Quote of the Day

Monday, November 16, 2009

Documents

Below are images of the documents referenced in today's guest post. The poster gave this blog permission to publish them. The poster's name and other personally-identifiable information have been redacted; otherwise the documents are unchanged.







Let me note that this blog has previously published positive information on George Wythe University. I truly hope to be able to write about the positive resolution of this very unfortunate situation. Here's hoping for a happy ending.

34 comments:

James F. said...

Wow, this is serious stuff. I can only imagine the the potential ramifications.

A few notes of clarification that I seek and I would hope that either "Former Student" or others that read legalese better than I can answer.

"Former Student" describes how it was promised that the $150,000 of loaned funds would be used for purchasing the hotel. She is angered that the funds were not used for this purpose. While I don't doubt her word that there was a verbal promise as to the intended use of the loaned funds, was this use of funds written out contractually? Perhaps I'm just overlooking these terms or are they not included in the documents here displayed?

And I also don't doubt the word of "Former Student" as to how she has been treated by those mentioned of GWU, however the only solid (and legal) information I see of this situation is the contracts that are displayed. Am I right in understanding that the repayment of the loan is not due till 2011--and even then, the payment will be in real property unless GWU hasn't yet converted it into such by the designated date?

So when "Former Student" says that she had to sell her house because GWU defaulted on repayment, it seems to me that she shouldn't have been expecting any repayment till 2011, and even then it would likely be in the form of land, not cash. What am I missing? I don't doubt that I can be missing something, I really am seeking an explanation.

So basically she wants to terminate the loan agreement prematurely--her attorney lists the idea that the contract is illegal since it is in exchange for "unregistered" and "unsubdivided" land. But if that idea doesn't happen to pan out, she just has to prove that GWU is insolvent, and therefor in breach of contract.

So my question is, what is the rest of the story? She's trying to get out of the loan prematurely, why? I think it has been established that the Monticello plans are crumbling--but GWU has yet to be shown to be in default. That may very well be coming--but that time hasn't yet arrived.

Now don't get me wrong, I still see plenty of ways GWU and Brooks maybe have acted inappropriately in this loan agreement, but with just the information provided, I think there is more going on.

Anonymous said...

Thank you for taking time to review the document.
You ask several important questions.
1. I maintain that the document is an illegal instrument as ascertained and therefore void.

2. The charging of land at a fee of $50,000.00 per acre for land that was valued at the most around $1500-$3000 is suspect for violating Blue Sky laws.
Other land was "sold" for far less in the same plot.

3. Shanon would constantly show me different parcels of land that were mine, changing the location.
The most recent location was on the land that they have missed their May 2009 payment on and which will soon be foreclosed on. Hence, they don't own the land anymore.

4. The Foundation acknowledges that they owe me the monies. In fact, if they do not reach a settlement of some kind, I will continue to disclose more documents and as Oliver DeMille is aware of, other events and mis-representation that would damage not only the University, but him also. This is not my overall objective...but I have lost my house because of this.

5. Yes, they have until 2011...unless of course they don't own the land anymore...which they don't. They are in default.
The other point however, was the promise of roads and development, which are not forthcoming.

6. It had been my intention and was alluded to that I would be a candidate to be a mentor at the Monticello campus. I had also purchased land a block from the temple ( which I sold at a great loss ) to build a small business there ( with living quarters)and help to promote the campus until a house could be built on the mountain.

7. Yes, it was not written in the contract that the monies would be used to purchase the Hyland Hotel. This was Shanon's words to me.
I certainly am not without fault in doing diligence and having an attorney look at the document. As you may note, the stipulation that the agreement would remain confidential deployed my efforts and I foolishly trusted them. Just like the many people who lost around a million dollars at Duck Creek.

8. It is not just this part of the story...there is more to come that has me GRAVELY disappointed in all concerned.

9. At attornies counsel...if bankruptcy is imminent, a judge would likely rule that the conditions will not be able to be met.

10. It is my understanding that the Board had no knowledge of this contract until over a year after it was made. Internal mismanagement and even fraud within the organization is also a consideration.
Shanon did not have to disclose where monies for "fundraising" were coming from as far as I understand. This however, was not fundraising and both sides of management were at fault for not clearly "check and balancing" their own internal affairs, a key concept taught regarding government.
11. While documents and records are not readily available for Youth for America ( a post on Wikipedia was recently changed to make it appear that Youth for America is a GWU entity and not Brooke's)...my recollection is that YFA was partly owned by Shanon. What a coincidence that my monies went to building a metal pavillion that was used for YFA.

