Poster: A snowHead
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The new owner of Killington ski resort in Vermont (US) has said it has no legal obligation to honour the more than 1,000 lifetime ski passes issued by a previous owner. Killington/Pico Ski Resort Partners LLC is being sued by a group of pass holders who want their passes honoured. The company claims the passes were only valid while the Sherburne Corporation - Killington's original owner - continued to operate the resort. ...The new owner, who have given pass holders a 2-year grace period for the passes, has announced that it does not intend to agree to further concessions for which it has no legal obligation.
Killington is reputedly the largest ski area in eastern North America.
From: http://www.wptz.com/news/14580659/detail.html
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Obviously A snowHead isn't a real person
Obviously A snowHead isn't a real person
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This sort of corporate pigheadness gets my back up.
If the new owners bought the resort from the Sherburne Corporation who had lifetime contracts with some clients to access and use part of its assest then that contract, subject to any significant change in the orginal assests, takes precedent, over any change of ownership.
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Well, the person's real but it's just a made up name, see?
Well, the person's real but it's just a made up name, see?
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Corporate pig headedness I agree. Legally I would need to be persuaded of your logic oif two seperate entities
right of action probably rests against Sherburne who entered in to the contract unless the liability was accepted by newco. Are sherburne solvent? They could be sued - they entered in to a life time contract which they can't now honour-damages- the cost of 1000 people getting a similar contract with newco or some sort of compound cost of buying a season lift pass.
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You need to Login to know who's really who.
You need to Login to know who's really who.
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Hmm in the UK law the big difference would bes whether newco bought the assets of Killington or Sheburne Corp itself. Let me give you a 'for instance'
Scenario 1
Alpha Corp owns a piece of machinery that it's rents to punter for a small annual fee under contract and punter gets benefits.
Beta Corp buys that machinery off Alpha Corp - does beta corp have any responsiblity to fulifl the contract between Alpha Corp and Punter - NO
Scenario 2
Alpha Corp owns a piece of machinery that it's rents to punter for a small annual fee under contract and punter gets benefits.
Beta corp buys the whole of Alpha corp and carry's on running it / integrates it into Beta Corp - does beta corp have any resposnsibility to fulfil contract between Alpha Corp and punter - YES
IANAL but that's how I understand..and if as appears to be the case it was just the assets purchased then under UK law the 'punters' would be SOL
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Anyway, snowHeads is much more fun if you do.
Anyway, snowHeads is much more fun if you do.
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Matter for the local court. If the new owners did due diligence before purchase with legal advice, the may have expected they had no liability for the previous owners commitment - in which case the 2 years grace seems quite generous.
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You'll need to Register first of course.
You'll need to Register first of course.
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What ever happened to my word is my Bond?
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Regardless of the legality of their position, which I am sure would be bulletproof for them to do it, its hardly great PR. We all now know that the new owners of Killington are tight fisted scrooges and the holders of the lifetme passes are hardly going to be rushing to buy tickets (plus their friends and family) when they've been screwed over.
Lots of other places Seppos can ski on the east coast.
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You'll get to see more forums and be part of the best ski club on the net.
You'll get to see more forums and be part of the best ski club on the net.
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Any 'lifetime membership' / 'discount for paying up front' offer is a warning signal.
Most businesses - and ski resorts are no exception - incur expenses and overheads every year to deliver their services. And most businesses will aim to have revenues every year that cover those costs and yield a profit.
Generally, if any service provider asks you to pay up-front for future services to be delivered over many months or years - let alone a 'lifetime', it is wise to be very cautious. What looks like a great offer can be nothing more than a signal that the business is desperate for cash, and risks going bust long before it finishes delivering its promise to you.
There can be exceptions: a ski resort could legitimately sell a limited number of 'lifetime' or long duration passes to raise money for a long-term investment, such as a new lift system, but if they are incurring long-term liabilities to fill a short-term financial gap, there will definitely be trouble ahead. And if you have no detailed knowledge of their financials, best keep your money in the bank and pay for services as you use them.
I'm guessing the new owners will have done their due diligence, and that their position is both legally and commercially justified. I understand the pass-holders of the former operator are disappointed; but they have just learned a lesson about the impermanence of corporate entities, and the fact that when an offer looks too good to be true it usually is.
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Quote: |
when an offer looks too good to be true it usually is.
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It wasn't. At least not at the time they were ORIGINALLY offered. Most people thought of it as kind of a time share. You pay for the cost of the construction and got the right to use it forever.
But that was a long time ago, and the original purchasers did get qutie a bit of use out of them. A lot of the lifetime passes had been re-sold for various amount of money. Those are the ones that're particularly unhappy right now, especially those who just bought recently.
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snowHeads are a friendly bunch.
snowHeads are a friendly bunch.
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IANAL, but was involved in company purchase a few years ago. Over here it would depend whether Sherburne were bought as a going concern, or out of receivership. If the company was bought as a going concern, the liabilities would transfer with the assets, so the new owners would be bound to honour the lifetime passes, or enter into negotiations to extract them selves from that liability. If Sherburne continued in existance as a going concern, but the new owners had just bought the assets of the resort, the contract and liability would remain, but it would be Sherburne's responsibility to fulfil that - e.g. by buying annual passes for those lifetime pass owners from Pico. If Sherburne had sold off its assets leaving it in a position unable to fulfil its obligations, the directors of Sherburne would be guilty of some variety of corporate fraud.
If Sherburne had gone into receivership, though, the receivers would have been responsible for getting the best deal possible for the creditors of the company in receivership, whether they are the taxman, trade creditors, long term loan owners or shareholders (in this country in descending order of priority). I would assume that owners of these passes would rank somewhere in those last categories. If the new owners of the assets were not happy assuming those liabilities, they may get some small financial compensation, or nothing, depending on what is left from that disposal after satisfying the higher priority creditors.
The law in Vermont (or whichever state they were registered in - the few I've come across all seem to be registered in Delaware, company law must be easier there) may be completely different though.
The only other question (in the case of a full company sale) I would wonder would be, for the pass owners where they bought the rights from an original owner, if there were any restriction on selling on those rights. As a last resort, with a bit of thought I would expect it to be possible for the new owners to dream up some way of making it possible, but economically or practically unviable for the owners of those lifetime passes to exercise their rights.
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