                                 CODE OF VIRGINIA

POSSIBILITY OF REVERTER (§ 55.1-2222)

A. A possibility of reverter contained in a reverter deed for a time-share
estate subject to reverter is valid, is enforceable in law and in equity, and
shall operate to transfer title to the time-share estate from each grantee in
such deed back to the developer, provided that the following conditions are
satisfied:

   1. The reverter deed from the developer contains the possibility of reverter
   by insertion of the language required by subsection E;

   2. A grantee in the reverter deed is in default and has been provided after
   such default with at least two written notices to this effect with no less
   than a 10-calendar day right to cure in each notice;

   3. A grantee in the reverter deed has been provided with no less than 30
   calendar days within which to cure the default before exercise of the
   possibility of reverter occurs;

   4. At the time of exercise of the possibility of reverter, the developer is
   the sole holder of the note and the sole beneficiary under the deed of trust;

   5. The exercise by the developer of the possibility of reverter is evidenced
   by an affidavit duly recorded where the reverter deed was recorded that
   contains the following information:
   				a. A description of the time-share project and time-share estate and a
   statement that, upon recordation of the affidavit, title to such time-share
   estate reverts back to the developer;
   				b. A description and recitation of the reverter deed that contained the
   possibility of reverter and a reference of when and where such deed was
   recorded and its recording information;
   				c. A recitation that the purchaser defaulted in or violated a consumer
   document and failed to cure such default or violation within a period of no
   less than 30 calendar days;
   				d. A description of the note and deed of trust with a recitation that (i)
   the developer is the sole holder of the note and the sole beneficiary under
   the deed of trust, (ii) such note is canceled and declared void, and (iii)
   such deed of trust is automatically released;
   				e. A recitation that such purchaser&#8217;s rights and entitlements in the
   time-share estate, the time-share project, and the time-share program are
   extinguished effective the date of recordation of the affidavit;
   				f. The signature of a duly authorized representative of the developer
   verified under oath as to its truth of the statements contained in such
   affidavit; and

   6. A copy of the recorded affidavit described in subdivision A 5 is sent by
   the developer to each purchaser at his address as maintained by the developer
   or the association, along with the statement from the developer explaining the
   consequences of such affidavit with emphasis on subdivisions A 5 a, d, and e.

B. The recordation of the affidavit referred to in subdivision A 5 shall
automatically:

   1. Transfer title to the time-share estate from each grantee in the reverter
   deed to the developer without the need of a deed to the developer or consent
   from such grantee;

   2. Declare null and void and act as an automatic release of the deed of trust
   or mortgage given by such grantee to finance a portion of the purchase price
   of the time-share estate with no deficiency resulting;

   3. Void and act as an automatic release of any debt from such grantee to the
   developer arising out of the purchase or financing of the time-share estate as
   evidenced by the note; and

   4. Extinguish any ownership or other property right or entitlements such
   grantee has in and to the time-share estate, the time-share project, and the
   time-share program.

C. The clerk of the court shall record such affidavit in the land books where
the time-share project is located, indexing the purchaser in the grantor indices
and the developer in the grantee indices. For indexing purposes only, the
purchaser shall be referred to as the grantor and the developer as the grantee.
The cost of recording the affidavit shall be limited to the clerk&#8217;s fee
only.

D. In the exercise of the possibility of reverter, the developer shall be liable
to the purchaser for the developer&#8217;s failure to comply with the provisions
of this section; however, such failure shall not operate to defeat or diminish
the transfer of title to the time-share estate from each grantee in the reverter
deed to the developer upon recordation of the affidavit referred to in
subdivision A 5. The developer&#8217;s liability shall be limited to the amount
paid by such purchaser toward the purchase price of the time-share estate,
exclusive of interest and closing costs but without offset for the
purchaser&#8217;s utilization of the time-share program. The court shall award
court costs and reasonable attorney fees to the prevailing party.

E. The reverter deed shall contain the following statement in order to possess
the possibility of reverter. The opening phrase shall be in 10-point boldface
type as follows:
			&#8220;Loss of Time-Share Estate. Developer has inserted into this deed a
&#8220;possibility of reverter.&#8221; By this concept, should a grantee of this
reverter deed default in or violate an obligation imposed by a consumer document
for a period of at least 60 days and fail to cure such violation or default
within no less than 30 calendar days thereafter, title to the time-share will
revert back to the developer upon the developer recording an affidavit to this
effect where this reverter deed is recorded. Only the developer can elect to
exercise the possibility of reverter. Each grantee in this reverter deed will be
sent at least two notices of default or violation within the 30-day period with
no less than 10 days to cure in each instance. The notice will be sent to the
address of each grantee maintained at the office of the developer or the
association. After the cure period has lapsed and the developer records the
affidavit, title to the time-share estate will automatically vest in the
developer and any note executed by the grantee will be deemed canceled and any
recorded deed of trust securing such note shall be automatically released. The
possibility of reverter will itself lapse and become null and void at the
soonest to occur of the following: (i) the deed of trust is released of record,
(ii) a statement that the deed of trust is released of record is executed and
recorded by the developer with a date of when the possibility of reverter was or
is to lapse, or (iii) when the time-share program terminates pursuant to either
the Virginia Real Estate Time-Share Act or the time-share instrument which
created such program.&#8221;

F. The filing of the affidavit referred to in subdivision A 5 shall not result
in the requirement of any filing under Chapter 12 (&#xA7; 64.2-1200 et seq.) of
Title 64.2.

G. Any possibility of reverter not otherwise exercised by the developer pursuant
to this section shall itself lapse and become null and void at the soonest to
occur of the following: (i) the deed of trust is released of record, (ii) a
statement that the deed of trust is released of record is executed and recorded
by the developer with a date of when the possibility of reverter was or is to
lapse, or (iii) when the time-share program terminates pursuant to either this
chapter or the time-share instrument.

H. In exercising the possibility of reverter, the developer shall be entitled to
retain as liquidated damages all moneys paid by the purchaser in conformity with
any consumer document.

I. The exercise of the possibility of reverter shall not operate to diminish or
eliminate (i) any debt of the purchaser to the time-share association or other
third party occasioned by ownership of the time-share estate or participation in
the time-share program or (ii) any recorded lien junior in priority to the deed
of trust lien referred to in this section.

HISTORY: 2004, c. 143, § 55-376.1; 2019, c. 712.