Appeals court ruling: HI timeshare owners get full voting rights

Friday, September 7, 2018

In a decision that may have a significant impact on the election of commissioners in the Holiday Island Suburban Improvement District, the Arkansas Court of Appeals ruled Wednesday that all timeshare owners at Table Rock Landing are entitled to vote in HISID elections.

The 14-page ruling, written by Judge Phillip T. Whiteaker, reverses an August 2017 ruling by Carroll County Circuit Judge Scott Jackson. Jackson’s order gave each timeshare unit one vote for a total of 28 — half of what timeshare owners had requested. The Court of Appeals ruling could result in as many as 1,428 votes going to timeshare owners — up to 51 for each of the 28 units. The actual number likely is much less since some owners may have multiple shares.

Holiday Island Development Corp. and the Table Rock Landing Owners Association sued the district initially seeking the same voting rights as other property owners, meaning voting rights for the first two otherwise eligible voters on each property deed.

The appeals court ruling goes much further, however.

“Each timeshare owner is issued a deed in his or her name, which is then record,” the ruling says. “While the timeshare owners do not receive an individual tax bill or an individual assessment, the property itself is assessed real property taxes by the assessor and improvement-district assessments by the HISID, which are then paid by timeshare owners through TRL — in other words a timeshare owner owns property subject to taxation. … Because a timeshare owner satisfies the definition of a ‘property owner’ under the statute, timeshare owners are entitled to individual notice of commissioner elections and are also entitled to the right to vote. How many votes are they entitled to? The statute clearly and unambiguously states that ‘[e]ach property owner shall be entitled to one (1) vote for each position of commissioner to be filled.’ … It is clear that each timeshare owner is a property owner and that each is entitled to one vote for each position of commissioner to be filled.”

The appeals court also struck down a HISID regulation that requires that nominees for the board of commissioners, as well as voters, not be delinquent in their assessments or utility bills and requires that past-due assessments be paid before the close of business on the day preceding the election.

“We agree these additional requirements are invalid,” the appeals court ruling says.

Holiday Island Development Corp. owner Tom Dees said the timeshare owners deserve voting rights.

“We’ve paid them literally millions of dollars since 1984 and have never had a say in our government,” Dees said.

District manager Lawrence Blood said Wednesday afternoon that the district is weighing its options.

“We got a ruling that’s kind of disappointing to us and we have an opportunity to appeal as well,” Blood said.

Blood said the dispute centers around differing interpretations of state law.

“Statutes are often vague and up to interpretation,” he said. “Two parties and two individuals can have very different interpretations.”

Voting rights in HISID elections have been based not on the traditional “one person, one vote” system but on property ownership. A single property owner gets one vote. Non-property owners cannot vote. Owners of multiple properties get one vote, the same as owners of single properties. Joint property owners — such as man and wife owners of a single property — may get up to two votes.

Blood said that arrangement gives true stakeholders in the community the opportunity to have a voice in district government.

“The elections have been based on people that have lots and houses in Holiday Island that have a direct interest in the development of the community,” he said, adding that a timeshare owner who spends one week a year at Table Rock Landing can’t be expected to have the same interest as a full-time property owner.

Matt Bishop, attorney for the district, said there is an 18-day window to appeal the most recent ruling.

“We’re disappointed in the ruling and still considering our options,” Bishop said.

Blood said that once the legal battle has run its course, the district will abide by the final outcome.

“After all the appeals and the smoke settles, everyone is obligated to follow the law and that’s what we are committed to do,” he said.

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