(1) Trusts, partnership interests, undivided interests as tenants in common, corporate shares, or other membership or use interests in a dwelling unit, in which thirteen or fewer undivided interests, corporation shares, partnership interests, trust interests, or other membership or use interests are conveyed, are referred to in this section as vacation multiple ownership interests and are not considered a vacation time sharing plan or a time sharing unit for purposes of this chapter. Debts, encumbrances, or liens, except for purchaser financing, may not exist on the dwelling unit at the time fee simple title is conveyed to the tenants in common, corporation, trust, partnership, or other purchasing organization. The contract of sale and sale of a vacation multiple ownership must be handled by a real estate salesman duly licensed pursuant to Chapter 57 of Title 40 unless handled by a regular employee of the seller. It is a violation of this chapter for a seller of a vacation multiple ownership interest to sell, lease, encumber, or convey in any manner, or to solicit or advertise those transactions, unless the seller is in compliance with the provisions of Sections 27-32-20, 27-32-30, 27-32-40 , 27-32-50, 27-32-60, 27-32-70, 27-32-80, 27-32-100, 27-32-110, 27-32-120, 27-32-140, 27-32-150, and 27-32-190. Where the phrase "time sharing" is used in those sections, it also means "multiple ownership" for purposes of this section.

(2) The sale or resale of a vacation multiple ownership interest and the exchange of an interest in a vacation multiple ownership interest is exempt from sales tax imposed by Chapter 36 of Title 12 pursuant to the provisions of Section 12-36-2120.

(3) An owner selling vacation multiple ownership interests in not more than one dwelling unit a year is not subject to the provisions of this section. An individual or a corporation, trust, business, or partnership in which the individual is an owner, partner, stockholder, trustee, beneficiary, or affiliate is considered the owner of the dwelling unit for purposes of this section.

(4) Funds received from purchasers of vacation multiple ownership interests must be placed in an escrow account with an insured institution and must not be disbursed until a sufficient number of vacation multiple ownership interests is sold to satisfy all outstanding debts, liens, and encumbrances on the dwelling unit, except for purchaser financing, and all furniture and furnishings in the dwelling unit, or until the posting with the Real Estate Commission of a bond, letter of credit, or other equivalent security satisfactory to the commission, to ensure payment of all outstanding debts, liens, and encumbrances on the dwelling unit and all furniture and furnishings in the dwelling unit.

(5) Definitions:

(a) The definitions contained in Section 27-32-10, items 1, 2, 3, 4, 5, 6, 10, 12, 13, and 16 are applicable to this section.

(b) "Dwelling unit" means the actual accommodations and related facilities which are the subject of the vacation multiple ownership interest.

(c) "Purchaser" means one who receives an undivided interest in a dwelling unit, a partner in a partnership that owns a dwelling unit, a shareholder in a corporation that owns a dwelling unit, a beneficiary in a trust that owns a dwelling unit, a holder of a leasehold interest in a dwelling unit, or a member of another organization that owns a dwelling unit.

HISTORY: 1986 Act No. 434, Section 1; 1994 Act No. 385, Section 54; 1998 Act No. 340, Section 3; 1998 Act No. 419, Part II, Section 61C; 2003 Act No. 84, Section 1.