From the Arkansas Advocate:
A judge issued a default judgment Wednesday against the former owners of a troubled Little Rock apartment complex after they did not appear in court.
Pulaski County Circuit Judge Cara Connors’ order brings the two-year-old case closer to a resolution, Attorney General Tim Griffin said in a news release.
“The former owners of Big Country Chateau continued their disregard for the court and its authority by failing to show up today,” Griffin said. “Today’s default judgment allows my office to seek relief and hold them accountable for their detestable behavior against Arkansans.”
Big Country Chateau residents nearly lost both water and electricity twice between August 2022 and January 2023 after apartment management did not pay the utility bills with the money collected in rent payments as promised.
Griffin’s predecessor, now-Lt. Gov. Leslie Rutledge, filed the consumer protection lawsuit against the complex, its parent company and its holding company after the first nonpayment of utility bills.
Rutledge claimed Big Country Chateau, Apex Big Chateau AR and New Jersey-based Apex Equity Group violated the Arkansas Deceptive Trade Practices Act, which prohibits accepting consumers’ money for a previously agreed-upon purpose and not using the money for that purpose. Violators of the Arkansas Deceptive Trade Practices Act can be fined up to $10,000 per violation.
The August 2022 legal complaint also alleged that Big Country Chateau rented out units despite knowing those units violated city code, with issues including mold, broken windows, scattered garbage and other “appalling” living conditions. The code violations have been the subject of separate litigation in Little Rock environmental court.
The defendants’ absence Wednesday was not the first occurrence. Connors held them in contempt of court in September 2023 and fined them $1,000 per day, dating back more than a month, after the defendants did not provide the court with several requested documents and did not appear at an August 2023 hearing.
The majority of Big Country Chateau’s 151 units have been vacant since before Rutledge filed the lawsuit. City officials said last year they would help the remaining residents relocate in order to shut down the complex.
In February 2023, Connors appointed Sal Thomas of Houston, Texas, as a third-party receiver for the apartments, collecting the remaining tenants’ rent and utility payments. Thomas did not evict any tenants or lease out vacant units, and he repeatedly said in circuit court documents that a minority of the tenants had been making rent and utility payments.
Connors terminated the receivership in February at Thomas’ attorney’s request after the Federal Home Loan Mortgage Corporation purchased the property, according to court documents. The corporation, commonly known as Freddie Mac, already owned the property’s mortgage.
Tenants’ advocates have used Big Country Chateau as an example of the city and state’s insufficient protections for low-income renters. Little Rock city directors advocated hiring more city code enforcement inspectors at an October discussion with tenants frustrated about living conditions.
Life safety violations in rental housing include a lack of or malfunctioning electricity, hot and cold running water, plumbing system and heating and cooling system, among other things, according to court documents.
These minimum standards did not become required by state law until 2021.
