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Mold, sewage, broken appliances among tenants’ problems in properties whose owner faces AG lawsuit


Mold, sewage, broken appliances among tenants’ problems in properties whose owner faces AG lawsuit

Sep 20, 2022 | 8:00 am ET
By Tess Vrbin
Mold, sewage, broken appliances among tenants’ problems in properties whose owner faces AG lawsuit
Nick Black looks up at a moldy vent he has tried to clean in the apartment he shares with his wife, Amy, and their 2-month-old son, August, on Aug. 28. His 4-year-old son and Amy's stepson, Mason, stays with them on weekends. The family has been sick from inhaling mold and hopes to move to a safer complex. Big Country Chateau faces a Pulaski County Circuit Court lawsuit for renting out unsafe apartments and for keeping tenants' money that was meant to pay utility bills. (Tess Vrbin/Arkansas Advocate)

Nick and Amy Black’s son, August, already had a persistent cough by the time he was two months old. Their pediatrician said the baby is allergic to the mold in the family’s Little Rock apartment.

It’s what makes Amy “the most mad” about their living situation at Big Country Chateau, which has had a plethora of problems since they moved there in November, she said.

“We’re stuck,” she said. “We don’t have the means or a place to move, and I feel like [management] kind of preys on that.”

Big Country Chateau and its parent company, New Jersey-based Apex Equity Group, are facing a consumer protection lawsuit alleging deception and mistreatment of tenants filed by Arkansas Attorney General Leslie Rutledge.

Mold was just one of many hazards Little Rock code enforcement found inside the 11-building, 151-unit complex during a July 27 inspection, according to the Pulaski County Circuit Court lawsuit filed in August.

“Outside the buildings, trash, animal feces, and debris were found scattered throughout the lawn and around the pool; doors were missing, with empty doorways boarded up; windows were shattered; electrical boxes were open, with wires tangled and exposed; and the fire extinguisher hooks were all empty,” the lawsuit states.

Apex did not respond to requests for comment for this story. Neither did PF Holdings, another New Jersey-based company with Arkansas properties that shares the same physical address with Apex.

The Blacks have lived at Big Country Chateau since November 2021. In addition to the mold visible in the vents, the dishwasher was broken before they moved in and still has not been replaced or fixed, they said. They have made several maintenance requests that they said have gone unanswered.

In addition to the state lawsuit, the city of Little Rock has been pursuing an environmental court case against Big Country Chateau since 2019. The case’s hearing was originally scheduled for Aug. 29 but was postponed until Wednesday to give the complex’s attorneys time to address new charges.

At first I thought they just don’t care, but it’s more than that ... They were pocketing money.

– Amy Black, Big Country Chateau resident

“Totally unlivable”

Vivian Allen lived at Jefferson Manor for seven years until Saturday, when she moved to Lonoke after waiting several weeks for a unit to become available.

PF Holdings owns Jefferson Manor, a 140-unit complex in North Little Rock. Almost half of its tenants receive assistance from the U.S. Department of Housing and Urban Development.

Allen’s former Jefferson Manor apartment had a water leak for four of the seven years she lived there, and a sewer line burst on Aug. 16 that flooded her and her neighbor’s apartments with raw sewage and made the units “totally unlivable,” she said.

As of the end of August, management had still not sent anyone to vacuum up the sewage, Allen said.

“It got so bad that we couldn’t breathe, so they put us in a hotel, but they don’t provide for food or anything,” she said. “All of our belongings are tied up in this building where we can’t even go back in there and get stuff out that we need.”

She said she was one of multiple residents who has been hospitalized for inhaling too much mold and sewage at the complex.

More about the lawsuit

Rutledge’s suit alleges Big Country Chateau and Apex Equity Group violated the Arkansas Deceptive Trade Practices Act by not paying water or electricity bills for the complex after collecting tenants’ money for this apparent reason.

Central Arkansas Water and Entergy Arkansas both gave notice in July that they would end their service to Big Country Chateau on Sept. 1. Big Country Chateau management owed $222,931.70 to Central Arkansas Water, according to the lawsuit.

