The homeowners of a tiny house community called The Retreat at Deer Lick Falls have filed a lawsuit against the developer, requesting $250,000 in damages. The community developer filed an extension to remain in control of the subdivision, but homeowners allege the timeframe of conservatorship should have ended.
Deer Lick Falls Lawsuit
The Retreat at Deer Lick Falls is supposedly a haven for tiny homes in Monteagle. However, several property owners filed a lawsuit requesting the court to end the period of developer control over the homeowners association. Defendants in the court case include Claude Hayes, III, and The Retreat at Deer Lick Falls LLC.
The lawsuit makes several allegations against the developer. Firstly, the lawsuit alleges the period of developer control should have ended on December 10, 2021. However, the developer filed for an extension of control on November 8, 2021, to expand the subdivision by adding more properties. The phase 2 development would fall under the same homeowners association. According to the lawsuit, the homeowners are requesting the court to make phase 2 a separate project because:
- The new properties are not contiguous to Deer Lick Falls
- The developer did not amend the documents or reference the new plat with additional properties in an amendment
- The development period has already expired because the developer breached its duty to turn over common areas and HOA control to the members after selling 100% of the lots
Other Claims Against the Developer
The lawsuit also claims the developer overcharged and overbilled Deer Lick Falls for lawn care. It states that Claude Hayes, III, acting as the developer, paid Claude Hayes (or a company Hayes owned) almost 80% of the HOA budget for lawn care services. Moreover, the lawsuit adds several other claims:
- Claude Hayes III is acting as the developer and charging rent for a Deer Lick Falls pavilion under his vacation rental entity without asking the property owners.
- The developer used Deer Lick Falls’ funds for things other than the community’s benefit after 100% of the properties were sold, including but not limited to funds for developing phase 2, and the developer profited from the breach.
- Claude Hayes III did not remove 50-100 dead trees that died during development, leaving the property owners to pay the expense.
According to the submitted information, property owners pay the HOA fees of $95 monthly, equating to roughly $1,140 annually.
Hayes’ Response
Claude Hayes’ lawyer, Attorney Tyler R. Moffatt. filed to dismiss the claims in June. The request stated that a member of an LLC cannot be held liable for the LLC’s obligations and actions under Tennessee law. Moreover, it stated that Hayes had no fiduciary duty to the defendants because he was not the developer.
According to The Retreat at Deer Lick Falls’ website, Oakstone Land & Capital developed the community. Meanwhile, the community’s property owners are represented by Attorney Thomas K. Austin.
