A residential homebuilder in Fayetteville is suing a Fort Smith developer for breach of a $2 million-plus contract to purchase 60 lots in a new Farmington subdivision.
Ed Blalock filed the suit in Washington County Circuit Court through his attorney, Kyle Unser of Kutak Rock in Rogers. Blalock runs Sunshine Homes and had planned to purchase and build on 60 lots in the Farmington Heights subdivision in southwest Farmington.
Blalock claims he and developer Charles Palmer of Fort Smith had reached an agreement in December 2016 for Blalock to purchase the lots from Palmer’s Lots 101 LLC. The total purchase price would be $2.37 million, with Blalock choosing the lots he wanted after the subdivision plat was finalized.
The suit claimed that finalizing the plat took nearly 2½ years and, unbeknownst to Blalock, Palmer’s Lots 101 sold some of the lots in the interim to Lots 102 LLC and Indian Territory LLC. Palmer is listed as the manager of both of those subsidiaries as well.
In November 2018, Blalock said Palmer offered him $100,000 to withdraw from the purchase agreement, but Blalock declined. When the plat was finalized last month, Blalock notified Palmer as to which of the lots he wanted, per their 2016 agreement.
The agreement called for Blalock to purchase 30 lots for $1.185 million and then acquire the other lots, 10 at a time for $395,000, on a predetermined schedule.
Blalock’s suit said that only after he designated the lots he wanted did he learn that Lots 101 had sold some of them to Lots 102 and Indian Territory.
Blalock’s suit also alleges the Farmington Heights Property Owners Association had instituted punishing covenants that would harm his ability to build in the subdivision. The Farmington Heights POA is led by Melissa Sims, who is also a member of the Lots 102 and Indian Territory limited liability companies.
The suit said the amended covenants of the subdivision were designed for the “sole purpose of bullying” Blalock to withdraw from the purchase agreement. Blalock alleged the members of the subsidiaries all knew about the agreement because they were controlled by the same person, and that the conspiracy was an “unlawful, oppressive or immoral” attempt to force Blalock to abandon the agreement.
Blalock is asking the courts to enforce the purchase agreement and to award punitive damages and attorney fees.
Palmer had not responded to the suit as of Wednesday, and his attorney did not return a call seeking comment by press time.