I would be interested in a clear accounting of those funds. GW Cedar City denies that they accessed those funds, throwing the ball back into Shanon's court..who of course takes no liability.

No one is seeming to take responsiblity or accountability.

There is so much more to come.
Former Student

J.L.L said...

Well first, having it signed by a notary was absolutely that right thing to do. And reproducing that here will prevent any challenge of authenticity. That's extremely helpful.

Second, what a strange deal. You loan us $150K at 0% which we will use to buy overpriced land in your name, and you and your posterity will be able to attend the school for free, and keep this deal quiet.

A deal like this is indicative of a cash flow problem. The fact that they bought land for several times more than market price indicates that the land was the excuse to get a hold of some money that would really be used for something else. It's cooking the books in my opinion, although in the contract it doesn't say what they would use the money for, just that within 4 years you get 3 acres.

Here's my take on your numbered points:

1. I would think this is valid because it looks like a loan to me, not a securities purchase.
2. It is suspect but the contract doesn't stipulate what they can do with the money.
3. Yeah that's not good. They don't have land allocated for you (to be given within 4 years)
4. That's how you will get them to act: through disclosure. I'm sure that this has already caused them some grief.
5. I think they have until 2011 to deliver "3 acres" regardless of what happens in the meantime.
6. Interesting that they implied you would be a mentor. Sounds like purchasing "mentorhood."
7. Yep
8. I'll bet
9. Probably right
10. Yeah doing this in secret (unknown internally) is a bad sign. But given the strangeness, I'm not surprised.
11. I didn't follow the connection to Youth for America. What's the significance?

On the one hand, I feel sorry for Guest Poster. But on the other, I don't think you were defrauded. There does look to be a breach of contract, true, but this is one strange contract that you agreed to. I just am continually not impressed with the character and dealings of GWU people. So now there is this contract made public and I think, yeah this doesn't surprise me at all. You'd think that people studying the classics and the principles of good government, with the best mentors on the planet, would not make contracts like this, and they would at least meet their obligations. I can't imagine a world where GWU ideals rule at any level. Why these people think they are going to be leaders of the future is beyond me.

I'm sure you'll get a response from them, Guest Poster. Signed, notarized, breached contracts that are strange is not something they want to deal with. I hope you get your money back.

James F. said...

"Former Student", I still think it a bit disingenuous to say that you lost your house because GWU defaulted. As I'm understanding, we don't yet know for sure that they have defaulted, and even if they have, you shouldn't have been expecting payment till 2011 and even then, only in real property which wouldn't even at that point help you make house payments.

So here is the question that is still burning in my head. Intent. Obviously for some period of time you shared the vision of Brooks, DeMille, and the others in their plans for the Monticello campus. Do you believe that it was their intent to defraud you of $150,000, giving you only cheap, undeveloped land in return? Or was it their intent that the Monticello campus would be successful, that construction plans would move forward, and that your investment would benefit them right now, and you in the future as the project matured?

Once again, I think it is obvious that GWU is in a complete bind right now. The downturn in the economy has hit universities especially hard. GWU was dreaming big at the absolute worst time. It is yet to be seen how much they will loose because of these decisions. You say they are already in default, but it seems that you are just hearing this. We don't know the real details.

So what is the rest of the story? It seems like you had a falling out with GWU. It is sad that you are loosing so much, but I wouldn't be surprised Brooks, DeMille, and others are loosing a lot right now too. So are you just wanting out now that you see that the project is perhaps indefinitely delayed?

I really do hope to see a happy ending to all of this. But from the details provided, it sounds like there are a lot of unhappy people surrounding GWU right now.

The Real George Wythe said...

I agree with you JLL, this was a one-sided agreement.

James, I agree with you that it's impossible to show with these documents that the George Wythe Foundation's conduct caused her to lose her house. Obviously, she had expectations of a job that were not met, probably based on verbal commitments. I don't know.

I don't blame her for freaking out when she learned that the school had allegedly stopped debt payments on a chunk of its Monticello property. Such an act would be a big red flag and indicate insolvency to any reasonable person, meaning (1) she would probably never be repaid, and (2) she therefore has the right under Sec B to call the loan immediately.

