HomeMy WebLinkAboutItem 06.mAugust 2, 2013
7 AV eville
Item No.
SETTLEMENT AGREEMENT FOR LAWSUIT FILED BY SECOND POINT LLC
August 5, 2013 City Council Meeting
Proposed Action
Staff recommends adoption of the following motion: Move to approve a settlement agreement and release
with Second Point, LLC.
Passage of this motion will result in Second Point LLC dismissing their lawsuit against the City and other
parties regarding the Hoppe Marketplace 3r Advance Auto Parts project.
Overview
Second Point LLC, owners of the ReMax office building, sued the City of Lakeville and United Properties
Investment LLC (UPI) and several other parties shortly after the City Council approved on May 6, 2013
the final plat for Hoppe Marketplace 3r Addition for the Advance Auto Parts (AAP) store. The ReMax
building is adjacent to and east of the proposed AAP building.
In the suit, Second Point cited concerns with the proposed use, the location of the proposed AAP
building, and parking lot configuration. During a hearing on July 23, 2013 in which Second Point was
seeking a temporary restraining order to delay construction of the proposed AAP building, Judge
Timothy McManus ordered all the parties to participate in settlement discussions in his chambers. As a
result of the settlement discussions, UPI has agreed to move the AAP building nine feet south and eight
feet west from the City approved location. UPI also agreed to move the trash enclosure to the east side of
the building and completely enclose it. Additional stipulations were agreed to by UPI regarding
landscaping and screening of mechanical equipment. Attached is a copy of the proposed Settlement
Agreement and Release.
Attorney George Hoff represented the City and the LMCIT on this case. He along with the City Attorney
and City staff recommend approval of the proposed settlement agreement. UPI and Second Point are
expected to sign the agreement prior to Monday's Council Meeting.
Primary Issues to Consider
This proposed settlement allows the development of a new commercial building, addresses
the concerns of an adjacent business owner and dismisses a lawsuit against the City.
Supporting Information
Proposed Settlement Agreement between the City and Second Point LLC.
David L. Olson
Community and Economic Development Director
cc: George Hoff, HOFF, BARRY &KOZAR, P.A., Mark Rossow, LMCIT
Financial Impact: $ Budgeted: Y/N Source:
SETTLEMENT AGREEMENT AND RELEASE
Second Pointe, LLC
V.
United Properties Investment LLC, Argonne Investment LLC, Ronn
Thomas, Bruce Carlson, City of Lakeville,
Draft Subject to change
SETTLEMENT AGREEMENT AND RELEASE
This Settlement Agreement and Release ( "Agreement ") is made and entered into as of
this _ day of July, 2013, by and between: Second Pointe, LLC ( "Second Pointe ") on the one
hand, and United Properties Investment LLC ( "United Properties "); Argonne Investment LLC;
Ronn Thomas; Bruce Carlson (collectively the "United Properties Parties "); and City of
Lakeville (the "City "), on the other hand (all parties together being referred to as the "Parties ").
RECITALS
WHEREAS, on or about July 12, 2013, Second Pointe filed an action in Dakota County
District Court captioned Second Pointe, LLC v. United Properties Investment LLC, et al.,
No. 19HA -CV -13 -3161, in which the United Properties Parties and the City were named as
defendants (the "Litigation "); and
WHEREAS, the Litigation concerned the construction of a building (the "AAP
Building ") on a parcel of land platted as Lot 1, Block 1 of Hoppe Marketplace 3 rd Addition,
located at Highway 50 and Jubilee Way in the City of Lakeville ( "Hoppe Marketplace
Development "); and
WHEREAS, the Hoppe Marketplace is subject to a Reciprocal Easement and Operation
Agreement for the Plat of Hoppe Marketplace, dated on or about July 18, 2005 (the "REOA "),
and a First Amendment to Reciprocal Easement and Operation Agreement for the Plat of Hoppe
Marketplace, dated January 18, 2006 (the "First Amended REOA "); and
WHEREAS, Second Pointe is an owner in the Hoppe Marketplace Development, and
claimed that the construction of the AAP Building violated various written agreements governing
the Hoppe Marketplace Development, including the REOA and the First Amended REOA, and
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oral representation made to it in the 2004 -2006 time period, and also violated various Minnesota
statutes; and
WHEREAS, the United Properties Parties and the City denied all claims made by
Second Pointe in the Litigation, including, but not limited to, the claim that the construction of
the AAP Building violated the REOA and /or the First Amended REOA, and denied any and all
liability to Second Pointe in connection with the Litigation; and
WHEREAS, the undersigned parties agreed to the material terms of a settlement of the
Litigation during a settlement conference, which occurred on July 23, 2013, conducted before the
Honorable Timothy J. McManus, a judge in Dakota County District Court; and
WHEREAS, as part of the settlement, the Parties agreed that the material terms of the
settlement would be incorporated into a final written agreement to be prepared and executed by
the Parties; and
WHEREAS, the undersigned Parties desire to resolve their disputes, dismiss the pending
Litigation with prejudice and on the merits, and to discharge and release all Claims (as defined
below);
NOW, THEREFORE, for the valuable consideration described below, the sufficiency of
which is hereby expressly acknowledged, the undersigned mutually agree as follows:
SETTLEMENT TERMS
1. Recitals The foregoing recitals are true and correct and are incorporated into the
body of this Agreement as if set forth at length herein.
