Housing & Redevelopment Authority of St. Paul v. Lambrecht

645 N.W.2d 157, 2002 Minn. App. LEXIS 550, 2002 WL 1018922
CourtCourt of Appeals of Minnesota
DecidedMay 21, 2002
DocketNo. C7-01-1919
StatusPublished
Cited by2 cases

This text of 645 N.W.2d 157 (Housing & Redevelopment Authority of St. Paul v. Lambrecht) is published on Counsel Stack Legal Research, covering Court of Appeals of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Housing & Redevelopment Authority of St. Paul v. Lambrecht, 645 N.W.2d 157, 2002 Minn. App. LEXIS 550, 2002 WL 1018922 (Mich. Ct. App. 2002).

Opinion

OPINION

R.A. RANDALL, Judge.

In this condemnation dispute, appellant Shannon Kelly’s, Inc., challenges the district court’s order (1) requiring appellant to repay respondent Housing and Redevelopment Authority of the City of St. Paul (“HRA”) $100,000 under Minn.Stat. § 117.155 and (2) dismissing appellant’s claim for loss of going-concern value because it misapplied City of Minneapolis v. Schutt, 256 N.W.2d 260 (Minn.1977). The HRA also argues that the district court erred in not awarding it prejudgment interest.

FACTS

On July 30, 1997, the HRA, by resolution, provided for the acquisition of “Block 39” in St. Paul, which contains all the property on the block in downtown St. Paul bounded by Fourth, Fifth, Wabasha, [160]*160and St. Peter Streets. In December 1997, the district court granted the HRA’s petition for condemnation of Block 39. At the time of the condemnation, Shannon Kelly’s Inc., operating as Shannon Kelly’s Brew Pub, was a tenant on the property at 395 Wabasha Street, also designated as Parcel 1 in Block 39. Shannon Kelly’s operated a bar-restaurant at the location since March 1990. James H. McGovern was president and principal shareholder of Shannon Kelly’s.1 On October 20, 1997, Shannon Kelly’s and Hoyt Development Company entered into a written agreement to lease the property from Hoyt for a term of five years.

On February 5, 1998, Shannon Kelly’s entered into an agreement with the HRA, whereby Shannon Kelly’s received $100,000 in consideration for its interest in the fixtures and leasehold improvements. And one day later, on February 6, 1998, pursuant to the court’s December 1997 order that authorized transfer of title upon payment or deposit of funds, the HRA deposited funds with the court administrator. The HRA’s affidavit accompanying the funds detailed the appraiser’s value of Parcel 1 and the property’s fixtures: the land and improvements were valued at $520,000, and the fixtures were valued at $272,504. The affidavit also noted that Shannon Kelly’s had received a $100,000 advance from the HRA and that the HRA deducted that amount from the deposit.

In July 1999, the court-appointed commissioners determined that the award for Parcel 1 should be $700,000 for the value of the real estate, $263,000 for the value of the trade fixtures, and $77,000 for the going-concern value, for a total award of $1,040,000. In August 1999, Shannon Kelly’s appealed the award of the commissioners, asserting that the damages awarded did not constitute just compensation for the taking. Hoyt also appealed the award, asserting that the damages were inadequate compensation and that the award faded to allocate all condemnation proceeds to Hoyt. The HRA cross-appealed, claiming the award was in excess of the fair market value of the property, was contrary to evidence presented at the commissioners’ hearing, and improperly included an amount for loss of going-concern value when no such loss was established at the hearing.

On December 29, 2000, the district court granted HRA’s motion for partial summary judgment and determined that Shannon Kelly’s could not state a claim for loss of going concern. In April 2001, the district court concluded that the lease between Shannon Kelly’s and Hoyt precluded recovery for the fixtures by Shannon Kelly’s. The court also noted that Shannon Kelly’s released and assigned its malpractice claim against its attorney for any settlement or judgment proceeds it might obtain in the condemnation proceedings, and as a result, Shannon Kelly’s received $174,817.43 in the fall of 1999 from Minnesota Lawyer’s Mutual and received indemnity for up to $100,000 if Shannon Kelly’s was required to repay any part of the $100,000 advance.

On June 29, 2001, after a trial on the valuation issue, a jury found in favor of Hoyt and against the HRA in the amount of $850,000. After the jury verdict, the HRA moved the trial court to enter judgment against Shannon Kelly’s for $100,000 [161]*161under Minn.Stat. § 117.155 (2000). The district court granted the HRA’s motion on August 31, 2001, and judgment was entered on October 5, 2001. The court concluded that HRA paid Shannon Kelly’s $100,000 as an advance on its claim for trade fixtures, and, because of the April 2001 order, Shannon Kelly’s was not entitled to any part of the advance. The court determined that the language of Minn. Stat. § 117.155 was clear, and, thus, required the court concluded it was to “enter judgment in the original condemnation action in favor of the condemnor for the amount owed in excess of the award as finally determined.” In the August 31, 2001, order, the district court also denied HRA’s motion for prejudgment interest, concluding that the HRA is not entitled to interest when it seeks reimbursement of an overpayment.

Shannon Kelly’s appeals from the district court’s December 29, 2000, order and the August 31, 2001, order and corresponding judgment. The HRA appeals the court’s denial of prejudgment interest in the August 31, 2001, order.

ISSUES

I. Did the district court err in determining that the HRA was entitled to return of the $100,000 it advanced to Shannon Kelly’s under Minn.Stat. § 117.155 (2000)?

II. Did the district court err by not awarding the HRA prejudgment interest? ’

III. Did the district court err in granting the HRA’s motion for partial summary judgment that dismissed Shannon Kelly’s claim for loss of going concern value?

ANALYSIS

I. Return of $100,000 Advance

Shannon Kelly’s argues that the district court erred in concluding that Minn.Stat. § 117.155 (2000) authorizes the return of the $100,000 advance to the HRA.

The construction of a statute is a question of law and reviewed de novo by an appellate court. Hibbing Educ. Ass’n v. Pub. Employment Relations Bd., 369 N.W.2d 527, 529 (Minn.1985). Minn.Stat. § 117.155 provides for payment and partial payment pending appeal:

Except as otherwise provided herein payment of damages awarded may be made or tendered at any time after the filing of the report; * * *. If either the petitioner or any respondent appeals from an award, the respondent or respondents * * * may demand of the petitioner a partial payment of the award pending the final determination thereof, and it shall be the duty of the petitioner to comply with such demand and to promptly pay the amount demanded but not in excess of an amount equal to three-fourths of the award of damages for the parcel which has been appealed, less any payments made by petitioner pursuant to section 117.042; * * *. A partial or full payment as herein provided shall not draw interest from the condemner from the date of payment or deposit, and upon final determination of any appeal the total award of damages shall be reduced by the amount of the partial or full payment. If any partial or full payment exceeds the amount of the award of compensation as finally determined, upon petitioner’s motion, final judgment must be entered in the condemnation action in favor of the petitioner in the amount of the balance owed to the petitioner and is recoverable within the original condemnation action.

Minn.Stat. § 117.155 was amended in 1997. The last sentence was added to the statute and the following was deleted:

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Related

Housing & Redevelopment Authority v. Lambrecht
663 N.W.2d 541 (Supreme Court of Minnesota, 2003)

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Bluebook (online)
645 N.W.2d 157, 2002 Minn. App. LEXIS 550, 2002 WL 1018922, Counsel Stack Legal Research, https://law.counselstack.com/opinion/housing-redevelopment-authority-of-st-paul-v-lambrecht-minnctapp-2002.