Justia Real Estate & Property Law Opinion Summaries

A bank made a $1.9 million loan secured by a mortgage on over 750 acres of real property. About a year later, a portion of the property was sold to a third party, who financed the purchase with a loan from a second bank. During the closing, a vice president of the first bank assured the title company that the bank would release its mortgage on the sold parcel. Relying on this representation, the title company distributed the proceeds, and the second bank lent money for the purchase. Years later, the first bank attempted to enforce its mortgage against the property, claiming its lien was superior to the interests of the second bank and the purchaser.The Lincoln County Circuit Court heard the case after the original borrowers filed for bankruptcy, which stayed claims against them except for breach of contract and foreclosure. The first bank obtained a default judgment for breach of contract against the borrower, but the case continued against the subsequent purchaser and the second bank. These parties moved for summary judgment, arguing the first bank was estopped from asserting its lien due to its agent’s prior representation. The circuit court granted summary judgment in their favor, and the first bank appealed. The Arkansas Court of Appeals dismissed the appeal for lack of a final order due to ambiguous abandonment of unresolved claims.The Supreme Court of Arkansas reviewed the case and held that the first bank’s abandonment of pending claims in its notice of appeal was sufficient for finality, allowing the appeal to proceed. On the merits, the court found no disputed material facts regarding the agent’s authority or the parties’ reliance on the representation. The Supreme Court affirmed the circuit court’s grant of summary judgment, holding that equitable estoppel barred the first bank from enforcing its lien under these circumstances. The opinion of the Court of Appeals was vacated. View "RELYANCE BANK, N.A. v. PHARR" on Justia Law

A company sought to operate a red-dirt surface mine on approximately twenty acres in a part of Washington County that was zoned for agricultural and single-family residential uses. The company, operating as Heritage Farms, applied for a conditional use permit, which the Washington County Planning Board considered and ultimately denied. The company then appealed this denial to the Washington County Quorum Court, which upheld the Planning Board’s decision and adopted an ordinance reflecting the denial. The company further appealed to the Washington County Circuit Court. During the circuit court proceedings, several local residents and a neighborhood association were allowed to intervene. The company moved for summary judgment, arguing that the denial was arbitrary and capricious, while the intervenors and county argued that the proper standard of review was arbitrary and capricious because the action was legislative, and that there was a rational basis for the denial.The Washington County Circuit Court found that the quorum court’s denial of the permit was a legislative act and thus applied the arbitrary-and-capricious standard of review. The court also held that Arkansas Code Annotated section 14-17-211 was unconstitutional to the extent that it permitted de novo review of legislative zoning decisions. Applying the arbitrary-and-capricious standard, the circuit court concluded there was a rational basis for the denial and affirmed the quorum court’s action. The Arkansas Court of Appeals then affirmed the circuit court’s order.The Supreme Court of Arkansas reviewed the case and held that the denial of the conditional use permit was a quasi-judicial act, not a legislative one, because it involved applying existing ordinance provisions to the facts of the application rather than creating new law. Therefore, the circuit court should have conducted a de novo review rather than applying the arbitrary-and-capricious standard. The Supreme Court of Arkansas reversed the circuit court’s judgment, vacated the Court of Appeals’ opinion, and remanded the case for further proceedings. View "MMSC, LLC V. WASHINGTON COUNTY, ARKANSAS" on Justia Law

