ALEXANDER, Ark. (KTHV) - A city fire truck was repossessed Friday, and the lawyers say it's all legal.
Alexander fire fighters said it only took a few seconds for a repossession company to take their fire engine parked outside of a restaurant while they ate lunch. They actually chased after it, and when they caught up, along with state troopers, it turns out the company that owned the truck wanted it back.
"It's embarrassing," said assistant Alexander City fire chief William Blankenship. "We had to basically chase it down, involve the state police and catch them so we could get all of our equipment off of it."
But, the repossession was not due to nonpayment, the city said. It all stems from ongoing litigation and a dispute over interest payments.
Paul Graver of First Government Lease Co. originated the loan on the fire truck. Actually, Alexander had a $350,000 loan through Graver for the truck and other city equipment. The loan was taken out in 2007 according to court documents.
In 2012, Graver sold the loan to First State Bank, but on October 2, First State Bank filed a Petition for Declaratory Judgment and Supplemental Relief in Pulaski County Court alleging Graver misled them when they took over the loan. They allege Graver has a pattern of defrauding Arkansas cities.
The documents also allege the city of Alexander stopped making payments to First State Bank in March 2013 because, among other things, Graver had charged them too much interest through the Lease Purchase Agreement. The City of Alexander said because Arkansas municipalities can only be charged a minimal interest, the agreement is null and void.
Graver told THV 11 by phone he bought the loan back and after heated conversations with the city, he repossessed the truck Friday for something called "anticipatory breach of contract". Graver added he's suing the city now, too, filing papers Friday afternoon.
It's a lot of legal confusion leaving the city without a fire truck tax payers have been paying for.
"If we didn't have any other trucks, you know it would be endangering the citizens, and that's a heartless individual. I wouldn't want to be friends with him," said Blankenship.
As for whether this will affect the fire department's ability to serve their citizens, Blakenship said it won't. They have four other engines they will utilize until this matter is resolved.