent.
(5) Each escrow agent shall maintain separate books and records for each time-sharing plan and shall maintain such books and records in accordance with good accounting practices.
(d) Any seller who intentionally fails to pay all required funds into the escrow account required by this section is guilty of a felony, and, upon conviction thereof, shall be confined in the penitentiary not less than one nor more than five years.