John and Nancy Butler v. Vep, LLC, D/B/A Vallon Condominiums; Chenal Properties, Inc.; And First Security Bank

2025 Ark. App. 514

• Court: Court of Appeals of Arkansas
• Decided: October 29, 2025
• Status: Published

Opinion

Cite as 2025 Ark. App. 514 ARKANSAS COURT OF APPEALS DIVISION I No. CV-24-233

Opinion Delivered October 29, 2025 JOHN AND NANCY BUTLER APPEAL FROM PULASKI COUNTY APPELLANTS CIRCUIT COURT, ELEVENTH DIVISION [NO. 60CV-17-697] V.

VEP, LLC, D/B/A/ VALLON CONDOMINIUMS; CHENAL HONORABLE PATRICIA JAMES, JUDGE PROPERTIES, INC.; AND FIRST SECURITY BANK AFFIRMED

APPELLEES

STEPHANIE POTTER BARRETT, Judge

Appellants, Nancy and John Butler, appeal the December 19, 2023 Pulaski County

Circuit Court order awarding attorneys’ fees and costs to appellee First Security Bank (“First

Security”). On appeal, the Butlers argue that the circuit court erred in awarding attorneys’

fees because (1) the relevant statute does not authorize attorneys’ fees for promissory-estoppel

claims; (2) the court should not expand the relevant statute to affirm a grant of attorneys’

fees on a promissory-estoppel claim; (3) it is erroneous to apply contract principles to actions

for promissory estoppel; (4) First Security’s obligations as to the promissory-estoppel claim

were not established in the written contract; (5) this court should not decide whether res

judicata would bar further litigation in this case; (6) attorneys’ fees cannot be awarded for a

nonsuited breach-of-contract claim until or unless the Butlers recommence the action; and (7) erroneous evidentiary rulings prevented the circuit court from applying the factors the

court must consider when awarding attorneys’ fees set out in Chrisco v. Sun Industries, Inc.,

304 Ark. 227, 800 S.W.2d 717 (1990), which caused unfair prejudice to the Butlers. We

find no error and affirm.

In 2007, VEP, LLC (“VEP”), began development of the Chenal Condominiums of

Vallon Circle (“Vallon”). 1 In the initial phases of construction, it was contemplated that

Vallon would consist of eleven condominium buildings with a total of 168 units, with

amenities consisting of an infinity pool with cascading water features, a conference room

and entertaining facility, and a fitness center. First Security financed the construction of the

first condominium of the project in January of that year. In 2008, VEP’s development plan

changed. Rather than the original eleven buildings and 168 units, the project was scaled

back to “six or seven” buildings with a total of 70 units.

In April 2008, while the Vallon building was still under construction, the Butlers

contracted with VEP to buy a unit in the building. The Butlers’ purchase was financed

through First Security, and the purchase of the condominium closed in September of that

year. However, VEP struggled to sell the remaining units in the first condominium building.

Due to the lack of buyers, VEP did not move forward with further phases of the Vallon

project. In the end, VEP constructed one building consisting of twelve units, with amenities

1 None of the decisions related to the claims against VEP or Chanel Properties, Inc., are being appealed here. First Security Bank is the only appellee.

2 that included a noninfinity pool and hot tub, an outdoor kitchen and patio area, a workout

facility, and a putting green.

On February 8, 2017, the Butlers filed this action alleging First Security orally

committed to fund VEP’s construction of the infinity pool, conference room, entertaining

facility, and a fitness center once half of the units in the first condominium building were

sold. In their amended complaint, the Butlers brought causes of action for fraudulent

inducement, breach of contract, promissory estoppel, and breach of fiduciary duty against

First Security.

On August 3, 2018, First Security moved for summary judgment. On December 31,

2019, the circuit court ruled on the summary-judgment motion and dismissed the Butlers’

fraudulent-inducement and breach-of-fiduciary-duty claims with prejudice, finding the

fraudulent-inducement claim was time-barred by a three-year statute of limitations and that

there was no fiduciary relationship between the parties. All claims against Chenal Properties,

Inc., were dismissed with prejudice. The circuit court left the Butlers’ breach-of-contract and

promissory-estoppel claims against First Security and VEP for jury trial.

On June 6, 2022, a three-day jury trial began. On the second day of the trial, the

Butlers nonsuited their breach-of-contract cause of action, which was dismissed without

prejudice, and continued with their promissory-estoppel claim. After the evidence was

closed, the circuit court granted First Security’s motion for directed verdict as to the Butlers’

claim for punitive damages and dismissed the promissory-estoppel claim with prejudice for

being filed outside the statute of limitations.

3 On June 8, First Security filed a motion for attorneys’ fees in the amount of

$181,530.33, arguing that while the Butlers had proceeded on only the promissory-estoppel

claim, the “gist” of their action sounded in contract or, alternatively, that First Security was,

in fact, the prevailing party on the contract claim notwithstanding its dismissal without

prejudice. In support of its motion for fees, First Security attached both its billing records

and counsel’s affidavit showing the time spent and fees charged to First Security. However,

a portion of those billing records were redacted, with First Security arguing the redaction

was based on attorney-client privilege. The Butlers filed a motion in limine arguing they

could not prepare for the hearing without the witnesses’ identity and unredacted bills and

asking the court for an order precluding First Security from calling the witnesses and

presenting the redacted bills. At the fee hearing, the circuit court agreed with the Butlers

and discounted the redacted portions of the billing record from its consideration. The

circuit court concluded that the Butlers’ cause of action sounded primarily in contract and

awarded First Security $110,000 in attorneys’ fees.

