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Little Rock loses appeal of $432,744 judgment as high court favors apartment complex owners

by John Moritz | January 17, 2020 at 6:59 a.m.

Little Rock's attempt to force the closure of a large apartment complex during Christmas week 2015 violated the due-process rights of both the owner and several tenants of the property, the Arkansas Supreme Court said in a ruling Thursday upholding a lower court's award of $432,744 in damages to the owners.

The 6-1 decision by the justices, however, sent several tenants at the property at 6310 Colonel Glenn Road back to a lower court to seek damages for their claims of distress and mental anguish.

City officials had been overseeing repairs to the 141-unit complex for more than a year when on Dec. 21, 2015, Fire Chief Gregory Summers ordered the property closed, citing safety concerns. Tenants had a week to vacate.

The owners, Alexander Apartments LLC, disputed the city's characterization of the complex and won a restraining order to stop the forced evictions. The complex has operated ever since.

[DOCUMENT: Read Arkansas Supreme Court's ruling »]

Little Rock City Attorney Thomas Carpenter said Thursday that while he disagreed with the outcome of the case, he thought it offered clarification to city officials in future situations.

"Anytime we come to an apartment complex now, regardless of how dangerous the situation is, this opinion makes it real clear we've got to notify all the tenants of it and offer them a hearing before we can do anything to protect their lives," Carpenter said. "If that's going to be the law, then we need to know that."

The complex owners had argued that the city violated state law and their rights to due process by not setting up a process to protest the city's order. The city's attorneys countered that the immediate appeal by Alexander Apartments' owners to the circuit court amounted to a de facto hearing on the matter.

As a result of the city's attempt to shut down the unit and resettle tenants, the owners alleged that the complex suffered an increase in vacancies, for which, they argued, the city had liability.

Pulaski County Circuit Judge Alice Gray agreed with the apartment owner's arguments, and in 2018 awarded them $423,744 in damages, which the city appealed.

Writing for the majority in Thursday's decision, Chief Justice Dan Kemp upheld that ruling, saying, "The urgent situation described by the City was belied by its own delay."

"Although the City claimed that an emergency observed on December 16, 2015 necessitated the immediate closure of the complex, the order did not mandate the closure until 12 days later," Kemp wrote.

Joining the chief justice in the majority were Justices Courtney Hudson, Shawn Womack, Karen Baker, Robin Wynne and Rhonda Wood.

Justice Josephine "Jo" Hart dissented, writing separately that the majority should have addressed arguments by the apartment owners that the Arkansas Fire Prevention Code is unconstitutional. The majority had declined to address the matter, stating that Gray had not issued a ruling on it.

Michael Shannon, an attorney for Alexander Apartments, said Thursday that the ruling "vindicated" Gray's decision.

Still left awaiting payouts, however, are four tenants of the apartment complex, Melody Branch, Carolyn Ford, Ingram Murphy and Linda Wheeler.

Kemp's decision found that the $52,000 awarded collectively to those tenants by Gray was based in part on factors that the city was not responsible for, such as distress caused when two of the tenants later had to vacate their apartments because of a gas leak. The Supreme Court remanded the tenants' damage claims to Gray for further hearings.

According to court records, a fire marshal inspection of the apartments in December 2015 had found a variety of problems, such as exposed wiring, leaks, mold and a lack of working smoke detectors. The managing member of Alexander Apartments LLC, Jason Bolden, could not be reached for comment Thursday.

Alexander Apartments LLC had purchased the complex in early 2014 in a state of "disrepair," records state. The owners had spent more than a year making repairs, their attorneys argued at a hearing shortly after the city tried to close the complex.

At least three of the four tenants involved in the case no longer live at the complex on Colonel Glenn Road, according to their attorneys. The attorney for the fourth tenant, Ingram Murphy, could not be reached for comment.

"They did lose significant tenants as a result of the city's actions," said Shannon, the owners' attorney.

The four tenants were represented by attorneys from several legal aid clinics in Little Rock. Arkansas Community Organizations, a Little Rock nonprofit advocacy group, also joined the lawsuit.

Kendall Lewellen, an attorney representing two tenants and Arkansas Community Organizations, said Thursday's Supreme Court ruling was a "partial resolution to several years of hard work."

Carpenter, the city's attorney, could not say whether the complex remained up to code -- though he noted that problems there had not originated with the current owners.

"The fact that they even took that on is a credit to them," Carpenter said. "The fact that we're still dealing with it for over a year, it's a question that I think the city's got to ask as a policy, when you got to get something right that's not right and people are living there, should you really take a year or 18 months and still not have it right."

Metro on 01/17/2020

Print Headline: Little Rock loses appeal of $432,744 judgment as high court favors apartment complex owners


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