Current through Register Vol. 47, No. 17, September 10, 2024
4.1.
Developer Must Register Prior to Conducting Business
The person, firm, partnership, joint venture, limited
liability company, association, corporation or other legal entity, or
combination thereof, who will sign as seller or lessor in any Consumer
Agreement, deed or any other instrument purporting to convey any site, tract,
lot, divided or undivided interest from a Subdivision, must secure a Developer
Certificate before negotiating or agreeing to sell, lease or transfer and
before any sale, lease or transfer is made. If such person is acting only as a
trustee, the beneficial owner of the Subdivision must secure a Developer
Certificate.
4.2. Developer
Must Maintain Business Records and Produce Upon Request
Pursuant to sections
12-10-505(1)(e),
C.R.S., 12-10-506(6)(b),
C.R.S., and
12-10-506(8),
C.R.S., a Developer must maintain Business Records as set forth in Rule 3.4 .,
and produce for inspection upon reasonable request by an authorized
representative of the Commission.
4.3. Disclosures to Prospective Purchasers
Prior to Contracting
Pursuant to sections
12-10-506(6)(a),
C.R.S., and
12-10-506(7),
C.R.S., Developer must supply to prospective purchasers the written disclosures
as set for forth in Rules 2.3 ., 2.4 ., 2.5 ., and 2.6. prior to contracting
with the public and must be disclosed in the Consumer Agreement, or in a
separate written disclosure document.
4.4. Developers Must Not Make
Misrepresentations or Conceal Material Facts
A. Failure to disclose to the purchaser the
availability of legal access, sewage disposal, public utilities, including
water, electricity, gas and telephone facilities, in the applicable uncompleted
Subdivision offered for sale or lease, including whether such are to be a
Developer or purchaser expense, when proven, is a violation of section
12-10-505(1)(b),
C.R.S.
B. No Developer will make
misrepresentations regarding the future availability or costs of services,
utilities, character, or use of real property for sale or lease of the
surrounding area of the Subdivision.
4.5. Disclosure of an Exchange Company
A Developer of a Time Share must disclose to the public
whether or not a Time Share plan involves an Exchange Program and, if so, will
disclose and deliver to prospective purchasers, a separate written document,
which may be provided by an exchange company if the document discloses the
following information:
A. The name and
the business address of the exchange company;
B. Whether the purchaser's contract with the
Exchange Program is separate and distinct from the purchaser's contract with
the Developer;
C. Whether the
purchaser's participation in the Exchange Program is dependent upon the
Developer's continued affiliation with the Exchange Program;
D. Whether or not the purchaser's
participation in the Exchange Program is voluntary;
E. The specific terms and conditions of the
purchaser's contractual relationship with the Exchange Program and the
procedure by which changes, if any, may be made in the terms and conditions of
such contractual relationship;
F.
The procedure of applying for and effecting any changes;
G. A complete description of all limitations,
restrictions, accrual rights, or priorities employed in the operation of the
Exchange Program, including but not limited to limitations on exchanges based
on seasonality, unit size, or levels of occupancy; and if the limitations,
restrictions or priorities are not applied uniformly by the Exchange Program, a
complete description of the manner of their application;
H. Whether exchanges are arranged on a
space-available basis or whether guarantees of fulfillment of specific requests
for exchanges are made by the exchange company;
I. Whether and under what conditions a
purchaser may, in dealing with the Exchange Program, lose the use and occupancy
of the Time Share period in any properly applied for exchange without being
offered substitute accommodations by the Exchange Program;
J. The fees for participation in the Exchange
Program, and whether the fees may be altered and the method of any altering;
and
K. The name and location of
each accommodation or facility, including the time sharing plans participating
in the Exchange Program.
4.6. Disclosure of Judgment, Decree or Order
Any material adverse order, judgment, or decree entered
against Developer in connection with the Subdivision by any regulatory
authority or by any court of appropriate jurisdiction, specifically including
any order, judgment or decree related to a proceeding under which Developer has
a duty to disclose as set forth in Rule 3.6.A.6 . but other than ordinary
routine litigation incidental to the Developer's business, must be filed with
the Commission by the Developer within thirty (30) Days of such order, judgment
or decree being final.
4.7.
Delivery of an Abstract of Title or Title Insurance
A. Developer must provide a title insurance
commitment or other evidence of title approved by the Commission within a
reasonable time after execution of any Consumer Agreement, or other instrument
purporting to convey any interest in the site, tract, lot, divided or undivided
interest from a Subdivision.
B.
Where the Consumer Agreement contemplates the delivery of a deed, an abstract
of title or title insurance policy must be delivered within a reasonable time
after the completion of payments by a purchaser.
C. Any period of time in excess of sixty (60)
Days will be deemed unreasonable for the purposes of this Rule. The parties may
contract to eliminate this requirement, but any such mutually acceptable waiver
must be in writing and in a conspicuous manner or print.
4.8. Delivery of Deed Must be Made within
Sixty (60) Days
A. Unless a sale is by means
of an installment contract, the delivery of a deed must be made within sixty
(60) Days after closing. For the purposes of this Rule, the date of closing is
defined as the date the purchaser has either paid the full cash purchase price
or has made partial cash payment and executed a promissory note or other
evidence of indebtedness for the balance of the purchase price.
B. If a sale is by means of an installment
contract, the delivery of a deed must be made within sixty (60) Days after the
completion of payments.
4.9. Duty to Respond to a Complaint or Audit
A. Pursuant to section
12-10-505, C.R.S., any Developer
who has received written notification from the Commission that a complaint has
been filed against the Developer, must submit a written answer to the
Commission within a reasonable time as set by the Commission.
B. Upon request of the Commission pursuant to
an investigation or audit notice, a Developer will file with the Commission an
audited financial statement in conformity with accepted accounting principles,
and sworn to by the Developer as an accurate reflection of the financial
condition of the Developer and/or the homeowners' association controlled by the
Developer.
C. Failure to submit a
written response required by this Rule will be grounds for disciplinary
action.
