CS/HB 405

1	A bill to be entitled
2	An act relating to vacation and timeshare plans; amending
3	s. 721.03, F.S.; revising the formula for funding reserve
4	accounts for conversions; authorizing a seller to offer
5	timeshare interests in a timeshare plan located outside of
6	this state without filing a public offering statement for
7	such out-of-state timeshare plan; providing criteria for
8	such offers; requiring certain notice; providing for a
9	fee; conforming cross-references and terminology; amending
10	s. 721.05, F.S.; revising the definition of the term "one-
11	to-one purchaser to accommodation ratio"; providing
12	definitions for the terms "lead dealer," "personal contact
13	information," and "resale service provider"; amending s.
14	721.07, F.S.; revising information required to be
15	contained in filed public offering statements for certain
16	timeshare plans; authorizing the Division of Florida Land
17	Sales, Condominiums, and Mobile Homes to accept alternate
18	forms of timeshare disclosure statements; conforming
19	cross-references; amending s. 721.075, F.S.; conforming
20	terminology; amending s. 721.11, F.S.; revising provisions
21	relating to advertising and oral statements to include
22	those made by resale service providers; providing that a
23	seller or resale service provider may not misrepresent or
24	falsely imply that the resale service provider is
25	affiliated with, or obtained personal contact information
26	from, a developer, managing entity, or exchange company;
27	creating s. 721.121, F.S.; providing recordkeeping
28	requirements for resale service providers and lead
29	dealers; providing that the failure to produce such
30	records in any civil or criminal action relating to the
31	wrongful possession or wrongful use of personal contact
32	information shall lead to a presumption that the personal
33	contact information was wrongfully obtained; providing
34	what constitutes wrongful use of such personal contact
35	information; providing for recovery of certain damages and
36	attorney's fees and costs; amending s. 721.13, F.S.;
37	providing that failure to obtain and maintain required
38	insurance coverage constitutes a breach of the managing
39	entity's fiduciary duty; authorizing funding of reserve
40	accounts to be waived or reduced; providing the managing
41	entity with certain rights and powers; providing language
42	to be included in public offering statements; providing
43	recordkeeping requirements; requiring the managing entity
44	to make certain records available to the division under
45	certain circumstances; conforming cross-references;
46	amending s. 721.15, F.S.; providing that amounts expended
47	for any insurance coverage required by law or by the
48	timeshare instrument to be maintained by the owners'
49	association shall be exempt from assessment of common
50	expenses; providing that any determination by a timeshare
51	association of whether assessments exceed 115 percent of
52	assessments for the prior fiscal year shall exclude
53	anticipated expenses for required insurance coverage;
54	amending s. 721.165, F.S.; revising provisions relating to
55	insurance; requiring managing entities to use due
56	diligence to obtain certain types of insurance; providing
57	factors that a managing entity must take into account in
58	determining whether the insurance obtained is adequate;
59	providing that insurance coverage may be subject to
60	certain requirements; authorizing the managing entity to
61	apply any existing reserves for certain purposes; amending
62	s. 721.52, F.S.; providing application with respect to use
63	of the term "vacation club"; amending ss. 721.55 and
64	721.552, F.S.; conforming cross-references and
65	terminology; amending s. 721.97, F.S.; authorizing the
66	Governor to appoint commissioners of deeds to take
67	acknowledgments, proofs of execution, or oaths in
68	international waters; providing an effective date.
69
70	Be It Enacted by the Legislature of the State of Florida:
71
72	Section 1.  Paragraph (b) of subsection (1), paragraph (e)
73	of subsection (3), and subsection (10) of section 721.03,
74	Florida Statutes, are amended, and subsection (11) is added to
75	that section, to read:
76	721.03  Scope of chapter.--
77	(1)  This chapter applies to all timeshare plans consisting
78	of more than seven timeshare periods over a period of at least 3
79	years in which the accommodations and facilities, if any, are
80	located within this state or offered within this state; provided
81	that:
82	(b)  With respect to a timeshare plan containing
83	accommodations or facilities located in this state which is
84	offered for sale outside the jurisdictional limits of the United
85	States, such offer or sale shall be exempt from the requirements
86	of this chapter, provided that the developer shall either file
87	the timeshare plan with the division for approval pursuant to
88	this chapter, or pay an exemption registration fee of $100 and
89	file the following minimum information pertaining to the
90	timeshare plan with the division for approval:
91	1.  The name and address of the timeshare plan.
92	2.  The name and address of the developer and seller, if
93	any.
94	3.  The location and a brief description of the
95	accommodations and facilities, if any, that are located in this
96	state.
97	4.  The number of timeshare interests and timeshare periods
98	to be offered.
99	5.  The term of the timeshare plan.
100	6.  A copy of the timeshare instrument relating to the
101	management and operation of accommodations and facilities, if
102	any, that are located in this state.
103	7.  A copy of the budget required by s. 721.07(5)(t)(u) or
104	s. 721.55(4)(h)5., as applicable.
105	8.  A copy of the management agreement and any other
106	contracts regarding management or operation of the
107	accommodations and facilities, if any, that are located in this
108	state, and which have terms in excess of 1 year.
109	9.  A copy of the provision of the purchase contract to be
110	utilized in offering the timeshare plan containing the following
111	disclosure in conspicuous type immediately above the space
112	provided for the purchaser's signature:
113
114	The offering of this timeshare plan outside the jurisdictional
115	limits of the United States of America is exempt from regulation
116	under Florida law, and any such purchase is not protected by the
117	State of Florida. However, the management and operation of any
118	accommodations or facilities located in Florida is subject to
119	Florida law and may give rise to enforcement action regardless
120	of the location of any offer.
121	(3)  A timeshare plan which is subject to the provisions of
122	chapter 718 or chapter 719, if fully in compliance with the
123	provisions of this chapter, is exempt from the following:
124	(e)  Part VI of chapter 718 and part VI of chapter 719,
125	relating to conversion of existing improvements to the
126	condominium or cooperative form of ownership, respectively,
127	provided that a developer converting existing improvements to a
128	timeshare condominium or timeshare cooperative must comply with
129	ss. 718.606, 718.608, 718.61, and 718.62, or ss. 719.606,
130	719.608, 719.61, and 719.62, if applicable, and, if the existing
131	improvements received a certificate of occupancy more than 18
132	months before such conversion, one of the following:
133	1.  The accommodations and facilities shall be renovated
134	and improved to a condition such that the remaining useful life
135	in years of the roof, plumbing, air-conditioning, and any
136	component of the structure which has a useful life less than the
137	useful life of the overall structure is equal to the useful life
138	of accommodations or facilities that would exist if such
139	accommodations and facilities were newly constructed and not
140	previously occupied.