Keeling Grubb, acting as president and CEO of Eureka Gun and Pawn, LLC, sought a conditional-use permit (CUP) from the City of Eureka Springs to operate the business as a gun and pawn shop. Grubb submitted the application in May 2023, but the City’s Planning Commission denied it at a special meeting, and the denial was subsequently upheld by the Eureka Springs City Council. After these denials, Grubb and Eureka Gun filed a complaint in Carroll County Circuit Court, challenging the City’s actions and advancing multiple constitutional and statutory claims related to due process, equal protection, property rights, freedom of association and speech, as well as the right to bear arms.In Carroll County Circuit Court, the bench trial was expressly limited to count one of the complaint: an appeal of the City Council’s administrative decision denying the CUP. The remaining claims were reserved for future resolution. During trial, evidence was presented on the nature of the business and community views, but the primary issue was whether Eureka Gun was entitled to a CUP under the City's ordinance. The circuit court denied the appellants’ motion for partial summary judgment and granted the City’s motion for directed verdict, finding that Eureka Gun was not entitled to the permit. Additionally, the court ruled that Arkansas Code Annotated § 14-16-504(b)(1)(A) did not apply to the commercial sale of firearms.The Supreme Court of Arkansas reviewed the appeal. It held that the orders appealed from were not final because the circuit court had only adjudicated one of multiple claims, leaving the others pending, and no Rule 54(b) certificate was issued to permit an immediate appeal. Consequently, the Supreme Court dismissed the appeal without prejudice for lack of a final order and declined to address the merits. View "EUREKA GUN AND PAWN, LLC V. THE CITY OF EUREKA SPRINGS" on Justia Law

David Scott Taylor owns property near Pinnacle Mountain in Pulaski County, Arkansas, adjacent to land owned and developed by Rick Ferguson and several related entities. Ferguson’s property, which is being developed into the Paradise Valley subdivision, allegedly causes increased stormwater runoff that floods Taylor’s land. Taylor claims that the development’s clearing of vegetation, paving, and planned drainage ditch will exacerbate flooding, potentially increasing it by up to 400 percent. Taylor filed suit in Pulaski County Circuit Court, seeking damages and equitable relief to require Ferguson to construct a larger storm-water detention pond to mitigate the flooding.After Taylor filed his complaint, Ferguson moved to dismiss, arguing that the claims involved matters assigned to the exclusive original jurisdiction of the county court under article 7, section 28 of the Arkansas Constitution, specifically relating to county roads, internal improvement, and local concerns. Taylor amended his complaint to remove references to county roads and public nuisance, focusing solely on private flooding. The circuit court initially denied Ferguson’s motion but later reconsidered and dismissed the case for lack of subject-matter jurisdiction, finding that the dispute fell within the county court’s exclusive original jurisdiction. Ferguson then nonsuited his counterclaim, and Taylor appealed.The Supreme Court of Arkansas reviewed the circuit court’s dismissal de novo. It held that Taylor’s claims do not involve county roads, internal improvement, or local concerns as those terms are used in article 7, section 28. The court found that the dispute is a private residential matter over flooding, not a public infrastructure or county regulatory issue, and thus falls within the jurisdiction of the circuit court. The Supreme Court of Arkansas reversed the circuit court’s dismissal and remanded the case for further proceedings. View "TAYLOR V. FERGUSON" on Justia Law

In this case, the owners of a residential property in Fayetteville, Arkansas, sought to rent their home as a short-term rental when not in residence. The City of Fayetteville had enacted an ordinance regulating short-term rentals, requiring a license for all such properties and a conditional-use permit for certain types in residential zones. The ordinance also imposed a cap on the number of these rentals. After applying for a conditional-use permit, the property owners’ application was denied by the Fayetteville Planning Commission, which found the proposed rental incompatible with the neighborhood due to the number of similar rentals nearby.Following the denial, the property owners attempted to appeal to the Fayetteville City Council, but their appeal was not sponsored by the required number of council members. They then filed an administrative appeal in the Washington County Circuit Court, along with claims for declaratory and constitutional relief. They also sought a preliminary injunction to prevent enforcement of the ordinance while their case was pending. The City moved for summary judgment, arguing the administrative appeal was untimely. The circuit court denied the preliminary injunction and dismissed the administrative appeal for lack of jurisdiction, but left the constitutional claims pending.The Supreme Court of Arkansas reviewed only the denial of the preliminary injunction, as the dismissal of the administrative appeal was not properly before it due to the absence of a final, appealable order. The court held that the circuit court did not abuse its discretion in denying the preliminary injunction, finding no irreparable harm and no likelihood of success on the merits at this stage. The denial of the preliminary injunction was affirmed, and the appeal of the administrative dismissal was dismissed without prejudice for lack of jurisdiction. View "HAUSE v. CITY OF FAYETTEVILLE, ARKANSAS; THE FAYETTEVILLE PLANNING COMMISSION" on Justia Law

