In classic Donald Trump fashion, the GOP presidential nominee testified Monday that improvements he made to an ailing Jupiter country club were “beautiful,” the members were “very happy” and those who weren’t were just “angry people” he didn’t want in his club anyway.
Trump’s appearance at the breach of contract trial in U.S. District Court was limited to a roughly 25-minute video deposition. It was taken at his New York City offices in April 2015, long before anyone imagined the real-estate-mogul-turned-TV-celebrity would secure the Republican presidential nomination.
As expected, Trump denied allegations by members of Trump National Golf Club in Jupiter that he improperly changed the rules of their membership contracts when he in December 2012 bought the financially troubled club from Ritz-Carlton Golf Club & Spa for $5 million. He was equally dismissive of suggestions that he got the club at a bargain price by agreeing to assume an estimated $41 million in liabilities that hung over it because Ritz-Carlton promised to refund initiation fees, ranging from $35,000 to $210,000, to members who quit.
“It could have been the club would have closed and gone into bankruptcy and everyone would have lost money,” Trump testified. His purchase, he said, saved the club — and its members — from what he called “the ‘B’ word.”
But, three members who filed the class-action suit on behalf of roughly 60 others when he refused to refund their membership fees, said Trump used their money to put the club on firm financial footing.
Shortly after buying the club in a gated community on Donald Ross Road near Alternate A1A, he wrote members a letter, alerting anyone who had announced their intention of resigning: “you’re out.”
Membership manager Deborah Shulman testified that initially members who were on the resignation list were told they could no longer use the club but wouldn’t have to pay dues. Under Ritz-Carlton’s ownership, members on the list could continue to pay dues to use the facilities until their memberships were sold to new members which was when they got their deposits back.
Later, the rules changed, she said. Not only were members barred from the club, but they were required to continue to pay dues of about $6,000 a year and to pay a roughly $1,800 minimum for food and beverages at a club they couldn’t use.
According to evidence presented by Trump lawyer Herman Joseph Russomanno III, some members now owe more than will get back when their initiation fees are refunded. Because of the system used to assign old memberships to new members, the process takes years.
Palm Beach Gardens attorney Richard Slawson, who paid a $45,000 refundable deposit when he joined the club in 2005, testified that after three years on the resignation list there were still roughly 50 people in front of him. Russomanno said as of July, Slawson owed $45,000 in unpaid dues and other charges.
“He refused me access to the club but he wanted me to pay for the usage of the club,” Slawson testified. Once members were denied access, Trump breached their membership contracts and was obligated to refund their deposits within 30 days, said attorney Bradley Edwards, who is representing the members.
Eric Trump, who operates the club for his father, is expected to take the witness stand Tuesday. But, on Monday, a brief portion of his video deposition was played to U.S. District Judge Kenneth Marra, who will decide the case.
In it, he vehemently denied that members who announced their intention to resign were blocked from the club. He said the club never implemented the new policy his father outlined in the letter. “In reality, we maintained the status quo and did not deny access,” he said.
Shulman and club general manager Tony Servideo testified that once Trump took over members on the resignation list were barred entry but were required to continue to pay dues — a change from Ritz-Carlton’s policy. Servideo testified that Trump attorneys told him there was nothing in documents members signed that absolved them of their responsibility to pay dues while waiting for new members to join.
For his part, Donald Trump testified that membership terms were negotiable. Those willing to forgo their deposits, were offered lower annual dues and the ability to use his other clubs, including Mar-A-Lago in Palm Beach. “They could call and make their own deal,” the author of “The Art of the Deal” insisted.
But, Slawson said, he repeatedly tried to persuade club officials that it was “ridiculous” for him to pay dues to a club he couldn’t use. “They said their hands were tied,” he testified.
The case was to have been decided by a jury until both sides agreed they would rather have Marra review the various membership documents that are key to the case. The trial is expected to wrap up Tuesday.