141	2.  The developer shall fund reserve accounts for capital
142	expenditures and deferred maintenance for the roof, plumbing,
143	air-conditioning, and any component of the structure the useful
144	life of which is less than the useful life of the overall
145	structure. The reserve accounts shall be funded for each
146	component in an amount equal to the product of the estimated
147	current replacement cost of such component as of the date of
148	such conversion (as disclosed and substantiated by a certificate
149	under the seal of an architect or engineer authorized to
150	practice in this state) multiplied by a fraction, the numerator
151	of which shall be the age remaining life of the component in
152	years (as disclosed and substantiated by a certificate under the
153	seal of an architect or engineer authorized to practice in this
154	state) and the denominator of which shall be the total useful
155	life of the component in years (as disclosed and substantiated
156	by a certificate under the seal of an architect or engineer
157	authorized to practice in this state). Alternatively, the
158	reserve accounts may be funded for each component in an amount
159	equal to the amount that, except for the application of this
160	subsection, would be required to be maintained pursuant to s.
161	718.618(1) or s. 719.618(1). The developer shall fund the
162	reserve accounts contemplated in this subparagraph out of the
163	proceeds of each sale of a timeshare interest, on a pro rata
164	basis, in an amount not less than a percentage of the total
165	amount to be deposited in the reserve account equal to the
166	percentage of ownership allocable to the timeshare interest
167	sold. When an owners' association makes an expenditure of
168	reserve account funds before the developer has initially sold
169	all timeshare interests, the developer shall make a deposit in
170	the reserve account if the reserve account is insufficient to
171	pay the expenditure. Such deposit shall be at least equal to
172	that portion of the expenditure which would be charged against
173	the reserve account deposit that would have been made for any
174	such timeshare interest had the timeshare interest been
175	initially sold. When a developer deposits amounts in excess of
176	the minimum reserve account funding, later deposits may be
177	reduced to the extent of the excess funding.
178	3.  The developer shall provide each purchaser with a
179	warranty of fitness and merchantability pursuant to s.
180	718.618(6) or s. 719.618(6).
181	(10)  A developer or seller may not offer any number of
182	timeshare interests that would cause the total number of
183	timeshare interests offered to exceed a one-to-one use right
184	purchaser to use night requirement accommodation ratio.
185	(11)(a)  A seller may offer timeshare interests in a real
186	property timeshare plan located outside of this state without
187	filing a public offering statement for such out-of-state real
188	property timeshare plan pursuant to s. 721.07 or s. 721.55,
189	provided all of the following criteria have been satisfied:
190	1.  The seller shall provide a disclosure statement to each
191	prospective purchaser of such out-of-state timeshare plan. The
192	disclosure statement for a single-site timeshare plan shall
193	contain information otherwise required under s. 721.07(5)(e)-
194	(cc) and the exhibits required by s. 721.07(5)(ff)1., 2., 3.,
195	4., 5., 7., 8., and 20. The disclosure statement for a multisite
196	timeshare plan shall contain information otherwise required
197	under s. 721.55(4) and (5) and the exhibits required under s.
198	721.55(7). If a developer has, in good faith, attempted to
199	comply with the requirements of this subsection and if the
200	developer has substantially complied with the disclosure
201	requirements of this subsection, nonmaterial errors or omissions
202	shall not be actionable. With respect to any offer for an out-
203	of-state timeshare plan made pursuant to this subsection, the
204	delivery by the seller to a prospective purchaser of the
205	disclosure statement required by this subparagraph shall be
206	deemed to satisfy any requirement of this chapter regarding a
207	public offering statement.
208	2.  The seller shall utilize and furnish to each purchaser
209	of an out-of-state timeshare plan offered under this subsection
210	a fully completed and executed copy of a purchase contract that
211	contains the statement set forth in s. 721.065(2)(c) in
212	conspicuous type located immediately prior to the space in the
213	contract reserved for the purchaser's signature. The purchase
214	contract shall also contain the initial purchase price and any
215	additional charges to which the purchaser may be subject in
216	connection with the purchase of the timeshare plan, such as
217	financing, or that will be collected from the purchaser on or
218	before closing, such as the current year's annual assessment for
219	common expenses.
220	3.  All purchase contracts for out-of-state timeshare plans
221	offered under this subsection must also contain the following
222	statements in conspicuous type:
223
224	This timeshare plan has not been reviewed or approved by
225	the State of Florida.
226
227	The timeshare interest you are purchasing requires certain
228	procedures to be followed in order for you to use your
229	interest. These procedures may be different from those
230	followed in other timeshare plans. You should read and
231	understand these procedures prior to purchasing.
232
233	4.a.  An out-of-state timeshare plan may only be offered
234	pursuant to this subsection by the seller on behalf of:
235	(I)  The developer of a timeshare plan that has been
236	approved by the division within the preceding 7 years pursuant
237	to s. 721.07 or s. 721.55, or concerning which an amendment by
238	the developer has been approved by the division within the
239	preceding 7 years, which timeshare plan has been neither
240	terminated nor withdrawn; or
241	(II)  A developer under common ownership or control with a
242	developer described in sub-sub-subparagraph (I), provided that
243	any common ownership shall constitute at least a 50-percent
244	ownership interest.
245	b.  An out-of-state timeshare plan may only be offered
246	pursuant to this subsection to a person who already owns a
247	timeshare interest in a timeshare plan filed by a developer
248	described in sub-subparagraph a.
249	5.  Any seller of an out-of-state timeshare plan offered
250	pursuant to this subsection shall be required to provide notice
251	of such plan to the division on a form prescribed by the
252	division, along with payment of a one-time fee not to exceed
253	$1,000 per filing.
254	(b)  Timeshare plans offered pursuant to this subsection
255	shall be exempt from the requirements of ss. 721.06, 721.065,
256	721.07, 721.27, 721.55, and 721.58 in addition to the exemptions
257	otherwise applicable to accommodations and facilities located
258	outside of the state pursuant to subparagraph (1)(c)1.