In October 2016, BAS, LLC purchased commercial property in Paragould, Arkansas, listing its mailing address as 3735 Winford Drive, Tarzana, California. BAS failed to pay property taxes for 2017 and 2018, leading the Greene County Clerk to certify the property to the Commissioner of State Lands for nonpayment. The Commissioner sent a notice of the upcoming tax sale to the Tarzana address via certified mail in August 2021, but did not receive a physical return receipt. USPS tracking data indicated the notice was delivered. In June 2022, the Commissioner sent another notice to the Paragould property, which was returned undelivered. The property was sold in August 2022, and BAS filed a lawsuit contesting the sale, alleging due process violations and unlawful taking.The Greene County Circuit Court denied the Commissioner’s motion for summary judgment, finding genuine issues of material fact regarding whether the Commissioner violated BAS’s due process rights, thus preventing a determination on sovereign immunity. The Commissioner appealed the decision.The Supreme Court of Arkansas reviewed the case and concluded that the Commissioner’s efforts to notify BAS were constitutionally sufficient. The court found no genuine dispute of material fact and determined that the Commissioner’s actions met due process requirements. The court held that BAS failed to allege an illegal or unconstitutional act to overcome sovereign immunity. Consequently, the Supreme Court of Arkansas reversed the circuit court’s decision and granted summary judgment in favor of the Commissioner. View "Land v. BAS, LLC" on Justia Law

The case involves a dispute arising from a 2016 real estate transaction in which the Bauers sold residential property in Crawford County to the Beamons. The Beamons filed a complaint with two claims under the theory of fraud and deceit, seeking both monetary damages and equitable rescission of the contract. Before trial, the Beamons elected remedies associated with their equitable claim, leading to a bench trial. The circuit court rejected the rescission claim but awarded damages for breach of contract and granted the Beamons' motion for attorney’s fees.The Bauers appealed to the Arkansas Supreme Court, arguing that the circuit court erred in awarding damages for breach of contract and attorney’s fees. The Beamons cross-appealed, arguing the court erred in denying their rescission request. The Arkansas Supreme Court reversed the circuit court’s award of damages for breach of contract, affirmed the denial of rescission, and noted it lacked jurisdiction to review the attorney’s fees award due to the Bauers' failure to file an amended notice of appeal.Following the mandate, the Bauers filed motions for their own attorney’s fees and to set aside the Beamons' attorney’s-fee judgment. The circuit court concluded it lacked jurisdiction to consider these motions. The Bauers appealed this decision.The Arkansas Supreme Court reviewed the case and held that the circuit court erred in concluding it lacked jurisdiction. The court clarified that the mandate did not foreclose the circuit court from ruling on new motions for attorney’s fees, which are collateral matters, or on a motion to set aside a judgment for fraud under Arkansas Rule of Civil Procedure 60(c)(4). Consequently, the Arkansas Supreme Court reversed the circuit court’s decision and remanded the case for further proceedings on the Bauers' motions. View "BAUER v. BEAMON" on Justia Law

