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9. City Attorney - Settlement Motion - SythAgenda -March 2, 1998 AGENDA ITEM 9 -APPROVAL OF SETTLEMENT (CITY ATTORNEY/CITY OF KALISPELL VS. ESTATE OF JERRY SYTH SETTLEMENT) BACKGROUND/CONSIDERATION: The City Attorney has attached a memo for your information concerning this issue. RECOMMENDATION: The City Attorney and I have conferred on this issue. I concur with the settlement as presented by Mr. Neier. ACTION REQUIRED: A MOTION to approve the settlement would place this in the record and allow us to complete the settlement process. February 27, 1998 To: Manager, Mayor and City Counc'l From: Glen Neier, City Att e Re: Syth Business Park During the year 1995, Jerry Syth began developing a condominium project between Airport Road and ist Avenue West near the City Shops. The City, during September of that year, supplied, without a written agreement or authorization, materials and labor necessary to install water service to the development. Later in November, the City supplied asphalt to patch the street where some of the work took place. The total material and labor bill amounted to $6113.00 and Syth was billed for the work. Syth did not pay the invoices and became deceased on January 12, 1996. This office filed a claim against the Syth Estate, which was denied, and later entered into a Stipulation in anticipation of negotiating a settlement of the claim. Under the Montana Uniform Probate Code, if a claim is denied, the claimant has only 60 days to file suit and the Stipulation extended the time for filing a suit. In April of 1997, the City filed suit against the Estate for the full amount of the claim plus interest. In February of this year, the Estate made claim against the City for water and sewer connection fees paid but not used in the amount of $1,292.00. The claim was referred to this office and I contacted the attorney for the Estate and we discussed settlement of all outstanding claims. I:\wp\busipark.wpd Post Office Box 1997 • Kalispell, Montana 59903-1997 Telephone (406) 758-7700 • FAX (406) 758-7758 Resolution of the matter is based upon the following: 1) It cannot be denied that the City supplied materials and labor to the project and the project benefitted from the City's work. 2) However, Syth did not, at least based upon the information supplied to this office, have information on the cost of work, nor did he or any of his agents request that it be done. Syth could have retained the services of an independent contractor or accomplished the work himself with a minimum of City assistance. The bottom line may have been less, or more, but the City would not have been involved. 3) The City has a policy of returning hook up fees not utilized. In this case the buildings anticipated were not, and will not be constructed. Credit against the City's claim is proper. 4) Material supplied to the project cannot be salvaged or reused by the City and is in use servicing the area. The cost of the material definitely amounts to a proper charge for which the Syth Estate should be responsible. 5) Essentially, the biggest complaint the Syth Estate has is the cost of labor associated with the construction. It amounts to approximately $2300.00. The charge is based upon established City charges for use of men and equipment. However, there is nothing demonstrating that Syth had prior knowledge of the cost. He may have elected alternative means of installing the equipment had he knowledge of the cost. If we pursue the matter we may recover some of the $2,300.00, but we may not recover it all. This office recommends that the City of Kalispell accept the settlement of the disputed claim and stipulate to the dismissal of the case. The City will be compensated totally in the amount of $3,787.00 for material, with credit to the Syth Estate for $1,292.00 previously paid for water and sewer connection fees. I:\wp\busipark.wpd