Francescutto v. Delta Hotels et al., 2014 BCPC 203 (CanLII)
Citation: Francescutto v. Delta Hotels et al. Date: 20140902
Registry: Kamloops
IN THE PROVINCIAL COURT OF BRITISH COLUMBIA
BETWEEN:
CAESAR FRANCESCUTTO
CLAIMANT
AND:
DELTA HOTELS NO. 48 HOLDINGS LTD.
DEFENDANT
REASONS FOR JUDGMENT
OF THE
HONOURABLE JUDGE S.D. FRAME
Appearing on their own behalf: Mr. Caesar Francescutto
Counsel for the Defendant: Ms. Helen Sevenoaks
Place of Hearing: Kamloops, B.C.
Date of Hearing: August 14, 2014
Date of Judgment: September 2, 2014
[1] This is a claim by Mr. Francescutto against Delta Hotels No. 48 Holdings Ltd. for recovery of the funds he paid for his timeshare at the Grand Hotel in Kelowna, British Columbia.
[2] Mr. Francescutto and his then wife, Arlene, purchased the timeshare prepaid package lease on June 15, 1999. Mr. Francescutto said that he did not purchase the timeshare for his own use but for his wife. They divorced in 2005. After they divorced, Mr. Francescutto decided that he was not going to use the timeshare and tried to sell it. He had no interested buyers and simply let the matter lapse.
[3] Each year, Mr. Francescutto received a statement for the annual use fee from the Grand advising him how much he had to pay for that year’s annual use fee. Each year, Mr. Francescutto paid those expenses.
[4] In August, 2008, the Defendant purchased the Grand Hotel from Royal Host and took an assignment of the leases. Mr. Francescutto did not have a full copy of the lease that he and his wife signed. He in fact had none of these documents in his possession. Nor did he approach his ex-wife to obtain a copy of them. Instead, he obtained a cover sheet from the Land Title Office setting out the basic terms of the lease. One of those basic terms is that he and Ms. Francescutto acknowledged that they had read and received the full lease. They agreed to the terms of it.
[5] After the Defendant purchased the Grand Hotel, it continued to issue statements for the annual use fee to Mr. Francescutto. It did so for several years but did not receive payment. Mr. Francescutto denies he received these statements. I do not believe Mr. Francescutto. It is clear from the documents produced at trial that he not only received the payments but attempted to negotiate out of paying the annual use fee because he was not using the timeshare. I am satisfied well beyond the balance of probabilities that Mr. Francescutto received annual statements which he did not pay.
[6] Further, Mr. Francescutto denied he ever received notice that the Defendant had purchased the hotel. However, Mr. Francescutto’s correspondence to the Defendant addressed the Defendant by its common name. I do not believe Mr. Francescutto.
[7] After several attempts to have Mr. Francescutto pay the annual use fee, the Defendant foreclosed Mr. Francescutto’s interest from the lease and timeshare unit. Mr. Francescutto expected to be repaid for the amount he paid for the lease package in 1999. It is clear from the lease terms that he is not entitled to compensation even if he had not been in default. However, Mr. Francescutto was clearly in default of the annual use payments, the Defendant was entitled to take the action that it took, and Mr. Francescutto is not entitled to be repaid for the prepaid lease package.
[8] Ms. Sevenoaks argued, and I agree, that a result of not paying the annual use fees is a fundamental breach of the contract going to the root of it. This amounted to a repudiation of the contract by Mr. Francescutto which was accepted by the Defendants. I agree with Ms. Sevenoaks and find that the annual use fee went to the very heart of the contract and was a key term of the agreement.
[9] Counsel referred me to the following cases on the matter of fundamental breach: Berhe v. Coblenz Holdings Ltd., 2013 BCCA 512 (CanLII), 2013 B.C.C.A. 512; Dillman Forest Products Ltd. v. GMAC Commercial Credit Corp., 2007 BCCA 88 (CanLII), 2007 B.C.C.A. 88; and Tang v. Zhang, 2013 BCCA 52 (CanLII), 2013 B.C.C.A 52.
[10] The Defendant did not accept the repudiation immediately. It attempted to communicate with Mr. Francescutto and reach a resolution. It was entirely unsuccessful in doing so. Upon cancellation of the lease, the repudiation was clearly accepted by the Defendant.
[11] The cover page of the prepaid vacation package lease identifies the amount paid by Mr. Francescutto as a deposit. That is clear even on the cover sheet Mr. Francuscetto presented at trial. There was no financing and the only other payment to be made under the lease was the annual user fee.
[12] There is no obligation on the part of the Defendants to buy, sell or rent Mr. Francescutto’s interest in the timeshare, although he is entitled to do so on his own behalf during the term of the lease.
[13] Pursuant to Article 8.2 of the lease, the Defendant was entitled to re-enter and terminate the lease upon default.
[14] I dismiss Mr. Francuscetto’s claim.
[15] Mr. Francescutto has failed to pay the annual use fee from 2009 to 2013 in the sum of $3,243.79. Interest accrues under the lease on outstanding amounts as owing from time to time from January 1, 2009 to the date of judgment. I note that the Defendant appropriately prorated the annual use fee for 2013 up to and including the date of termination of the lease, August 14, 2013.
[16] I grant judgment to the Defendant on its counterclaim in the sum of $3,243.79, together with interest at 26.824% per annum on the following amounts owing to the date of judgment:
2009 $618.19
2010 $649.10
2011 $715.61
2012 $751.39
2013 $509.50.
[17] The Defendant shall have its reasonable costs of the claim and counterclaim as assessed by the Registrar.
______________________
S.D. Frame
Provincial Court Judge