Section 707.31 - Transfer of special developer rights(1) DEFINITION. In this section, "special developer right" means a developer's right to do any of the following:(a) Add more units to a time-share property under s. 707.21(1) (f).(b) Maintain sales offices, management offices, models and signs under s. 707.25.(c) Appoint, control or serve as the managing entity.(2) REQUIREMENTS FOR TRANSFER. No special developer right may be transferred except by an instrument executed by both the transferor and transferee which evidences the transfer and is recorded in every county in which any portion of the time-share property is located.(3) LIABILITY OF TRANSFEROR. Upon transfer of a special developer right, the liability of a transferor shall be as follows: (a) The transferor may not be relieved of any obligation or liability arising before the transfer, and the transferor shall remain liable for warranty obligations imposed upon him or her under s. 707.53. Lack of privity may not deprive a time-share owner of standing to maintain an action to enforce an obligation of the transferor.(b) If a successor to a special developer right is an affiliate of the developer, the transferor shall be jointly and severally liable with the successor for any obligations or liabilities of the successor relating to the time-share property.(c) If the transferor retains any special developer right but transfers other special developer rights to a successor who is not an affiliate of the developer, the transferor shall be liable for any obligations or liabilities imposed on a developer either by this chapter or by the time-share instrument relating to the retained special developer rights and arising after the transfer.(d) A transferor is not liable for any act or omission or any breach of a contractual or warranty obligation arising from the exercise of a special developer right by a successor developer who is not an affiliate of the transferor.(4) RIGHTS WHERE FORECLOSURE OR TAX SALE. (a)1. Unless otherwise provided in a mortgage instrument or deed of trust, in case of foreclosure of a mortgage, tax sale, judicial sale, sale by a trustee under a deed of trust, or sale under bankruptcy or receivership proceedings, of any time shares owned by a developer in the time-share property, a person acquiring title to all of the time shares being foreclosed or sold shall succeed, depending upon his or her request, to one of the following: a. All special developer rights.b. Any rights reserved in the time-share instrument under s. 707.25 allowing the developer to maintain sales offices, management offices, models and signs.2. The judgment or instrument conveying title shall provide for transfer of only those special developer rights requested under subd. 1.(b) Upon foreclosure, tax sale, judicial sale, sale by a trustee under a deed of trust, or sale under bankruptcy or receivership proceedings of all time shares in a time-share property owned by a developer, all of the following shall occur: 1. The right to appoint, control or serve as the managing entity shall terminate unless the judgment or instrument conveying title provides for transfer of all special developer rights to a successor developer.2. The developer shall cease to have any other special developer rights.(5) RIGHTS, LIABILITIES AND DUTIES OF SUCCESSOR.(a) A successor to any special developer right who is an affiliate of a developer is subject to all obligations and liabilities imposed on the transferor by this chapter or the time-share instrument.(b)1. A successor to any special developer right, other than a successor described in par. (c) or (d), who is not an affiliate of a developer, is subject to any of the following obligations and liabilities imposed by this chapter or the time-share instrument: a. On a developer, which relate to a developer's exercise or nonexercise of special developer rights.b. On the successor's transferor, except as provided in subd. 2.2. A successor described in subd. 1. is not subject to any of the following obligations and liabilities of the successor's transferor: a. Liability for misrepresentations by a previous developer.b. Warranty obligations on improvements made by any previous developer or made before the property became a time-share property.c. Breach of any fiduciary obligation by any previous developer or any developer's appointees.d. Any liability or obligation imposed on the transferor as a result of the transferor's acts or omissions after the transfer.(c) A successor to only the right to maintain sales offices, management offices, models and signs under s. 707.25, if the successor is not an affiliate of a developer, may not exercise any other special developer right and is not subject to any liability or obligation as a developer, except the obligation to provide a time-share disclosure statement and any liability arising as a result of providing the time-share disclosure statement.(d) If a successor to all special developer rights held by a transferor is not an affiliate of the developer and has succeeded to those rights by deed in lieu of foreclosure, judgment or an instrument conveying title to the time shares under sub. (4), the successor may declare in a recorded instrument the intention to hold those rights solely for transfer to another person. Thereafter, until transferring all special developer rights, that successor may not exercise any of those rights other than any right held by the transferor to appoint, control or serve as the managing entity, and any attempted exercise of those rights is void. During any period in which a successor may not exercise special developer rights under this paragraph, the successor is not subject to any liability or obligation as a developer other than liability for his or her acts and omissions in appointing, controlling or serving as the managing entity.(6) PRESERVATION OF PURCHASER'S CLAIMS AND DEFENSES.(a) Any claim or defense based on any written documentation which a purchaser may raise against the person who sold the time share to the purchaser is preserved against any assignee or successor to any of the following:2. Any credit contract in connection with the sale of the time share which is executed by the purchaser and which may be retained by or assigned to the developer, an affiliate of the developer or a creditor having a contractual relationship with the developer.(b) Any recovery by a purchaser under par. (a) may not exceed the amounts paid by the purchaser under the contract.(c) Sellers and creditors shall include the following language in promissory notes executed in connection with the sale of time shares: NOTICE
ANY HOLDER OF THIS CREDIT CONTRACT IS SUBJECT TO ALL CLAIMS AND DEFENSES WHICH THE DEBTOR COULD ASSERT AGAINST THE SELLER OF SERVICES OR PROPERTY OBTAINED PURSUANT TO THE CREDIT CONTRACT OR WITH THE PROCEEDS OF THE CREDIT CONTRACT. RECOVERY UNDER THE CREDIT CONTRACT BY THE DEBTOR MAY NOT EXCEED AMOUNTS PAID BY THE DEBTOR UNDER THE CREDIT CONTRACT.
(7) EXTENT OF OBLIGATIONS. Nothing in this section subjects any successor to a special developer right to any claims against or other obligations of a transferor developer, other than claims and obligations arising under this chapter or any written documentation.