Perpetuity In Contracts

The membership of a club attracts maintenance fees and it is those fees and the continuance of them which generates the most worry for elderly people as the resorts and timeshare seller say that your heirs and successors will have to join the club and they will be responsible for the ongoing fees.


The test used in these two cases – find a radical change in the intentions of contracting parties – has found favour over the implied term test, which has been criticised to the extent of being called a “grave threat to the sanctity of contract.”


A common objection to this test was that it was ‘artificial’; in many cases, such as Davis Contractors v Fareham UDC, it would not be true to say that both parties would intend for an implied term to cover particular situations. Thus an implication of a term to discharge a contract may run contrary to the intentions of the contracting parties. As a result, a test of contractual purpose is preferred, as laid out in Davis Contractor’s v Fareham UDC, in the judgement of Lord Reid:


Frustrating events in Timeshare contracts


Incapacity or Death

A contract may become frustrated where a person or group under contract become unavailable (either through death, illness or unavailability).


Perpetuity is in general terms forever and it can (although not often) impart on the timeshare consumers a liability to the contract unless it is frustrated. In the event of death perpetuity has come to an end. In short the party who has died is unable to fulfil and benefit from the membership of the club.