Hirsch v. Jupiter Golf Club LLC

• Decision Date: 01 February 2017
• Docket Number: CASE NO. 13–80456–CIV–MARRA/MATTHEWMAN
• Citation: 232 F.Supp.3d 1243
• Parties: Norman HIRSCH, Matthew Dwyer, and Ralph Willard, individually and on behalf of all others similarly situated, Plaintiffs, v. JUPITER GOLF CLUB LLC, a Delaware LLC d/b/a Trump National Golf Club Jupiter and RBF, LLC d/b/a the Ritz–Carlton Golf Club & Spa Jupiter, Defendants.
• Court: U.S. District Court — Southern District of Florida

232 F.Supp.3d 1243

Norman HIRSCH, Matthew Dwyer, and Ralph Willard, individually and on behalf of all others similarly situated, Plaintiffs,

v.JUPITER GOLF CLUB LLC, a Delaware LLC d/b/a Trump National Golf Club Jupiter and RBF, LLC d/b/a the Ritz–Carlton Golf Club & Spa Jupiter, Defendants.

CASE NO. 13–80456–CIV–MARRA/MATTHEWMAN

United States District Court, S.D. Florida.

Signed February 1, 2017

Bradley James Edwards, Steven R. Jaffe, Seth Michael Lehrman, Mark S. Fistos, Farmer, Jaffe, Weissing, Edwards, Fistos & Lehrman, P.L., Fort Lauderdale, FL, for Plaintiffs.

Herman Joseph Russomanno, III, Robert John Borrello, Russomanno & Borrello, P.A., Miami, FL, Jerry R. Linscott, Julie Singer Brady, Baker & Hostetler, Jorge A. Castillo, Paul Alexander Quimby, Baker Hostetler LLP, Orlando, FL, for Defendants.

FINDINGS OF FACT AND CONCLUSIONS OF LAW¹

KENNETH A. MARRA, United States District Judge

This matter was tried before the Court. Based upon the evidence presented during the bench trial, the record in this matter, the argument of counsel,² and otherwise being duly advised in the premises, the Court issues these findings of fact and conclusions of law pursuant to Rule 52(a) of the Federal Rules of Civil Procedure.

I. INTRODUCTION

Plaintiffs Norman Hirsch, Matthew Dwyer and Ralph Willard ("Plaintiffs") purchased refundable memberships in the Ritz–Carlton Golf Club & Spa Jupiter, n/k/a Trump National Golf Club Jupiter ("Club"). The underlying dispute arises out of Plaintiffs' contention that the current Club owner—Defendant, Jupiter Golf Club, LLC d/b/a Trump National Golf Club Jupiter ("Defendant")—failed to refund their membership deposits under the terms of the agreements they executed to become Club members.³

II. FINDINGS OF FACT

Plaintiffs are members of the Class ("Class Members") that the Court certified and whose rights to refunds the parties tried before the Court. (DE 227 at 4). The Class contains sixty-five identified members including Plaintiffs. (Id. at 4–5).

Class Members purchased Club memberships and became Club members of the Club by executing the Ritz Membership Agreement. That agreement defined the members' relationship with the Club, it established the categories of membership and granted them access to the Club. (Trial Tr. Vol. I at 18–19, 25–27, 29–30; Trial Tr. Vol. II at 9; Plaintiffs' Trial Ex. 10 at R000000958; Ex. 6, Ex. 7–9 and Ex. 59–61). The membership categories the Class Members purchased were either Full Golf, Fractional Golf, or Social and Spa. (DE 146 at 17; Plaintiffs' Trial Ex. 7–9 and Ex. 59–61). These categories of memberships were "Refundable Memberships," entitling them to a refund of the membership deposit they made when joining the Club. (Id. ; Plaintiffs' Trial Ex. 10 at R000000958; DE 227 at 4). The deposit amount each Class Member paid with respect to the member's category of membership is uncontested. (DE 227 at 4).

The Refundable Memberships entitled the members to use the Club facilities according to their membership categories (Trial Tr. Vol. I at 39, 50; Vol. II at 24), and expressly granted them "a revocable license to use the Club Facilities in accordance with the terms and conditions of the Membership Plan and Rules and Regulations ..." (Trial Tr. Vol. II at 20–21, 23; Plaintiffs' Trial Ex. 7 at R0000008174–8175; Ex. 8 at R0000001216; Ex. 9 at R0000001199–1200; Ex. 56 at TMP 000005; Ex. 58 at TMP 000155; Ex. 59 at TMP 000148; Ex. 60 at TMP 000265; Ex. 61 at TMP 000254).

In addition to executing a Membership Agreement, the Club provided Membership Plans ("Plan") and Rules and Regulations ("Rules") to the Plaintiffs and the Class Members upon their admission to membership. (Trial Tr. Vol. I at 30–31). Under Section V of the Membership Agreement, a member agreed not only to be bound by the Membership Agreement, but also to be bound by the terms and conditions of the [Ritz] Membership Plan and Rules and Regulations. (Plaintiffs' Trial Ex. 7 at R0000008175; Ex. 8 at R0000001216; Ex. 9 at R0000001200; Ex. 56 at TMP 000005; Ex. 58 at TMP 000156; Ex. 59 at TMP 000149; Ex. 60 at TMP 000266; Ex. 61 at TMP 000255).

The Dispute

The documents governing operation of the Club provide four circumstances which would entitle those members with Refundable Memberships the right to a return of their deposit within 30 days: [1] termination of the Membership Plan, [2] termination of any category of membership, [3] recall of the membership or [4] the discontinuance of operation of all or substantially all of the Club Facilities ..." (Plaintiffs' Trial Ex. 7 at R0000008174; Ex. 8 at R0000001216; Ex. 9 at R0000001199; Ex. 56 at TMP 000005; Ex. 58 at TMP 000155–56; Ex. 59 at TMP 000149; Ex. 60 at TMP 000266; Ex. 61 at TMP 000255; DE 146 at ¶¶ 17, 36, 80d, 103–104; DE 216 at 6, 9).

