In Overton v. Westgate Resorts, LTD., L.P., No. E2014-00303-COA-R3-CV (Tenn. Ct. App. Jan. 30, 2015), the Court of Appeals recently affirmed a punitive damage award in a fraud and misrepresentation case. Plaintiffs had traveled to Gatlinburg to look for and purchase a timeshare. Their primary concern was being able to accommodate their extended family for a trip the same week each December. While in downtown, they saw a Westgate booth and made arrangements to attend a presentation. According to plaintiffs, the presentation was “high pressure” and salespeople spent almost eight hours with plaintiffs on the relevant day. Plaintiffs found a unit that would fit their needs and decided to purchase the timeshare from Westgate.
Plaintiffs asserted that their decision to purchase was based on assurances from the Westgate salespeople. Specifically, the Westgate representatives stated that plaintiffs would be able to retain the unit they looked at for the same week in December each year; that they would be able to book unlimited additional nights at any Westgate resort at a promotional price; that the two salespeople they worked with would refund part of their commission; and that the salespeople would purchase a foosball table to be kept at the resort for plaintiffs to use during their stays. The agreements regarding the commission and foosball table were put in writing, but the other two were not. Plaintiffs closed on the timeshare at 11:00 pm that night and were given copies of their closing documents and three CD-ROMs. The purchase price was just under $40,000.
After closing, plaintiffs tried to confirm their December reservation, and after some unsuccessful attempts were informed that the booking would not be guaranteed for the unit they had looked at and that units were not assigned until a few days before arrival. After speaking to several customer service individuals, they also found out that they did not have the ability to book unlimited nights at other resorts as described during the presentation. Plaintiffs retained counsel, who realized that plaintiffs had not been given a current copy of the Westgate’s public offering statement, as required by the Tennessee Consumer Protection Act. Instead, plaintiffs had received an old version on CD-ROM which was extremely difficult to access and navigate. Plaintiffs sought to rescind the contract based on the TCPA, but Westgate refused. Plaintiffs then brought this action.