In 1992, the Johnston Planning Board approved the plan for Ashley Estates, a 26-home subdivision off of Shun Pike.
Nearly a decade later, homeowners are still waiting for their neighborhood to be completed.
The town this week filed a lawsuit for breach of contract against Quality Homes, Inc., the company responsible for Ashley Estates, alleging that the work done on the subdivision is “negligent” and has created unsafe conditions.
“We have to do something for the homeowners,” said Town Solicitor Billy Conley. “Litigation is the last resort, but ultimately the people who live there need adequate public improvements.”
Mayor Joseph Polisena is hopeful that now that the suit has been filed, answers for residents are not far off.
“I want things to happen yesterday, but in the legal world it doesn’t,” he said. “We’ve hit a dead end. We want to make sure the neighborhood is protected.”
The Planning Board approved the initial plans in January of 1992, and gave final approval for the second phase of the project in November of 2000. That approval, however, was contingent upon the delivery of a performance bond by Quality Homes.
A performance bond is a surety bond issued by an insurance company that guarantees completion of a project by a contractor.
It’s that performance bond that the town has an issue with.
“For reasons that are unfathomable, the performance bond was set at $30,000” Conley said. “The bond, at $30,000, didn’t even pass a straight face test.”
The bond was meant to cover road construction, paving and drainage improvements. Today, Conley believes those infrastructure projects would cost closer to $500,000.
“Somebody might argue, at that time, maybe it was closer to $350,000, but that would be cutting it close,” he said.
The solicitor believes that the $30,000 performance bond should never have been approved, and beyond that, Quality Homes should not have issued certificates of occupancy to homebuyers until the subdivision was complete as outlined in the plans.
Drive through Ashley Estates today, and you’ll find roads that are crumbling, water pooling at the bottom of driveways and overgrown landscape on property not occupied by a homeowner.
“What essentially happened is the developer threw down a primary coat on the roads without ever finishing it. That’s now crumbled. It’s of no value at all,” Conley said. “The drainage improvements and the engineering required were never done.”
The administration became aware of the problems in Ashley Estates – which includes Ashley Court, Nicole Lane and part of Shun Pike – just over a year after Polisena took office. Since then, they have attempted to work out an agreement with Quality Homes.
They corresponded with the company more than half a dozen times between 2009 and today, but no resolution was reached.
“We would reach an agreement, but as we tried to put the agreement in place, there would be a problem,” Conley explained.
Now, the town of Johnston is calling for monetary damages, costs and attorney’s fees, and name both Quality Homes and its owners in the lawsuit.
“Our intent is to not only go after the company, but we have concerns that the company ever had the assets to complete this project,” Conley said, explaining that the owners could be liable for the costs.
Based on engineering estimates, the town believes it will take $300,000 to complete work on the subdivision.
Going forward, Conley says the town has cracked down on development standards and requirements, which he believes will prevent these types of problems in the future.