In the present case, the Court determined, as a matter of law, that there was no showing by Plaintiffs that the first, second or fourth circumstances occurred. The Court also concluded that a genuine issue of material fact existed as to whether Defendant recalled the memberships of Plaintiffs and the Class members entitling them to a return of the membership deposits within 30 days. (DE 124).

Defendant's Assumption of Ritz's Obligations

Defendant purchased the Club through a Purchase and Sale Agreement ("PSA") dated November 14, 2012. (Plaintiffs' Trial Ex. 1, 7–9, 59–61; Trial Tr. Vol. II at 5; DE 141 at ¶¶ 24, 26; DE 227 at 5). In the Membership Agreement, Club members agreed, "[i]n the event that the Club Facilities are sold and the buyer assumes liability for the repayment of the membership deposit, the[y] ... shall look solely to the new owner for repayment of the membership deposit and the seller of the Club Facilities shall be released from all liability for the repayment thereof." (Plaintiffs' Trial Ex. 7 at R0000008174; Ex. 8 at R0000001216; Ex. 9 at R0000001199; Ex. 56 at TMP 000005; Ex. 58 at TMP 000155; Ex. 59 at TMP 000148; Ex. 60 at TMP 000265; Ex. 61 at TMP 000254).

Plaintiffs and the Class Members paid a total of $4,849,000 in refundable membership deposits. In the PSA, Defendant assumed the obligation to repay the membership deposits according to the terms and conditions of the Delivered Club Documents. (DE 227 at 5–6). As previously indicated, one of the obligations Defendant assumed provides: "In the event of termination of the Membership Plan, termination of any category of membership, recall of the membership or the discontinuance of operation of all or substantially all of the Club Facilities, the members affected will be entitled to a refund of the membership deposit paid within 30 days." (Plaintiffs' Trial Ex. 7 at R0000008174; Ex. 8 at R0000001216; Ex. 9 at R0000001199; Ex. 56 at TMP 000005; Ex. 58 at TMP 000155–56; Ex. 59 at TMP 000148; Ex. 60 at TMP 000265; Ex. 61 at TMP 000254; DE 146 at ¶¶ 17, 36, 80d, 103–104; DE 216 at 6, 9).

Fees and Charges

In addition to the payment of dues and refundable deposits, Club members, including Plaintiffs and the Class Members, were obligated by the governing Club documents to pay fees and charges. (Trial Tr. Vol. I at 36–37, 39–40, 54, 125, 142, 154, 172). Fees and charges were and are associated with actual use of the Club facilities and were and are paid in consideration for some form of actual Club usage. (Trial Tr. Vol. I at 39–40, 54, 169–170, 172, 191; Plaintiffs' Trial Ex. 10 at R000000959–0960, R000000962). A person having no access to the Club facilities would not incur a fee owed to the Club. (Trial Tr. Vol. II at 95). Examples of usage fees include cart, caddie, range, greens, and guest fees. (Trial Tr. Vol. I at 39–40, 54, 112, 125–126; Plaintiffs' Trial Ex. 10 at R000000959–0960). Examples of usage charges include charges for use of the ballroom, spa, or for consumption for food and beverages at the Club. (Trial Tr. Vol. I at 54, 126, 142, 169–171).

Membership Status While on the Resignation Waiting List

The Membership Plan described the refundable deposit as a "Special Benefit" for members joining the Club. (Trial Tr. Vol. I at 53; Plaintiffs' Trial Ex. 10 at R000000952).

The Plan provides, "[s]hould a member desire to resign from the Club, the member shall be required to give written notice to the Club, which notice must be signed by all parties on the membership application." (Plaintiffs' Ex. 10 at R000000967). Prior to Defendant's acquisition of the Club, Club members could and did express a desire to resign their Club memberships by informing Ritz in writing of their desire to resign. (Trial Tr. Vol. I at 19–20, 22–23; Plaintiffs' Trial Ex. 10 at R000000966, R000000967; Ex. 14 at TMP 001135, Ex. 18, Ex. 21, Ex. 22a–22f). In return, the Club placed their "Refundable Membership[s] ... on a waiting list." The Club responded to the notice of the member's submission of an intention to resign with a standard form letter advising the member of the placement and the standard resignation procedures, including that they would be notified upon reissuance of their memberships and in the meantime their memberships remained active. (Trial Tr. Vol. I at 23–24, 37–38, 40; Plaintiffs' Trial Ex. 10 at R000000967; Plaintiffs' Trial Ex. 22a–22f; DE 141 at ¶¶ 11–13).

Under the Plan, if the Club had memberships available for sale in a category of membership, then every fifth membership sold in that category would come from the resignation waiting list. (Plaintiffs' Trial Ex. 10 at R000000953, R000000967; Trial Tr. Vol. II at 172; D. Trump Dep. at 14). Reissuance of a membership from the resignation waiting list can and could under Ritz and Defendant take ten years or more (Trial Tr. Vol. I at 127–28; Vol. II at 176; Plaintiffs' Trial Ex. 11 at R000017415).⁴ Once the member reached the top of the list, his or her membership deposit would be refunded (DE 141 at ¶¶ 11–13).

Under the Plan, members on the resignation waiting list remained obligated "to continue to pay dues, fees and other charges" until reissuance of their membership. (Trial Tr. Vol. I at 40; Plaintiffs' Trial ...