UPDATED: Class action lawsuit filed over vacation renters denied refunds from Surf or Sound Realty

Beach houses against the sunset in Kill Devil Hills. [Kari Pugh photo]

It’s official: Attorneys on Tuesday filed a class-action lawsuit on behalf of vacation-home renters denied refunds from Surf or Sound Realty after they were unable to come to the Outer Banks due to coronavirus-related bridge closures.

In a statement, the Law Office of James Scott Farrin in Greenville said Surf or Sound Realty originally told vacation customers they would receive either a full refund or the choice of an alternate week for the same price as their deposits and payments. Vacationers were shut out of the Outer Banks from March 17 to May 16 due to the coronavirus pandemic.

In May, the realty company reversed the refund decision and told would-be vacationers they wouldn’t be getting their money back after all. The company offered alternative weeks instead.

That decision was based on the opinion of Lloyd C. Smith Jr., an attorney hired to represent Surf or Sound Realty. Smith contends that paying refunds shouldn’t fall on realty companies and homeowners, but instead Dare County and the Outer Banks’ town governments. He said the offers of alternative weeks is a fair compromise.

Smith himself is representing non-resident Outer Banks property owners in their own class-action lawsuit, this one against Dare County and the towns of Duck, Southern Shores, Kitty Hawk, Kill Devil Hills, Nags Head and Manteo.

The suit in the U.S. District Court of Eastern North Carolina claims the closure of Dare County amounted to an illegal seizure of out-of-town owners’ property in violation of the U.S. Constitution. The suit is asking for Dare County and town governments to pay rental loss and other expenses for out-of-town property owners who were also kept from their vacation homes.

Related story: Couple files class-action lawsuit seeking damages for Outer Banks’ non-resident property owners

Any owners who use Surf or Sound for vacation-rental management will automatically be added to the class-action lawsuit unless they opt out, according to a letter the realty company sent to homeowners.

“This is a simple case of insisting that a company do what’s right and fair by its customers,” attorney Gary Jackson said. “People invested in a vacation getaway at one of the most beautiful places in the world. They trusted Surf and Sound, which made assurances, then tried to change the rules. They can’t do that. And now, they need to make their customers whole.”
In more than 80 emails sent from Surf or Sound April and May rental customers to OBXToday.com, people from all over the country – as well as Canada and the United Kingdom – detailed losing deposits ranging from $1,200 to more than $6,000.

They also told stories of lost weddings, family reunions and other meaningful getaways, now with no funds to replace the experience.

Rebecca and Cassius Lawrence were coming from Lawrenceville, Georgia for time with lifelong friends because Cassius is terminally ill with stage four cancer, his wife said.

“Rebooking for next year is not really an acceptable option for us for obvious reasons of his health,” Rebecca Lawrence said. “I hope that you will be able to make our voices heard and that Surf or Sound will do what is morally and legally the right thing to do.”

Ryan Leather of Hagerstown, Maryland was coming down for a “guys’ fishing trip” in early April with a group of first responders. Brian and Jennifer McPhillips were coming with family from Liberty, New York, as a “last hurrah for the kids in the family.” The weeklong vacation was to be the kids’ reward from graduating from high school or college.

Dozens of Surf or Sound renters have also filed complaints with the Better Business Bureau, the North Carolina Attorney General’s Office and the North Carolina Real Estate Commission, which issued an opinion earlier this year that vacation property owners are legally bound to return funds for lessees who couldn’t access vacation homes.

Related story: Real Estate Commission: Give vacation home renters their money back

The thwarted vacationers have launched a Facebook group to share informationClick here to join the group.

To speak with an attorney associated with the class-action suit, call Gary Jackson or Chris Bagley at 1-866-900-7078.

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About Kari Pugh 648 Articles
Kari Pugh is digital director for OBXToday.com, Beach 104, 99.1 The Sound, 94.5 WCMS and Classic Rock 92.3. Reach her at [email protected]