During a formal hearing on Monday, Faulkner County Circuit Judge Susan Weaver ruled in favor of the attorney general’s request for a preliminary injunction against Bruce Keathley and Diamond K. Investments, Inc.
Attorney General Leslie Rutledge filed a complaint, followed by a preliminary injunction and a request for expedited consideration on Friday, alleging defendants violated the Arkansas Deceptive Trade Practices Act.
Keathley is the owner and landlord of Brookside Village Mobile Home Park in Conway. In April, he sent eviction letters to all tenants – 300 people in 114 households – giving them until June 30 to relocate, citing increases in water and sewer rates by Conway Corporation as his reason to cease operations at the park. Later, upon request from local nonprofit City of Hope Outreach, defendants met with Conway Corporation and agreed to extend the deadline to July 15.
Last Monday, however, several families remained on the premises.
Per an affidavit signed by CoHO’s Executive Director Phil Fletcher, 21 families were left, 15 of which CoHO was able to find hotel stays or alternative housing for, with six refusing to leave Brookside.
Fletcher stated in the document that on July 15, the electricity was turned off to some and water was turned off to all.
The Log Cabin Democrat spoke with Conway Corporation’s Crystal Kemp on Friday, who said they had received a request from their water customer, Keathley in this situation, to turn water off on July 15, which was done. However, regarding the electricity, Keathley did not and could not request – has to come through their customers, which in this case are the Brookside tenants – that from the energy business; if electricity was turned off, it wasn’t by them.
“Your landlord can not come to us and say, ‘hey can you shut off their power,’” Kemp said. “We cannot shut off ... for any landlord in town. Electricity is billed per trailer with some meters being connected under the landlord’s name and others being connected under the tenant’s name.”
Assistant Attorney General Shannon Halijan argued the office had the authority to pursue said injunction to prevent “false, deceptive, misleading, or unconscionable business practices,” defined as “one that affronts the sense of justice, decency, or reasonableness, including acts that violate public policy or statute,” stated in the original complaint, by showing they believed the violations were being committed and, because Diamond Investments is a for-profit business, Keathley participated in self-help evictions by turning off residents water without pursuing any unlawful detainers toward park residents.
“The attorney general is arguing, today, that behavior is unconscionable,” Halijan said.
The court agreed with the prosecuting party and granted the preliminary injunction on Friday, initially ordering water and electric be turned back on, and again on Monday, excluding electric, because, as Judge Weaver put it, she couldn’t make Keathley do what he couldn’t do – he can’t control whether electric is turned on or off.
On Monday, the court heard from both Fletcher and Keathley, called as witnesses.
Fletcher testified that, from the very beginning, they have had every intention to get residents moved by the June 30 date, and again, on July 15, but also mentioned several issues they’ve come across which led to their inability to do so, all of which he said were “important to recognize”:
1.) Most of the families were on fixed income and, though the April-to-June eviction date was within reason for most, those who aren’t economically inclinded have a harder time coming up with money to do so.
2.) Many within the park were disabled, with wheelchair ramps attached to trailers, making the entire package more difficult to transport.
3.) Finding movers with reasonable rates proved difficult, but were able to find professionals charging $1,700 to $1,800.
4.) Weather issues.
5.) Not all of the trailers were in good enough shape to actually move and, after being inspected, families were required to make alternative decisions.
“Each household had a different situation,” Fletcher told the court.
He did add that as the date approached, he and the other nonprofits working the situation made it very clear to all residents that July 15 was the move-out date.
Halijan asked Fletcher, of the ones who stayed behind, was he concerned for them, having prior mentioned the water being shut off and high-heat temperatures.
“Yes, I was concerned about all of them,” he said, but added he knows he can’t force them to make a decision.
Danny Crabtree, counsel for the defense, asked Fletcher if, “given everything,” did he think Keathley acted reasonably to which Fletcher replied, “No,” he should have given more time. However, Keathley disagreed and told the court he felt he gave residents ample time to move.
Upon calling Keathley to the stand, Crabtree asked his client what his main reason was for closing Brookside, which he has owned for more than 30 years. Keathley said he’s been considering it for several years, due to Conway Corporation increasing several of its rates.
“It was just finally evident to me that nothing was going to change,” he told the court, adding that it took every penny he had to pay the bills that ranged from $15,000 one month to $20,000 another.
Lot rent for Brookside, Keathley testified, is supposed to be $300 a month. He said some have paid that, others have paid less and some, nothing at all.
Crabtree said if that was so, why give the three-month window instead of just suing tenants from the start to get them out.
“I have a good relationship with my tenants,” Keathley answered, adding that he wanted to give them that time, knowing many of their financial situations. “That’s my logic in doing it that way.”
Since he sent the April eviction, the landlord said he’s hardly received anything from the Brookside residents. Keathley said in June, 11 lots paid rent: eight paid $800, one paid $200, one paid $100 and one paid $150. In July, only three households paid, totaling $350.
Crabtree asked the owner what his Conway Corp bill sits at and Keathley said it amounts to around $18,000, which has accumulated due to renters allegedly not paying.
In addition, Keathley was also recently hit with more than 170 code violations for Brookside through the City of Conway, totaling more than $48,000.
The attorney asked his client if he was requesting the court not order him to turn back on the water ... Keathley said, that would “just prolong things.”
“I feel like I’ve done everything in my power to help them and give them [time],” he said.
Halijan asked Keathley, regardless of what his tenants do, should he follow the law – referring to the state’s arguments about self-help eviction and unlawful detainer requests – to which he replied, “I always try to follow the law.”
Following Judge Weaver’s decision, the attorney general’s office said they would amend their complaint – in regards to the complaint including electricity – and would request a hearing on the matter at a later date.