259	(c)  Any escrow account required to be established by s.
260	721.08 for any out-of-state timeshare plan offered under this
261	subsection may be maintained in the situs jurisdiction provided
262	the escrow agent submits to personal jurisdiction in this state
263	in a form satisfactory to the division.
264	Section 2.  Subsection (25) of section 721.05, Florida
265	Statutes, is amended, and subsections (42), (43), and (44) are
266	added to that section, to read:
267	721.05  Definitions.--As used in this chapter, the term:
268	(25)  "One-to-one use right purchaser to use night
269	requirement accommodation ratio" means that the sum of the
270	nights that owners are entitled to use in a given 12-month
271	period shall not exceed the number of nights available for use
272	by those owners during the same 12-month period. No individual
273	timeshare unit may be counted as providing more than 365 use
274	nights per 12-month period or more than 366 use nights per 12-
275	month period that includes February 29. The use rights of each
276	owner shall be counted without regard to whether the owner's use
277	rights have been suspended for failure to pay assessments or
278	otherwise the ratio of the number of purchasers eligible to use
279	the accommodations of a timeshare plan on a given day to the
280	number of accommodations available for use within the plan on
281	that day, such that the total number of purchasers eligible to
282	use the accommodations of the timeshare plan during a given
283	calendar year never exceeds the total number of accommodations
284	available for use in the timeshare plan during that year. For
285	purposes of calculation under this subsection, each purchaser
286	must be counted at least once, and no individual timeshare unit
287	may be counted more than 365 times per calendar year (or more
288	than 366 times per leap year). A purchaser who is delinquent in
289	the payment of timeshare plan assessments shall continue to be
290	considered eligible to use the accommodations of the timeshare
291	plan for purposes of this subsection notwithstanding any
292	application of s. 721.13(6).
293	(42)  "Lead dealer" means any person who sells or otherwise
294	provides a resale service provider or any other person with
295	personal contact information for five or more owners of
296	timeshare interests. In the event a lead dealer is not a natural
297	person, the term shall also include the natural person providing
298	personal contact information to a resale service provider or
299	other person on behalf of the lead dealer entity. The term does
300	not include developers, managing entities, or exchange companies
301	to the extent they provide others with personal contact
302	information about owners of timeshare interests in their own
303	timeshare plans or members of their own exchange programs. The
304	term does not include persons providing personal contact
305	information that is not designed specifically or primarily to
306	identify owners of timeshare interests even though the
307	information provided may include five or more owners of
308	timeshare interests.
309	(43)  "Personal contact information" means any information
310	that can be used to contact the owner of a specific timeshare
311	interest, including, but not limited to, the owner's name,
312	address, telephone number, and e-mail address.
313	(44)  "Resale service provider" means any person who uses
314	unsolicited telemarketing, direct mail, or e-mail in connection
315	with the offering of resale brokerage or resale advertising
316	services to owners of timeshare interests. The term does not
317	include developers, managing entities, or exchange companies to
318	the extent they offer resale brokerage or resale advertising
319	services to owners of timeshare interests in their own timeshare
320	plans or members of their own exchange programs.
321	Section 3.  Paragraphs (n) through (v) of subsection (5) of
322	section 721.07, Florida Statutes, are redesignated as paragraphs
323	(m) through (u), present paragraphs (m), (v), and (ff) of that
324	subsection are amended, and subsection (7) is added to that
325	section, to read:
326	721.07  Public offering statement.--Prior to offering any
327	timeshare plan, the developer must submit a filed public
328	offering statement to the division for approval as prescribed by
329	s. 721.03, s. 721.55, or this section. Until the division
330	approves such filing, any contract regarding the sale of that
331	timeshare plan is subject to cancellation by the purchaser
332	pursuant to s. 721.10.
333	(5)  Every filed public offering statement for a timeshare
334	plan which is not a multisite timeshare plan shall contain the
335	information required by this subsection. The division is
336	authorized to provide by rule the method by which a developer
337	must provide such information to the division.
338	(m)  A description of any financing to be offered to
339	purchasers by the developer or any person or entity in which the
340	developer has a financial interest, together with a disclosure
341	that the description of such financing may be changed by the
342	developer and that any change in the financing offered to
343	prospective purchasers will not be deemed to be a material
344	change.
345	(u)(v)  For any timeshare plan for which the purchase or
346	closing of timeshare interests is not subject to the
347	requirements of the Real Estate Settlement Procedures Act, 12
348	U.S.C. s. 2601 et seq., a schedule of estimated closing expenses
349	to be paid by a purchaser or lessee of a timeshare interest.
350	(v)  and A statement as to whether a title opinion or title
351	insurance policy is available to the purchaser and, if so, at
352	whose expense.
353	(ff)  Copies of the following documents and plans, to the
354	extent they are applicable, shall be included as exhibits to the
355	filed public offering statement provided, if the timeshare plan
356	has not been declared or created at the time of the filing, the
357	developer shall provide proposed documents:
358	1.  The declaration of condominium.
359	2.  The cooperative documents.
360	3.  The declaration of covenants and restrictions.
361	4.  The articles of incorporation creating the owners'
362	association.
363	5.  The bylaws of the owners' association.
364	6.  Any ground lease or other underlying lease of the real
365	property associated with the timeshare plan. In the case of a
366	personal property timeshare plan, any lease of the personal
367	property associated with the personal property timeshare plan.
368	7.  The management agreement and all maintenance and other
369	contracts regarding the management and operation of the
370	timeshare property which have terms in excess of 1 year.
371	8.  The estimated operating budget for the timeshare plan
372	and the required schedule of purchasers' expenses.
373	9.  The floor plan of each type of accommodation and the
374	plot plan showing the location of all accommodations and
375	facilities declared as part of the timeshare plan and filed with
376	the division.
377	10.  The lease for any facilities.
378	11.  A declaration of servitude of properties serving the
379	accommodations and facilities, but not owned by purchasers or
380	leased to them or the owners' association.
381	12.  Any documents required by s. 721.03(3)(e) as the
382	result of the inclusion of a timeshare plan in the conversion of
383	the building to condominium or cooperative ownership.
384	13.  The form of agreement for sale or lease of timeshare
385	interests.