(Besides insolvency, their stopping payments could have another explanation, by the way, given (1) they scaled back (cancelled?) plans for this campus, and (2) the crushing burden of that debt according to the financial statements. Why keep throwing money toward a campus you're never going to build?)

The way I read Section A is that this agreement is effectively a prepayment on 3 acres of developed land: "Borrower shall convert this note to payment in full for 3 acres of real property...within 4 years." I am curious to see what the Utah Division of Securities has to say about this, since there are tight regulations about how you can market land developments.

James, don't forget that the road to hell is paved with good intentions. I get the feeling that Rick Koerber had good intentions as well, but does that excuse the loss of $100 million? It also excuses nothing in this case. Indeed, that seems to be a recurring theme with George Wythe University: good intentions, lousy follow-through.

Also don't forget that history appears to be repeating itself here. GW's mother institution, the Meadeau View Institute, undertook similar activities in the early 1990s: promises of land and lots in the future in exchange for donations and loans now. You can read all about it in several Deseret News articles from that time, including this one.

James F. said...

Yeah, you're right RGW, intent really doesn't matter. I just like to humanize disagreements by showing that both sides are trying to do what is right in their own view.

Time will tell how big of a mess GWU is in. "Former Student" assumed an investment risk, she now wants out. I don't blame her. However to get her way I think it is obvious that she is attempting to demonize GWU in accusing them of loosing her house, of spending her money as they pleased, etc. GWU didn't breach their contract by spending the money the way that they did, and they didn't loose her house either.

Good intentions don't excuse what has happened--but they do explain why it has happened. I really do feel bad for "Former Student"--but she wasn't looking for a fail-safe investment, rather she was sharing in the dream for expanding GWU. It isn't working out as planned.

We'll see what happens, I have no clue whether "Former Student" really has a case in showing that the contract itself was illegal in securing against unregistered property. It seems that it would be easier to recoup her money by showing that GWU is insolvent and therefore in breach of contract--but if they are truly insolvent she'll also have a tough time getting her money back.

I think we have a case of far too many visionaries getting together without any pragmatists. You throw economic turbulence into the equation and you're really asking for trouble.

J.L.L said...

"I think we have a case of far too many visionaries getting together without any pragmatists."

That's not how I'd describe it, James.

Don't they teach "Contracts" at GWU?

I don't think this is just about GWU getting hit hard by a downturn in the economy. They crafted a strange contract that would only be done if they already were in financial straights. It was suspect from the beginning and it is no surprise that it is now going sour.

The contract carries risk that it appears that the Guest Poster now finds very high and wants out. I can understand that. Too late for that. But, regardless, if GWU has been missing payments then they are in breach of the contract.

Anonymous said...

I find it very interesting that the majority of people related to this blog are Anonymous. Laughable really.

Anonymous said...

I'm losing my house too. At first I was blaming Obama, but now I'm sure Brooks had something to with it.

R.C. said...

"I find it very interesting that the majority of people related to this blog are Anonymous. Laughable really."

Why do you find it interesting and laughable? You posted as anonymous as well? Why don't you expose your identity here as well?

R.C. said...

"I'm losing my house too"

Way to mock a single mother who lost her house. Now that's real statesmanship!

R.C. said...

Maybe I should actually weigh in on this posting as well. To quote James F: This is serious stuff. If this turns out to be true and a lawsuit is actually filed, and a judgement is reached, I don't know how GWU can survive this.

Kristine said...
This comment has been removed by a blog administrator.
Kristine said...
This comment has been removed by the author.
James F. said...

Kristine, thank you for your reply.

I still don't understand what you mean in saying that DeMille caused you to loose your house. Are you referring to the hotel? Or to your own residence? If it is your own residence, what are we not understanding about the contract that would have allowed you to make payments on it, or keep it, had GWU not defaulted (which while I think is completely possible, you're the only source of this information that I've seen)? The contract suggests that you shouldn't have been expecting anything till 2011--and even then, only property.

I'm not familiar with any of the philanthropic organizations you menion. These are organizations that DeMille has used? You accuse DeMille and other GWU folks using the school as a 'shell' to make profits--Now this is a serious accusation, but I think it needs to be established that they have acted inappropriately or illegally--merely making a profit is not suspect in a country with a free market. Do you have any specific examples of misconduct? Any proof that they are going beyond making an honest living for themselves? Proof that they are profit driven and not just seeking to make the school and these ideas sustainable?

