At a fiery annual meeting of the Loch Rannoch Highland Club, its elected committee beat off challenges from

disgruntled owners and insisted it would continue to manage the resort itself, using volunteers, book-keeping software, and an auditor, having dismissed first Macdonald Hotels and then a successor company set up by owners at the instigation of the committee itself.

In the past year the club has paid out £550,000 plus over £200,000 in legal fees to settle court action by Macdonald, and been served with a claim for £389,000 for wrongful termination of contract by Timeshare Management Services Ltd (TMSL), whose founders are now agitating against the committee.

“The auditors have been given the job of running the club, which means the committee has infringed its own constitution,” said TMSL director Eddie Monks.

But the club with 3200 members has cut management costs at the resort from well over £100,000 under Macdonald to a £40,000-a-year auditing fee.

Macdonald Hotels, meanwhile, the UK’s leading timeshare operator, has been manoeuvring to try to harness owner discontent and eventually regain the contract for managing the resort next to its Loch Rannoch hotel, which it lost in 2003 after taking dozens of owners to court, refusing industry mediation, and banning holidaymakers from the hotel bar.

Donald Macdonald, founder of the Bathgate-based group which he took private six years ago with backer Bank of Scotland, has admitted for the first time to “shortcomings” in the group’s past resort management.

“When we lost the management of the club there were issues which our management people badly handled … we paid the price for our shortcomings,” he told The Herald. But he says the business has “moved forward enormously”.

But when asked whether Macdonald might regain control of the resort, committee member Allan Kenneth told The Herald: “Not a chance.”

The hotels group has tried unsuccessfully to use the Timeshare Association, which styles itself an ‘independent consumer body’ but works closely with resort companies, to promote the case for Macdonald at Loch Rannoch.

The association’s director Harry Taylor said it had offered to contact all the owners using a membership list retained by Macdonald.

“We got a letter back from their solicitor saying keep out of it. The committee rules with an iron rod, they are not taking any notice of anyone, and they are taking the resort into oblivion.”

Kenneth said: “They call themselves an independent consumer body but regrettably they are not.” He went on:

“We have a viable model, we have an improved management structure. When we went independent in 2003, we spoke to a number of different timeshares and it was obvious that the most successful ones were the self-managed ones.”

But Harry McKerral, an owner, said: “You can’t manage any company or business by committee, particularly a committee of people who are spread around the country.” He added: “The committee really don’t want to

get into bed with Macdonald, though a lot of members think they could keep them at arm’s length.”

Simon Jackson, managing director of Macdonald Resorts, said discussions over lifting the ban on access to the hotel swimming pool had broken down. “We would still be prepared to sit down with them … But old sentiments kept coming to the forefront, they couldn’t let go.”

A decade ago the then Barratt International Resorts, 50% owned by Macdonald, took almost 200 owners at four Scottish resorts to court in an attempt to recover £250,000 of disputed management fees. Owners were unhappy that full accounts were not available to enable them to scrutinise expenditure, and that the Macdonald-managed resorts were being used to cross-subsidise leisure facilities for the group’s adjacent hotels.

But the firm refused to join an international industry body offering mediation, ignored a government report on timeshare contract disputes which said “most of the complaints concern resorts owned by a particular developer”, and also launched a £50,000 gagging action against an owner couple who had set up a consumer website.

Then in 2003 Macdonald, which had bought out Barratt and taken full control of the resorts business, served interdicts on six owners at Loch Rannoch in an attempt to stop them taking the £1.4m management contract away from the group, which was still listed on the stock market.

But the Court of Session refused to uphold the interdicts, and also blocked Macdonald’s plans to hold its own special meeting to rubber-stamp the renewal of the long-term contract when it expired. Three committee members who had been served with interdicts were then re-elected on large votes in a four times normal turn-out.

Macdonald then threatened to ban owners not only from the hotel’s swimming-pool but even from the hotel bar if its contract was not renewed, it slapped an injunction on the resort’s full-time manager, and it refused to hand over the list of club members until outstanding debts of £803,000 were settled personally by the committee.

In February 2004 owners at the 85 lochside lodges voted by four to one to replace Macdonald with TMSL, which cut fees and improved facilities. Four months later the hotels group lifted the ban on lodge owners

using the bar at Loch Rannoch Hotel, paving the way for a fresh initiative by Donald Macdonald.

In 2005, he contacted most owners, saying the resort had lost its international exchange status and its weeks were “selling for £150 on Ebay”. But his offer to buy back owners’ weeks in order to regain control of the club, then sell them back to the members “once normality is restored”, secured only a third of acceptances.

McKerral commented: “The whole tenor of the site improved under TMSL, we didn’t have Macdonald on our backs.”

In 2007, Macdonald had what he said were “amicable” discussions over selling the hotel to the club for £3m, which came to nothing, while the group continued to withhold management fees for the 163 holiday weeks in its ownership, some 4% of the total, and to pursue the £803,000 claim against three committee members.

The settlement on the steps of the court saw Macdonald bank £550,000 but also hand back its owned weeks, which Donald Macdonald said last week has “saved the group £1.5m” in a capitalised ongoing liability.

Kenneth, however, said it marked a retreat by Macdonald which was “losing interest in the fight for Rannoch”.

Jackson said Rannoch had now been de-listed by international exchange group RCI.

Macdonald said the group was still interested in the resort.