386	14.  The executed agreement for escrow of payments made to
387	the developer prior to closing and the form of any agreement for
388	escrow of ad valorem tax escrow payments, if any, to be made
389	into an ad valorem tax escrow account pursuant to s. 192.037(6).
390	15.  The documents containing any restrictions on use of
391	the property required by paragraph (r) (s).
392	16.  A letter from the escrow agent or filing attorney
393	confirming that the escrow agent and its officers, directors, or
394	other partners are independent pursuant to the requirements of
395	this chapter.
396	17.  Any nondisturbance and notice to creditors instrument
397	required by s. 721.08.
398	18.  In the case of any personal property timeshare plan in
399	which the accommodations and facilities are located on or in a
400	documented vessel or foreign vessel as provided in s.
401	721.08(2)(c)3.e., a copy of the certificate of ownership of such
402	vessel and either a copy of the certificate of documentation or
403	certificate of registry of such vessel.
404	19.  An executed affidavit given under oath by an attorney
405	licensed to practice law in any jurisdiction in the United
406	States stating that the attorney has researched the applicable
407	laws of the jurisdiction in which governing law has been
408	established and the laws of the jurisdiction in which the vessel
409	is registered, and has found that the timeshare instrument
410	complies with the provisions of s. 721.08(2)(c)3.e.(II)(C) and
411	(III).
412	20.  Any other documents or instruments creating the
413	timeshare plan.
414	(7)  The division may accept an alternate form of timeshare
415	disclosure statement under an agreement with another state. At a
416	minimum, the alternate form of timeshare disclosure statement
417	must have provisions substantially similar to this section. The
418	division may adopt rules pursuant to ss. 120.536(1) and 120.54
419	to implement this subsection.
420	Section 4.  Paragraph (d) of subsection (1) of section
421	721.075, Florida Statutes, is amended to read:
422	721.075  Incidental benefits.--Incidental benefits shall be
423	offered only as provided in this section.
424	(1)  Accommodations, facilities, products, services,
425	discounts, or other benefits which satisfy the requirements of
426	this subsection shall be subject to the provisions of this
427	section and exempt from the other provisions of this chapter
428	which would otherwise apply to such accommodations or facilities
429	if and only if:
430	(d)  The continued availability to purchasers of timeshare
431	plan accommodations on no greater than a one-to-one use right
432	purchaser to use night requirement accommodation ratio is not
433	dependent upon continued availability of the incidental benefit.
434	Section 5.  Subsection (4) of section 721.11, Florida
435	Statutes, is amended to read:
436	721.11  Advertising materials; oral statements.--
437	(4)  No advertising or oral statement made by any seller or
438	resale service provider shall:
439	(a)  Misrepresent a fact or create a false or misleading
440	impression regarding the timeshare plan or promotion thereof.
441	(b)  Make a prediction of specific or immediate increases
442	in the price or value of timeshare interests.
443	(c)  Contain a statement concerning future price increases
444	by a seller which are nonspecific or not bona fide.
445	(d)  Contain any asterisk or other reference symbol as a
446	means of contradicting or substantially changing any previously
447	made statement or as a means of obscuring a material fact.
448	(e)  Describe any facility that is not required to be built
449	or that is uncompleted unless the improvement is conspicuously
450	labeled as "NEED NOT BE BUILT," "PROPOSED," or "UNDER
451	CONSTRUCTION." If the facility is labeled "NEED NOT BE BUILT" or
452	"PROPOSED," the seller may indicate the estimated date that such
453	facility will be made part of the timeshare plan. If the
454	facility is labeled "UNDER CONSTRUCTION," the estimated date of
455	completion must be included.
456	(f)  Misrepresent the size, nature, extent, qualities, or
457	characteristics of the offered accommodations or facilities.
458	(g)  Misrepresent the amount or period of time during which
459	the accommodations or facilities will be available to any
460	purchaser.
461	(h)  Misrepresent the nature or extent of any incidental
462	benefit.
463	(i)  Make any misleading or deceptive representation with
464	respect to the contents of the public offering statement and the
465	contract or the rights, privileges, benefits, or obligations of
466	the purchaser under the contract or this chapter.
467	(j)  Misrepresent the conditions under which a purchaser
468	may exchange the right to use accommodations or facilities in
469	one location for the right to use accommodations or facilities
470	in another location.
471	(k)  Misrepresent the availability of a resale or rental
472	program or resale or rental opportunity offered by or on behalf
473	of the developer.
474	(l)  Contain an offer or inducement to purchase which
475	purports to be limited as to quantity or restricted as to time
476	unless the numerical quantity or time limit applicable to the
477	offer or inducement is clearly stated.
478	(m)  Imply that a facility is available for the exclusive
479	use of purchasers if the facility will actually be shared by
480	others or by the general public.
481	(n)  Purport to have resulted from a referral unless the
482	name of the person making the referral can be produced upon
483	demand of the division.
484	(o)  Misrepresent the source of the advertising or
485	statement by leading a prospective purchaser to believe that the
486	advertising material is mailed by a governmental or official
487	agency, credit bureau, bank, or attorney, if that is not the
488	case.
489	(p)  Misrepresent the value of any prize, gift, or other
490	item to be awarded in connection with any prize and gift
491	promotional offer, as described in s. 721.111, or any incidental
492	benefit.
493	(q)  Misrepresent or falsely imply that the resale service
494	provider is affiliated with, or obtained personal contact
495	information from, a developer, managing entity, or exchange
496	company.
497	Section 6.  Section 721.121, Florida Statutes, is created
498	to read:
499	721.121  Recordkeeping by resale service providers and lead
500	dealers.--
501	(1)  Resale service providers and lead dealers shall
502	maintain the following records for a period of 5 years from the
503	date each piece of personal contact information is obtained:
504	(a)  The name, home address, work address, home telephone
505	number, work telephone number, and cellular telephone number of
506	the lead dealer from which the personal contact information was
507	obtained.
508	(b)  A copy of a current government-issued photographic
509	identification for the lead dealer from which the personal
510	contact information was obtained, such as a driver's license,
511	passport, or military identification card.
512	(c)  The date, time, and place of the transaction at which
513	the personal contact information was obtained, along with the
514	amount of consideration paid and a signed receipt from the lead
515	dealer or copy of a canceled check.
516	(d)  A copy of all pieces of personal contact information
517	obtained in the exact form and media in which they were
518	received.