2. Settlement
a. Location of the AAP Building Subject to approval by the City, the AAP
Building will be repositioned from its current municipal approved location on
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Lot 1, Block 1 of Hoppe Marketplace 3 rd Addition as follows: (a) the AAP
Building will be moved a total of 9 feet South and 8 feet West from its current
municipal approved location; and (b) the trash enclosure area for the AAP
Building, currently located pursuant to the municipal approved plans on the
Southeast corner of the AAP Building, will be relocated to the East side of the
AAP Building, as generally set forth in the attached Exhibit A. and redesigned
as set forth in this agreement.
b. The Parties further agree that (a) in a form and with information required by
the City, a Civil Site Plan, signed by a licensed engineer, reflecting the
changes described in the preceding paragraph, and new Building Elevations
for the East side of the AAP Building showing the relocated and redesigned
trash enclosure generated by a licensed architect, will be created (the "Final
Plans "), at United Properties' expense, and provided to all Parties, along with
any CAD drawings or file; and (b) Second Pointe shall have three (3) business
days to review and comment on the Final Plans, but shall not have the right to
reject such plans unless they are materially inconsistent with Exhibit A as to
location of the AAP Building and the redesign of the trash enclosure. It is
understood and agreed that any deviation from the provisions of paragraph 2a
would be "materially inconsistent ". The Parties agree that any dispute
regarding the interpretation of this agreement including but not limited to
whether the Final Plans are materially inconsistent with Exhibit A or the
proposed redesign of the trash enclosure, the matter may be submitted to
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Judge McManus to be heard on an expedited basis, subject to Judge
McManus' availability, and that his ruling on the issue will be deemed final.
c. Landscaping for the East Elevation on the AAP Building Second Pointe shall
have the right to design, acquire and install landscaping on the East side of the
AAP Building, as shown in green on the attached Exhibit A, for the purpose
of enhancing the aesthetics of the trash enclosure area of the AAP Building
and enhancing the aesthetics of the AAP Building as viewed from the East.
Such landscaping shall be done is a timely manner to allow United Properties
to meet its construction delivery schedule of November 15, 2013, and shall be
reasonable for the location, consistent with any other landscaping and /or
aesthetic in the Hoppe Marketplace Development and, to the extent required,
approved by the City, and not in violation of any City laws, ordinances and /or
regulations. All costs and expenses associated with the design, purchase and
installation of this landscaping shall be borne solely by Second Pointe.
Second Pointe shall provide United Properties with a copy of the plans for the
landscaping at least fourteen (14) days before any installation takes place, in
order to give United Properties the opportunity to review and approve the
plans (which approval shall not be unreasonably withheld and with the right to
seek judicial intervention as outline in paragraph 2b of this agreement), and to
coordinate the installation with the tenant if necessary. Second Pointe will
have the right to maintain and replace any landscaping that should, in its sole
discretion, needs to be performed. Second Pointe does not need United
Properties or AAP Buildings tenant's approval for any maintenance or
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replacement of landscaping as long as it is consistent with the previously
agreed upon landscaping plan. Any irrigation system that is installed and
maintained by United Properties to service the landscaping on the AAP
Building lot will be extended to the areas on the easterly side of the building
where the Second Pointe maintained landscaping areas are located.
