Written/Reviewed By:
Barry S. Kantrowitz, Esq.
Last Updated: Jul 15, 2021
Read Time: 3 mins
New Jersey dealt a blow to former members in the golf club lawsuit they filed. They tried to recover a portion of the net proceeds from the sale of their former club. The State’s courts summarily rejected their lawsuit– essentially stating that a merger agreement executed by the club did not envision the payments that the former members were seeking.
The lawyers at Kantrowitz, Goldhamer, Graifman, Perlmutter & Carballo, P.C. in conjunction with attorney Robert Dowd note that this matter is unique to its specific facts. The result in this case will have little or no bearing on the efforts of members of other golf clubs to recover refunds of their membership fees when they resign from their club, or the club is no longer in operation.
What are the details of the New Jersey lawsuit?
Like many private clubs, in 2015 Rock Springs Golf Club was suffering from declining membership and poor finances. It merged with and its members transitioned their memberships to Montclair Golf Club. The merger agreement stated that if Rock Springs’s property was sold, its former members would share in the sale proceeds. However, the sale had to happen within three years of the merger.
The property sold in 2019 for $11 million, almost four years after the merger. Regardless, twenty-six former Rock Spring members sued to recover a refund equal to a portion of the purchase price. A court summarily dismissed their lawsuit and an appellate court upheld the dismissal.
Under what circumstances can members recover compensation from a golf club?
The Rock Springs golf club lawsuit highlights the importance of the contracts that are the foundation of club memberships. Specifically, in Rock Springs’s case, it is the basis for distributing proceeds when club property is sold. At a minimum, every member of a golf club should review their membership contract to understand the rights and privileges granted to members. In particular, they should review the right to receive a refund of membership fees if the member resigns or the club ceases operations.
Further, if a club envisions a sale of its properties or any mergers, the member should retain an independent golf club attorney. They can review all documents and agreements to understand how those materials affect the rights of individual members.
Call Kantrowitz, Goldhamer, & Graifman and Attorney Robert Dowd for Experienced Representation in Golf Club Lawsuits
The lawyers at Kantrowitz, Goldhamer, Graifman, Perlmutter & Carballo, P.C. in collaboration with attorney Robert Dowd have represented individual golf club members and membership groups in class action lawsuits against country clubs. Our clients come from Rockland and Bergen Counties and elsewhere in New York and New Jersey. In all cases, they seek to recover the fees that are rightfully theirs.
Please see our website or call any of our offices if you need assistance with your golf club contracts. Your club may be withholding fees or refunds, or they are charging you fees that are not authorized by your membership agreement or the club’s bylaws. We will handle your grievances against your club in the most professional manner.