I'm interested in the truth. If things are really as you say they are, I want to know. I have long been a supporter of GWU, but I will admittedly be rethinking that support if these accusations are correct. However I try to be very honest and thorough in my evaluations. You've called GWU out to the floor on this, and I hope that they will offer up their side of the story and defend their integrity. In the mean time, I would encourage you to maintain your integrity and to present the facts as you know them in a clear, thought-out way. Your public threat here on this blog aimed at DeMille to "reveal" more incriminating information about him could be interpreted as blackmail. Your comments seem frantic and almost desperate. If you are really in the right and you really want your way, I think you need to slow down, solidify your position, and present this clearly.

James F. said...

What's the story RGW? Why did you and Kristine remove two of her comments?

The Real George Wythe said...

James, I removed that comment because she asked me to and also because it violated my blog rules. She removed the other comment herself.

Anonymous said...

How did she contact you? I have a few things to say about this situation that may help her case. I'm just not interested in posted it here on this blog.

Anonymous said...

How did she contact you? I have a few things to say about this situation that may help her case. I'm just not interested in posting this information here on this blog.

Anonymous said...

One of the reasons that I am still upset about this is because they did offer me a resolution.
Their "best" offer was to take on a new problem. One of the Board members had a piece of property in St. George area that he was trying to sell. It had been on the market for 30 months. They told me that it would be "relatively easy" to find a developer, build apartments, sell off their mortgage and I could keep the rest! To me this was an attempt to FURTHER take advantage of me. I understand that the property has since been foreclosed on.
When I asked for tuition trade for friends to pay off some of it they refused. In fact, they have refused EVERY OFFER I have bent over backwards to come up with to try to assist. Where this went wrong for me is that they seem to take an attitude that I am "infringing"on their energies.
They seem to me to forget that they OWE me this money. All the things that they taught me seem to be theories alone...not put into practice.

James F. said...

"They seem to me to forget that they OWE me this money" You still haven't explained yourself on this idea and the idea that GWU caused you to loose your house. When you say that they "owe" you this money, are you saying this assuming that they have breached the contract by defaulting? Or are you expecting your money back regardless?

Anonymous said...

"All the things that they taught me seem to be theories alone...not put into practice."

You're not the only one who has observed poor behavior of the GWU leadership that is not in line with their teachings. I agree with J.L.L. I too am continually not impressed with the character and dealings of GWU people. With your story now disclosed, I'm going to guess people are going to be very hesitant to ever donate or go under contract with GWU again. The word seems to get out quickly. However, sadly, I don't think your story will be the only one. Best of luck recovering your funds.

Anonymous said...

James, I appreciate your desire to understand my rationale.
Here is where I am attributing cause and effect to the loss of my house.

1. While our legal system has great merits, there are drawbacks too. Before we became such a litigenous society...there was a moral sense of community that permeated our ethics.
Because community was small and everyone's lives impacted each other...CHARACTER became the mark of a real man.
His word was his bond.
His actions and promises were taken as his honor.
He was a PROTECTOR to his home and family, but also to the community at large.
He was a WARRIOR against injustice and stood for the innocent as well as the poor.
The GRAND message at the end of every introductory Statesmanship Retreat that I have ever been to ends as this:
Our missions are ultimately to :
Feed the Hungry, Clothe the Naked, Succor the Poor and to form moral communities that expand to the Nation and Globe.
No, I didn't have Shanon's admission that the monies were to purchase the Hyland Hotel in writing.
I had his word, and his honor.

2. No, I didn't have a default clause that if the Monticello project was to be set aside, that all my monies would be promptly returned.
I did have a clause about infrastructure to be placed and a "common sense"inference that if the project was abandoned, the 3 acres ( which they will soon no longer own) would be of no value.
What does one do if land that they bought from a certain party is no longer owned,and they have defaulted on that land? Common sense would dictate that if they are unable to provide their side of the promises, that the contract is null.
An attorney also told me that if it is clearly "Imminenet" that the school would fail that a Judge would grant a judgement.

3. And while, yes, the economy hit hard, I fail to see how realistic it was for Shanon to expect to raise $ 1 million dollars to put in a well system that would provide enough water to sustain the size of community that he was advertising.
It was represented to me that the funds were forthcoming.

Anonymous said...