d. Monument Sign United Properties shall have the right to install a new
monument sign, or modify the existing monument sign, to allow for three
equal sized panels on the sign to match the current panel size. Second Pointe
shall have the top panel on the sign, which shall be no smaller than it currently
is today. All costs and expenses associated with the design and installation of
the sign (or the redesign of the existing monument sign), including the costs of
any required permits, shall be borne solely by United Properties. Such sign
shall be similar and consistent with the current sign and shall be subject to
approval by the City, and be consistent with City ordinances, rules or laws, so
long as it meets the criteria of this paragraph.
e. Trash Enclosure The trash enclosure that is to be located on the east side of
the AAP Building will be fully enclosed making the trash receptacle located
inside the enclosure concealed from view from the Second Point Building.
The easterly wall of the enclosure will be an extension of the existing exterior
wall of the building and extend to a point north so as to totally enclose any
trash receptacle. The enclosure will have a metal sloped roof made up on the
same material and color as the Second Pointe Building roof. The door or front
of the enclosure will be a roll down door which will be a color matching the
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building material of the AAP Building. The enclosure design shall be subject
to approval by the City.
f. Wall Sign on the AAP Building United Properties shall have the right to
install a third wall sign on the south side of the AAP Building. Such wall sign
shall be consistent in general appearance and size with the other signs
previously approved by the City for the AAP Building. All costs and
expenses associated with the design and installation of the wall sign, including
the costs of any required permits, shall be borne solely by United Properties.
Such sign shall be subject to approval by the City, so long as it meets the
criteria of this paragraph.
g. HVAC Second Pointe shall have the right to design and install a rooftop
screen for the HVAC unit(s) or other elements on the top of the AAP
Building. Such screening shall be completed in a timely manner to allow
United Properties to meet its construction delivery schedule of November 15,
2013, and be reasonable for the location, consistent with any other aesthetic in
the Hoppe Marketplace Development, and not in violation of the REOA, any
City laws, ordinances and/or regulations. In addition, the screening must not
violate or nullify any warranties associated with the HVAC unit(s) or the
roofing. All costs and expenses associated with the initial design and
installation of this screening, including the costs of any required permits, shall
be borne solely by Second Pointe, who shall also be solely responsible for any
damage or injuries caused to the AAP Building, third parties, or workers,
during the initial installation of the screening. United Properties and /or its
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successors in interest to this property will maintain and repair said screening
installed. Second Pointe shall provide United Properties with a copy of any
plans for the screening at least fourteen (14) days before any installation takes
place, in order to give United Properties the opportunity to review and
approve the plans (which approval shall not be unreasonably withheld and
with the right to seek judicial intervention as outline in paragraph 2b of this
agreement), and to coordinate the installation with the tenant if necessary.
Such screening shall be subject to approval by the City, so long as it meets the
criteria of this paragraph.
h. City Actions. As contemplated in this Agreement, certain plans will be
provided to the City for its review and approval. By entering into this
Agreement the City is not agreeing that such plans as submitted to the City
will be approved; rather, that the City will process and review in accordance
with its process and criteria.
i. Restrictions with Respect to Remaining Lot on Hoppe Marketplace Second
Pointe shall have no right to control, select, and/or choose the tenantibuyer for
the lot located to the South of the AAP Building, identified as Lot 2, Block 1,
of Hoppe Marketplace 3 rd Addition (the "South Lot "), or require that any
building on the South Lot be located in a specific location or built to a specific
configuration or pursuant to certain elevations, and there are no restrictions on
United Properties' development, construction, or sale of the South Lot, other
than as specifically set forth in (a) the REOA (but not including any implied
or stated restrictions as set forth in the representations or depictions in the site
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plans attached to the REOA); (b) the First Amended REOA; (c) all applicable
government regulations; and (d) any subsequent amendment(s) to the REOA,
except as follows:
i. No building may be constructed on the South Lot such that the closest
easterly point of said building is closer to the current building on Lot
1, Block 1, of Hoppe Marketplace 2nd (the "Second Pointe Building ")
than the closest easterly point of the AAP building (as repositioned by
this Agreement and shown in Exhibit A) is to the Second Pointe
Building;
ii. In its development of the South Lot, United Properties shall design the
site such that neither the internal drive aisle directly to the East of the
AAP Building, nor the twenty -two (22) parking stalls currently located
on the Eastern edge of Lots 1 and 2, Block 1, of Hoppe Marketplace
3 Addition, as shown on Exhibit A, will be permanently altered in a
material way as part of any development of the South Lot;
iii. All other provisions of the REOA and First Amended REOA that are
not specifically addressed in this agreement are in full force and effect.
