More Details on Trump’s Kluge Purchase

The WSJ has some revelations about Trump’s involvement in Kluge’s estate  #

10 Responses to “More Details on Trump’s Kluge Purchase”


  • The most interesting thing to me in all of this is the sale of the parcel held in trust for John Jr. According to the article it was split off from the Albemarle House property by John Sr. in order to make it more difficult for Pat to divest herself of that estate without the trustees for their son agreeing (is she one of those trustees? Is she the only one?), yet I think I read somewhere that she sold that property to Trump early on (as in before the wave of bankruptcies hit)? How did the trust for John Jr. benefit by this? Surely the property is worth much more to a prospective A.H. buyer than as leverage for Trump to get what he wants, at his price? And for those 200 acres adjoining A.H. to fetch just $500k while she was still marketing the house for $100M seems ludicrous. Finally, did the money from that sale go to benefit John Jr.? Or did Pat use it to keep her head above water just a little longer? Maybe Bank of America is looking into all of this in an effort to void the sale. If Pat arranged the sale of that piece to Trump at an artificially low price (I don’t think it was ever on the market) in exchange for a promise of future employment for herself (with little or no benefit to the trust)then maybe that’s a breach of trust, a violation of the laws of agency, and a voidable sale?

  • Read the discussion too. Not addressed is whether Kluge’s deals with Trump before her bankruptcy might trigger a look-back.
    http://wiki.answers.com/Q/Can_a_bankruptcy_trustee_look_back_to_a_sale_of_an_asset_prior_to_filing_for_bankruptcy

  • Posted before I saw ******’s post so I wasn’t responding to him or her. Some commenters at WSJ did not read both pages. All the stuff about adverse possession is pointless. The easement & annoyance of having Trump as a neighbor balance out probably. He can’t build on a conservation easement.

    Horrible Trump may know a lot about real estate, or once did, but the biz press seems to think his most valuable asset now is his (horrible) brand name. He may not know much about Virginia real estate quirks.

    If B of A builds an expensive fence and makes him pay half, then gets him to come over to the fence on some pretext when he may be in town, they could shoot him and get away with it. Yes, someone should warn Horrible about the Caroline County fence murder. Because we value the dignity of all creatures.

  • The thing is, the land from the trust wouldn’t be an asset in bankruptcy, so your link doesn’t really apply. If that land hadn’t been sold, and all of the resulting bankruptcies had gone forward, that parcel wouldn’t be an asset of the custodian to sell for the benefit of creditors because it belonged to the trust for John Jr. BUT, if Pat as an agent (trustee for John Jr.) and a disclosed agent at that, sold that parcel to Trump in a manner that benefited her personally (promise of future employment) ,that’s a violation of the laws of agency. Trump, knowing she was an agent acting for her own benefit (at least in part) wouldn’t necessarily acquire an enforceable title to the property. Certainly B of A might have a few million reasons to dispute it.

  • That makes more sense ******. I just wonder if the federal bankruptcy court might have bigger hammer and might be looking askance at any of this. She negotiated some deal with Trump as she was circling the drain. And the benefits of that deal may persist past the bankruptcy: she gets a job or something. But it’s a slim reed. People make all kinds of deals before bankruptcy, it doesn’t mean they knew bankruptcy was inevitable.

  • My hope against hope is for Trump to get tangled up in some legal mess, such as Kluge’s bankruptcy, and that the experience is displeasing enough that he sells out and leaves the state. That’s where I’m coming from! Her and her assets are a more likely issue, but T is just too horrible to contemplate. Can you imagine seeing that guy around town? Ugh.

  • Even more displeasing than the prospect of seeing trump around town would be contact with any of the buffoons who could and would pay to be associated with his brand. If he turns the Kluge property into some rich folks golf-getaway country club type place, we’re going to be overrun with them.

    I think for B of A to overturn the sale of the 200 acres to trump, they’d have to demonstrate that it wasn’t in the interests of the trust or a fraudulent conveyance, though if the only one hurt in all of this is John Jr., maybe they’d have to have a substitute trustee appointed to act on his behalf? How old is he? There’s about 10 different types of law tied up in all of this.

  • I think it’s worth mentioning, that Trump now owns the 5 acre parcel between Blenheim Rd and Carters Mountain Road where the former “Kluge Estate Winery Farm Shop” is situated, and it will serve that function again now that Trump owns it. The NoVa bidder sold it to him sometime after the auction.

    As for John K. Jr. How old is he? I would’ve thought he’d be an adult by now and capable of making his own decisions – unless he’s got some sort of developmental disability.

  • From an update to a cville article found here:
    http://www.c-ville.com/index.php?cat=11431101084614805&ShowArticle_ID=11100111103995321
    “Updated Tuesday, November 2: The civil suit filed by Farm Credit of the Virginias against Patricia Kluge and William Moses contends that while Kluge and Moses were in negotiations to restructure their loan in September, they transfered 7.18 acres and property to a trust in the name of Kluge’s son, John W. Kluge Jr. Patricia Kluge is the trustee for the John W. Kluge, Jr. Trust. The bank contends that such a gift rendered Kluge and Moses insolvent and that they made the gift “for the purpose of shielding and/or concealing assets from [the bank’s reach.] Alleging fraud, Farm Credit wants the gift voided. Moreover, Farm Credit seeks a lien on the land and property that was transfered to the Kluge Jr. Trust and that the property be sold towards satisfying Kluge and Moses’ debt to Farm Credit.”

    So, according to that update there’s already allegations that Kluge is using a trust for her son John Jr. as a way to hide assets, and that she is the only trustee. I’d say there’s a great chance that BofA may go after the transfer of the 200 acres to trump. Why wouldn’t they?

  • As I understand it, the 7.18 acre parcel in question comprises the old house and small portion of acreage of Ellerslie. I’d always assumed that PK and Bill were going to renovate the place and move there (heard murmurings of financial troubles going back several years), so it makes sense to me that they would have wanted to put it in trust to John Jr to keep it safe.

    Once John Jr turned 21, the 200 acre front yard became a potential bargaining chip. The golf course was torn up shortly thereafter.

    Jr still owns the Ellerslie parcel containing the conservatory, storage bldg, and what we called the machine shed. He’s a good egg, though I don’t know what role he’s played in any of what has transpired. I’ve never had the impression that he wanted anything to do with any of this property.

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