New complaints arise about Hilton Head Island time-share company

May 2, 2010 

Almost four years after the Coral Sands time-share company on Hilton Head Island told the state Real Estate Commission it would do more to help buyers understand its sales contracts, similar new complaints have surfaced.

Three such complaints have been filed against Coral Sands' developer, Coral Resorts, this year, according to Beaufort County court records. In all three cases, people who bought time shares claim the company or its agents misrepresented the deals to which they agreed.

Company officials say they have adhered to the measures they said they would put into effect.

In 2005, they promised to provide additional sales staff and an attorney to dispense independent legal advice after some buyers told the S.C. Real Estate Commission they were misled during sales pitches. The commission received 38 complaints in two years, a number the commission deemed "alarming and far in excess of any reasonably acceptable norm."

Commission spokeswoman Lesia Kudelka said in an e-mail last week that the commission met with the company a few years ago to discuss complaints, but "there was no formal agreement or order signed."

The commission has 18 pending complaints regarding Coral Resorts, she said. She did not provide details of the complaints but said they were generally about "misrepresentation of product."

In two cases, buyers say they believed they were purchasing Coral Sands time shares under terms that were not reflected in contracts they were hurried to sign.

"The actions of the defendants have a real and substantial potential for repetition and are a threat to the public interest," both lawsuits state.

In the third case, a buyer bought a time share in 2008 from the company at Island Links, a different time-share development on the island, and was "induced" to buy another in 2009. Although he repeatedly inquired if there would be additional fees and was assured there would not be, he has been repeatedly billed with such fees and threatened with foreclosure, according to the lawsuit.

Company officials referred questions to attorney Dean Pierce.

Although Coral Resorts strives to make every customer happy, it's not reasonable to expect complete satisfaction considering the company brings in 25,000 to 30,000 couples per year for tours, Pierce said. Of those, about 4,000 to 4,500 buy time shares from the company.

The company has added staff to its customer care department since the agreement, Pierce said. Although the company stopped keeping a lawyer on-site last year because "he didn't get enough questions to really keep him busy," one is available by telephone at customers' request, he said.

"I think the company has made great strides," he said.

EX-SALESWOMEN ALSO SUE

In addition to lawsuits brought by customers, Coral Resorts also faces legal challenges from two former saleswomen who say the company withheld money they earned before firing them March 5.

Donnalee Forenza and Wendy Hunter began protesting the company outside its office in Park Plaza. They stationed themselves across the street so they could not be cited for trespassing and held signs urging passersby to beware of the company.

"All we wanted was our paycheck," Forenza said, "and it's come to this."

Hunter is seeking in excess of $495,000 for breach of contract and other claims, and Forenza is seeking $299,300 for similar claims, according to their suits.

Coral Resorts, which says it fired the women for using "improper sales practices," has filed motions to dismiss their cases and seeks sanctions for bringing "frivolous proceedings."

"We have every confidence these charges will be found to be frivolous and totally without merit," attorney Nekki Shutt said. "We're saying we don't owe them anything."

Shutt said some of Hunter's and Forenza's practices were contradictory to the company's training and written material.

"That's why we had to terminate them," she said.

Forenza said she used sales practices that she learned from the company.

"I wasn't doing anything I wasn't allowed to do," she said. "In fact, they taught me very well how to do it."

Hunter said she also did what company officials told her.

"They authorized it really and encouraged it," Hunter said.

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