2013/06/17 Settlement Agreement - Diamond AireCity of Kalispell
Post Office Box 1997 - Kalispell, Montana 59903
Telephone: (406) 758-7701 Fax: (406) 758-7758
MEMORANDUM
To: Mayor Fisher and City Council
From: Doug Russell, City Manager
Re: Settlement Agreement with Montana Diamond Aire, Inc.
Meeting Date: June 17, 2013
BACKGROUND: In 2004, Diamond Aire, Inc., filed a lawsuit (amended in 2010), against
the City of Kalispell related to allegations of diminished access to the Kalispell City Airport and
interference with business operations. Trial on this case is scheduled for August of 2013.
The City of Kalispell has met with its insurers and counsel as part of the process to investigate
the potential of a settlement versus going to trial. At the meeting on June 17th, staff will present
proposed terms for settlement of the case.
RECOMMENDATION: It is recommended the City Council receive and approve the proposed
terms of the settlement with Montana Diamond Aire, Inc.
MONTANA DIAMOND
AIRE, INC., and RJT PROPERTIES,
LLCY
Plaintiffs,
CITY OF ., KALISPELL CITY
AIRPORT ADVISORY BOARD and
FRED LEISTIKO,
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Cause No. DV-04-286(B)
(Heidi riche)
SETTLEMENT TERMS
SETTLEMENT AND ASSIGNMENT AGREEMENT TERMS
This following settlement terns are agreed to by aiid between Jobs. Talmage,,
Montana Diamond Aire. Inc.. and RJT Properties, " .. ` 's" and. pending
ratification within seven days by the City Council. the`it of Kalispell,a is ell City
p
Airport .dvisor card, and Fred Leistiko ,4 e endants"):
I. City to make a case payment of *3o,000 within 30 days funded by Defendants"
insurers".
. Talmage may remove fence between airport and property:
. City to waive past,user fees:
. City to lift deed restriction.-
5.
City to have right of first refusal to purchase the property;
. City to gibe irrevocable. transferable/assignable lic to use ri .
property is used for aeronautical and/or airportpurposes.-,
Defendants will not construct a hangar or other obstruction on spot presently
deSigDated for 100 x 100 hangar directly in front of DianioDd Aire so long 't
continues to be used for aeronautical and./or airport purposes;
R City will allow Diamond Aire sign to be placed by the runway, not to violate
airport usage guidelines and city ordinances:
. Defendants shall eater i* nto a consent j uda ent the amount of $1.5 million iii.
Plaintiffs' favor and assign them all rights! cruses of action against a non -
defending insurerr
. Plaintiffs will eDlCr into a covenant not to execute the $1.5 million judgment
against Defendants-
11.
Defendants will cooperate in future litigation with any insurer;
E2. Mutual release of parties and. Chards- Old Republic. and MMIA, including any
and all claims*,,
1.3. Plaintiffs may void this agreement if a non -defending 'insurer agrees to provide a
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defense prior to ratification and/or if Defendants, insurers do not timely fund this
settlernent,'
14. If pro erty is used for non -airport purposes by a subsequent grantee/purchaser, the
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City may erect a fence at its expense along the perimeter boundary.:
15. Any use following the relocation of the fence, 'if a fence is relocated (as opposed
to removal of ffie fence as provi'ded in terni 42), will result in no prescriptive
claim and, rather. is a license.
Si cmed bv-
/-0 dellalf of Defendants n
110 'behdif of PI
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