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City of Bethel Heights v. Gregory A. Kendrick Rev. Liv. Tr.
515 S.W.3d 135
Ark. Ct. App.
2017
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Background

  • Appellees (Gregory A. Kendrick Revocable Living Trust and Shelly Kendrick) owned ~86 acres adjacent to Springdale and sought annexation into Springdale under Ark. Code Ann. § 14-40-2001 et seq.
  • Appellees’ counsel sent Bethel Heights a December 2014 letter requesting "municipal sewer service" — specifically an eight-inch service main for industrial use — if an intercity agreement failed.
  • Bethel Heights replied in January 2015, stating it would "provide services adequate to service the needs" and would provide an eight-inch connection or stub to an adjacent forced-main wastewater line, and asked appellees for additional zoning/use information.
  • Appellees did not supply the requested information; Springdale annexed the property in March 2015; Bethel Heights sued Springdale and appellees in April 2015, alleging breach of contract among other claims.
  • The trial court dismissed all claims except breach of contract against appellees; appellees moved for summary judgment arguing no contract existed, no breach occurred, and performance became impossible after annexation.
  • The trial court granted summary judgment for appellees; Bethel Heights appealed and the Court of Appeals affirmed.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Whether the exchanged letters formed a binding contract Bethel Heights: appellees’ service request was an offer that Bethel Heights accepted by committing to provide requested services Appellees: Bethel Heights’ response was a counteroffer (different/service-equivalent) and there was no meeting of minds No contract — no mutual agreement; response was at most a counteroffer
Whether contract terms were sufficiently definite Bethel Heights: terms were reasonably certain to require performance Appellees: Bethel Heights’ letter lacked definite terms (forced main v. eight-inch gravity main) Terms were indefinite; no reasonable certainty to form enforceable contract
Whether appellees breached by not providing information and by seeking annexation Bethel Heights: appellees breached by failing to provide requested info and by allowing annexation without notice Appellees: they made no promise to provide info or refrain from annexation; no mutual obligation existed No mutual obligation existed; failure to provide info/annexation not a breach
Whether statutory obligations created contract remedies Bethel Heights: statutory process under Ark. Code gave obligations/enforcement avenues Appellees: statute does not create a private contract where none exists Statute not a substitute for a contract; separate statutory challenge was untimely and not before the court on appeal

Key Cases Cited

  • Dev. & Constr. Mgmt., Inc. v. City of N. Little Rock, 119 S.W.3d 77 (Ark. App. 2003) (summary-judgment burden and proof standards)
  • City of Dardanelle v. City of Russellville, 277 S.W.3d 562 (Ark. 2008) (contract requires mutual agreement and reasonably certain terms)
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Case Details

Case Name: City of Bethel Heights v. Gregory A. Kendrick Rev. Liv. Tr.
Court Name: Court of Appeals of Arkansas
Date Published: Feb 8, 2017
Citation: 515 S.W.3d 135
Docket Number: CV-16-336
Court Abbreviation: Ark. Ct. App.