Where I went wrong, is that I BELIEVED when they said that they had a $1 million dollar donation, that they actually had such monies...not so.

4. As the moderator points out...this is not a one time mistake. This is a pattern of grandiose and unchecked mismanagement of monies.
That it is a repeat of Duck Creek is a very sad thing. Yes, I contacted everyone on the Board, including Don Sills and all menotrs.While they asked to remain anonymous, they had their own stories to tell of their monies that were also lost, albeit done in legal donation status.

There is the letter of the law...and the spirit of the law.
I plead my case yes, according to both. I submitted ,as is shown a demand note for the monies, as they were bankrupt on the day I presented it. The agreed to condition had been met, they just don't want to pay the legal and ethical and moral consequence.

As I stated, I had also purchased land in Monticello in which to live while the University was being built. Because the University was a poorly mismanaged project, I am not living in Monticello. And while I could have kept my house and remained in Enoch, it would have continued to be uncomfortable for all.

The "courting" of my monies with promises that I would be a canidate for becoming a Mentor- (not buying the position, my academic merits held weight) but by becoming part of a community of people who had common vision and dreams, was a fallacy because the George Wythe University they presented and the community that they were building in Monticello that I "bought into" did not ever exist.
It was at the best- A Blue Sky - proposition, with deception built in.
To add to this perspective...how many know that GWU lost over $30,000.00 on their Glenn Beck fundraiser?

At some point mismanagement has to have accountability.
I firmly believe that this was a scam by default because the Board did not keep checks and balances of their funds and those who were running the University.
Such claims of grandiosity at some point has to be held accountable. Playing high risk games with other's monies while misrepresenting assets is in my eyes, fraud.
What say you?

David said...

Wait a minute. You claim in the original post that GWU caused you to lose your home, but in your most recent comment to the post you claim that you could have kept your house but it would have been "uncomfortable". Which is it?

Anonymous said...

Both.

I could have kept my house and stayed $200K in debt, as we go into a very uncertain economy. I could have stayed and gone to class and been very uncomfortable with every minute of it, as I already had. I had paid my mortgage until Oct 2009.
But to keep my house and feed my children, I would have had to put them in public school and have gone to work.
When I told this to Shanon, he said, so what , we all have to make sacrifices.
Umm....I came into this school so that I could get an education and homeschool my children.

And then what? They defaulted on the land...they don't own the land that they are promising me!

How about Shanon get a job at Home Depot and pay me back?

When I made the deal, I had planned to sell my house in Oct 2009 and to live on the land that I had purchased close to the temple, while building community and beginning building on the mountain.

But last year it was evident that the school was in trouble.

Before the May 2009 "fundraiser" I was aware that they had defaulted on their payment to the land that they said my parcel was on.

Shanon had moved my parcel around 3times, and he would not commit to a specific area.
I asked for a signed agreement as to what specific 3 acres and where the campus buildings would be.

He didn't.
In fact, I knew something was wrong when I was invited to a charrette to plan the new campus.

Shanon would only talk about what it would look like in 100 years...and 500 years. Ummm...I wanted to talk about how it would unfold in 5, 10 and 20 years.

There was never a time for me to present my ideas. It seemed like just a staged show to make it seem like something important was being done.
There was nothing practical accomplished.

I "looked deeper" into their finances and it clicked where that "1 million dollar donation" had come from...it hadn't.
And they were about to lose the land.

Anonymous said...

Both.

I could have kept my house and stayed $200K in debt, as we go into a very uncertain economy. I could have stayed and gone to class and been very uncomfortable with every minute of it, as I already had. I had paid my mortgage until Oct 2009.
But to keep my house and feed my children, I would have had to put them in public school and have gone to work.
When I told this to Shanon, he said, so what , we all have to make sacrifices.
Umm....I came into this school so that I could get an education and homeschool my children.

And then what? They defaulted on the land...they don't own the land that they are promising me!

How about Shanon get a job at Home Depot and pay me back?

When I made the deal, I had planned to sell my house in Oct 2009 and to live on the land that I had purchased close to the temple, while building community and beginning building on the mountain.

But last year it was evident that the school was in trouble.

Before the May 2009 "fundraiser" I was aware that they had defaulted on their payment to the land that they said my parcel was on.

Shanon had moved my parcel around 3times, and he would not commit to a specific area.
I asked for a signed agreement as to what specific 3 acres and where the campus buildings would be.

