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Mr. Calvin Portner <br />April 4, 2016 <br />Page Two <br />contract for deed and take back the property. Under this scenario, the City would have a <br />substantial darnage judgment against it and have also lost the property. The City would then <br />appeal to the Minnesota Court of Appeals in hopes of having the judgment thrown out, with the <br />Krauses limited to taking back the property. <br />We have extensively discussed this litigation in two recent closed sessions with the <br />council. As a result of those discussions, settlement discussions were initiated with the Krauses <br />attorney, resulting in the proposed settlement. <br />in exchange for the $1,550,000 payment to the Krauses, the lawsuit will be dismissed, <br />with the City retaining ownership of the golf course and all amounts due the Krauses considered <br />paid in fall. An appraiser retained by the City valued the property at $565,000 as of July 1, 2014. <br />If the City goes to trial, a judgment potentially as high as $1.5 Million could be entered <br />against the City and the Krauses would have gotten the golf course back. In exchange for giving <br />up its right to appeal this judgment, the City will own the property outright, free and clear of any <br />claims by the Krauses, and the litigation will come to an end, without the continued uncertainty <br />of another year or more of appeals. <br />We recommend approval of the Stipulation of Settlement. <br />Best regards, <br />CAMPBELL KIS UTSON <br />Professional Association <br />By: <br />'�'Tbomas M. Scott <br />TMS/qJh <br />Enclosure <br />1864620 <br />