P.R. Laws tit. 31, § 1255b
If the timeshare plan or vacation club documents permit additions, substitutions, or deletions of accommodations and facilities to or from a timeshare plan or vacation club, then the developer thereof shall, to the extent applicable, include the following explanations and disclosures in the public offering statement required to be furnished to prospective purchasers of timeshares or vacation club rights, pursuant to §§ 1255–1255d of this title:
(a) Additions.—
(1) The developer shall disclose the basis upon which new accommodations and facilities may be added to the timeshare plan or vacation club, including by whom additions may be made and the anticipated effect of the addition of any new accommodations and facilities upon the owners likely ability to obtain confirmed reservations;
(2) the developer shall disclose the existence of any limitation on annual increases in common expense assessments of the timeshare plan or vacation club that would apply in the event that additional accommodations or facilities were made a part thereof or, alternatively, the fact that no such limitation exists, and
(3) the developer shall disclose the extent to which the owners other than the developer would have the right to approve any proposed additions of accommodations or facilities.
(b) Substitutions.—
(1) The provisions of this section apply only to vacation clubs offering non-specific vacation club rights as defined in § 1251b(45) of this title. No right to substitute accommodations or facilities for any existing accommodations or facilities of a vacation club in connection with which specific vacation club rights, as defined in § 1251b(45) of this title, are offered shall exist.
(2) The developer shall disclose the basis upon which new accommodations and facilities may be substituted for existing accommodations and facilities of the vacation club, including by whom such substitutions may be made, the reasons why any such substitutions may occur, and any limitations upon the developer’s right to cause substitutions to occur. The developer shall also disclose the extent to which owners of vacation club rights or accommodations other than the developer would have the right to approve any proposed substitutions of accommodations or facilities.
(3) Substitutions that are otherwise permitted hereunder may only be made to the extent that the one-to-one purchaser to accommodation ratio requirement is satisfied at all times. Accordingly, only protected accommodations may be substituted for other protected accommodations, unless the one-to-one purchaser to accommodation ratio requirement can be satisfied following such substitution, notwithstanding the substitution of an unprotected accommodation for a protected accommodation.
(4) Any substitute accommodations or facilities shall be of comparable term of availability, vacation value, quality and location to the accommodations or facilities for which they are substituted.
(c) Deletions.— The developer shall disclose that deletions may occur only in the following circumstances:
(1) Deletion by casualty.—
(A) The timeshare or vacation club documents shall require that all of a timeshare plan’s or vacation club’s accommodations and facilities shall be insured against all risks of direct physical loss commonly insured against with respect to accommodations and facilities similar in construction, location, use, and occupancy to the subject accommodations and facilities in the total amount, after application of deductibles, of the maximum insurable replacement value thereof, without deduction for depreciation. Replacement value shall be determined periodically by each managing entity. The timeshare or vacation club documents must also provide that in the event of any casualty or other occurrence that results in accommodations or facilities being unavailable for use or occupancy by owners of timeshares, vacation club rights or accommodations, the managing entity shall notify all affected owners of such unavailability within thirty (30) days following the date of such occurrence. The timeshare or vacation club documents may also provide for the procurement and maintenance of business interruption insurance, if available, the proceeds of which would be used to secure substitute accommodations or facilities during any period of repair, reconstruction, or replacement.
(B) The timeshare or vacation club documents shall provide for the application of any insurance proceeds arising from a casualty or other occurrence, to the extent not used to repair or reconstruct the damaged or destroyed accommodation or facility, to either the acquisition of substitute accommodations or facilities that are of comparable value, quality, and location to the damaged or destroyed accommodation or facility or to the removal of owners from the timeshare plan or vacation club so that owners would not be competing for available accommodations on the basis of a greater than one-to-one purchaser to accommodation ratio. The basis upon which owners shall be removed from the timeshare plan or vacation club, together with the procedures necessary to implement such removals, shall be set forth in the timeshare or vacation club documents and fully described in the public offering statement.
The timeshare or vacation club documents shall also describe the powers of the managing entity with respect to the settlement and/r adjustment of claims arising under the insurance policies for the property forming a part of the timeshare regime or vacation club and the powers of such managing entity with respect to the application of the proceeds of such insurance policies.
(C) The developer shall disclose that during a period of repair, reconstruction, or replacement of the timeshare plan’s or vacation club’s damaged or destroyed protected accommodations, or as a result of the unavailability of sufficient hazard insurance proceeds or other financial resources, including but not limited to the proceeds of any business interruption insurance or special assessments levied upon owners and the contents of any applicable reserve accounts, and pending the removal of owners from the timeshare plan or vacation club, pursuant to subsection (c)(i)(B) hereof, the one-to-one purchaser to accommodation ratio requirement may temporarily not be satisfied, and accordingly, owners of timeshares or vacation club rights may experience greater levels of competition for the timeshare plan’s or vacation club’s then-available accommodations.‘
(2) Deletion by eminent domain.—
(A) The timeshare or vacation club documents shall provide for the application of any proceeds arising from a taking or condemnation, pursuant to eminent domain proceedings, to either the replacement of the accommodation or facility so taken with an accommodation or facility of comparable term of availability, vacation value, quality, and location, or to the removal of owners from the timeshare plan or vacation club so that owners would not be competing for available accommodations on the basis of a greater than one-to-one purchaser to accommodation ratio.
(B) The developer shall disclose that during any such period of replacement of a timeshare’s plan or vacation club’s accommodations which have been deleted by eminent domain, or as a result of the unavailability of sufficient condemnation proceeds or other financial resources, including but not limited to the proceeds of any business interruption insurance or special assessments levied upon owners and the contents of any applicable reserve accounts, and pending the removal of owners from the timeshare plan or vacation club, pursuant to subsection (c)(ii)(A) of this section, the one-to-one purchaser to accommodation ratio requirement may temporarily not be satisfied, and accordingly, owners of timeshares or vacation club rights may experience greater levels of competition for the timeshare’s plan or vacation club’s then-available accommodations.
(3) Automatic deletion.— The vacation club documents may provide that a particular component site or one or more accommodations thereat will automatically be deleted from the vacation club at a certain time or under certain circumstances; Provided, however, That such vacation club documents further provide for the removal of owners from the vacation club so that the remaining owners would not be competing for available accommodations on the basis of a greater than one-to-one purchaser to accommodation ratio.
History —Dec. 26, 1995, No. 252, § 5-103; July 5, 1996, No. 66, § 8; Jan. 5, 1999, No. 3, § 30.