519	(e)  If personal contact information was directly
520	researched and assembled by the resale service provider or lead
521	dealer and not obtained from another lead dealer, a complete
522	written description of the sources from which personal contact
523	information was obtained, the methodologies used for researching
524	and assembling it, the items set forth in paragraphs (a) and (b)
525	for the individuals who performed the work, and the date such
526	work was done.
527	(2)  In any civil or criminal action relating to the
528	wrongful possession or wrongful use of personal contact
529	information by a resale service provider or lead dealer, any
530	failure by a resale service provider or lead dealer to produce
531	the records required by subsection (1) shall lead to a
532	presumption that the personal contact information was wrongfully
533	obtained.
534	(3)  Any use by a resale service provider or lead dealer of
535	personal contact information that is wrongfully obtained
536	pursuant to this section shall be considered wrongful use of
537	such personal contact information by the resale service provider
538	or lead dealer, as applicable. Any party who establishes that a
539	resale service provider or lead dealer wrongfully obtained or
540	wrongfully used personal contact information with respect to
541	owners of a timeshare plan or members of an exchange program
542	shall, in addition to any other remedies that may be available
543	in law or equity, be entitled to recover from such resale
544	service provider or lead dealer an amount equal to $1,000 for
545	each owner about whom personal contact information was
546	wrongfully obtained or used. Upon prevailing, the plaintiff in
547	any such action shall also be entitled to recover reasonable
548	attorney's fees and costs.
549	Section 7.  Paragraph (c) is added to subsection (2) of
550	section 721.13, Florida Statutes, paragraph (c) of subsection
551	(3) of that section is amended, and subsection (12) is added to
552	that section, to read:
553	721.13  Management.--
554	(2)
555	(c)  Failure by a managing entity to obtain and maintain
556	insurance coverage as required under s. 721.165 during any
557	period of developer control of the managing entity shall
558	constitute a breach of the managing entity's fiduciary duty.
559	(3)  The duties of the managing entity include, but are not
560	limited to:
561	(c)1.  Providing each year to all purchasers an itemized
562	annual budget which shall include all estimated revenues and
563	expenses. The budget shall be in the form required by s.
564	721.07(5)(t)(u). The budget shall be the final budget adopted by
565	the managing entity for the current fiscal year. The final
566	adopted budget is not required to be delivered if the managing
567	entity has previously delivered a proposed annual budget for the
568	current fiscal year to purchasers in accordance with chapter 718
569	or chapter 719 and the managing entity includes a description of
570	any changes in the adopted budget with the assessment notice and
571	a disclosure regarding the purchasers' right to receive a copy
572	of the adopted budget, if desired. The budget shall contain, as
573	a footnote or otherwise, any related party transaction
574	disclosures or notes which appear in the audited financial
575	statements of the managing entity for the previous budget year
576	as required by paragraph (e). A copy of the final budget shall
577	be filed with the division for review within 30 days after the
578	beginning of each fiscal year together with a statement of the
579	number of periods of 7-day annual use availability that exist
580	within the timeshare plan, including those periods filed for
581	sale by the developer but not yet committed to the timeshare
582	plan, for which annual fees are required to be paid to the
583	division under s. 721.27.
584	2.  Notwithstanding anything contained in chapter 718 or
585	chapter 719 to the contrary, the board of administration of an
586	owners' association which serves as the managing entity may from
587	time to time reallocate reserves for deferred maintenance and
588	capital expenditures required by s. 721.07(5)(t)(u)3.a.(XI) from
589	any deferred maintenance or capital expenditure reserve account
590	to any other deferred maintenance or capital expenditure reserve
591	account or accounts in its discretion without the consent of
592	purchasers of the timeshare plan. Funds in any deferred
593	maintenance or capital expenditure reserve account may not be
594	transferred to any operating account without the consent of a
595	majority of the purchasers of the timeshare plan. The managing
596	entity may from time to time transfer excess funds in any
597	operating account to any deferred maintenance or capital
598	expenditure reserve account without the vote or approval of
599	purchasers of the timeshare plan. In the event any amount of
600	reserves for accommodations and facilities of a timeshare plan
601	containing timeshare licenses or personal property timeshare
602	interests exists at the end of the term of the timeshare plan,
603	such reserves shall be refunded to purchasers on a pro rata
604	basis.
605	3.  With respect to any timeshare plan that has a managing
606	entity that is an owners' association, reserves may be waived or
607	reduced by a majority vote of those voting interests that are
608	present, in person or by proxy, at a duly called meeting of the
609	owners' association. If a meeting of the purchasers has been
610	called to determine whether to waive or reduce the funding of
611	reserves and no such result is achieved or a quorum is not
612	attained, the reserves as included in the budget shall go into
613	effect.
614	(12)(a)  In addition to any other rights granted by the
615	rules and regulations of the timeshare plan, the managing entity
616	of a timeshare plan is authorized to manage the reservation and
617	use of accommodations using those processes, analyses,
618	procedures, and methods that are in the best interests of the
619	owners as a whole to efficiently manage the timeshare plan and
620	encourage the maximum use and enjoyment of the accommodations
621	and other benefits made available through the timeshare plan.
622	The managing entity shall have the right to forecast anticipated
623	reservation and use of the accommodations, including the right
624	to take into account current and previous reservation and use of
625	the accommodations, information about events that are scheduled
626	to occur, seasonal use patterns, and other pertinent factors
627	that affect the reservation or use of the accommodations. In
628	furtherance of the provisions of this subsection, the managing
629	entity is authorized to reserve accommodations, in the best
630	interests of the owners as a whole, for the purposes of
631	depositing such reserved use with an affiliated exchange program
632	or renting such reserved accommodations in order to facilitate
633	the use or future use of the accommodations or other benefits
634	made available through the timeshare plan.
635	(b)  A statement in conspicuous type, in substantially the
636	following form, shall appear in the public offering statement as
637	provided in s. 721.07:
638
639	The managing entity shall have the right to forecast
640	anticipated reservation and use of the accommodations of
641	the timeshare plan and is authorized to reasonably reserve,
642	deposit, or rent the accommodations for the purpose of
643	facilitating the use or future use of the accommodations or
644	other benefits made available through the timeshare plan.