The case involves Little Scholars of Arkansas, AP Consolidated Theatres II L.P., CSRC Charter LISA, LLC, and KLS Leasing LLC (collectively, appellants) who appealed against Pulaski County, Arkansas, and its officials (collectively, appellees). The appellants operate charter schools and lease properties for their schools. The appellees assessed real-property taxes against the schools, which the appellants contested, arguing that the properties used for school purposes are exempt from taxes under the Arkansas Constitution. The appellants also sought a declaration that Ark. Code Ann. § 6-21-118, which they claimed the appellees relied on for the tax assessment, is void under the constitution.The case was initially brought before the Pulaski County Circuit Court. The appellees moved to dismiss the case, arguing that the county courts have exclusive jurisdiction over county tax matters. The circuit court agreed with the appellees, dismissing the case on the grounds that it lacked subject-matter jurisdiction over the appellants' claims.The case was then brought before the Supreme Court of Arkansas. The appellants argued that the circuit court did have subject-matter jurisdiction over their illegal-exaction claims. They also argued that their request for a declaration that Ark. Code Ann. § 6-21-118 is void does not fall within the county court’s jurisdiction. The Supreme Court disagreed with the appellants, affirming the circuit court's decision. The Supreme Court held that the appellants' claim was not an illegal-exaction claim but an assessment dispute, which falls within the exclusive original jurisdiction of the county court. The Supreme Court also held that the circuit court did not have subject-matter jurisdiction over the appellants' request for declaratory judgment. View "LITTLE SCHOLARS OF ARKANSAS FOUNDATION v. PULASKI COUNTY, ARKANSAS" on Justia Law

Fred and Sandra Monaco took legal action against the Faulkner County Assessor and the Faulkner County Tax Collector concerning the 2021 assessment of their property. Sandra Monaco had purchased a parcel of timberland in 2005 and later built a home on it. The property was assessed as agricultural without a building until 2020 when the Assessor's office discovered the improvement and reassessed the property's value. In July 2021, Sandra deeded the property to herself and her husband, Fred, and subsequently filed a form asserting a homestead right on the property and her right to an assessment freeze under amendment 79 of the Arkansas Constitution. Following the Board's upholding of the Assessor's valuation and assessment, Fred filed a petition for writ of mandamus in circuit court, which was denied.The Supreme Court of Arkansas upheld the circuit court's decision on several grounds. Firstly, Fred's attempt to represent Sandra's interests was deemed unauthorized practice of law, rendering the petition null with respect to Sandra's claims. Secondly, Fred could not claim a writ of mandamus as there were other remedies available to him such as appealing the Board's decision. The court found that a writ of mandamus is an extraordinary remedy only issued to enforce an established right or the performance of a duty, and it requires the petitioner to show a clear and certain right to the relief sought and the absence of any other remedy. In this case, Fred failed to meet these requirements. View "MONACO v. LEWIS" on Justia Law

In September 2021, Aaron Welch died intestate, leaving behind a widow, Kristin Welch, and two minor children from his previous marriage. Kristin Welch, appointed as the administratrix of Aaron Welch's estate, filed an application for reservation of homestead & dower with the Pope County Circuit Court, claiming a homestead interest in the mortgaged home she had lived in with her late husband. Katelyn Gipson, the natural guardian of the minor children, argued that Kristin Welch did not have such an interest based on Arkansas Code Ann. § 28-39-201. This statute requires a surviving spouse to have been continuously married to the deceased for more than a year to have a homestead interest. Kristin Welch challenged the constitutionality of this statute, but the circuit court found it constitutional and ruled that she did not have a homestead interest in the property.On appeal, the Supreme Court of Arkansas affirmed the lower court's decision. The Supreme Court noted that the Arkansas Constitution's provision on homestead rights was gender-based and had been previously declared unconstitutional for violating the Fourteenth Amendment's Equal Protection Clause. Consequently, the statutory provision, Ark. Code Ann. § 28-39-201(d), which is gender-neutral and requires the continuous marriage condition, stands as the controlling law. The court found no error in the circuit court's application of this statute and concluded that Kristin Welch, having been married to the decedent for less than a year, did not have a statutory homestead interest in the property. View "WELCH ex rel. ESTATE OF AARON WELCH v. GIPSON" on Justia Law