3. Dismissal with Prejudice Within ten (10) days of execution of this Agreement
by all Parties, the Parties will execute and file with the Court, through counsel, a stipulation of
dismissal in the form attached hereto providing that all claims against the Defendants in the
Litigation are dismissed with prejudice.
4. Mutual Release Except for the obligations specifically set forth in this
Agreement, Second Pointe, the United Properties Parties, and the City, on their own behalf and
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on behalf of their officers, directors, shareholders, employees, partners, affiliates, employees,
agents, affiliates, heirs and attorneys, hereby release, disclaim and discharge each other, and their
officers, directors, members, partners, affiliates, insurers, including without limitation the League
of Minnesota Cities Insurance Trust, subsidiaries, shareholders, employees, agents and attorneys,
from any and all actions, causes of action, suits, controversies, damages, claims, demands,
contracts, duties, obligations, liabilities, debts, costs, expenses, including any claims for
attorneys fees, and losses of every kind and nature whatsoever, whether known or unknown,
fixed or contingent, asserted or unasserted, in law or in equity, that relate to or in any way arise
from the approval by the City or construction of the AAP Building, or any other approvals or any
decisions previously made by the City with respect to Hoppe Marketplace or any of its
Additions, or the claims, facts, circumstances, transactions, events, occurrences, acts, omissions,
or failures to act, related to the development of the subdivision of the AAP Building and the
"South Lot" and asserted in this Litigation.
5. No Admission of Liability All Parties specifically deny any liability, fault or
wrongdoing with regard to each other. By signing this Agreement, the Parties hereto understand
and agree that this Agreement does not constitute and should not be construed as an admission of
liability, fault or wrongdoing. The Parties have agreed to the consideration herein in order to
reach an expeditious resolution of the Litigation and to minimize the time, attorneys' fees and
costs that otherwise would be expended related thereto.
6. Miscellaneous
a. The undersigned parties represent that they have full authority to settle the
Claims and to provide the releases and covenants set forth in this Agreement.
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b. This Agreement constitutes the entire agreement of the undersigned Parties
concerning the subject matter hereof, and supersedes all negotiations, prior
discussions, representations, promises, and understandings, oral or written,
expressed or implied, including the July 23, 2013 agreement on material
terms, made prior to or contemporaneous with its signing.
c. This Agreement may only be modified or amended by a written agreement
entered into subsequent to its execution and signed by the Parties.
d. No breach of any provision of this Agreement by any party hereto can be
waived by any other party hereto, unless expressly done so in writing. Waiver
of any one breach shall not be deemed to be a waiver of any other breach of
the same or any other provisions hereof.
e. The undersigned Parties and their respective counsel represent and warrant
that none of the Claims have been assigned, encumbered or in any manner
transferred in whole or in part.
f. The undersigned Parties and their respective counsel have reviewed this
Agreement, and the rule of construction to the effect that any ambiguities are
to be resolved against the drafting party shall not be employed in the
interpretation of this Agreement.
g. Each of the undersigned Parties acknowledge and represent that it has had the
opportunity to consult with legal, financial, and other professional advisors as
it deems appropriate in connection with its consideration and execution of this
Agreement. Each party further represents and declares that in executing this
Agreement, it has relied solely upon its own judgment, belief and knowledge,
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and the advice and recommendation of its own professional advisors,
concerning the nature, extent and duration of its rights, obligations and claims,
and that it has not been influenced to any extent whatsoever in executing this
Agreement by any representations or statements made by the other party or its
representatives, except those expressly contained or referred to herein.
h. This Agreement shall be binding upon, and shall inure to the benefit of, the
successors and assigns of the Parties hereto.
i. This Agreement shall be governed by, and construed in accordance with, the
laws of the State of Minnesota regardless of the laws that might otherwise
govern under applicable principles of conflicts of laws thereof.
j. This Agreement may be executed in counterparts, each of which shall be
deemed to be one and the same instrument. The undersigned parties shall
exchange among themselves original signed counterparts.