645
646	(c)  The managing entity shall maintain copies of all
647	records, data, and information supporting the processes,
648	analyses, procedures, and methods utilized by the managing
649	entity in its determination to reserve accommodations of the
650	timeshare plan pursuant to this subsection for a period of 5
651	years from the date of such determination. In the event of an
652	investigation by the division for failure of a managing entity
653	to comply with this subsection, the managing entity shall make
654	all such records, data, and information available to the
655	division for inspection, provided that if the managing entity
656	complies with the provisions of s. 721.071, any such records,
657	data, and information provided to the division shall constitute
658	a trade secret pursuant to that section.
659	Section 8.  Paragraph (c) of subsection (2) of section
660	721.15, Florida Statutes, is amended, and subsection (11) is
661	added to that section, to read:
662	721.15  Assessments for common expenses.--
663	(2)
664	(c)  For the purpose of calculating the obligation of a
665	developer under a guarantee pursuant to paragraph (b), amounts
666	expended for any insurance coverage required by law or by the
667	timeshare instrument to be maintained by the owners' association
668	and depreciation expenses related to real property shall be
669	excluded from common expenses incurred during the guarantee
670	period, except that for real property that is used for the
671	production of fees, revenues, or other income, depreciation
672	expenses shall be excluded only to the extent that they exceed
673	the net income from the production of such fees, revenues, or
674	other income. Any special assessment imposed for amounts
675	excluded from the developer guarantee pursuant to this paragraph
676	shall be paid proportionately by all owners of timeshare
677	interests, including the developer with respect to the timeshare
678	interests owned by the developer, in accordance with the
679	timeshare instrument.
680	(11)  Notwithstanding any provision of chapter 718 or
681	chapter 719 to the contrary, any determination by a timeshare
682	association of whether assessments exceed 115 percent of
683	assessments for the prior fiscal year shall exclude anticipated
684	expenses for insurance coverage required by law or by the
685	timeshare instrument to be maintained by the association.
686	Section 9.  Section 721.165, Florida Statutes, is amended
687	to read:
688	721.165  Insurance.--
689	(1)  Notwithstanding any provision contained in the
690	timeshare instrument or in this chapter, chapter 718, or chapter
691	719 to the contrary, the seller, initially, and thereafter the
692	managing entity, shall use due diligence to obtain adequate
693	casualty be responsible for obtaining insurance as a common
694	expense of the timeshare plan to protect the timeshare property
695	against all reasonably foreseeable perils, in such covered
696	amounts and subject to such reasonable exclusions and reasonable
697	deductibles as are consistent with the provisions of this
698	section accommodations and facilities of the timeshare plan in
699	an amount equal to the replacement cost of such accommodations
700	and facilities. Failure to obtain and maintain the insurance
701	required by this subsection during any period of developer
702	control of the managing entity shall constitute a breach of s.
703	721.13(2)(a) by the managing entity, unless the managing entity
704	can show that, despite such failure, it exercised due diligence
705	to obtain and maintain the insurance required by this
706	subsection.
707	(2)  In making the determination as to whether the
708	insurance obtained pursuant to subsection (1) is adequate, the
709	managing entity shall take into account the following factors,
710	among others as may be applicable:
711	(a)  Available insurance coverages and related premiums in
712	the marketplace.
713	(b)  Amounts of any related deductibles, types of
714	exclusions, and coverage limitations; provided that, for
715	purposes of this paragraph, a deductible of 5 percent or less
716	shall be deemed to be reasonable per se.
717	(c)  The probable maximum loss relating to the insured
718	timeshare property during the policy term.
719	(d)  The extent to which a given peril is insurable under
720	commercially reasonable terms.
721	(e)  Amounts of any deferred maintenance or replacement
722	reserves on hand.
723	(f)  Geography and any special risks associated with the
724	location of the timeshare property.
725	(g)  The age and type of construction of the timeshare
726	property.
727	(3)  Notwithstanding any provision contained in this
728	section or in the timeshare instrument to the contrary,
729	insurance shall be procured and maintained by the managing
730	entity for the timeshare property as a common expense of the
731	timeshare plan against such perils, in such coverages, and
732	subject to such reasonable deductions or reasonable exclusions
733	as may be required by:
734	(a)  An institutional lender to a developer, for so long as
735	such lender holds a mortgage encumbering any interest in or lien
736	against a portion of the timeshare property; or
737	(b)  Any holder or pledgee of, or any institutional lender
738	having a security interest in, a pool of promissory notes
739	secured by mortgages or other security interests relating to the
740	timeshare plan, executed by purchasers in connection with such
741	purchasers' acquisition of timeshare interests in such timeshare
742	property, or any agent, underwriter, placement agent, trustee,
743	servicer, custodian, or other portfolio manager acting on behalf
744	of such holder, pledgee, or institutional lender, for so long as
745	any such notes and mortgages or other security interests remain
746	outstanding.
747	(4)  Notwithstanding any provision contained in the
748	timeshare instrument or in this chapter, chapter 718, or chapter
749	719 to the contrary, the managing entity is authorized to apply
750	any existing reserves for deferred maintenance and capital
751	expenditures toward payment of insurance deductibles or the
752	repair or replacement of the timeshare property after a casualty
753	without regard to the purposes for which such reserves were
754	originally established.
755	(5)(2)  A copy of each policy of insurance in effect shall
756	be made available for reasonable inspection by purchasers and
757	their authorized agents.
758	Section 10.  Subsection (8) of section 721.52, Florida
759	Statutes, is amended to read:
760	721.52  Definitions.--As used in this chapter, the term:
761	(8)  "Vacation club" means a multisite timeshare plan.
762	However, notwithstanding any other provision of this chapter,
763	the use of the term "vacation club" by a person or entity as
764	part of a company, brand, or product name shall not, in and of
765	itself, subject the person, entity, or product being offered to
766	the provisions of this part unless the product offered otherwise
767	meets the definition of a "multisite timeshare plan" as defined
768	in subsection (4).
769	Section 11.  Paragraphs (f) and (h) of subsection (4) and
770	paragraph (l) of subsection (7) of section 721.55, Florida
771	Statutes, are amended to read:
772	721.55  Multisite timeshare plan public offering
773	statement.--Each filed public offering statement for a multisite
774	timeshare plan shall contain the information required by this
775	section and shall comply with the provisions of s. 721.07,
776	except as otherwise provided therein. The division is authorized
777	to provide by rule the method by which a developer must provide
778	such information to the division. Each multisite timeshare plan
779	filed public offering statement shall contain the following
780	information and disclosures:
781	(4)  A text, which shall include, where applicable, the
782	information and disclosures set forth in paragraphs (a)-(l).
