The city of Mitchell’s two year-long legal battle with the former owners of the Crafty Fox building on Main Street came to an end on Monday.
During Monday’s meeting at City Hall, the Mitchell City Council approved a settlement agreement with Ronald and Janice Christensen, the former owners of the 223 N. Main St. building, ending a long federal courtroom battle over the city’s purchase of the property.
“Well we’ve all been waiting for this one,” said Mitchell Mayor Bob Everson during Monday night’s meeting.
The Christensens filed a lawsuit against the city and Mitchell Area Development Corporation (MADC) in November 2019, alleging the city of Mitchell took ownership of the nuisance building through threats and conspiracy that violated their civil rights. They were requesting more than $500,000 in damages from the city and MADC. However, the city and MADC filed its own lawsuit against the Christensens in part due to the former property owners “unpaid mortgages” on the downtown building and their alleged claims on the city’s acquisition of the building.
As part of the settlement agreement that was reached between all the parties involved on May 11, the city will receive payments from the “other parties” involved in the matter, and will use those funds to satisfy the outstanding mortgages on the building, according to City Attorney Justin Johnson.
While Johnson expressed his relief for the legal battle coming to a conclusion, he wasn’t exactly happy with the final outcome of the settlement. No dollar amounts of the settlement agreement were disclosed during Monday’s meeting.
“I don’t know if this was a settlement anyone was real happy with. But they say the best settlements is one where everybody thinks they lost,” Johnson said. “The result will be various parties paying money to the city, and then the city paying off the remaining mortgages that are outstanding,”
The city purchased the building — which had been deemed a nuisance property — for $1 roughly two years ago and planned on transferring ownership over to the Mitchell Area Development Corporation. However, the transfer was halted after the previous property owners filed a lawsuit against the city and MADC, alleging the city wrongly took ownership of the building through threats and conspiracy that violated their civil rights. The city also intended to make an estimated $150,000 in repairs and sell the building for redevelopment, which was discussed among the council at the time of the purchase.
When the city responded with its countersue lawsuit against the Christensens, the city alleged the former property owners did not pay the appropriate mortgages and failed to uphold their end of the contract.
Over the past year, the city has been renovating the building and correcting the nuisance conditions such as window repairs and improving the roof. Previously, Mayor Everson said the overall goal with the property is to see it be redeveloped.
Throughout the years of the Christensens owning the property, the city issued a number of order to corrects, including window repairs and tuckpointing work, to name a few. In 2019, prior to the city's ownership, Janice Christensen told the Mitchell Republic the cheapest options for her to replace the windows to bring the portion of the building up to code hovered around $250,000.
However, she noted the city offered her a cheaper option involving a local window business, which she said cost around $115,000 with a 20-year payment plan option, ultimately resulting in her decision to decline the option.
Since taking ownership of the property, the city has put $60,000 into fixing the windows and roughly $30,000 for the roof repair work. An unforeseen fee recently came after an inspection was completed in the building that detected high concentrations of lead, which exceeded the Environmental Protection Agency’s concentration levels for residences, according to City Engineer Joe Schroeder.
To mitigate the lead dust issues, the City Council approved a contractor on Monday to remove the lead dust at a cost of roughly $21,000. Schroeder said the renovation work on the building will be able to resume following the lead removal that’s being done by FloorTec Cleaning.