The decision by a lower court in February to order the refunds confirmed that the case is one of a “straightforward breach of contract,” the members said. The Trump Organization is appealing the decision, arguing that it followed the contracts by placing members who wished to resign on a waiting list to have membership deposits refunded once a required number of new memberships were sold.
On October 13th, members of Trump National Golf Club Jupiter (Fla.) asked the Eleventh Circuit of Appeals in Atlanta to uphold a ruling ordering the club to refund roughly $5.7 million to those members who had resigned before The Trump Organization’s 2012 purchase of the property, Hospitality Law360 reported.
The members’ response to The Trump Organization’s appeal of U.S. District Judge Kenneth A. Marra’s decision to order the refunds argued that the dispute was a “straightforward breach of contract case,” Hospitality Law360 reported, and that Judge Marra had correctly construed their membership agreements in ruling that policy changes after The Trump Organizations bought the club in late 2012 should have immediately triggered refund provisions.
The members were on a resignation waiting list when the golf club canceled their memberships in December 2012 without refunding their deposits as required by their membership agreements, Hospitality Law360 reported. They said they were told when they placed their names on the waiting lists that their memberships were still active and that they could use the facilities while they waited to move to the top of the list, as long as they continued to pay their fees.
“Those statements, and the club’s uncontested prior practice of actually treating resigning members as continuing members—by assessing them dues and giving them club access in return—are powerful evidence that the parties to the contract understood that plaintiffs were waiting to resign, and, therefore, were still members when [The Trump Organization] took over the club and issued [the] ultimatum,” the members said in their filing with the Eleventh Circuit Court.
The controversy arose, Hospitality Law360 reported, after a December 17, 2012, letter signed by Donald Trump stated that members who had requested to be added to a resignation waitlist to have their memberships refunded once a certain number of new memberships were sold—typically five for each member on the list—would no longer be able to use the club facilities.
“I do not want them to utilize the club nor want their dues,” Donald Trump said in the letter, adding: “If you choose to remain on the resignation list, you are out.”
Norman Hirsch, Matthew Dwyer and Ralph Willard sued Jupiter Golf Club in 2013, Hospitality Law360 reported, alleging they were denied refunds of their deposits after The Trump Organization bought the club, despite changes to club memberships they claim should have triggered the refund provisions in their agreements.
Judge Marra certified a class of about 65 members and ordered the club in February to refund $4.8 million in fees, plus about $925,000 in interest, Hospitality Law360 reported.
The club appealed the decision to the Eleventh Circuit (https://clubandresortbusiness.com/2017/08/trump-national-gc-jupiter-fla-appeals-5-8m-decision/), arguing that it followed the contracts by placing members who wished to resign on a waiting list and refunding their membership deposits when they got to the top.
The club challenged Judge Marra’s assessment that Trump recalled the memberships with his policy change and breached the agreements by failing to issue refunds within 30 days, Hospitality Law360 reported, arguing that those memberships couldn’t be recalled because the members had already resigned.
“There can be no recall, revocation [or] cancellation where there has been a resignation. One cannot recall, revoke, or cancel that which no longer is extant,” the golf club said in its appeal.
The club did admit that its administration told resigned members that they needed to keep paying dues while they waited, which it says was wrong, Hospitality Law360 reported. But the fact is that these resigned members didn’t actually pay any dues or fees; instead, they “turned that misguided request into a breach of contract claim,” the club argued.