783	(f)  If the provisions of s. 721.552 and the timeshare
784	instrument permit additions, substitutions, or deletions of
785	accommodations or facilities, the public offering statement must
786	include substantially the following information:
787	1.  Additions.--
788	a.  A description of the basis upon which new
789	accommodations and facilities may be added to the multisite
790	timeshare plan; by whom additions may be made; and the
791	anticipated effect of the addition of new accommodations and
792	facilities upon the reservation system, its priorities, its
793	rules and regulations, and the availability of existing
794	accommodations and facilities.
795	b.  The developer must disclose the existence of any cap on
796	annual increases in common expenses of the multisite timeshare
797	plan that would apply in the event that additional
798	accommodations and facilities are made a part of the plan.
799	c.  The developer shall also disclose any extent to which
800	the purchasers of the multisite timeshare plan will have the
801	right to consent to any proposed additions; if the purchasers do
802	not have the right to consent, the developer must include the
803	following disclosure in conspicuous type:
804
805	Accommodations and facilities may be added to this
806	multisite timeshare plan (or multisite vacation ownership plan
807	or multisite vacation plan or vacation club) without the consent
808	of the purchasers. The addition of accommodations and facilities
809	to the plan may result in the addition of new purchasers who
810	will compete with existing purchasers in making reservations for
811	the use of available accommodations and facilities within the
812	plan, and may also result in an increase in the annual
813	assessment against purchasers for common expenses.
814
815	2.  Substitutions.--
816	a.  A description of the basis upon which new
817	accommodations and facilities may be substituted for existing
818	accommodations and facilities of the multisite timeshare plan;
819	by whom substitutions may be made; the basis upon which the
820	determination may be made to cause such substitutions to occur;
821	and any limitations upon the ability to cause substitutions to
822	occur.
823	b.  The developer shall also disclose any extent to which
824	purchasers will have the right to consent to any proposed
825	substitutions; if the purchasers do not have the right to
826	consent, the developer must include the following disclosure in
827	conspicuous type:
828
829	New accommodations and facilities may be substituted for
830	existing accommodations and facilities of this multisite
831	timeshare plan (or multisite vacation ownership plan or
832	multisite vacation plan or vacation club) without the consent of
833	the purchasers. The replacement accommodations and facilities
834	may be located at a different place or may be of a different
835	type or quality than the replaced accommodations and facilities.
836	The substitution of accommodations and facilities may also
837	result in an increase in the annual assessment against
838	purchasers for common expenses.
839
840	3.  Deletions.--A description of any provision of the
841	timeshare instrument governing deletion of accommodations or
842	facilities from the multisite timeshare plan. If the timeshare
843	instrument does not provide for business interruption insurance
844	in the event of a casualty, or if it is unavailable, or if the
845	instrument permits the developer, the managing entity, or the
846	purchasers to elect not to reconstruct after casualty under
847	certain circumstances or to secure replacement accommodations or
848	facilities in lieu of reconstruction, the public offering
849	statement must contain a disclosure that during the
850	reconstruction, replacement, or acquisition period, or as a
851	result of a decision not to reconstruct, purchasers of the plan
852	may temporarily compete for available accommodations on a
853	greater than one-to-one use right purchaser to use night
854	requirement accommodation ratio.
855	(h)  A description of the purchaser's liability for common
856	expenses of the multisite timeshare plan, including the
857	following:
858	1.  A description of the common expenses of the plan,
859	including the method of allocation and assessment of such common
860	expenses, whether component site common expenses and real estate
861	taxes are included within the total common expense assessment of
862	the multisite timeshare plan, and, if not, the manner in which
863	timely payment of component site common expenses and real estate
864	taxes shall be accomplished.
865	2.  A description of any cap imposed upon the level of
866	common expenses payable by the purchaser. In no event shall the
867	total common expense assessment for the multisite timeshare plan
868	in a given calendar year exceed 125 percent of the total common
869	expense assessment for the plan in the previous calendar year.
870	3.  A description of the entity responsible for the
871	determination of the common expenses of the multisite timeshare
872	plan, as well as any entity which may increase the level of
873	common expenses assessed against the purchaser at the multisite
874	timeshare plan level.
875	4.  A description of the method used to collect common
876	expenses, including the entity responsible for such collections,
877	and the lien rights of any entity for nonpayment of common
878	expenses. If the common expenses of any component site are
879	collected by the managing entity of the multisite timeshare
880	plan, a statement to that effect together with the identity and
881	address of the escrow agent required by s. 721.56(3).
882	5.  If the purchaser will receive an interest in a
883	nonspecific multisite timeshare plan, a statement that a
884	multisite timeshare plan budget is attached to the public
885	offering statement as an exhibit pursuant to paragraph (7)(c).
886	The multisite timeshare plan budget shall comply with the
887	provisions of s. 721.07(5)(t)(u).
888	6.  If the developer intends to guarantee the level of
889	assessments for the multisite timeshare plan, such guarantee
890	must be based upon a good faith estimate of the revenues and
891	expenses of the multisite timeshare plan. The guarantee must
892	include a description of the following:
893	a.  The specific time period, measured in one or more
894	calendar or fiscal years, during which the guarantee will be in
895	effect.
896	b.  A statement that the developer will pay all common
897	expenses incurred in excess of the total revenues of the
898	multisite timeshare plan, if the developer is to be excused from
899	the payment of assessments during the guarantee period.
900	c.  The level, expressed in total dollars, at which the
901	developer guarantees the assessments. If the developer has
902	reserved the right to extend or increase the guarantee level, a
903	disclosure must be included to that effect.
904	7.  If required under applicable law, the developer shall
905	also disclose the following matters for each component site:
906	a.  Any limitation upon annual increases in common
907	expenses;
908	b.  The existence of any bad debt or working capital
909	reserve; and
910	c.  The existence of any replacement or deferred
911	maintenance reserve.
912	(7)  The following documents shall be included as exhibits
913	to the filed public offering statement, if applicable:
914	(l)1.  If the multisite timeshare plan contains any
915	component sites located in this state, the information required
916	by s. 721.07(5) pertaining to each such component site unless
917	exempt pursuant to s. 721.03.