Whether an award of attorneys’ fees is appropriate under Arkansas Code Annotated

section 16-22-308 (Repl. 1999) depends on whether the case is one primarily based on breach

of contract. Jiles v. Union Planters Bank, 90 Ark. App. 245, 247, 205 S.W.3d 187, 189 (2005).

Our well-established rule relating to attorneys’ fees is that they are not allowed except when

expressly provided by statute. Patton Hosp. Mgmt., LLC v. Bella Vista Vill. Coopershares Owners

Ass’n, Inc., 2016 Ark. App. 281, 493 S.W.3d 798. Assuming fees are authorized by statute,

a circuit court’s decision to grant or deny attorneys’ fees, and in what amount, lies within

4 the sound discretion of the court, and the appellate court will not reverse absent a showing

of abuse of discretion. Harris v. City of Forth Smith, 366 Ark. 277, 234 S.W.3d 875 (2006).

In determining whether the circuit court was authorized to award attorneys’ fees, we must

examine whether Arkansas Code Annotated section 16-22-308 applied. The statute

provides:

In any civil action to recover on . . . breach of contract, unless otherwise provided by law or the contract which is the subject matter of the action, the prevailing party may be allowed a reasonable attorney's fee to be assessed by the court and collected as costs.

The word “may” in the statute implies permissive or discretional, rather than

mandatory, action or conduct and is construed in a permissive sense. McDermott Brandon

Props., LLC v. Wheeler, 2023 Ark. App. 269, at 13, 669 S.W.3d 229, 237–38. A circuit court,

therefore, is not required to award attorneys’ fees under this statute, and any amounts

awarded are discretionary. Conway Com. Warehousing, LLC v. FedEx Freight E., Inc., 2011 Ark.

App. 51, 381 S.W.3d 94. Furthermore, because of the circuit court’s intimate acquaintance

with the trial proceedings, our appellate courts usually recognize the superior perspective of

the circuit court in determining whether to award attorneys’ fees. Marcum v. Wengert, 344

Ark. 153, 40 S.W.3d 230 (2001). It is uncontroverted that attorneys’ fees are not recoverable

for actions based in tort or for actions seeking injunctive relief. See Wheeler Motor Co., Inc. v.

Roth, 315 Ark. 318, 867 S.W.2d 446 (1993); see also Ark. Okla. Gas Corp. v. Waelder Oil &

Gas, Inc., 332 Ark. 548, 966 S.W.2d 259 (1998). However, where multiple claims are

advanced—including a breach-of-contract claim—an attorneys’-fee award is proper when the

5 action is primarily based in contract. Barringer v. Hall, 89 Ark. App. 293, 305, 202 S.W.3d

568, 576 (2005). The factual underpinnings of several cases applying this rule were discussed

in Meyer v. Riverdale Harbor Municipal Property Owners Improvement District, 58 Ark. App. 91,

947 S.W.2d 20 (1997), in which the court noted that, although each of those cases involved

a contract or breach-of-contract claim substantial enough to justify presentation to the jury,

fees were nonetheless denied to the prevailing party because the action was not based

primarily in contract.

Here, the circuit court’s order stated,

[T]his court finds this matter clearly sounds in contract. Although multiples causes of action were alleged, it is clear the issues in this matter revolve around the real estate contract and alleged representations made in relation to [the Butlers’] agreement to purchase a condominium. First Security Bank was therefore the prevailing party in this matter once this court granted the oral Motion for Directed Verdict on the claim for promissory estoppel.

In reviewing the record and arguments of both parties, we hold the Butlers’ cause of

action on which First Security’s recovery was based was primarily based in contract. This

court previously held, “The determining factor, we think, is whether the primary obligation

arises under the contract.” Jiles, 90 Ark. App. at 248, 205 S.W.3d at 189. Here, First

Security’s obligation would not have existed had the parties not entered freely into an

agreement for the Butlers to purchase the condominium and for First Security to finance

the construction. All of First Security’s obligations flowed from that initial agreement, and

keeping in mind the consideration we give to the circuit court in making these discretionary

choices, we cannot say the circuit court abused its discretion in finding the Butlers’ claim

6 primarily sounded in contract, warranting an award of attorneys’ fee to First Security. By

finding in favor of First Security on this first issue, we have also answered points two through

six on appeal, all of which come back to the same question: does the cause of action sound

in contract? We hold that it does.

For their final point on appeal, the Butlers argue they were unfairly prejudiced by

erroneous evidentiary rulings that prevented the circuit court from applying the Chrisco

factors. Although the Butlers’ evidentiary arguments are not preserved, the portion of their

argument regarding the Chrisco factors is appropriately before us. While the Butlers argue

the circuit court did not consider the Chrisco factors, we disagree. First Security provided an

in-depth recitation of each factor in its ordered prehearing brief, and at the fee hearing

reiterated to the court that its attorneys’-fees motion demonstrated the Chrisco factors, which

our supreme court has held to be sufficient. See City of Little Rock v. Nelson, 2020 Ark. 19, at

5, 592 S.W.3d 666, 669. Indeed, the circuit court in this case exercised its discretion by

lowering the amount of attorneys’ fees to be awarded and finding a portion of the fees

unreasonable. Therefore, because the circuit court properly considered the appropriate

factors, demonstrated by its exercise of discretion in lowering the amount of fees awarded,

we cannot say the court abused its discretion in its award of attorneys’ fees. We affirm.

Affirmed.

THYER and WOOD, JJ., agree.

Luther Oneal Sutter and Lucien R. Gillham, for appellants.

7 The Jiles Firm, LLP, by: Gary D. Jiles and Matthew K. Brown, for appellee First Security

Bank.