Legal Question in Business Law in California

I have a membership with a timeshare exchange company that was abruptly cancelled, with the exchange company claiming that I have violated its terms and conditions. At first I didn't care much about the membership termination, but I later found out that a reservation that I have confirmed through the exchange company over a year ago for this coming Christmas holiday has been cancelled by the exchange company. The reservation was for a 3 bedroom unit with a nice resort at Southern California for 1 week. It is worth over $3000 if booked directly through the resort, not to mention that there is no availability for a 3 bedroom for the week that I was booked for. I confirmed the week through an exchange, which means it was all paid for. The exchange company didn't notify me of the cancellation, and I found out accidently by calling the resort directly. The exchange company also didn't compensate me for the cancellation. I have called and wrote to the exchange company numerous times, but all requested were ignored and unresponded to.

I am planning to file a small claim case against this company, who is a subsidiary to a corporation that is registered to do business in California. However, I have the following questions:

1. In the exchange company�s membership terms and conditions, it talked about Governing Law being the laws of State of New Jersey, and the Jurisdiction which "Member consents and waives Member�s objection to the non-exclusive personal jurisdiction of and venue in the New Jersey state." With that, can I file the small claim in California, specifically the City where I lived and signed the contract?

2. Also in the exchange company�s membership terms and conditions, I realized that its terms and conditions specifically said that it has the right to cancel my confirmation without any compensation. If I file the small claim, do I have any chance of winning?

3. When I do file, do I have to name anyone on my filing? I do have a name of the exchange company�s Customer Service Director from the membership cancellation notice. Should I use that name?

I am very frustrated with the exchange company�s unresponsiveness, and really feel helpless as an individual consumer like me can hardly do anything to a big corporation even when taken advantage of. Any advise is greatly appreciated. Thank you in advance for your help.


Asked on 9/29/09, 1:53 am

1 Answer from Attorneys
Cathy Cowin Law Offices of Cathy Cowin

(1) Yes, the venue provision complicates matters; however, there may be ways around it.

(2) Yes, the cancellation clause makes your case less strong, but you're not just talking about cancellation of a single reservation (for a good reason), you're talking about cancellation of the entire contract and you'd have to analyze the agreement comprehensively and the cancellation letter to determine if it was justified or a break of the agreement on their party;

(3) No, you do not need to name an individual as a defendant and have no apparent justification to do so based on the limited facts stated in the post

(Other) Options: (1) Immediately file in small claims; (2) Have an attorney get involved to draft a demand letter and have a clear goal in mind (e.g. do you want money or your reservation honored?) or (3) get a mediator involved (e.g. through the BBB, who will often provide free services in these types of situations)

Please note that this response does not form an attorney-client relationship as our office does not accept cases without a personal consultation and conflict check and because the limited nature of this forum only allows a general response that cannot be relied upon as accurate legal advice. To obtain an accurate legal recommendation, all related documents must be reviewed and additional information provided.

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Answered on 9/29/09, 11:10 am


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