SECOND POINTE, LLC UNITED PROPERTIES INVESTMENT
LLC
By:
Printed Name:
Its:
Dated:
By:
Printed Name:
Its:
Dated:
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ARGONNE INVESTMENT LLC
By:
Printed Name:
Its:
Dated:
Ronn Thomas, Individually
Dated:
Bruce Carlson, Individually
Dated:
CITY OF LAKEVILLE
By:
Its: Mayor
Dated:
Attested to:
By:
Its: City Clerk
Dated:
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STATE OF MINNESOTA
COUNTY OF DAKOTA
Second Pointe, LLC, a Minnesota limited
liability company,
Plaintiff,
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United Properties Investment LLC, a
Minnesota limited liability company, Argonne
Investment LLC, a Minnesota limited liability
company, Ronn Thomas, Bruce Carlson, City
of Lakeville, a municipality organized under
the laws of the State of Minnesota, John Does,
and Mary Roes„
DISTRICT COURT
FIRST JUDICIAL DISTRICT
Case Type: Civil /Contract/Declaratory
Judgment/Other /Misc.
Court File No.: 19HA -CV -13 -3161
STIPULATION OF DISMISSAL WITH
PREJUDICE
Defendants.
Plaintiff Second Pointe, LLC and Defendants United Properties Investment LLC;
Argonne Investment LLC; Ronn Thomas; Bruce Carlson; and City of Lakeville (collectively, the
"Defendants ") hereby stipulate that all claims against the Defendants in this action are hereby
dismissed with prejudice and on the merits, with each party to bear its own costs, fees, and
expenses, and that the Court may enter the Order of Dismissal attached hereto without further
notice or a hearing.
Dated: 9 2013
THOMSEN NYBECK
David J. McGee ( #0203403)
Sarah B. Bennett ( #0389076)
Nathan J. Knoernschild ( #0387842)
3600 American Blvd W, Suite 400
Bloomington, MN 55431
Phone: (952) 835 -7000
Email: dmcgee@tn-law.com
sbennett@tn-law.com
nknoernschild@tn-law.com
Attorneys for Plaintiff Second Pointe, LLC
Dated: , 2013
FAFINSKI MARK & JOHNSON, P.A.
Patrick J. Rooney ( #198274)
Peter A. T. Carlson ( #0350448)
Flagship Corporate Center, Suite 400
775 Prairie Center Drive
Eden Prairie, MN 55344
Phone: (952) 995 -9500
Email: patrick.rooney@fmjlaw.com
peter. carlson@fmjlaw.com
Attorneys for Defendants United Properties
Investment LLC; Argonne Investment
LLC; Ronn Thomas; and Bruce Carlson
Dated: , 2013
HOFF, BARRY & KOZAR, P.A.
George C. Hoff (# )
Shelley M. Ryan (# )
775 Prairie Center Drive, Suite 160
Eden Prairie, MN 55344
Phone: (952) 941 -9220
Email: sryan @hbklaw.com
Attorneys for Defendant City of Lakeville
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STATE OF MINNESOTA
COUNTY OF DAKOTA
Second Pointe, LLC, a Minnesota limited
liability company,
Plaintiff,
M
United Properties Investment LLC, a
Minnesota limited liability company, Argonne
Investment LLC, a Minnesota limited liability
company, Ronn Thomas, Bruce Carlson, City
of Lakeville, a municipality organized under
the laws of the State of Minnesota, John Does,
and Mary Roes„
Defendants.
DISTRICT COURT
FIRST JUDICIAL DISTRICT
Case Type: Civil /Contract/Declaratory
Judgment/Other /Misc.
Court File No.: 19HA -CV -13 -3161
[PROPOSED]
ORDER OF DISMISSAL
This matter came before the Court on the Stipulation of Dismissal with Prejudice by
Plaintiff Second Pointe, LLC and Defendants United Properties Investment LLC; Argonne
Investment LLC; Ronn Thomas; Bruce Carlson; and City of Lakeville (collectively, the
"Defendants "). Based on all the files, records, and proceedings in this action,
IT IS HEREBY ORDERED that all claims against the Defendants are dismissed with
prejudice and on the merits, with each party to bear its own costs, fees, and expenses.
Dated: , 2013
Judge of District Court
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