Bentonville could be stuck dealing with busted dam
BENTONVILLE — Bentonville could be stuck with repairing or replacing a broken dam after the Arkansas Court of Appeals reversed and remanded a case Wednesday over the city’s obligations for the dam on Lake Bella Vista.
Appeals Court judges sent the case back for Benton County Circuit Judge John Scott to further decide disputed questions of fact about the validity and enforceability of the contract between the city and Cooper Reality Investments, a former owner of the dam.
Scott granted summary judgment to Bentonville, saying any prior agreements between the parties regarding the transfer of 89 acres surrounding and including Lake Bella Vista and the Lake Bella Vista dam merged into a subsequently executed deed between the parties.
Scott said the special warranty deed established all of the city’s
contractual requirements as to the property and the dam, and it doesn’t require the city to rebuild
the damaged dam or prohibit the city from completely removing it.
The Court of Appeals ruling by
a three-judge panel disagreed, saying the agreements didn’t merge with the deed.
The Appeals Court judges said the plain language of the agreement articulates an intent the city would continue maintaining the dam. The deed contains a reversion clause that if the property isn’t used for the intended purpose of public recreation, it reverts to the previous owners, indicating the parties intended to create ongoing obligations as to how the property could be used and managed, the court said in its opinion written by Judge Larry Vaught.
The city also applied for and received federal and state funding to replace the dam; commissioned an environmental assessment to analyze the environmental and social impacts of improvements to the dam; and represented the terms of the agreement as binding in its communications to other government agencies and the public, according to the ruling.
The decision was short of a clear win for Cooper, which had
asked the Court of Appeals to reverse Scott’s grant of summary judgment and instruct him to instead enter summary judgment in Cooper’s favor.
“Because there are still disputed questions of fact regarding the validity and enforceability of the contract, we reverse and remand with instructions for the circuit court to proceed in a manner consistent with this opinion,” the judges wrote.
The lake and dam were constructed between 1915 and 1918. In February 2000, Cooper transferred ownership of the property to Bentonville/Bella Vista Trailblazers Association as a gift for the benefit of the general public. The association made the property a park.
On July 1, 2005, the city and the association agreed to transfer the property and the dam to the city subject to various conditions and terms in the agreement. Of particular importance to the case, the parties’ agreement said the city “shall maintain the dam and in the event of damage or destruction replace or repair the same” and that the obligation would survive future agreements.
Cooper and Trailblazers then executed a correction limited warranty deed Aug. 3, 2006. On Nov. 21, 2006, Trailblazers executed a special warranty deed that gifted the property to the city. The special warranty deed states the “use of the property is further restricted and burdened and shall be used exclusively for public passive recreational activities,” and if the property were to ever be used for any other purpose, then ownership of the property reverts to the association.
The dam was damaged by heavy rain between 2008 and 2011. The city applied for and received federal and state money to replace the dam. In 2011, the city commissioned an environmental assessment.
After the city learned that costs to replace the dam would be substantial, city officials questioned whether the conveyance agreement was binding. In 2019, the city filed suit seeking a declaratory judgment that its obligations were defined only by the special warranty deed. The city argued because the conveyance agreement merged into the special warranty deed, the city was not bound to maintain, repair or replace the dam.
Cooper argued the conveyance agreement contained several provisions that were expressly agreed to survive subsequent agreements
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