Developer accuses buyers of fraud

A Galveston County development company is suing over claims property buyers induced a sale by falsely promising to contract the company to construct a residence on the property.

Bill Wyly Development Inc. filed a lawsuit Oct. 22 in Galveston County District Court against Eron Smith and Hanna Smith, citing statutory fraud.

According to the complaint, Bill Wyly Development maintained a relationship with the individual owners of a number of properties in the Tiki Island subdivision in Galveston County, in order to market the owners' properties for sale and contract with the purchasers to construct residential improvements. The complaint states Eron Smith and Hanna Smith approached the plaintiff in June 2013 with interest in purchasing a lot in section eight of Tiki Island, and the defendants were made aware the purchase was conditioned upon their engaging the plaintiff to prepare plans for the construction of a residence on that lot and constructing such a residence. Billy Wyly Development states the Smiths purchased the lot from the owner Aug. 22, 2013, based upon that understanding.

The lawsuit states Bill Wyly Development worked on the plans and drawings over a period of several months, revised them and provided them to the defendants, but in June 2014, the Smiths announced they did not intend for and would not engage the plaintiff company to construct improvements on the property. The Smiths are accused of statutory fraud in a real estate transaction by making false representations in order to induce the sale of the property to them and violating the Texas Deceptive Trade Practices-Consumer Protection Act.

Bill Wyly Development seeks actual and exemplary damages, attorney fees and costs of court. It is also seeks judgment declaring that the conveyance of the property to the defendants is canceled and rescinded.

The plaintiff company is represented by attorney Thomas W. McQuage in Galveston.

Galveston County District Court case number: 14-CV-1126.