In Adelsperger v. Elkside Development, LLC, the Oregon Supreme Court upheld a jury verdict against a company that refused to honor lifetime campground membership contracts after purchasing the property. The case is a reminder for business owners that inherited obligations—especially involving vulnerable individuals—can’t be ignored without legal consequences.
What Happened
The case involved “lifetime” campground membership contracts at Osprey Point RV Resort, most held by individuals over 65. These agreements granted contract holders seasonal access to the RV park and other benefits like frozen dues and reduced fees. The campground’s original owner, Elkside Development, sold the property to Barnett Resorts with full disclosure of the membership contracts.
Despite knowing about the contracts, Barnett later refused to honor them, increased dues, voided reservations, and claimed the agreements were never part of the purchase. The plaintiffs sued for breach of contract and elder abuse.
The Court’s Findings
The Oregon Supreme Court agreed with the jury that Barnett could be held liable under both claims.
Breach of Contract
Barnett argued it wasn’t bound by the contracts because they weren’t recorded under ORS 94.986 and that it was not a successor to Elkside. The trial court—and ultimately the Supreme Court—disagreed. The court found that even if the contracts weren’t recorded, Barnett had actual notice and that the contracts could bind successors under common-law servitude principles. Oregon law allows a party to assert a property right claim based on the notion that certain property rights, such as the right of a non-property owner to use another’s property for a specific purpose, stay attached to the land even if the property is sold to a new owner.
Elder Abuse
Plaintiffs, all over age 65, also brought claims under Oregon’s elder abuse statute (ORS 124.110). The elder abuse statute allows people 65 years of age or older, as well as those with disabilities, to bring a lawsuit against a party who has wrongfully exploited their vulnerability in a way that causes physical harm, emotional distress, or a loss of money or property. The Court affirmed that Barnett’s conduct—refusing to honor known property rights and depriving the elderly plaintiffs of access to the property—could be viewed by a jury as “injurious, unjust, or unfair” under the statute, even if no separate tort or crime occurred.
Key Takeaways for Business Buyers
- Disclosure isn’t a shield: Even if a contract wasn’t recorded, a buyer may still be liable if they had actual knowledge of the obligation.
- Technicalities may not protect you: Equity and fairness—especially involving seniors—can override statutory formalities.
- Don’t ignore vulnerability: Oregon courts may treat the refusal to honor known benefits to elderly individuals as elder abuse, even without other civil or criminal violations.
Conclusion
Adelsperger is a cautionary tale for business owners purchasing companies or properties with pre-existing customer agreements—especially when those agreements involve elderly individuals. Buyers should consult closely with legal counsel and understand that ignoring inherited obligations could lead to serious liability under both contract and elder abuse laws.
