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HomeMy WebLinkAbout16. 12-185 APRIL 24, 2012 12-185 RESOLUTION (CARRIED__7-0______LOST________LAID OVER________WITHDRAWN________) PURPOSE: APPROVE SETTLEMENT AGREEMENT WITH CED PROPERTIES, LLC FOR RIGHT-OF-WAY ACQUISITION / JACKSON STREET – MURDOCK AVENUE INTERSECTION IMPROVEMENT PROJECT INITIATED BY: PUBLIC WORKS DEPARTMENT WHEREAS, by Resolution 08-469 adopted on December 9, 2008, the Common Council approved a revised relocation order and approved a Determination of Necessity pursuant to Sec. 32.07 of the Wisconsin Statutes, to acquire certain land for right-of-way purposes at the Jackson Street and Murdock Avenue intersection; and WHEREAS, by Resolution 09-326 adopted on August 25, 2009, the Common Council approved a jurisdictional offer of $50,000.00 to acquire property located at 1800 Jackson Street owned by CED Properties, LLC; and WHEREAS, the City of Oshkosh acquired title to the property by filing with the Winnebago County Circuit Court an Award of Damages; and WHEREAS, the landowner appealed from the Award of Damages; and WHEREAS, upon further discovery during the course of the litigation it was discovered that the project had encroached further upon the landowner’s property requiring additional compensation; and WHEREAS, representatives of the City, Wisconsin Department of Transportation and the landowner participated in mediation over the disagreement as to the appropriate amount of compensation for this acquisition and the parties reached a tentative agreement, subject to final Council approval, providing that the City of Oshkosh would pay an additional $130,000.00 over and above the City’s Award of Damages; and WHEREAS, the Wisconsin Department of Transportation will reimburse the City for 75% of the costs related to the acquisition. NOW, THEREFORE, BE IT RESOLVED by the Common Council for the City of Oshkosh that the tentative agreement is hereby approved and the proper City officials are hereby authorized and directed to sign all documents and to undertake those steps necessary for implementing this agreement. BE IT FURTHER RESOLVED that money for this purpose is appropriated from: SETTLEMENT AGREEMENT NOW COMES plaintiff CED Properties, LLC and defendant City of Oshkosh by their respective attorneys and agree as follows: 1. Dismiss Winnebago County Circuit Court case#10-CV-1379 with prejudice and without further costs to either party; 2. Plaintiff will convey an easement to defendant to enable defendant to permanently retain its current land improvements on the 160.29 square feet which is outside the taking; with plaintiff to retain the right to construct a barrier wall in the easement area; 3. Plaintiff will execute a written release to defendant releasing defendant from any and all claims of any nature whatsoever arising out of Project ID 6430-14-21 and Project 6430-14- 71, except for the special assessment issues pending between the parties; 4. Defendant will pay plaintiff$130,000 over and above its Award of Damages payment of $50,000, as just compensation; 5. Defendant's approval of the Settlement Agreement is contingent upon approval by defendant's Common Council. If approved by the Council, defendant's compensation check will be put in the mail to Attorney Southwick on or about May 4, 2012; 6. This Settlement Agreement constitutes the entire agreement between the parties. FOR PLAINTIFF: 0gy/p- Randall Abitz, Date Erik Olsen, D e Managing Member Attorney for plaintiff CED Properties, LLC Samuel Phillip Law Offices, LLC FOR DEFENDANT: au; C P0,1-44_ c12_ L --.: dr' , y~ /- David C Patek Date Benjam n So thwick Date Director of Public Works Attorney for defendant City of Oshkosh H:ltracyttTracy's Files\A-Dave's Files110-13 CEO Prop Settlement Agreement_4-9-12.docx TO: Honorable Mayor and Members of the Common Council FROM: Lynn A. Lorenson, City Attorney DATE: April 19, 2012 RE: Approval of Settlement Agreement with CED Properties, LLC — Property Acquisition for Jackson Street— Murdock Avenue Intersection Improvement Project BACKGROUND CED Properties, LLC is the owner of property located at 1800 Jackson Street in the City of Oshkosh. On August 25, 2009, the Common Council approved a jurisdictional offer in connection with public improvements made in and around the Jackson Street — Murdock Avenue Intersection to acquire a portion of the property owned by CED Properties, LLC. CED Properties, LLC timely appealed the Award of Damages by filing a lawsuit in Winnebago County Circuit Court. Attorney Ben Southwick, whose practice specializes in eminent domain, was appointed to represent the City of Oshkosh. ANALYSIS CED Properties raised a number of issues with regard to the valuation of the property and the parties in this case participated in a significant amount of discovery related to the matter. During this discovery, it was also determined that a portion of the final project had been built upon property still owned by CED Properties. Based upon the additional information provided regarding the valuation of the property and the discovery of the additional encroachment of the project onto the property owned by CED Properties, LLC. staff is recommending approval of the proposed settlement agreement. The Wisconsin Department of Transportation also participated in mediation with the parties and concurred in the settlement of the case. Under the Agreement between the City and the Department of Transportation, the Department of Transportation will be responsible to reimburse the City of Oshkosh 75% of the additional amount to be paid to CED Properties, LLC. With regard to the risks of not approving the proposed settlement, if the City would proceed to litigation the City would incur additional attorney fees, costs for experts and other costs associated with a trial. Because this matter relates to an eminent domain action by the City, defense costs related to this matter are not covered under the City's insurance policy and the City must pay all costs of litigation. While the Department of Transportation would be responsible for reimbursement related to the compensation to the paid for the land under the City's Agreement with the Department, the DOT would not be responsible for the City's costs of litigation. In addition, staff time and any direct costs of the City would also be the responsibility of the City. In addition, if the property owner were to succeed in having the value of the property set at an amount in excess of 15% of the Jurisdictional Offer of the City, the City would become responsible for the property owner's attorney fees and costs as well. FISCAL IMPACT The proposed settlement would result in an additional payment of $130,000 to the property owner. The Wisconsin Department of Transportation would then reimburse the City for 75% of that amount, so the actual cost to the City is $32,500. RECOMMENDATION Based upon all of the facts of this case and consideration of the law and recommendation of special counsel in this matter, staff recommends that the Council approve the settlement agreement. If there are sensitive questions or concerns relative to this matter, I recommend that they be discussed in a closed session pursuant to section 19.85(g) of the Wisconsin Statutes which would allow the Council to meet with legal counsel concerning strategy to be adopted by the body with respect to litigation in which it is or is likely to become involved. Non-sensitive questions regarding this matter can, of course, be discussed in open session. Therefore, if any member of the Council has questions or concerns regarding the proposed settlement please contact the City Attorney's office to discuss the matter and/or to request that this matter be placed on the Council's Agenda for a closed session to allow for additional discussion. Respectfully Submitted, Approved: Lynn A. Lorenson Mark A. Rohloff City Attorney City Manager