Two South Carolina businessmen have sued a nephew of evangelist Billy Graham, contending he defrauded them as they planned to purchase his Myrtle Beach golf course.
The nephew, Mel Graham, serves on the boards of two prominent local charities – Billy Graham Evangelistic Association and Samaritan’s Purse, an international relief agency. Both charities are headed by Billy Graham’s son, Franklin Graham.
Mel Graham, a Charlotte developer, owns the International World Tour Golf Links, a golf course where all 27 holes are modeled after famous holes around the world.
The plaintiffs, Jeffrey Gohn and Rolf Hendricksen, allege that Mel Graham breached a contract, acted in bad faith and committed fraud after they entered into discussions to buy World Tour. Now, they contend, they’re out $500,000.
In an emailed statement, Mel Graham said that he adamantly denied the allegations and intended to aggressively defend them.
“I believe this is nothing more than a sour grapes claim from a couple of guys who could not live up to their commitments,” stated Graham, 55, who has developed several golf courses and residential communities in the Carolinas.
“I have every confidence that we will prevail in court when the truth and all of the correct facts are revealed by my attorney.”
In a lawsuit filed in Horry County, S.C., the plaintiffs allege that when they entered into purchase discussions late last year, Mel Graham told them that while the annual financial statements had not been completed, the course’s 2011 revenue was approximately the same as that for 2010. The plaintiffs say that they later discovered that the 2011 revenue was only 45 percent of the previous year’s.
“Had this fact not been misrepresented, the Plaintiffs would have never agreed to the Option Agreement,” the suit states.
Gohn and Hendricksen say they understood the course needed about $500,000 in improvements. They agreed to pay $500,000 with an option to buy the course for $7 million. But when the plaintiffs sought financing, they were told the course’s profits would need to increase dramatically before they could qualify for a loan.
The plaintiffs agreed to work at the course as marketing consultants to drum up more business. Under the terms of a marketing agreement, they were to be paid commissions of 15 to 25 percent on all new revenue that resulted from their efforts.
They contend Mel Graham promised to make needed improvements, and to provide them with information they needed to build the course’s business and profitability. But by early 2012, neither of those things had happened, they say.
The plaintiffs contend they asked Mel Graham when capital improvements would be made to the course, and were told that the plan would progress if they agreed to a higher purchase price. Gohn and Hendricksen refused.
Soon afterward, they alleged, Mel Graham ejected them from the course and prohibited them from doing further work.
“Once they paid the money, the cooperation all ended,” said Mark Neill, the attorney representing the plaintiffs.
Mel Graham contends he honored his agreement with the plaintiffs “to the letter.”
“They are the ones who failed miserably at marketing and bringing the business to the table that they promised,” he stated.
“I believe these gentlemen just got in over their head,” he stated. “They became very confused and desperate when they were unable to perform on some marketing commitments they made …”
Mel Graham said Gohn and Hendricksen never expressed any of their concerns to him before filing their court complaint.
“They just blindsided us with the suit…,” he stated.
The plaintiffs are asking that the court award damages and make Mel Graham repay the $500,000.
Among Mel Graham’s developments is the Club at Longview, a residential golf community in Weddington with a course designed by Jack Nicklaus.
Mel Graham also plans to turn 6,000 acres in Chester County into a massive mixed-use development with 8,000 homes. Plans for the project were first announced in 2006, but the economic downturn later stalled the project.