He didn't.
In fact, I knew something was wrong when I was invited to a charrette to plan the new campus.

Shanon would only talk about what it would look like in 100 years...and 500 years. Ummm...I wanted to talk about how it would unfold in 5, 10 and 20 years.

There was never a time for me to present my ideas. It seemed like just a staged show to make it seem like something important was being done.
There was nothing practical accomplished.

I "looked deeper" into their finances and it clicked where that "1 million dollar donation" had come from...it hadn't.
And they were about to lose the land.

Anonymous said...

And YES, I DID lose my house. I had paid several thousand of dollars in architect fees to have the house and Permaculture center drawn up.
Due to their "optimistic" or rather over-inflated Blue Sky claims of the subdivision and college- they even had a developer who was supposed to be selling many lots-I had put monies into this project.

Now that the project is folded...there is no more Monticello campus, there is no million dollar donation, there is no "accredation forthcoming".
The land I was promised does not belong to them, and they will be foreclosed on by the first of the year.


As I looked closer and talked to more people, I saw things that I believe are against the law.

There are changes to "bookeeping" and questions as to how donated monies were used.

My attorney's demand letter is valid...they were bankrupt as per the conditions they were to pay me back and without the monies which I am entitled to - I could not afford the house payment on my house.

I now pay 1/3 of what my house payment was and am barely making ends meet.

To require me to keep a house that I really can't afford,( however, the repayment of the $150k would have left me with a $50k mortgage, which I could have afforded)...CAUSED ME TO LOSE MY HOUSE.

The second offer that they made-
$5,000 now and $1000 a month for the next 14 years - WITHOUT interest and taking away all the benefits that are listed in the second document AND CHARGING ME for tuition for the time I did attend since the contract was put in play is another example of why I am upset.

I might have even considered it, it would have allowed me to keep my home...but again- they went over the edge...not only did they want an interest free loan now extended for 14 YEARS!, they wanted to take everything else away from me.
Now that builds loyalty.

As in everything, it's not just one thing...it's everything.
There are many other things I am not sharing just now.

The terms were that if they were insolvent, I would get the money back..I calculated that risk and knew I would be able to pay my house off and I had Oliver's promise and commitment that the money would be repaid.

If GWU was building the "world-wide" campus that is in my picture book that Shanon put together as a sales tool, I would comfortably be in a house on the land near the temple and contemplating building on the mountain.

Anonymous said...

Now, there is no land on the mountain , no plans for the near future, no monies to pay me back....and no one taking responsibility.

Again, my upsettedness is not just that they are without funds...the failure of the last "fundraiser" was not just about the economy...it was about a small school trying to bite off more than they should,over-extending themselves, talking a big story without sound business practices, and worse yet, internal mismanagement and no checks and balances within their structure.


It is about "owning" the mistakes, and apologizing and doing what ever they can to make it right.

My requests to be paid back in either copyrighted lecture material, or tuition credit
were ignored. No Board member has offered to "give" any of their resources ( well one did, after he left the board...he gave me his advice) to rescue the situation.

Don Sills said he would try to get some money together....never heard back from him.

And if this was an isolated event, apart from the Duck Creek it would be more forgivable....I didn't know about Duck Creek until after...and now understand how they were "relieved" of their funds.
If I understand correctly, Cleon Skousen LEFT this group of people, in response to their disastrous financial dealings...

And I still don't have a penny nor a pencil nor a book from them in repayment.

I lost my house because they did not pay me back.
According to 4 attorneys, a judgement would not be hard to get..see the reasons' in the above letter.

It was not an investment, it was a loan and is to be paid back.

How can they pay me in land that they no longer own?

They can't. They don't. They won't.

I am confident a judge would rule that since the land is gone, and they are not fiscally sound, and after looking into their books -that the monies should be paid back.

I need attorney's fees to do this however...

Jen said...

I remember Kristine already going public with this a few months ago on Facebook, TJED message boards, e-mail groups, etc., so I’m a bit perplexed that it’s being spun here as "breaking news" with her identity a secret. Back when it was all the buzz, I emailed the school about it and their reply included this letter signed by the board chair. I saw the letter posted on the TJEdMUSE message group, so it may be posted in other places as well. My guess is that it was a general response the school was sending out to inquiries on the matter. It seems to shed some light on her claims. Apparently even though the school isn’t obligated to do anything for two more years, they’ve made a number of good faith attempts to modify the terms to help her, but she might have rejected them for motives we aren’t being told about. I’ve pasted the letter below:


August 21, 2009

Re: Rumors surrounding Ms. Emanuelson's Loan

To our Friends and Supporters,

In addition to regular donations and volunteering time, a number of people have supported GWU by providing loans to support development of the Monticello project. As with regular donors, these supporters are appreciated greatly for their kindness and commitment.