918	2.  If the purchaser will receive a timeshare estate
919	pursuant to s. 721.57, or an interest in a specific multisite
920	timeshare plan, in a component site located outside of this
921	state but which is offered in this state, the information
922	required by s. 721.07(5) pertaining to that component site,
923	provided, however, that the provisions of s. 721.07(5)(t)(u)
924	shall only require disclosure of information related to the
925	estimated budget for the timeshare plan and purchaser's expenses
926	as required by the jurisdiction in which the component site is
927	located.
928	Section 12.  Paragraph (b) of subsection (1), paragraph (g)
929	of subsection (2), and subsection (3) of section 721.552,
930	Florida Statutes, are amended to read:
931	721.552  Additions, substitutions, or deletions of
932	component site accommodations or facilities; purchaser remedies
933	for violations.--Additions, substitutions, or deletions of
934	component site accommodations or facilities may be made only in
935	accordance with the following:
936	(1)  ADDITIONS.--
937	(b)  Any person who is authorized by the timeshare
938	instrument to make additions to the multisite timeshare plan
939	pursuant to this subsection shall act as a fiduciary in such
940	capacity in the best interests of the purchasers of the plan as
941	a whole and shall adhere to the demand balancing standard set
942	forth in s. 721.56(6) in connection with such additions.
943	Additions that are otherwise permitted may be made only so long
944	as a one-to-one use right purchaser to use night requirement
945	accommodation ratio is maintained at all times.
946	(2)  SUBSTITUTIONS.--
947	(g)  The person who is authorized by the timeshare
948	instrument to make substitutions to the multisite timeshare plan
949	pursuant to this subsection shall act as a fiduciary in such
950	capacity in the best interests of the purchasers of the plan as
951	a whole and shall adhere to the demand balancing standard set
952	forth in s. 721.56(6) in connection with such substitutions.
953	Substitutions that are otherwise permitted may be made only so
954	long as a one-to-one use right purchaser to use night
955	requirement accommodation ratio is maintained at all times.
956	(3)  DELETIONS.--
957	(a)  Deletion by casualty.--
958	1.  Pursuant to s. 721.165, the timeshare instrument
959	creating the multisite timeshare plan must provide for casualty
960	insurance for the accommodations and facilities of the multisite
961	timeshare plan in an amount equal to the replacement cost of
962	such accommodations or facilities. The timeshare instrument must
963	also provide that in the event of a casualty that results in
964	accommodations or facilities being unavailable for use by
965	purchasers, the managing entity shall notify all affected
966	purchasers of such unavailability of use within 30 days after
967	the event of casualty.
968	2.  The timeshare instrument must also provide for the
969	application of any insurance proceeds arising from a casualty to
970	either the replacement or acquisition of additional similar
971	accommodations or facilities or to the removal of purchasers
972	from the multisite timeshare plan so that purchasers will not be
973	competing for available accommodations on a greater than one-to-
974	one use right purchaser to use night requirement accommodation
975	ratio.
976	3.  If the timeshare instrument does not provide for
977	business interruption insurance, or if it is unavailable, or if
978	the instrument permits the developer, the managing entity, or
979	the purchasers to elect not to reconstruct after casualty under
980	certain circumstances or to secure replacement accommodations or
981	facilities in lieu of reconstruction, purchasers of the plan may
982	temporarily compete for available accommodations on a greater
983	than one-to-one use right purchaser to use night requirement
984	accommodation ratio. The decision whether or not to reconstruct
985	shall be made as promptly as possible under the circumstances.
986	4.  Any replacement of accommodations or facilities
987	pursuant to this paragraph shall be made upon the same basis as
988	required for substitution as set forth in subparagraph (2)(b)2.
989	(b)  Deletion by eminent domain.--
990	1.  The timeshare instrument creating the multisite
991	timeshare plan must also provide for the application of any
992	proceeds arising from a taking under eminent domain proceedings
993	to either the replacement or acquisition of additional similar
994	accommodations or facilities or to the removal of purchasers
995	from the multisite timeshare plan so that purchasers will not be
996	competing for available accommodations on a greater than one-to-
997	one use right purchaser to use night requirement accommodation
998	ratio.
999	2.  Any replacement of accommodations or facilities
1000	pursuant to this paragraph shall be made upon the same basis as
1001	required for substitution set forth in subparagraph (2)(b)2.
1002	(c)  Automatic deletion.--The timeshare instrument may
1003	provide that a component site will be automatically deleted upon
1004	the expiration of its term in a timeshare plan other than a
1005	nonspecific multisite timeshare plan or as otherwise provided in
1006	the timeshare instrument. However, the timeshare instrument must
1007	also provide that in the event a component site is deleted from
1008	the plan in this manner, a sufficient number of purchasers of
1009	the plan will also be deleted so as to maintain no greater than
1010	a one-to-one use right purchaser to use night requirement
1011	accommodation ratio.
1012	Section 13.  Subsection (1) of section 721.97, Florida
1013	Statutes, is amended to read:
1014	721.97  Timeshare commissioner of deeds.--
1015	(1)  The Governor may appoint commissioners of deeds to
1016	take acknowledgments, proofs of execution, or oaths in any
1017	foreign country, in international waters, or in any possession,
1018	territory, or commonwealth of the United States outside the 50
1019	states. The term of office is 4 years. Commissioners of deeds
1020	shall have authority to take acknowledgments, proofs of
1021	execution, and oaths in connection with the execution of any
1022	deed, mortgage, deed of trust, contract, power of attorney, or
1023	any other writing to be used or recorded in connection with a
1024	timeshare estate, personal property timeshare interest,
1025	timeshare license, any property subject to a timeshare plan, or
1026	the operation of a timeshare plan located within this state;
1027	provided such instrument or writing is executed outside the
1028	United States. Such acknowledgments, proofs of execution, and
1029	oaths must be taken or made in the manner directed by the laws
1030	of this state, including but not limited to s. 117.05(4),
1031	(5)(a), and (6), Florida Statutes 1997, and certified by a
1032	commissioner of deeds. The certification must be endorsed on or
1033	annexed to the instrument or writing aforesaid and has the same
1034	effect as if made or taken by a notary public licensed in this
1035	state.
1036	Section 14.  This act shall take effect July 1, 2007.

CODING: Words stricken are deletions; words underlined are additions.