Update from FRP Advisory regarding the liquidation of Club La Costa (UK) PLC

Update from FRP Advisory regarding the liquidation of Club La Costa (UK) PLC

(Background and insights on CLC claims and exits provided by KwikChex)

A report has been filed regarding the progress of the liquidation of the timeshare company Club La Costa (UK) PLC. The report can be viewed on the Companies House website via the company’s filing history:
https://find-and-update.company-information.service.gov.uk/company/03123199/filing-history

Background

Many consumers who purchased timeshares from Club La Costa (CLC) have subsequently filed compensation claims alleging mis-selling. These claims are included within the information relating to unsecured creditors. The total amount reported by FRP as claims from unsecured creditors has now reached £140 million.

Confirmation of ongoing investigation and pursuit of claims

FRP has confirmed:

“We have continued to liaise with our solicitors and legal counsel to consider claims that the Liquidators and/or the Company may be able to pursue and have received positive advice on the merits of bringing such claims. However, given the absence of sufficient funds available within the estate to progress claims, our recent attention has been focused on obtaining third-party litigation funding.

We confirm that an agreement is now in place with a third-party litigation funder that will provide sufficient funds for the Liquidators to pursue claims that we (and our legal advisors) consider to have strong prospects of success. Without obtaining this funding agreement, no claims could have been pursued.

The claims remain at an early stage and, until details such as the names of defendants and the quantum of claims are publicly available, we are not in a position to disclose further information, as this may prejudice the outcome. We shall, however, be able to update creditors in subsequent reports and potentially earlier, should circumstances allow.”

Ongoing acceptance of claims

The liquidators have also confirmed that they continue to accept claims, stating:

“It should be noted that any potential creditors are able to submit their claims directly should they wish. We may request further information if and when we are in a position to make a distribution to creditors.”

While the latest FRP report indicates a more optimistic view regarding the prospects of success, it remains subject to cautionary advice:

“It is currently uncertain as to whether there will be sufficient funds available to make a distribution to unsecured creditors, albeit our investigations continue.”

CLC insights and clarity

KwikChex continues to monitor developments relating to CLC and provides the following key context:

• The owners of Club La Costa placed Club La Costa (UK) PLC into voluntary administration, primarily following a surge in mis-selling claims after a 2015 Spanish Supreme Court decision.

• Club La Costa (UK) PLC was responsible for sales activities, while most assets and operational control of resorts and timeshare schemes sit with other entities, including trusts. As a result, the resorts and schemes were able to continue operating.

• In October 2021, a strategic partnership was formed between CLC operating businesses and Wyndham. CLC resorts were subsequently rebranded as Wyndham. This is a marketing and operational partnership, not a takeover of CLC by Wyndham.

Other claims, legal arguments, and rulings affecting CLC

Claims under the UK Consumer Credit Act

Many claims have been brought against lenders that provided loans for CLC timeshare purchases. These claims often relate to fractional timeshares allegedly sold as investments, which would be prohibited under the Timeshare, Holiday Products, Resale and Exchange Contracts Regulations 2010.

Additional claims rely on broader consumer protection laws, including allegations of Unfair Credit Relationships under the UK Consumer Credit Act 1974 (CCA).

Thousands of such claims are believed to have been referred to the UK Financial Ombudsman Service (FOS). These issues remain highly contentious. A 2023 High Court Judicial Review broadly supported the FOS position that some fractional timeshares, including those sold by CLC, were mis-sold.

One lender, Barclays, has since paid millions in compensation and has, in some cases, proactively compensated affected consumers who had not registered claims.

However, many other claims have been rejected by FOS, often on the basis that they are time-barred under the Limitation Act, which generally allows six years to bring a claim. This remains contentious, as Section 32 of the Act allows extensions where fraud or concealment is alleged and could not reasonably have been discovered earlier. FOS typically advises that such matters are more appropriately determined by the courts.

European Court of Justice ruling

In September 2023, the European Court of Justice ruled that Spanish courts lack jurisdiction in CLC cases where:
a) the claimant is not a Spanish national, and
b) the contracting company was not incorporated in Spain and the contract specifies the law of another country.

As most CLC purchasers are UK citizens and contracts are governed by the law of England and Wales, this ruling means UK jurisdiction applies, not Spanish. This affects ongoing and future claims in Spain that have not yet been ruled upon.

Amendments to Spanish law

In January 2025, Spanish timeshare legislation was amended following extensive lobbying by affected timeshare companies. These amendments have significant but complex implications for ongoing and future claims brought under Spain’s timeshare regulations.

The ongoing pursuit of claims

Law firms and claims businesses continue to adapt how claims are pursued, increasingly relying on wider consumer protection laws beyond timeshare-specific legislation, including misrepresentation, unfair practices, and allegations of fraud.

In the UK, firms are also challenging aspects of rejected Consumer Credit Act claims, including potential Judicial Reviews, group litigation, and test cases on time-barring and extensions of time.

Caution and due diligence for timeshare owners

At present, there are few definitive conclusions, only ongoing developments. This complexity has led to increased confusion among timeshare owners, creating fertile ground for scams that have cost owners hundreds of millions of pounds.

Core advice on CLC claims and exits

• If you wish to exit your CLC timeshare without making a claim, contact CLC directly to establish available options. Note that CLC may require fees to be fully up to date and that no claims are pursued.

• If you believe you were mis-sold, your case requires careful assessment across multiple legal frameworks. Claims are ongoing, but complexity is exceptional.

• Seek multiple expert opinions, ask for clarification, and take your time. Request evidence of expertise and track records.

• Be wary of cold callers and unsolicited contact.

• Do not be intimidated by high-pressure tactics or threats regarding liabilities.

Support from KwikChex

KwikChex provides advice and conducts checks through its Protect and Insight services, including identifying fraud and misrepresentation. Advice is impartial and evidence-based, and options—including self-advocacy—are clearly explained.

Bringing clarity to timeshare

After more than a decade of dealing with complex timeshare matters, KwikChex has launched the new Timeshare Clarity Initiative.

About KwikChex

KwikChex is a long-established, independent consumer protection and anti-fraud organisation recognised for integrity and evidence-led investigations. It is vetted and approved by UK Trading Standards and received a Trading Standards Business Hero Award in 2019. KwikChex regularly supports law enforcement, regulators, and the media, with frequent appearances on BBC platforms.

Disclaimer

The information published by KwikChex is for general information and consumer awareness only and does not constitute legal advice. Readers should seek independent professional advice before taking action.