Unfortunately, it has come to our attention that one of these individuals has publicized claims that GWU has failed to repay her. There are many problems with Ms. Emanuelson’s campaign of phone calls, texts, emails, tweets and forum posts—from factual to legal and ethical.

Contrary to Ms. Emanuelson’s claims, this loan is not in default, and according to the terms of the contract, reimbursement is not due for another two years. Several months ago Ms. Emanuelson asked the Board to change the terms of repayment. Because the school and its projects operate on planned budgets, it is very difficult to add new recurring line items in the middle of the year—especially this year when resources have already been allocated toward new projects like the online programs, which are already operating.

Notwithstanding this, we recognize that Ms. Emanuelson’s personal circumstances may have changed since signing the loan agreement. With that in mind, we have made numerous attempts to work out a short-term solution for Ms. Emanuelson privately. But since she has taken this to the public forum, we are left with no choice but to respond publicly for the benefit of the GW community. Whenever possible, we will continue do what we can to resolve this privately. We are naturally concerned for the welfare of Ms. Emanuelson and her family, and appreciative for the good she has done for the university. We continue to work with her and look forward to a solution.

Diann Jeppson
Chairman, Board of Trustees, George Wythe University

David said...

I have been reviewing the posts and comments and a few things still bug me about all of the griping against GWU. People and institutions fall on hard times. Contracts grant benefits and secure obligations.

It appears that the original intent of the contract was to (loan/borrow) money for a period of four years and by the end of the four years either (receive/convey) land or the money back. In case there was a serious problem with the University there is a default clause.

The default options all refer to the filing of some legal documents or an immediate financial condition. 1- BK protection, 3- a Federal Tax Lien, and 5- a money judgment. The one bantered around the most right now is 2- insolvency.

The contract allows for notice of default and a cure of the default. If GWU can pay their bills NOW, then they are not in default. There has been no showing of insolvency, just allegations and innuendo.

The attorney's letter is threatening and menacing but not exactly an impartial reading of the situation since the attorneys are being paid to argue Kristine's side.

The contract was pretty clear, in four years either land or money would be given in return for the money loaned at the time of the contract signing.

I am sad you lost your house, these are tough times. The contract indicated that you should not expect to have repayment for at least two more years from now.

Anonymous said...

I guess we will all just disagree with the reading of this contract.

1. I still maintain that they were insolvent when I asked for the funds to be returned.

2. I maintain that it was mis-represented that there was NO million dollar donation.

3. I maintain that is was misrepresented what the monies would be used for.

4. GWU will no longer own the land that they promised me and as such, the contract if void.

5. I never twittered anything on this.

6. The only resolution the Board has come up with has been to further try to get more by offereing less.

7. The Board DOES NOT work with me, that is why I posted this...they are NOT in contact with me.

8. The contract is null and void as it was a Blue Sky scheme...

9. I was told that I may not be able to use my "tuition for perpetuity " and not be able to register for Winter classes since I posted this on this site.

10. I have been at this for over a year and a half with no success of resolution. Seems to me that if they were truly concerned that an agreement could be reached.
They continue to stall, and refuse any requests and are not in contact with me. This is the reason I chose to post it.

Can anyone help with pursuing this legally?

9.

David said...

That's why litigation happens when the sides cannot agree. The very terms of the first paragraph of the promissory note say that the demand for repayment is not until four years later, and only a demand for repayment if they have not deeded three acres of land to you. The agreement was for land or the money back after four years.

Just because it looks like the land part will not materialize does not invalidate the rest of the agreement. If they were insolvent as per clause D(2) they have the opportunity to cure the default under paragraph E(2). If they have cured the default there is no default and no rightful demand for payment.

Blue Sky Laws sound fancy but they deal with the sale/purchase of securities, not unsecured loans/debts.

R.C. said...

The moral of this whole story: don't loan $150,000 to somebody without the guidance of a reputable attorney. This includes friends, family, and universities.