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PELICAN--The Simpson Bay Resort and Marina and the Villas at Simpson Bay resort and Marina, formerly known as the Pelican Resort Club and Pelican Marina Residences, will close as of Sunday February 20, possibly putting 182 employees out of work as a result and potentially dealing a major blow to St. Maarten's timeshare industry and, by extension, its economy.
The new owner of the properties cited "unforeseen circumstances" as having caused "significant unbudgeted expenses and judicial liabilities that require a massive financial injection in order to be able to responsibly operate the resort."
Prime Minister Sarah Wescot-Williams, who holds the labour ministry portfolio, said on Friday evening that upon learning of the closure notice, her ministry immediately consulted with the Labour Office and instructed officials to bring together the parties involved in the ongoing saga (the Simpson Bay Resort and Marina and Workers Institute for Organised Labour [WIFOL]), to understand what their intentions were.
As executives of the Simpson Bay Resort and Marina are currently not on island, their legal representative Jairo Bloem was contacted and so was Theophilus Thompson of WIFOL.
The Prime Minister, who is expected to appoint two special mediators for any new negotiations between the parties, said she now awaits word from Bloem on when his clients can head back to the negotiating table with WIFOL. The PM said Bloem was asked to communicate to his clients that a closure of the resort is not something anyone wants and would be devastating for the workers, the timeshare sector and the island as a whole.
Meanwhile, in a letter to timeshare owners, the new owner said "diligence, responsibility, long-term viability of the resort, consideration of the interest of stakeholders and as stated in particular the protection of your timeshare rights for the long term, compels management to close the resort as of Sunday, February 20, 2011, until solutions are found. Please note that no check-ins will be possible as of Saturday, February 19, 2011."
Timeshare owners were assured that a priority of the new owner remains the protection of the value of their timeshare purchase on St. Maarten. "Several important issues must be resolved to establish a new responsible and viable long-term operating plan. Examples of these important issues include ownership of movable assets and labour issues," the timeshare owners were told.
In that context, The Daily Herald understands that the new owner will reportedly also challenge other aspects of the court ruling besides those related to the employees.
The language in the court ruling regard the new ownership entity as the same as the previous. Such language could possibly leave the door open for creditors of the previous ownership entity to lay claim on assets and the like. The new owner is reportedly seeking ways to negate that possibility.
"Management is looking at tangible solutions, also considering correspondence to you including those dated December 18, 2010 and January 27, 2011, wherein it was communicated a preference to operate without any immediate increase in fees or a special assessment," timeshare owners were told.
Attorney representing WIFOL Wim van Sambeek of HBN Law firm said the announcement by Simpson Bay Resort and Marina was not unexpected. "This announcement follows the ruling by the Court of First Instance in which it was considered (in short) that Royal Resorts (through an affiliate company) continued to manage and operate the resort (like it did since 1997) and thus, remains responsible for obligations towards WIFOL and its members," he said.
He continued: "Since it became apparent that one of the objectives of Royal Resorts was to continue the operation without responsibilities towards the employees, this announcement does not come unexpected. It also makes clear why Royal Resorts did not want to discuss an orderly return to work with WIFOL and or the government mediator."
Van Sambeek said the announcement seems solely to be intended to pressure WIFOL to give up secured employment rights, "as Royal Resorts will claim (without presenting any proof) that this is the only way to keep the resort open."
He said HBN Law regrets that as a result of the announcement by Royal Resorts, the uncertainty for the families of the members of WIFOL will continue. "WIFOL asked us to monitor the developments and instructed us to prepare to take the necessary legal action, including claims to return to the place of work," he said.
As far as the expected appointment of two special mediators by the Prime Minister is concerned, Van Sambeek questioned the scope of their assignment since the decision of the court is clear. "All that needs to be talked about is the orderly return of the employees to their place of work," he told The Daily Herald.
The announcement to timeshare owners was signed by "Management" and did not specifically mention Royal Resorts.
"Please accept the deepest apology for this inconvenience and know that every responsible effort has been made to avoid this circumstance. Please be advised that Management will continue to do its utmost efforts to ensure that you as a member will have your usage rights protected," the announcement read in part.
The closure of the resort does not entail the closure of the independent businesses operating on the property. They remain open to the public at their discretion.
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