FORT SMITH — A judge said Monday that he will rule in a day or two whether to drop River Valley Sports Complex from a lawsuit over work left unpaid after the complex's partners, including former state Sen. Jake Files, abandoned the project, leaving the city to pick up the tab.
Sebastian County Circuit Court Judge Stephen Tabor heard arguments from the complex's remaining partner, Lee Webb, and from an attorney representing the city over the River Valley Sports Complex's motion for summary judgment.
Files was not in court Monday. He is scheduled to report to federal prison Thursday to begin serving an 18-month sentence after pleading guilty to bank fraud, wire fraud and money laundering charges. Only Webb was present Monday for River Valley Sports Complex.
Fort Smith attorney Joe Byars, who represents River Valley Sports Complex, asked Tabor to dismiss the city's complaint, saying it was undisputed the city violated the contract with the sports complex when it terminated the contract in February 2017 and ordered cessation of work on the 60-acre site at Chaffee Crossing.
He argued there were no facts in dispute for a jury to decide, and all that remained was for Tabor to rule in River Valley Sport Complex's favor as a matter of law and dismiss Fort Smith's lawsuit.
Fort Smith's attorney, Michael Jones of Mountainburg, argued there remained a disagreement on the facts in the case that a jury would have to sort out and that River Valley Sports Complex's motion to for summary judgment should be denied.
Byars argued Fort Smith violated Section 13 of the agreement, which said if work was suspended on the project for 90 consecutive days through no fault of River Valley Sports Complex, it could give seven days' notice to the city and "terminate Seller's [River Valley Sports Complex] obligations under the agreement."
He said River Valley Sports Complex submitted a letter withdrawing from the project but the city never acted on it, opting to terminate the contract, for which the sports complex partners never received notice.
Byars notified the city in August 2017 it was terminating the contract under Section 13.
Jones argued that Files went to City Administrator Carl Geffken on Jan. 31, 2016, and asked to withdraw River Valley Sports Complex from the project. Geffken told Files to submit a letter to that effect. A week later, the Fort Smith Board of Directors voted to terminate the contract between the city and River Valley Sports Complex.
The city contends that Files' letter withdrawing River Valley Sports Complex from the project constituted a waiver of the city's requirement to notify River Valley Sports Complex within seven days of its intent to terminate the contract, as set out in Section 12. That section also gave River Valley Sports Complex a chance to resume work and finish the project.
River Valley Sports Complex owed $200,120 to four companies -- B&A Electric Inc., Megehee Fence Contracting LLC., Grimes Dozer Service Inc., and James Griffith -- for work the companies did on the ball fields.
After the city terminated its agreement with the River Valley Sports Complex, the four companies sued the city in March 2017 to recover money for the work performed, contending that River Valley Sports Complex was an agent for the city and was responsible for the sports complex's debt.
The city denied that it was responsible for the River Valley Sports Complex's debts on the project. In turn, the city sued River Valley Sports Complex in May 2017.
In the suit, the city said it wanted the sports complex to pay for any expenses the city incurred as a result of the complex's breach of its agreement with the city, including any costs to the city if it decides to finish the complex, sell it or tear it down.
The city also seeks the return of $26,945.91 in state General Improvement Fund grant money that was awarded to River Valley Sports Complex and disbursed to DiAnna Gonzales to perform work on the project.
Files has admitted to falsifying the bids that awarded the project to Gonzales, an employee of Files' FFH Construction Inc. Files confessed to instructing Gonzales to turn cash and a cashier's check from the grant over to him and he used the money to pay FFH employees, give bonus money to Gonzales, pocket the remaining cash and deposit the cashier's check into his personal bank account.
Files and Webb envisioned a sports complex consisting of eight tournament-quality softball and baseball fields with bleachers, concessions and other amenities that would attract teams from around the region and be a boost to the local economy.
The two men persuaded the city in 2014 to commit $1.6 million to the project and Files and Webb would raise the remaining project cost -- a total estimated at $4 million to $6 million -- through donations of equipment, materials and labor.
The city had paid in $1.08 million at the time the project was halted.
A Section on 07/31/2018