Judge grants request to freeze assets, name receiver for Little Rock apartments

(This story was updated by Sonny Albarado on Feb. 4, 2023.)

A Pulaski County circuit judge on Friday froze the assets of the owners of the troubled Big Country Chateau apartments in Little Rock and issued a temporary restraining order to protect tenants.

Judge Cara Connors also granted Attorney General Tim Griffin’s emergency request to appoint a third-party receiver to collect rent, pay utility bills and make repairs at a Little Rock apartment complex that faces allegations of deceptive business practices.

The court found “there is good cause to believe that Defendants have engaged in and are likely to continue to engage in conduct in violation of the ADTPA [Arkansas Deceptive Trade Practices Act].”

Connor wrote that the state “has provided sufficient evidence to show that consumers will continue to be at risk of immediate and irreparable harm before a hearing can be held” on the motion filed Wednesday by Assistant Attorney General Amanda J. Wentz.

“The Court finds that a temporary order is warranted to protect consumers from immediate, unconscionable, and irreparable harm,” the judge wrote.

Griffin’s office sent a request Wednesday for the court to allow his office and Big Country Chateau three days to agree upon a receiver. If the parties cannot agree, they will submit a list of names for the court to choose from.

Connors agreed to that request.

Griffin also asked the court to freeze the assets of the 151-unit complex, its holding company and its New Jersey-based parent company, all defendants in an ongoing consumer protection lawsuit. Former Attorney General Leslie Rutledge filed the suit in August 2022 in Pulaski County Circuit Court.

Big Country Chateau residents have nearly lost both water and electricity twice in six months after apartment management did not pay the utility bills with the money collected in rent payments as promised.

Accepting consumers’ money for a previously agreed-upon purpose and not using the money for that purpose is “a deceptive, false, and unconscionable business practice” that violates the Arkansas Deceptive Trade Practices Act, the lawsuit states.

Last year, Entergy Arkansas and Central Arkansas Water gave notice in July that they would cease services to the complex on Sept. 1. Big Country Chateau management paid off its $70,000 debt to Entergy Arkansas and made “arrangements” with Central Arkansas Water before Sept. 1, so both utilities continued to provide services to the complex until they sent notice in January that they intended to cancel again.

Griffin spoke to tenants and their supporters at a rally at Little Rock City Hall on Jan. 26, saying he had asked Entergy and Central Arkansas Water to postpone the shutoffs while his office works on legal remedies.

Entergy spokeswoman Brandi Hinkle said the utility has suspended the disconnection while waiting for Griffin’s office and the court to determine “whatever resolution they come up with.”

Griffin’s petition also requests a temporary restraining order that would prohibit the tampering or destruction of records by the defendants.

“Although the law does not require the State to prove immediate and irreparable harm when requesting a temporary restraining order, the State alleges that immediate and irreparable damage will occur if consumers’ water and electric utilities are shut off because the tenants will not be able to safely remain in their apartments,” the court filing states. “Loss of electricity will invite tenants to use heating and cooking methods that pose a risk of fire and will endanger the lives of the tenants.”

The petition asks for a quick decision on the restraining order so that the defendants do not have time to continue misusing tenants’ money.

At the Jan. 26 rally, Big Country Chateau tenants said their struggles include unsafe living conditions. Tenants previously told the Arkansas Advocate that management often has not responded to maintenance requests and “scrambled” to do so after the first nonpayment of utility bills became public knowledge in July 2022.

Little Rock environmental court has been pursuing a case against Big Country Chateau since 2019. City code violations at the complex have included ​​mold, broken windows, exposed electrical wiring and scattered garbage.

In October, apartment management pleaded no contest to several code violations, and attorney Sylvester Smith of Little Rock told District Judge Mark Leverett that about 90% of the “life and safety issues” at the apartments had been resolved.

In November, life and safety violations had been resolved in all but seven units, Smith said. Management was considering filing civil eviction actions against the residents of the remaining units as a last resort to gain access and improve the living conditions.

Smith did not return calls requesting comment.