Residents of the complex did not lose water or electricity on Sept. 1 after all. Management made “arrangements” with Central Arkansas Water, CAW spokesman Doug Shackelford said. 

The complex owed $70,000 to Entergy Arkansas and has since paid it off, utility spokeswoman Brandi Hinkle said.

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 attorney general’s lawsuit states.

Breaking this law is a Class A misdemeanor, and the attorney general may seek an injunction against the offender, according to state statute. Violators of the Arkansas Deceptive Trade Practices Act can be fined up to $10,000 per violation.

Rutledge said in an Aug. 17 news conference about the lawsuit that residents of other properties in Arkansas owned by Apex can file a complaint with her office if they are facing unfair or unsafe living conditions.

Several current Jefferson Manor residents, who did not want to be named due to fear of retaliation, said their apartments have a variety of issues that management has not fixed or took a long time to fix after multiple requests. The problems range from mold to broken air conditioning units to unusable kitchen appliances, similar to the Blacks’ problems at Big Country Chateau.

Jefferson Manor and Big Country Chateau both have federal Housing Assistance Payment contracts that allow tenants who receive Section 8 housing choice vouchers to live at those complexes if they so choose. Allen receives HUD assistance; the Blacks do not.

HUD is currently withholding its payments to Jefferson Manor for 22 of its 68 HAP units because they “were identified with deficiencies” and the property’s owners or management have not provided proof that the issues are resolved, a HUD spokesman said in an email.

PF Holdings owns at least four other properties in Arkansas: Terrace Green in Little Rock, The Summit at Town & Country in Little Rock, Hillsboro Town House Apartments in El Dorado and Allied Gardens Estate in Fort Smith.

Allen said she is frustrated that HUD is withholding money that could be used to make Jefferson Manor more livable.

Big Country Chateau’s Section 8 tenants recently received vouchers to move somewhere else, said Kenyon Lowe, board chairman at the Metropolitan Housing Alliance, Little Rock’s HUD-funded housing authority.

The complex violated its HAP contract by not paying utility bills and not fixing its unsafe living conditions within 60 days of MHA becoming aware of them, Lowe said.

Allen filed a consumer complaint with Rutledge’s office about conditions at Jefferson Manor, in response to Rutledge’s request when she announced the lawsuit.

Consumer complaints are usually mediated by the attorney general’s office, but in this case they contribute to the office’s legal case against Apex and Big Country Chateau, Amanda Priest, a spokeswoman for Rutledge, said in an email.

Some complainants might be contacted by a victim advocate to provide further testimony about their experiences before the case goes to trial, Priest said.

One of the lawsuit’s goals is to prohibit Apex from doing business in Arkansas ever again. Jefferson Manor and PF Holdings are not currently defendants in Rutledge’s lawsuit.

“However, as the lawsuit progresses and more information is obtained about the corporate structure of these companies, they may be implicated in the request to enjoin these bad actors from deceptive trade in Arkansas,” Priest said.

Feeling “trapped”

When the Blacks’ air conditioning stopped working in July, they bought a $300 portable air conditioning unit, and their landlord said the amount would be deducted from their rent. But it never was, they said.

Their front door is lopsided and leaves an opening that lets insects into the house, and Nick Black used a nail and a rubber band to make it possible to close a door with a busted handle.

Management has been “scrambling” to make repairs, some of them haphazard and done by unqualified individuals, since the water and electricity nonpayments became public knowledge, the Blacks said.

“At first I thought they just don’t care, but it’s more than that [because] they were pocketing money,” Amy Black said.

Like the Jefferson Manor residents, the Blacks said they are wary of potential retaliation from management for discussing their problems publicly, but they said they are better off than some other Big Country Chateau residents. They hope they can draw attention to the complex’s issues and help hold management accountable for its actions and inactions.

They are trying to find a new place to live with help from the Our House social services agency, they said, but at the moment they have to stay put.

“I’ve always hated the feeling of being trapped with no options,” Nick Black said.